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New Team Options In Free Agent Contracts

Team options outside of rookie scale contracts are rare in the NBA. Only nine new contracts from this summer feature a team option, aside from all of the new rookie scale deals, of course. Not surprisingly, the Sixers handed out a third of those new pacts with team options, and it would qualify as something of an upset if the four-year agreement that the Sixers reportedly struck today with Christian Wood doesn’t have a team option, too.

The three new team options already on the books for Philadelphia represent double options of sorts. That’s because the salaries in the option years are also non-guaranteed. It’s a quirk in the system, as options can only exist on the final year of a contract, but any season may be non-guaranteed. The term “team option” is often used to refer to a non-guaranteed season, but they’re not the same. Teams don’t have to decide on non-guaranteed seasons until January, or an earlier point specified in the contract if both sides agree. The deadline for team options is the June 29th before the season starts. That’s an advantage that non-guaranteed seasons offer for teams, but options can also be helpful. A team can turn down its option on a player with three or fewer years of experience and still make him a restricted free agent. Players with non-guaranteed seasons would become unrestricted free agents if they cleared waivers.

So, the Sixers have the best of both worlds with Richaun Holmes, Pierre Jackson and Scottie Wilbekin. The Pacers also added three new contracts with team options, but not all of them are truly for the benefit of the team. Lavoy Allen wouldn’t be eligible for restricted free agency if Indiana turns down his team option in two years, when he’ll ostensibly be a six-year veteran. So, it’s exclusively to Allen’s benefit that the salary is a team option instead of non-guaranteed. If the Pacers don’t want to keep him, Allen would become a free agent on July 1st in 2017, just as the market is at is busiest. Indiana could hang on to him for months longer if the contract featured non-guaranteed salary, and all the while, many opportunities for him to go elsewhere would likely dry up.

Here’s a look at each new team option from this offseason. The season the option is for is in parentheses, along with the value of the option.

The Basketball Insiders salary pages were used in the creation of this post.

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One thought on “New Team Options In Free Agent Contracts

  1. Niku

    I thought Javale McGee’s deal included a team option in year 2?

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