Per the rules of a Two-Way contract, Quinn Cook is eligible to travel and practice with the Golden State Warriors during the 2018 NBA Playoffs, but he must be placed on the Inactive List for any and all playoff games. In order for Cook to play during the playoffs, the Warriors have two options to perform before tipoff of the final regular season game (4/10/18 @ Utah Jazz):
a. “Standard NBA Conversion Option.”
This would allow the Warriors to convert Cook’s Two-Way into a “rest-of-season” prorated NBA Veteran’s Minimum contract. Because it is a conversion contract, it cannot last longer than the duration of the Two-Way, which is a one-year deal. Thus, if the Warriors perform this action on April 4, the numbers will be as follows:
(Days on Warriors/Days in NBA Season) * (2YOS Veteran’s Min Salary) = New Contract
(1/177) * $1,471,382 = $8,313
The Cavaliers performed a similar transaction when they signed G Dahntay Jones on the final day of the season last year. Though small in amount, this contract would allow Cook to be moved to the Active List for the 2018 NBA Playoffs.*
b. Standard NBA Contract
This would allow the Warriors to negotiate a new contract with Cook.*
*In either case, the Warriors will need to open up a roster spot for Cook if he were to play during the playoffs. For example, if they waive Omri Casspi, they will likely pay out the remainder of his 1yr/$1,471,382 unless he is claimed off the waivers. The Warriors have used the MLE on Nick Young, and they don’t have the BAE due to being over the Tax Apron. Cook does not have Bird or Early Bird rights either.
On March 18, the Cleveland Cavaliers signed F Okaro White to a 10-Day Contract. Per 10-Day Contract rules, White will play for the longer of 10 days or 3 games with the Cavaliers. Since the Cavaliers will play the Bucks (3/19), Raptors (3/21), and Suns (3/23) within 10 days of signing, his contract will terminate after ten days.
The contract numbers break down as follows:
(Days on Cavaliers/Days in NBA Season) * (1YOS Veteran’s Min Salary) = 10-Day Deal
(10/177) * $1,312,611 = $74,159
Using the chart below, the contract will charge the Tax Bill at a value of $83,129, as the league counts all 10-Day contracts the same against the Luxury Tax.
Prior to the signing, the Cavaliers were $16,556,755 over the Luxury Tax Line ($119,266,000). With this signing, they will raise that bill as follows:
Luxury Tax Prior to White + White Tax Bill = New Total Salaries
$16,556,755 + $83,129 = $16,639,884
Since the Cavaliers have exceeded the Salary Cap in three of the past four seasons, they fall under the Repeater Tax rate. Their new Luxury Tax breakdown is as follows:
White Tax Bill * ($15,000,000-$19,999,999 Tax Rate) = Total White Lux Tax Bill
$83,129 * ($4.25) = $353,298
Updated Luxury Tax Bill:
$4,999,999 * ($2.50) = $12,499,997
$4,999,999 * ($2.75) = $13,749,997
$4,999,999 * ($3.50) = $17,499,996
$1,639,884 * ($4.25) = $6,969,507
The signing of F Okaro White has raised the Cavaliers’ Luxury Tax Bill by $353,298 to a new total of $50,719,497.
2017-2018 Value: $4,328,000
The Room Mid-Level Exception still required a team to be beneath the Salary Cap, so it blocks the use of the other exceptions as a result. However, it is the smallest of the exceptions, so it is ideal for a team who is right beneath the cap and wants to still sign a player. The Room Mid-Level Exception allows a team to sign a player
As a general note, the Taxpayer Mid-Level and BAE count against the cap as holds until they are renounced. Thus, they count against the Salary Cap even if they aren’t used, until the day a team tells the league that they won’t be using the exceptions.
Current NBA Usage:
In 2017-2018, only 8 NBA teams are using the BAE: Washington, Atlanta, Dallas, Detroit, Utah, Boston, Minnesota, and New York. The contracts can be seen below:
The Clippers are signing G Sean Kilpatrick to a 10-day contract. This is the first time they have signed him this season, and they can sign him to one more 10-day contract this season (2 total with one team). A 10-day contract, by rule, allows for a player to be with the longer of team for 10 days or three games. Because the Bucks waived Kilpatrick before 11:59 PM on March 1, he is still eligible to play in the playoffs per CBA rules.
Kilpatrick’s deal will be a pro-rated 6YOS veteran’s minimum contract for the 10 days. Because Kilpatrick is not a veteran, a 2 Year-of-Service Veteran’s Minimum Salary is used to calculate the value. The details are below:
(Days on Clippers/Days in NBA Season) * (2YOS Veteran’s Min Salary) = 10-Day Deal
(10/177) * $1,471,382 = $83,128
Because Kilpatrick is in his sixth year in the NBA, he will amass a salary of the following amount. The NBA will pay the difference between the Clippers’ $83k and his $104k ($20,931).
(10/177) * $1,841,849= $104,059
The reason for the use of 2YOS Vet Minimum is to encourage teams to sign veterans and not be burdened by an increased salary. The standard 10-Day salary for a one year NBA veteran is $74,159, thus the roughly $9k variation should not impede veteran signings. Any deal for a veteran with more than 2YOS counts the same as one with only 2YOS with regard to the luxury tax, because the NBA pays the difference.
If a team had 3 games in 12 days, the amount of the contracts would go up. In addition, a team cannot sign a player to a 10-Day contract if there are fewer than 10 days left in the season. Teams can end a 10-day contract early, and the contract doesn’t get posted to waivers, making the player an immediate free agent.
The Cap Hit for a 10-day contract is the same as the team-paid value of the contract ($74,159 or 83,128). Thus, the Clippers began the day with $629,032 in cap room, which will be reduced by Kilpatrick’s 10-Day as follows:
$629,032 - $83,128 = $545,904
*177 Days were used for the length of the NBA season.
I'm Jake, a recent graduate of Duke University pursuing a career in collegiate or professional basketball operations.
Cap #s 2018 - 2019
Salary Cap: $101.869M
Lux. Tax: $123.733M
Tax Apron: $129.827M
Tax Floor: $91.682M
Room MLE: $4.45M