Cap Observations: Mutual Options, DFS, Incentives, Nuggets, BAE
After NBA teams spent the week officially finalizing many of the trades and free agent signings they'd agreed to during the July moratorium (or earlier), we're starting to get a clearer sense of trends emerging among the contracts signed in 2025/26, as well as a better idea of how teams are managing their cap exceptions and apron-related restrictions.
With that in mind, we're taking a closer look today at some of those contract trends, as well as a unique trade kicker, a cap-related decision facing the Nuggets, and a new use of the bi-annual exception.
Let's dive in...
Rockets Finalize Minimum Deals With Aaron Holiday, Jeff Green
July 10: The Rockets have put out a press release officially confirming their new deals with Holiday and Green.
June 30: The Rockets have agreed to bring back guard Aaron Holiday and forward Jeff Green on one-year, minimum-salary contracts, reports Kelly Iko of The Athletic (Twitter link).
The news doesn’t come as a surprise, given that word broke on Friday that Houston intended to re-sign both players – along with free agent forward Jae’Sean Tate – to deals at or near the veteran’s minimum. Tate reached a one-year, $3MM agreement with the club earlier today.
Holiday, who has spent the past two seasons in Houston, had a solid season in 2024/25 as a backup point guard, averaging 5.5 points, 1.3 assists, and 1.3 rebounds per game on .437/.398/.829 shooting. However, his playing time dipped — his 12.8 minutes per game represented a career low.
While the Rockets still like Holiday, they wanted to bring him back on a more team-friendly deal than his previous contract, so they turned down his $4.9MM team option and will now carry a $2.3MM cap hit for the 28-year-old in 2025/26.
Green also played less than ever in 2024/25, averaging a career-low 12.4 minutes per game in 32 appearances. However, he’s a respected veteran locker-room leader and held his own in his limited role, with averages of 5.4 PPG and 1.8 RPG and a .504/.367/.808 shooting line.
Groups Set For 2025 NBA Cup
The NBA has officially announced the six groups of five teams apiece for the 2025 Emirates NBA Cup, also known as the in-season tournament (Twitter link).
In order to set the groups, the league splits the Western and Eastern Conferences into five three-team tiers based on last season’s regular season standings, with one club from each tier randomly drawn into each of the conference’s three groups.
For instance, the top three teams from the West will all be in separate groups, with each of those three groups also featuring one team in the 4-6 range, one in the 7-9 range, and so on.
Here are the groups for the 2025 NBA Cup:
- West Group A: Oklahoma City Thunder (1), Minnesota Timberwolves (6), Sacramento Kings (9), Phoenix Suns (11), Utah Jazz (15)
- West Group B: Los Angeles Lakers (3), Los Angeles Clippers (5), Memphis Grizzlies (8), Dallas Mavericks (10), New Orleans Pelicans (14)
- West Group C: Houston Rockets (2), Denver Nuggets (4), Golden State Warriors (7), Portland Trail Blazers (12), San Antonio Spurs (13)
- East Group A: Cleveland Cavaliers (1), Indiana Pacers (4), Atlanta Hawks (8), Toronto Raptors (11), Washington Wizards (15)
- East Group B: Boston Celtics (2), Detroit Pistons (6), Orlando Magic (7), Brooklyn Nets (12), Philadelphia 76ers (13)
- East Group C: New York Knicks (3), Milwaukee Bucks (5), Chicago Bulls (9), Miami Heat (10), Charlotte Hornets (14)
The round-robin group play games will be starting a little earlier than usual this season and will run from October 31 to November 28. Each team will face the other four clubs in its group once, with the winners of each group and one wild card team from each conference advancing to the eight-team, single-elimination knockout round.
The full schedule of group play games can be viewed right here.
The quarterfinals will be played on December 9-10, with the semifinals and final to follow on Dec. 13 and Dec. 16, respectively, in Las Vegas. The knockout round games will all be aired by one of the NBA’s new broadcasting partners, Amazon Prime.
The Bucks won last season’s NBA Cup, with star forward Giannis Antetokounmpo earning MVP honors after leading Milwaukee to a victory over the Thunder in the championship game.
Free Agent Notes: Melton, Warriors, Horford, Hayes-Davis
There was chatter early in the free agent period connecting De’Anthony Melton to the Lakers, but that talk has “cooled” in recent days, according to Jovan Buha, who said during a Monday live-stream (YouTube link) that the free agent guard has been more frequently connected to the Warriors as of late.
NBA insider Marc Stein (Twitter link) confirms as much, citing league sources who say that Golden State has emerged as a “strong contender” to sign Melton.
The Warriors used their full non-taxpayer mid-level exception to sign Melton to a one-year contract in free agency last season, but he suffered a season-ending ACL tear in just his sixth game with his new team. Prior to the injury, the 27-year-old was looking like an ideal fit in Golden State’s backcourt, with an average of 10.3 points per game and a .371 3PT%, albeit in a very small sample size.
Here are a few more free agent notes from around the NBA:
- Big man Al Horford is another free agent who has been frequently connected to the Warriors. According to Noa Dalzell of CelticsBlog (Twitter link), Celtics president of basketball operations Brad Stevens acknowledged on Tuesday that it’s “unlikely” Horford returns to Boston, though Stevens did say the team made offers to both him and Luke Kornet (who signed with San Antonio).
- Veteran forward Nigel Hayes-Davis and Fenerbahce have officially parted ways, the Turkish team announced (via Twitter). The move paves the way for Hayes-Davis to get his FIBA letter of clearance and officially finalize his reported agreement with the Suns. Hayes-Davis reportedly turned down a lucrative offer from Fenerbahce that would have made him one of the EuroLeague’s highest-paid players.
- Chris Herring, Zach Kram, Bobby Marks, and Kevin Pelton of ESPN broke down some of their favorite – and least favorite – moves of the free agent period so far, with Kornet to the Spurs, Brook Lopez to the Clippers, and Dorian Finney-Smith to the Rockets among the signings that earned kudos.
Contract Details: KPJ, J. Smith, Wiseman, Schröder, Stevens
Despite the fact that the Bucks used their room exception to complete the signing, guard Kevin Porter Jr. received the exact value of the bi-annual exception on his new two-year deal, Hoops Rumors has confirmed. The first year is worth $5,134,000, with a second-year player option worth $5,390,700. The move leaves roughly $3.65MM on Milwaukee’s room exception.
A player who re-signs with his previous team on either a one-year contract or a two-year deal with a second-year option is typically awarded the right to veto a trade for the rest of that season. However, Porter is one of a few players, along with Lakers big man Jaxson Hayes, who have waived that right as part of their new deals.
Sixers guard Eric Gordon and Raptors wing Garrett Temple have also given up that right to veto a trade, Hoops Rumors has confirmed.
We have more details on some of the recently signed contracts from around the league:
- Jabari Smith Jr.‘s five-year, $122MM rookie scale extension with the Rockets declines in the second season before increasing in each of the final three years, notes Mike Vorkunov of The Athletic. That dip in 2027/28 comes during the season in which an extension for Amen Thompson figures to be hitting Houston’s books — it could also be the final year of Kevin Durant‘s contract, if he signs a two-year extension with the team at some point.
- James Wiseman‘s new two-year, minimum-salary contract with the Pacers, which features a second-year team option, is partially guaranteed for $1MM in 2025/26, Hoops Rumors has learned. If Wiseman’s option for ’26/27 is exercised, that year’s salary would be partially guaranteed for roughly $1.13MM.
- Dennis Schröder‘s three-year deal with the Kings, which is worth exactly the three-year value of the mid-level exception ($44,427,600), is partially guaranteed for $4.35MM in the third year, tweets Michael Scotto of HoopsHype. Although the contract fits into the MLE, Sacramento is believed to have used an existing trade exception to accommodate the acquisition of Schröder.
- Isaiah Stevens‘ two-way contract agreement with the Kings will cover two years, according to Scotto (Twitter link).
Rockets’ Stone Talks KD, Whitmore, Green, Sheppard, Capela
Asked on Monday about the biggest factor that made the Rockets want to make a deal for Kevin Durant, general manager Rafael Stone offered a simple answer, per Danielle Lerner of The Houston Chronicle (subscription required).
“He’s Kevin Durant,” Stone said.
Stone went on to laud Durant’s shooting efficiency and prowess as a half-court scorer, suggesting that adding that dimension to the offense should make Houston a more well-rounded team. He’s also looking forward to seeing what the team’s young players learn from the 15-time All-Star.
“His work ethic is just awesome,” Stone said. “The speed at which he practices and kind of the intensity of which he practices is something that has made him great over the years, and it started when he was very young. And so of all the things that that I hope rubs off, that’s the main one.”
There was some uncertainty entering the offseason about how aggressive the Rockets would be in their pursuit of Durant, given that he’s entering his age-37 season and doesn’t necessarily fit the timeline of the club’s young core. Asked about that line of thinking, Stone suggested that Houston is no longer a “developmental” team and that he believes those young players are ready to win now.
“We were the No. 2 seed (in the West) last year, and I think a very legitimate one. And so we think we can contend now,” Stone said. “We lost a close series last year, and we thought we had a real chance of contending in the playoffs last year, and we hope to have a real chance of contending in the playoffs this year.”
Here’s more from the Rockets’ GM:
- The fact that Houston is no longer a “developmental” team is one reason why the front office felt like it made sense to move on from 2023 first-round pick Cam Whitmore, Stone explains. “We want to provide Cam with the opportunity to do in his career what we still believe he very much can do,” the GM said. “I think Cam is an insanely talented, really nice young man, and wanted to provide him an opportunity to go home and be in a situation where he could really play through mistakes in a way that we never could afford him, just in the iteration of the of the Rockets that he joined.”
- Including former No. 2 overall pick Jalen Green in the package for Durant was necessary due to salary-matching rules, but wasn’t easy, according to Stone. “Jalen is awesome. He did everything we asked,” Stone said. “He’s a wonderful combination of talent and work ethic, along with being just a great human being. And any time that you have the privilege to work with someone who is talented and works really hard and is really nice, you should value it. And so organizationally, we’ve valued him tremendously. So yeah, very hard.”
- Asked whether the Rockets still want to add more backcourt depth, Stone said the team will always be on the lookout for upgrades, but expressed skepticism that there are still meaningful moves on the way before the season begins (YouTube link). “I like our team as is,” he said. “… We’re hard-capped at the first apron and we have no space left, so I think very likely we’ll enter the season looking very similar to the way we look now. It’s pretty hard not to.”
- One reason the Rockets are comfortable with their current guards is a belief that 2024’s No. 3 overall pick Reed Sheppard is ready to take on a larger role. “Reed’s just going to have to be really good for us, period,” Stone said (YouTube link).
- Stone confirmed that the free agency addition of Clint Capela signals the Rockets’ willingness to lean on two-big lineups more in 2025/26 (YouTube link). “We loved that lineup once we discovered it last year. We thought it was really, really effective for us,” he said. “Also, Clint just adds something we don’t have in terms of being a center who can move a little bit easier on the perimeter, also as a lob threat. Finally, we just think depth is super-important. As we’re trying to make it through the season, we don’t want there to be huge drop-offs. We did not anticipate going into free agency that we would be able to get Clint, but we were ecstatic when that materialized.”
Contract Details: Capela, VanVleet, Lopez, Ayton, LaRavia, Kalkbrenner
The Rockets‘ new three-year deal with Clint Capela includes a 5% trade kicker, reports Michael Scotto of HoopsHype (Twitter link).
The fully guaranteed deal is worth $21,105,000 over three years, Hoops Rumors has confirmed, coming in slightly below the initially reported price of $21.5MM. It includes a first-year salary of $6.7MM, with an ascending structure that sees it increase to $7.37MM by year three.
Here are a few more details on some recently signed contracts from around the NBA:
- Fred VanVleet‘s two-year, $50MM contract with the Rockets has a flat structure, with a $25MM first-year salary and a $25MM player option for 2026/27, Hoops Rumors has learned.
- Brook Lopez‘s two-year deal with the Clippers came in slightly below the reported $18MM price. It uses $8.75MM of the non-taxpayer mid-level exception for the 2025/26 season, leaving L.A. with $5,354,000 still to use. Lopez’s second-year team option is worth $9,187,500
- The Lakers‘ used up their entire $14,104,000 non-taxpayer mid-level exception on Deandre Ayton ($8,104,000) and Jake LaRavia ($6MM), as expected. Those salary figures are also Ayton’s and LaRavia’s cap hits for 2026/27 — Ayton’s second year is a player option and LaRavia’s is fully guaranteed.
- No. 34 overall pick Ryan Kalkbrenner signed a four-year, $9.97MM contract with the Hornets, according to Scotto (Twitter link). That’s the most he could earn under the terms of the second-round pick exception. Kalkbrenner’s first two years are fully guaranteed, with a third-year trigger date and a fourth-year team option, Scotto adds.
Seven-Team Kevin Durant Trade Officially Finalized
The seven-team trade that sends star forward Kevin Durant and free agent big man Clint Capela (via sign-and-trade) to Houston is now official, according to press releases from several teams, including the Rockets.
“Having played against Kevin and coached him before, I know he’s the type of competitor who fits with what we’ve been building here in Houston,” head coach Ime Udoka said in a statement. “His skill level, love of basketball, and dedication to his craft have made him one of the most respected players of his generation, and my staff and I are excited to work with him.”
The move sets a new NBA record for most teams involved in a single trade. The terms of the deal are as follows:
- Rockets acquire:
- Kevin Durant (from Suns)
- Clint Capela (sign-and-trade; from Hawks)
- Suns acquire:
- Jalen Green (from Rockets)
- Dillon Brooks (from Rockets)
- Daeqwon Plowden (from Hawks)
- The draft rights to Khaman Maluach (No. 10 pick; from Rockets)
- The draft rights to Rasheer Fleming (No. 31 pick; from Timberwolves)
- The draft rights to Koby Brea (No. 41 pick; from Warriors)
- Either the Thunder’s, Mavericks’, or Sixers’ 2026 second-round pick (whichever is second-most favorable; from Rockets)
- Lakers acquire:
- The draft rights to Adou Thiero (No. 36 pick; from Nets)
- Warriors acquire:
- The draft rights to Alex Toohey (No. 52 pick; from Suns) and the draft rights to Jahmai Mashack (No. 59 pick; from Rockets)
- Note: Mashack’s rights will be sent to the Grizzlies in a subsequent trade.
- The draft rights to Alex Toohey (No. 52 pick; from Suns) and the draft rights to Jahmai Mashack (No. 59 pick; from Rockets)
- Timberwolves acquire:
- The draft rights to Rocco Zikarsky (No. 45 pick; from Lakers)
- Either the Warriors’ or Nuggets’ 2026 second-round pick (whichever is least favorable; from Suns)
- Either the Suns’ or Rockets’ 2032 second-round pick (whichever is most favorable; from Suns/Rockets)
- Note: The Suns, not the Rockets, retain the least favorable of the two picks.
- Cash (from Lakers).
- Note: $3.25MM, per ESPN’s Bobby Marks (Twitter link).
- Nets acquire:
- Either the Clippers’ 2026 second-round pick or the most favorable of the Celtics’, Pacers’, and Heat’s 2026 second-round picks (whichever is least favorable; from Rockets)
- The Celtics’ 2030 second-round pick (from Rockets)
- Hawks acquire:
- David Roddy (from Rockets)
- The right to swap their own 2031 second-round pick for the Rockets’ 2031 second-round pick (56-60 protected; from Rockets)
- Cash (from Rockets)
- Note: $85,300, per Marks (Twitter link).
Word first broke on Wednesday that the Durant trade was being expanded to be completed as a seven-team deal. For the most part, it was just a matter of folding separate draft-night trade agreements into a single transaction.
In addition to the original Durant blockbuster (story), this transaction incorporates trade agreements between the Suns and Nets (story), Suns and Warriors (story), Suns and Timberwolves (story), and Lakers and Timberwolves (story), as well as the sign-and-trade deal sending Capela from the Hawks to the Rockets (story).
The only two new additions to this deal are Plowden and Roddy, who are both entering the second year of two-way contracts. The addition of Plowden ensures that the Hawks are “touching” a second team besides Houston in the deal. He’s being waived by the Suns, reports Duane Rankin of The Arizona Republic (Twitter link).
In exchange for sending out Plowden, the Hawks are filling that newly opened two-way slot with Roddy, a former first-round pick who spent more than half of the 2024/25 season in Atlanta on a standard contract.
Attaching the Capela sign-and-trade deal into this transaction has cap-related benefits for the Rockets, who would otherwise have had to send out a separate matching salary in order to sign Capela to his reported three-year, $21MM deal.
However, for the most part, amalgamating all those draft-night deals is just about streamlining the process for several teams, allowing them to take part in (or wait out) fewer trade calls and get their newly acquired rookies under contract sooner.
Wizards, Pelicans, Rockets Compete Three-Team Trade
As expected, the Wizards have rolled a pair of trade agreements with the Pelicans and Rockets into the same deal, officially completing the two deals as a single three-team transaction, per a press release from New Orleans.
The terms of the trade are as follows:
Wizards acquire CJ McCollum, Kelly Olynyk, Cam Whitmore, and the Bulls’ 2027 second-round pick (from Pelicans).- Pelicans acquire Jordan Poole, Saddiq Bey, and the draft rights to Micah Peavy (No. 40 pick).
- Rockets acquire the draft rights to Mojave King, the Bulls’ 2026 second-round pick (from Wizards) and the Kings’ 2029 second-round pick (from Wizards).
The original trade agreement between Washington and New Orleans was reached on June 24, a day before the first round of the draft, with the Whitmore deal between Houston and Washington just agreed upon yesterday.
It was beneficial for the Wizards to combine the two deals into a single trade because they were sending out any matching salary to the Rockets for Whitmore. While they could have used one of several cap exceptions they had on hand to take on Whitmore’s $3.54MM salary for 2025/26, including him in this deal allows them to use their 125% allowance for Poole’s and Bey’s outgoing salary to acquire him, McCollum, and Olynyk.
The only new part of this deal is the Rockets acquiring the draft rights to King from New Orleans, which was necessary to ensure that Houston and New Orleans were “touching” as part of the three-team deal.
You can read our original story on the Wizards/Pelicans deal headlined by McCollum and Poole here, while our report on the Wizards’ deal for Whitmore is here.
Southwest Notes: Durant, Finney-Smith, Roddy, Shammgod, Pelicans
Trading for Kevin Durant and adding Dorian Finney-Smith in free agency should solve the outside shooting woes that have bogged down the Rockets‘ offense, writes Kelly Iko of The Athletic. He notes that Houston went just 5-of-17 from beyond the arc in a Game 7 loss to Golden State while averaging just 78.0 points per 100 half-court plays. Management believed the team had become too reliant on scoring off the offensive glass and needed to find a way to stretch opposing defenses.
Durant, who remains one of the league’s top shooters at age 36, should go a long way toward fixing the problem. Iko notes that Phoenix managed to be a top-10 half-court team last season, which is largely due to Durant’s brilliance. He should provide the lion’s share of Houston’s offense, with elite athletes surrounding him to keep opposing defenses honest.
Finney-Smith posted two huge games against the Rockets in March and April, Iko adds, going a combined 12-of-20 from three-point range. Iko cites statistics from Cleaning the Glass showing that Finney-Smith’s on-off numbers were +10.8 during his time with Brooklyn last season and +9.3 with Los Angeles. Iko expects the Rockets to see fewer zones with Durant and Finney-Smith on hand to counter them.
There’s more from the Southwest Division:
- Rockets two-way player David Roddy appears to be headed to the Hawks as compensation for Clint Capela when a seven-team deal becomes official on Sunday, according to Danielle Lerner of The Houston Chronicle (Twitter link). Roddy began last season with Atlanta before being waived at the trade deadline.
- God Shammgod talked to Brad Townsend of The Dallas Morning News about his decision to leave the Mavericks‘ coaching staff and join his friend Jamahl Mosley with the Magic. Shammgod is among four assistants Dallas is losing this offseason. He has been with the organization since 2016 and said he never expected to make such a move a month ago. “I’ve been very fortunate, being under a great coach like Rick Carlisle, and then going to another good coach like (Jason Kidd) and being a part of one of the best organizations in the world,” Shammgod said. “And Mark Cuban, you know, probably one of the greatest owners in sports — but, to me, an even better person. There will always be a love relationship for me here in Dallas. I just appreciate everything Dallas did for me, as a coach and as a person.”
- New Pelicans head of basketball operations Joe Dumars is taking a huge chance that the young roster he has assembled can be a playoff contender, observes William Guillory of The Athletic. If it doesn’t work out, Guillory believes Dumars will be facing a full rebuild that could include trading Zion Williamson and firing coach Willie Green.