Opt-Outs On Two-Year Deals Becoming Common

As the free agent signing period slows down, we'll continue to use the data compiled in our Free Agent Tracker to assess the offseason's trends and items of interest. Already, Chuck Myron has examined the most and least active NBA teams in free agency, as well as listing each team's most expensive free agent addition.

Today, we'll turn our attention to the two-year contracts signed so far by this offseason's free agents. Based on reports to date, 47 players have signed two-year deals with NBA teams. However, only a small fraction of those contracts are guaranteed for two full seasons. In most cases, either the player or the team has the chance to opt out after the first year of the deal, or perhaps even before that.

The increasing popularity of this sort of contract shouldn't come as a surprise, considering the league's latest Collective Bargaining Agreement has reduced the length of contracts in general. With teams valuing cap flexibility more than ever, it makes sense that clubs would be interested in locking up a player for one guaranteed season, then re-assessing the situation next summer.

Meanwhile, for players who may have been unable to score the lenghty multiyear deal they were originally seeking, accepting one guaranteed year with a player option is a decent compromise. A successful season will give the player another chance to test the market a year from now, while that option provides some financial security in the event of a down year.

Of the 47 players who have signed two-year contracts this offseason, 14 have a second-year player option. 12 more have a team option or non-guaranteed salary for their second year, after a fully guaranteed first year. Three more only have a partially guaranteed first season to go along with a non-guaranteed second year. Four (Donald Sloan, Ian Clark, Jeremy Tyler, and Elias Harris) are not believed to have fully guaranteed deals, though the exact terms of their agreement aren't yet known. That leaves just 14 of 47 players with two fully guaranteed seasons on their deals.

Interestingly, those fully guaranteed two-year contracts were typically handed out by the same few teams. The Spurs, Pistons, Pacers, Mavericks, and Hawks all signed multiple players to fully guaranteed two-year deals. That doesn't necessarily mean those teams had the same motivations — the Pacers and Spurs appear unlikely to be major players in 2014's free agent period, so perhaps including options for '14/15 was unnecessary. On the other hand, the Mavs and Hawks may not want to go year-to-year with their rosters, constantly using cap space to plug in players on one-year contracts. Or perhaps some of the players these teams signed simply demanded that guaranteed second year, lest they take their services elsewhere.

In any case, while teams may not be handing out lucrative one-year deals as frequently as they used to, it's clear that teams still value the flexibility that de facto one-year contracts provide. Here's the complete list of players who signed two-year deals this summer, broken down by contract type:

Fully guaranteed:

Second-year player option:

Second-year non-guaranteed or team option:

  • Earl Clark (Cavaliers): $8.5MM. $4.25MM non-guaranteed.
  • Samuel Dalembert (Mavericks): $7.57MM. $2.07MM non-guaranteed.
  • Tyler Hansbrough (Raptors): $6.51MM. $2.33MM non-guaranteed.
  • Chauncey Billups (Pistons): $5MM. $2.5MM team option.
  • Jason Maxiell (Magic): $5MM. $2.5MM non-guaranteed.
  • John Lucas III (Jazz): $3.2MM. $1.6MM non-guaranteed.
  • Pero Antic (Hawks): $2.45MM. $1.25MM non-guaranteed.
  • Dwight Buycks (Raptors): $1.52MM. $816K non-guaranteed.
  • Francisco Garcia (Rockets): Minimum salary. $1.32MM non-guaranteed.
  • Ronnie Price (Magic): Minimum salary. $1.32MM non-guaranteed.
  • Omri Casspi (Rockets): Minimum salary. $1.06MM non-guaranteed.
  • Austin Daye (Raptors): Minimum salary. $1.06MM non-guaranteed.

Both years non-guaranteed or partially guaranteed:

  • Andrew Bynum (Cavaliers): $24.79MM. $6MM of first year guaranteed.
  • Reggie Williams (Rockets): Minimum salary. 50% of first year guaranteed.
  • C.J. Leslie (Knicks): Minimum salary. $200K of first year guaranteed.

Details not yet known (believed to be partially guaranteed):

  • Ian Clark (Jazz)
  • Elias Harris (Lakers)
  • Donald Sloan (Pacers)
  • Jeremy Tyler (Knicks)

HoopsWorld and ShamSports were used in the creation of this post.

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