Summer Contracts

NBA teams typically turn their attention to deals known as summer contracts once the madness of the first few weeks of free agency subsides. The term is something of a misnomer, since these aren’t contracts for summer league, as the name might suggest. Instead, they’re signed with an eye toward October, when teams conduct training camps and play preseason games.

Rosters can swell to as many as 20 players during the offseason, and many teams will take full advantage between now and the time camps open, signing a handful of prospects who dream of making it to opening night, when teams may carry no more than 15 players again. A few will break through and displace established veterans on guaranteed contracts, but most will be gone by the regular season, when players start to receive paychecks. Almost every team in the league will sign camp invitees to contracts that will be terminated before the salary even begins to be paid out, and the league treats these contracts differently from others.

Summer contracts must be non-guaranteed, and while they’re almost always for the minimum salary, they don’t have to be. They also needn’t be for just one season. The one-year, minimum-salary limits apply to Exhibit 9 contracts, which are a subset of summer pacts. Those restrictions are also in place if a club re-signs one of its own free agents to a summer contract, or if a team inks a summer contract with one of its former players who has yet to sign with another NBA team. Still, it’s a fair bet we’ll see the Sixers, who made prolific use of lengthy non-guaranteed contracts last season, sign players to summer contracts for three and four seasons, and many other teams surely will, too.

Sixers power forward Brandon Davies signed his four-year summer contract on October 27th, 2013, just before the start of the regular season this past year. Teams can sign summer contracts from the first day following the July moratorium until the last day before the regular season starts. Most of them are signed during August and September.

Teams are allowed to sign players to summer contracts even if they don’t have the cap room or an exception available to facilitate such a deal, as long as they create the necessary flexibility by the start of the regular season if they wind up keeping the players. That caveat doesn’t often come into play too frequently, since most summer contracts are for the minimum salary and fall under the auspices of the minimum-salary exception. However, the minimum salary exception only covers contracts of no more than two years, so the rule helps teams that sign players to longer summer contracts. It also comes in handy for teams that have triggered hard caps with the use of the non-taxpayer’s mid-level exception, biannual exception, and/or the acquisition of a player via sign-and-trade.

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA’s Collective Bargaining Agreement. Larry Coon’s Salary Cap FAQ and ShamSports were used in the creation of this post.

View Comments (7)