Nene - "Human Trade Exception" [Marks]

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Nene - "Human Trade Exception" [Marks] 

Post#1 » by DeathLineup » Thu Sep 12, 2019 4:51 am

Here are the full details on the creative Nene contract with the Rockets. Houston signed the veteran to a two-year $20M contract. However, the base comp for 2019-20 is $2.56M comparable to a minimum contract (but signed using the bird exception) with $7.44M in likely bonuses, bringing his cap hit to $10M this season. The full $10M cap hit can be used in a trade after Jan. 15. and is now a valuable trade chip. The bonuses in his contract are broken down into 3 categories;
1) $2.435M for playing at least 10 games and 52+ wins;
2) $2.5M for playing at least 25 games and 52+ wins;
3) $2.5M for playing at least 40 games and 52+ wins.
The bonuses are deemed likely because Nene played in 42 games last season and the team won 53 games. Had the bonuses been unlikely, the Rockets would have been capped at $384K (15% of his salary) in bonuses that could be added for this season. The Rockets are now $353K below the luxury tax, not including the $7.44M in likely bonuses for this season. The $2.69M base comp in 2020-21 becomes fully guaranteed if Nene is not waived by Feb. 15., 2020, nine days after the trade deadline.

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Re: Nene - "Human Trade Exception" [Stiegel & Marks] 

Post#2 » by giberish » Thu Sep 12, 2019 5:06 am

CBA question:

If he's traded mid-season to a team that won under 52 games last year, what does his salary count as for trade matching? All those bonuses become unlikely so his salary for a new team would just be the $2.56M base, but presumably Houston did this to have a $10M salary for matching in a trade.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#3 » by Resistance » Thu Sep 12, 2019 7:52 am

Jeff Siegel has details on how the contract could be used.

Analysis: Houston and Nene get creative on new contract
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Re: Nene - "Human Trade Exception" [Marks] 

Post#4 » by DeathLineup » Thu Sep 12, 2019 8:37 am

Resistance wrote:Jeff Siegel has details on how the contract could be used.

Analysis: Houston and Nene get creative on new contract

Morey masterclass.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#5 » by MoneyTalks41890 » Thu Sep 12, 2019 12:19 pm

This is genius.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#6 » by Magic_Johnny12 » Thu Sep 12, 2019 2:12 pm

Chess moves
PM me if you can help a brotha finally get an AVI.
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Re: Nene - "Human Trade Exception" [Stiegel & Marks] 

Post#7 » by K_chile22 » Thu Sep 12, 2019 2:18 pm

giberish wrote:CBA question:

If he's traded mid-season to a team that won under 52 games last year, what does his salary count as for trade matching? All those bonuses become unlikely so his salary for a new team would just be the $2.56M base, but presumably Houston did this to have a $10M salary for matching in a trade.
It's unlikely for the new team but still likely for Houston in the trade. So for Houston it counts as $10M outgoing, but for team x it counts as $2.5 incoming which makes it incredibly easy to trade. Genius contract that will probably be legislated out of the next cba
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Re: Nene - "Human Trade Exception" [Marks] 

Post#8 » by QRich3 » Thu Sep 12, 2019 2:30 pm

Pretty genius indeed. For every team except the Rockets, Blazers, Nuggets, Warriors, Raptors and Bucks, he's a minimum salary that counts as $2.6M incoming in a trade. But for the Rockets, he will count as $10M in outgoing salary in a trade. However, if they can't find a trade for him, they can just waive him by the trade deadline, since he's unguaranteed.

I wonder if they had someone specific in mind that they tailored the contract to. Like for instance, say they were targeting Iguodala. Nene + Austin Rivers + Chandler are enough salary to make the trade legal on Houston's end, but for the Grizzlies it's just three veteran minimum contracts. You put a pick on top of it and you got yourself a trade by January 15th. If they were negotiating now, and the Grizzlies were refusing to eat Shumpert on a big contract s&t, this is an amazingly creative way to resolve the situation.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#9 » by K_chile22 » Thu Sep 12, 2019 2:49 pm

QRich3 wrote:Pretty genius indeed. For every team except the Rockets, Blazers, Nuggets, Warriors, Raptors and Bucks, he's a minimum salary that counts as $2.6M incoming in a trade. But for the Rockets, he will count as $10M in outgoing salary in a trade. However, if they can't find a trade for him, they can just waive him by the trade deadline, since he's unguaranteed.

I wonder if they had someone specific in mind that they tailored the contract to. Like for instance, say they were targeting Iguodala. Nene + Austin Rivers + Chandler are enough salary to make the trade legal on Houston's end, but for the Grizzlies it's just three veteran minimum contracts. You put a pick on top of it and you got yourself a trade by January 15th. If they were negotiating now, and the Grizzlies were refusing to eat Shumpert on a big contract s&t, this is an amazingly creative way to resolve the situation.
A name I think could be interesting is Marvin Williams. Jordan's cheap so would probably be happy to get off all that money with light compensation
But then again so is fertitta
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Re: Nene - "Human Trade Exception" [Marks] 

Post#10 » by K_chile22 » Thu Sep 12, 2019 2:51 pm

I think they're gonna let him play, and not worry about the incentives and dump him to a bad team with cash, as he then becomes a minimum guy essentially, similar to what they did with MCW last season, if nothing big comes through
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Re: Nene - "Human Trade Exception" [Marks] 

Post#11 » by gom » Thu Sep 12, 2019 3:23 pm

I've always been a fan of NenĂª.
Humans: Out of nature and hopelessly in it; dual, up in the stars and yet housed in a heart-pumping, breath-gasping body that once belonged to a fish and still carries the gill-marks to prove it.

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Re: Nene - "Human Trade Exception" [Marks] 

Post#12 » by HartfordWhalers » Thu Sep 12, 2019 3:56 pm

Watch Nene gets traded and the team wins 22 of 25, shockingly getting him 7.5m and the team a 4th seed from playoff obscurity in the East.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#13 » by MoneyTalks41890 » Thu Sep 12, 2019 4:19 pm

Nene, Shump SnT (8m 1 gtd yr), Hartenstein, 2022 HOU 1st top 8 prot for Gallo, Muscala
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Re: Nene - "Human Trade Exception" [Marks] 

Post#14 » by Resistance » Thu Sep 12, 2019 4:43 pm

MoneyTalks41890 wrote:Nene, Shump SnT (8m 1 gtd yr), Hartenstein, 2022 HOU 1st top 8 prot for Gallo, Muscala



There is a timing issue with that trade. Nene can't be traded until mid January and the window for a sign and trade closes when the season starts.

92. Can a free agent be signed and immediately traded?

The trade must be completed prior to the first game of the regular season (sign-and-trades are not allowed once the season begins).
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Re: Nene - "Human Trade Exception" [Marks] 

Post#15 » by K_chile22 » Thu Sep 12, 2019 5:07 pm

HartfordWhalers wrote:Watch Nene gets traded and the team wins 22 of 25, shockingly getting him 7.5m and the team a 4th seed from playoff obscurity in the East.

Unless they have tax issues I think most teams would be happy with that outcome, but it would still be hilarious
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Re: Nene - "Human Trade Exception" [Marks] 

Post#16 » by red96 » Thu Sep 12, 2019 7:39 pm

Absolutely genius move by Morey, that will no doubt be changed with new CBA. Couldn't Morey do the same type of contract with Shumpert, too?
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Re: Nene - "Human Trade Exception" [Marks] 

Post#17 » by MoneyTalks41890 » Thu Sep 12, 2019 8:08 pm

red96 wrote:Absolutely genius move by Morey, that will no doubt be changed with new CBA. Couldn't Morey do the same type of contract with Shumpert, too?


I don't see why not. I see two potential hangups, though. Rockets can easily sit Nene and ensure he doesn't actually hit the incentives and only hit incentives count for tax purposes.

Shump may want incentives that are less uncertain, or just more of a guarantee, and they may be trying to work that out. For example, incentives deemed likely under the CBA that get him to 10m trade chip territory, but in actuality you have his base min, then something like 3 mil that he might actually hit, and the rest he probably wouldn't hit. Which could still cause a tax problem for the Rockets, but probably represent a compromise that a younger guy like Shump might take. But if they can lock him into a deal like that they have tons of options once those deals are tradeable.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#18 » by red96 » Thu Sep 12, 2019 8:50 pm

MoneyTalks41890 wrote:
red96 wrote:Absolutely genius move by Morey, that will no doubt be changed with new CBA. Couldn't Morey do the same type of contract with Shumpert, too?


I don't see why not. I see two potential hangups, though. Rockets can easily sit Nene and ensure he doesn't actually hit the incentives and only hit incentives count for tax purposes.

Shump may want incentives that are less uncertain, or just more of a guarantee, and they may be trying to work that out. For example, incentives deemed likely under the CBA that get him to 10m trade chip territory, but in actuality you have his base min, then something like 3 mil that he might actually hit, and the rest he probably wouldn't hit. Which could still cause a tax problem for the Rockets, but probably represent a compromise that a younger guy like Shump might take. But if they can lock him into a deal like that they have tons of options once those deals are tradeable.
Well, if Shumpert also gets that deal, the Rockets will probably be major players at the trade deadline. We're talking about $20 million on the cap that only really costs around $5 million. With just those 2 players the Rockets could potentialy swing a deal for a player making $25 million, giving another team $20 million in savings, almost instantly. THATS HUGE IMO.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#19 » by MoneyTalks41890 » Thu Sep 12, 2019 8:59 pm

red96 wrote:
MoneyTalks41890 wrote:
red96 wrote:Absolutely genius move by Morey, that will no doubt be changed with new CBA. Couldn't Morey do the same type of contract with Shumpert, too?


I don't see why not. I see two potential hangups, though. Rockets can easily sit Nene and ensure he doesn't actually hit the incentives and only hit incentives count for tax purposes.

Shump may want incentives that are less uncertain, or just more of a guarantee, and they may be trying to work that out. For example, incentives deemed likely under the CBA that get him to 10m trade chip territory, but in actuality you have his base min, then something like 3 mil that he might actually hit, and the rest he probably wouldn't hit. Which could still cause a tax problem for the Rockets, but probably represent a compromise that a younger guy like Shump might take. But if they can lock him into a deal like that they have tons of options once those deals are tradeable.
Well, if Shumpert also gets that deal, the Rockets will probably be major players at the trade deadline. We're talking about $20 million on the cap that only really costs around $5 million. With just those 2 players the Rockets could potentialy swing a deal for a player making $25 million, giving another team $20 million in savings, almost instantly. THATS HUGE IMO.


Oh, I agree. It's a great way to create additional value in a deal. For example, maybe not the right one, but taking on Dieng and RoCo and giving up a couple picks, with a ton of value in the TPEs created for Minny. Or, it could be valuable to a team like OKC who can turn around and flip those players for more value to a different team looking to dump bad salary. Such as Nene, Shump, 1st for Gallo, then OKC trades Nene for Felicio, 2nds, etc.
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Re: Nene - "Human Trade Exception" [Marks] 

Post#20 » by letsgorockets » Thu Sep 12, 2019 11:03 pm

I hope he strikes a similar deal with Shumpert, the ability to take back $20+ million and only send back 5 million is absolutely huge in the trade market. There's deals to be done with that kind of salary discrepancy that wouldn't require any picks. Hell, if you can offer that kind of get outta jail free card for some players you might get picks back.

Edit - That's enough to get Jae Crowder and Iggy, and with that kind of savings a couple 2nds and a young prospect might do it. It would complete Houston's rotation nicely and put then on par with any team in the league as contenders.

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