Max Qualifying Offer vs. Maximum Extension

rcmoore1
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Max Qualifying Offer vs. Maximum Extension 

Post#1 » by rcmoore1 » Tue Oct 14, 2014 9:15 pm

What exactly is the difference between the max QO and a max extension. I understand the max QO can't have options or early termination options (so, e.g. Kyrie Irving's extension is a max extension and not a max QO). But what is the difference in salary distribution? Is the max QO giving the QO for the 5th year and then additional years at the max?
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#2 » by DBoys » Tue Oct 14, 2014 10:48 pm

1 A QO of any kind is an offer to a restricted free agent, not a deal. It creates a new contract (if accepted) rather than an extension.

2 A team could sign a player to a max rookie scale extension, with terms identical to an accepted "max QO" for the same player the next summer.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#3 » by rcmoore1 » Tue Oct 14, 2014 11:00 pm

I understand that the max qualifying offer is just an offer, but so is a max extension before it's signed.

So, back to the Irving example, if Irving's deal would not have contained the early termination option, he essentially would have been signing his max qualifying offer, correct? Since his contract is for 5 years at the max. Because signing a max extension is basically negotiating a new contract with the team (because, for example, you want a player option and thus don't want to take a max qualifying offer).
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#4 » by DBoys » Wed Oct 15, 2014 1:24 pm

There are actual differences between negotiating and signing, and between offers, deals, and extensions, and using them interchangeably when they really aren't makes it difficult to discern what you're trying to ask.

A few observations...
1 Irving received neither a max QO, nor a QO of any kind. He was not a restricted free agent when he signed an extension.
2 So of course he did not sign a QO or a max QO.
3 He did sign a 5 year extension.
4 "signing a max extension is basically negotiating a new contract"...Um no. Negotiating is the process of working to come to an agreement. Signing is the act of enacting an agreed-upon negotiation. They are different steps in the process of arriving at a new deal of some sort.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#5 » by rcmoore1 » Wed Oct 15, 2014 2:05 pm

Your 4th observation is unnecessary. Obviously signing and negotiating are two different steps in the process. But you don't sign a max extension without negotiating the max extension first. Signing a max extension is the product of negotiating a new deal. That was my point.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#6 » by Klomp » Mon Oct 27, 2014 8:33 am

rcmoore1 wrote:What exactly is the difference between the max QO and a max extension. I understand the max QO can't have options or early termination options (so, e.g. Kyrie Irving's extension is a max extension and not a max QO). But what is the difference in salary distribution? Is the max QO giving the QO for the 5th year and then additional years at the max?

If I'm understanding Coon's FAQ correctly, the only difference I see is when they are offered:

Extension: "From the day following the July moratorium to the October 31 preceding the player's last option season"
Qualifying Offer: Comes after the last option season, before player hits restricted free agency.

I could be wrong, though.
tsherkin wrote:The important thing to take away here is that Klomp is wrong.
Esohny wrote:Why are you asking Klomp? "He's" actually a bot that posts random blurbs from a database.

Klomp wrote:I'm putting the tired in retired mod at the moment
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#7 » by nodeal » Fri Oct 31, 2014 12:25 pm

Klomp wrote:
rcmoore1 wrote:What exactly is the difference between the max QO and a max extension. I understand the max QO can't have options or early termination options (so, e.g. Kyrie Irving's extension is a max extension and not a max QO). But what is the difference in salary distribution? Is the max QO giving the QO for the 5th year and then additional years at the max?

If I'm understanding Coon's FAQ correctly, the only difference I see is when they are offered:

Extension: "From the day following the July moratorium to the October 31 preceding the player's last option season"
Qualifying Offer: Comes after the last option season, before player hits restricted free agency.

I could be wrong, though.


That's correct.

Max extension:
When: "From the day following the July moratorium to the October 31 preceding the player's last option season"
Teams must use their designated player distinction to get the full 5 yr max extension (it is actually called a 6 yr extension, the upcoming year + 5 additional years)
The contract is for 25%-30%. Kyrie signed for 27.5%. The player has to meet certain requirements to receive the amount over 25%.

Max qualifying offer:
When: "In order to make their free agent a restricted free agent, a team must submit a qualifying offer to the player between the day following the last game of the NBA Finals and June 30"

If the player is coming off the fourth year of his rookie scale contract, then in addition to a qualifying offer, his team can also submit a maximum qualifying offer. A maximum qualifying offer is for five seasons at the maximum salary with 7.5% annual raises. It can contain no options, ETOs or bonuses of any kind, and must be fully guaranteed. The max is 25%

The max qualifying offer, is still just an offer sheet. The player doesnt have to sign it. The team will have restricted free agency right though so they probably would sign it. Signing the extension was without doubt better for kyrie than waiting for a max qualifying offer. He wouldnt have been too happy if they didnt offer him the extension. He wouldve lost the player option, the possibility to earn 27.5%, and risk of injury.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#8 » by DBoys » Fri Oct 31, 2014 3:05 pm

nodeal wrote:Signing the extension was without doubt better for kyrie than waiting for a max qualifying offer. He wouldnt have been too happy if they didnt offer him the extension. He wouldve lost the player option, the possibility to earn 27.5%, and risk of injury.

For the player, the advantage of avoiding the risk of injury angle is accurate, as is the now-vs-later aspect of getting the same deal done.

But the possibility to earn 27.5%, or even as much as 30%, is just as possible for the one who decides to wait until RFA. There is no difference in the max amount available to sign for, between the rookie scale extension and RFA process.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#9 » by nodeal » Fri Oct 31, 2014 3:25 pm

DBoys wrote:
nodeal wrote:Signing the extension was without doubt better for kyrie than waiting for a max qualifying offer. He wouldnt have been too happy if they didnt offer him the extension. He wouldve lost the player option, the possibility to earn 27.5%, and risk of injury.

For the player, the advantage of avoiding the risk of injury angle is accurate, as is the now-vs-later aspect of getting the same deal done.

But the possibility to earn 27.5%, or even as much as 30%, is just as possible for the one who decides to wait until RFA. There is no difference in the max amount available to sign for, between the rookie scale extension and RFA process.


The max qualifying offer is 25% even if kyrie qualifies for 30%. This is about max qualifying offer vs extension. There is also a big difference in offering a player 27.5% if they are unlikely to qualify for it and 27.5% if its a sure thing. if a player turns down a 27.5% extension its very very unlikely they get 27.5% next off season.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#10 » by DBoys » Fri Oct 31, 2014 3:53 pm

nodeal wrote:The max qualifying offer is 25% even if kyrie qualifies for 30%. This is about max qualifying offer vs extension. There is also a big difference in offering a player 27.5% if they are unlikely to qualify for it and 27.5% if its a sure thing. if a player turns down a 27.5% extension its very very unlikely they get 27.5% next off season.


It looked to me that you had slid into a comparative discussion of the contractual limits in the two situations, and I interacted accordingly. If I misunderstood what you were discussing, sorry about that.

As for the "more than 25%, up to 30%" amount, they either qualify for it or they don't - - so their ability to actually be offered, or to get, the extra amount won't be altered by when they sign the deal, which was my point. I doubt that a player who qualified wouldn't get offer it in a RFA deal, considering what it takes to qualify, so I tend to disagree that the offer of "maybe 27.5%" is a now or never proposition.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#11 » by nodeal » Fri Oct 31, 2014 9:40 pm

DBoys wrote:
nodeal wrote:The max qualifying offer is 25% even if kyrie qualifies for 30%. This is about max qualifying offer vs extension. There is also a big difference in offering a player 27.5% if they are unlikely to qualify for it and 27.5% if its a sure thing. if a player turns down a 27.5% extension its very very unlikely they get 27.5% next off season.


It looked to me that you had slid into a comparative discussion of the contractual limits in the two situations, and I interacted accordingly. If I misunderstood what you were discussing, sorry about that.

As for the "more than 25%, up to 30%" amount, they either qualify for it or they don't - - so their ability to actually be offered, or to get, the extra amount won't be altered by when they sign the deal, which was my point. I doubt that a player who qualified wouldn't get offer it in a RFA deal, considering what it takes to qualify, so I tend to disagree that the offer of "maybe 27.5%" is a now or never proposition.


From kyries perspective
If he signs the 27.5% extension his chances of getting paid 27.5% are equal to the chances he qualifies for it.
If he doesnt sign the 27.5% extension his chances of signing a 27.5% contract is not equal to the chances he qualifies for it. He has to qualify for it and cleveland has to give it to him knowing its 100%.

As an extension
27.5% = chances he qualifies for it.
As a restricted free agent
27.5% = chances he qualifies for it x chances cleveland offers it to him after the fact knowing its a sure thing.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#12 » by DBoys » Sat Nov 1, 2014 10:23 pm

The flip side is, if they're having to negotiate in the aftermath of making the criteria, he'd likely get 30%. So for the Cavs, instead of 30 if he makes it and 25 if he doesn't, now its 27.5 if he makes it and 25 if he doesn't.

So you can see a plus for him in this deal, I see one for the team, which means there was a plus for both of them at 27.5 if done now ...which, that's what negotiations are about.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#13 » by nodeal » Mon Nov 3, 2014 9:11 pm

DBoys wrote:The flip side is, if they're having to negotiate in the aftermath of making the criteria, he'd likely get 30%. So for the Cavs, instead of 30 if he makes it and 25 if he doesn't, now its 27.5 if he makes it and 25 if he doesn't.

So you can see a plus for him in this deal, I see one for the team, which means there was a plus for both of them at 27.5 if done now ...which, that's what negotiations are about.


Cleveland would hold way too much leverage to have to give him 30%. The difference between what they can offer vs what other teams can offer is huge. Not only that but they can match what other teams can offer.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#14 » by DBoys » Tue Nov 4, 2014 2:07 am

nodeal wrote:
DBoys wrote:The flip side is, if they're having to negotiate in the aftermath of making the criteria, he'd likely get 30%. So for the Cavs, instead of 30 if he makes it and 25 if he doesn't, now its 27.5 if he makes it and 25 if he doesn't.

So you can see a plus for him in this deal, I see one for the team, which means there was a plus for both of them at 27.5 if done now ...which, that's what negotiations are about.


Cleveland would hold way too much leverage to have to give him 30%. The difference between what they can offer vs what other teams can offer is huge. Not only that but they can match what other teams can offer.


Then why would they have ever offered the 27.5 in the first place, since they didn't have to and no team can even offer the same size of 25% offer as they can? Yet, they did.

If it was really true that CLE is only going to make an over-25% offer by being forced to (supposedly), CLE could and would have simply declined to offer him more than 25% extension, knowing that they hold the upper hand all the way through. The same dynamics, that motivated them to offer 27.5% in advance when they didn't have to, still exist after a player has earned the honors, and may be even greater since unrestricted free agency is that much closer.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#15 » by nodeal » Tue Nov 4, 2014 4:46 am

DBoys wrote:If it was really true that CLE is only going to make an over-25% offer by being forced to (supposedly), CLE could and would have simply declined to offer him more than 25% extension, knowing that they hold the upper hand all the way through. The same dynamics, that motivated them to offer 27.5% in advance when they didn't have to, still exist after a player has earned the honors, and may be even greater since unrestricted free agency is that much closer.


Thats why i said it was a good offer for kyrie. He had almost nothing to gain by holding out, and cleveland had almost nothing to lose by holding out.

Also 27.5% a certain % of the time and 25% a certain % of the time isnt 27.5% its somewhere in the middle. The added motivation was probably enough for cleveland to give the possibility for a slight raise.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#16 » by DBoys » Tue Nov 4, 2014 8:03 am

As I noted before - -
you can see the plus for Irving in his deal (and you stated it yet again),
I see the one for the team (which I have noted several times),
which means there was a plus for both of them at 27.5 if done now, so they did it ...which, that's what negotiations are about.
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Re: Max Qualifying Offer vs. Maximum Extension 

Post#17 » by nodeal » Sun Jan 25, 2015 2:55 am

I know what negotiations are about I also know just because both sides negotiated doesnt mean they both have to come out as equal winners. Kyrie came out of these negotiations as the winner. Cleveland couldve done with kyrie what SA is doing with Leonard. When youre at the max there is no where to go but down and all risk of injury/regression is on cleveland and Kawhi. Just because i give reasons as to why cleveland would do this doesnt mean they came out of this as good as kyrie did. Which is all ive said, kyrie got the better end of this deal.

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