Knicks · Info from Coon's site on NTC and trade kickers (page 1)
99. How do trade bonuses affect team salary and trades?http://www.cbafaq.com/salarycap.htm#Q99The value of a trade bonus is applied to the team salary among the remaining years of the contract (excluding non-guaranteed years -- see question number 64, and years following an Option or ETO -- see question number 59), in proportion to the percentage of salary in each of those seasons that is guaranteed. For example, suppose the player from question number 98 is traded at the start of the fourth season of his contract. Per the chart in that question, the actual value of his trade bonus that season is $300,000. If every season of the contract is guaranteed, and there is no Early Termination Option, then $150,000 of the trade bonus is charged to each of the final two seasons of the player's contract, so a total of $1,150,000 is included in the team salary in each of those seasons. (Note that the allocation is not proportionate to the salary itself, but rather to how much of the salary is guaranteed. If the player from question number 98 had a higher salary in the fifth season than in the fourth season, his bonus would still be allocated equally to those seasons. However, if the fifth season was only 50% guaranteed, then two-thirds of the bonus would be allocated to the fourth seasons, and one-third to the fifth season.)
Suppose the same player has an Early Termination Option following the fourth season of his contract. In this event, the entire trade bonus would be allocated to the fourth season of the contract. The player would therefore count $1,300,000 against the team salary during that season.
In the special case of a contract where all additional years are non-guaranteed, the entire trade bonus is applied to the cap in the season in which the trade occurred.
Trade bonuses can be a nuisance. When a team trades for a player with a trade bonus, it must count the portion of the bonus that applies to team salary in that season as incoming salary. Let's say a taxpaying team wants to trade their $800,000 player for the player used in the example above, in the fourth season of that player's contract. Assuming there is no Early Termination Option or non-guaranteed season, $150,000 of the trade bonus counts in the current season, so the trade cannot be made. The team trading the $800,000 player can accept up to $1,100,000 in return (see question number 83), but the player with the trade bonus counts as $1,150,000 in incoming salary.
The CBA allows the player to waive part of his trade bonus, if necessary to make a trade permissible. To make the above trade work, the player would need to waive $100,000 of his $300,000 trade bonus. The bonus would then be worth $200,000, and $100,000 of that would be charged to the current season. The player would therefore count $1,100,000 as incoming salary, which exactly matches the maximum the other team can accept in return for their $800,000 player. The player is not allowed to waive more than the amount necessary to make the trade legal.
A player is also allowed to waive a portion of his trade bonus to make his incoming salary fit within another team's trade exception (see question number 85). In the above example, if the other team has a $1 million trade exception (and is not trading an $800,000 player), the player would have to waive his entire trade bonus in order for his incoming salary to fit within the trade exception.
Another potential difficulty is that a team trading a player with a trade bonus uses the player's pre-trade salary (without the bonus), when comparing salaries for trade. Here is another example, using the same player as before (assume the player's team is a taxpayer, and can accept 125% plus $100,000 of the player's outgoing salary).This time, let's assume our player has an Early Termination Option following the fourth season of his contract, so if he is traded during the fourth season, the entire bonus is allocated to that season. This means that following a trade, $1,300,000 would be included in his new team's team salary. Suppose a taxpaying team wants to trade their $1,400,000 player for this player. That team can accept $1,850,000 for their player, and since our player counts $1,300,000 as incoming salary, there's no problem on their end. But our player counts for $1 million as outgoing salary, so the most we can accept in return is $1,350,000. This means the trade doesn't work from our end. And in this case, waiving a portion of the trade bonus will not help.
A player's salary added to his trade bonus cannot exceed the maximum for that season (based on years of service). For example, in 2011-12 the maximum salary for a player with 7-9 years of service is $15,506,632. If such a player has a $15 million salary and a $1 million trade bonus, then his trade bonus is pared down to $506,632 when he is traded1. This happens automatically -- the player has no say in the matter. The same is true for trades of rookie scale contracts that include a trade bonus. If the salary added to the trade bonus exceeds 120% of the player's scale salary amount (see question number 49) the trade bonus is reduced automatically when the player is traded.
If a team is capped at the "apron" ($4 million over the tax line) because it has used the Bi-Annual exception, Non-Taxpayer Mid-Level exception, or (beginning in 2013-14) acquired a player in a sign-and-trade transaction, and wants to acquire a player whose salary added to his trade bonus exceeds the apron, then the trade bonus cannot be reduced (even with the player's consent); the trade is simply illegal.
There is no recomputation of the allocation of a trade bonus based on whether the player does or does not invoke an option or ETO. For example, if a player with a five-year contract and an ETO following the fourth season is traded during the fourth season of his contract, then his entire trade bonus is charged to the team salary that season. If the player does not invoke his ETO that summer (locking in the fifth season), the allocation of the trade bonus does not change -- none of the bonus is charged to the fifth season. In other words, the allocation of a trade bonus always reflects the state of the contract at the time of the trade.
1 Since a player's maximum salary is the greater of the league-wide maximum and 105% of his previous salary (see question number 16), the player could be entitled to more of his bonus depending on his salary in the previous season. In this example, if the player also had a $15 million salary the previous season, his maximum salary would be 105% of that amount, or $15.75 million. His trade bonus therefore would be reduced from $1 million to $750,000.
100. When can't a player be traded? Can players be given "no-trade" clauses in their contracts?A "no-trade" clause prevents the team from trading the player without the player's consent. A no-trade clause can be negotiated into a new contract1 if the player has been in the NBA for at least eight seasons, and has played for the team with which he is signing for at least four seasons2. They don't have to be the four most recent seasons -- for example, Horace Grant received a no-trade clause from Orlando when he signed with them in 2001. He had played for Orlando for the requisite four seasons, but had played for Seattle and Los Angeles in the interim. Few players actually have one of these negotiated no-trade provisions (currently only Carmelo Anthony, Kobe Bryant, Tim Duncan, Kevin Garnett, Dirk Nowitzki and Dwyane Wade have them).
If a player with a negotiated no-trade clause consents to a trade and is traded, his no-trade clause remains in effect with his new team.
There are two additional circumstances in which a trade requires the player's consent:
When the player is playing under a one-year contract (excluding any option year) and will have Larry Bird or Early Bird rights at the end of the season. This includes first round draft picks following their fourth (option) season, who accept their team's qualifying offer for their fifth season. When the player consents to such a trade, his Larry Bird/Early Bird rights are not traded with him, and instead becomes a Non-Bird free agent3.
For one year after exercising the right of first refusal to keep a restricted free agent. The player must consent to a trade to any team, although he cannot be traded to the team that signed him to the offer sheet.
In addition, teams cannot trade players under the following circumstances:For two months after receiving the player in trade, if the trade aggregates the player's salary with the salaries of other players. However, the team is free to trade the player immediately, either by himself or without aggregating his salary with other salaries. This restriction applies only to players who were acquired using an exception (and not cap room). (Also see question number 88.)
When the trade deadline has passed. Teams are free to make trades again once their season has ended4, but cannot trade players whose contracts are ending or could end due to an option or ETO.
For three months or until December 15 of that season (whichever is later) after signing a contract as a free agent or matching an offer sheet to a restricted free agent. This obviously does not apply to the trade completing a sign-and-trade transaction (see question number 91).
For three months or until January 15 of that season (whichever is later) after re-signing a free agent with Larry Bird or Early Bird rights, if the team is over the cap, the player's new salary is above the minimum, and he receives a raise greater than 20%.
For 30 days after signing as a draft pick. This applies even for later-signed first round picks, who are signed using cap room at least three seasons after they are drafted (see question number 51).
For six months after signing a player to an extension that is over the limit (in terms of years, salary or raises) for an extend-and-trade transaction5 (see question number 94).
After claiming a player on waivers, for 30 days if the player was claimed during the season. If the player was claimed during the offseason, he cannot be traded until the 30th day of the following season.
A team cannot reacquire a player they traded away during that season (a season being July 1 - June 30). If he is waived by his new team, then he cannot re-sign with his original team until the one-year anniversary of the trade, or until the July 1 following the end of his contract, whichever comes first. However, if a team trades a player's draft rights, they can reacquire the player during the same season.
Until the following July 1 if the player was acquired through the Amnesty provision via a secondary waiver claim (see question number 69).
When a player is waived through the Amnesty provision he cannot be reacquired for the length of the terminated contract.
A team cannot acquire players during a season when they do not have room on their 15-man roster, even if they intend to waive an incoming player immediately. For example, a team with 14 players cannot trade one player for three, while simultaneously waiving an incoming player to remain at 15 players6.
1 A no-trade clause cannot be negotiated into an extension, unless player's existing contract or extension already contained a no-trade clause.
2 When the player has been with his team a partial season (for example, when traded mid-season), they round his team tenure up. For example, when Carmelo Anthony re-signed with the Knicks in 2014, he received a no-trade clause despite being with the Knicks only 3.5 seasons. The logic is the same as the years of service rule, where a player is credited for a full year of service even if he was on a team's roster for just a single day.
3 When there is an option year involved, they may be able to get around this restriction by invoking the option prior to the trade.
4 Playoff teams can trade players during the playoffs who are not on their playoff roster.
5 This does not apply to rookie scale contracts, which can be extended without such limitations immediately after they are traded.
6 It is possible to work around this restriction by waiving a current player, executing the trade, waiving one of the incoming players, and then re-signing the original player.