Carmelo Anthony Trade Kicker

[NYG]

Basically using the specific numbers as they relate to Carmelo Anthony, could some one simplify what the following means in the case of Carmelo Anthony in a way that is easy to understand?

"100. How do trade bonuses affect team salary and trades?

The value of a trade bonus is applied to the team salary among the remaining seasons of the contract (excluding non-guaranteed seasons -- see question number 63, and seasons following an Option or ETO -- see question number 57), in proportion to the percentage of salary in each of those seasons that is guaranteed. For example, suppose the player from question number 99 is traded at the start of the third season of his contract. Per the chart in that question, the actual value of his trade bonus at that time is $3 million. If every season of the contract is fully guaranteed and there is no Early Termination Option, then $1.5 million of the trade bonus is charged to each of the final two seasons of the player's contract. The allocation is not proportionate to the salary itself, but rather to how much of the salary is guaranteed. If the fourth season was only 50% guaranteed, then two-thirds of the bonus would be allocated to the third season, and one-third to the fourth season.

In the special case of a contract where all additional seasons are non-guaranteed, the entire trade bonus is applied to the cap in the season in which the trade occurred.

If a contract that contains a trade bonus is extended, and the trade bonus is removed from the extension, then the value of the trade bonus is applied to the team salary across the remaining seasons of the original contract, and not across the extension.

Trade bonuses can be a nuisance. When a team trades for a player with a trade bonus, it must count the portion of the bonus that applies to team salary in that season as incoming salary. Let's say a taxpaying team wants to trade its $9 million player for the player used in the example above, in the third season of that player's contract. Assuming there is no Early Termination Option or non-guaranteed season, $1.5 million of the trade bonus counts in the current season, so the trade cannot be made. The team trading the $9 million player can accept up to $11.35 million in return (see question number 85), but the player with the trade bonus counts as $11.5 million in incoming salary.

The CBA allows the player to waive all or part of his trade bonus, at his discretion. To make the above trade work, the player could choose to waive $300,000 of his $3 million trade bonus. The bonus would then be worth $2.7 million, and $1.35 million of that would be charged to the current season. The player would therefore count $11.35 million as incoming salary, which exactly matches the maximum the other team can accept in return for their $9 million player.

Another potential difficulty is that a team trading a player with a trade bonus uses the player's pre-trade salary (without the bonus), when comparing salaries for trade. Here is another example, using the same player as before (assume the player's team is a taxpayer, and can accept 125% plus $100,000 of the player's outgoing salary). This time, let's assume our player has no guarantee in the fourth season of his contract, so if he is traded during the third season, the entire bonus is allocated to that season. This means that following a trade, $13 million would be included in his new team's team salary. Suppose a taxpaying team wants to trade their $13 million player for this player. That team has $13 million outgoing and $13 million incoming, so there is no problem on their end. But our player counts as $10 million in outgoing salary, so the most we can accept in return is $12.6 million. This means the trade doesn't work from our end. And in this case, waiving a portion of the trade bonus will not help.

A player's salary added to his trade bonus cannot exceed the maximum salary for that season (based on his years of service). For example, in 2017-18 the maximum salary for a player with 7-9 years of service is $29,727,900. If such a player has a $28 million salary and a $2 million trade bonus, then his trade bonus is pared down to $1,727,900 when he is traded1. This happens automatically -- the player has no say in the matter. The same is true for trades of rookie scale contracts that include a trade bonus. If the salary added to the trade bonus exceeds 120% of the player's scale salary amount (see question number 47) the trade bonus is reduced automatically when the player is traded.

There is no recomputation of the allocation of a trade bonus based on whether the player does or does not invoke an option or ETO. For example, if a player with a five-year contract and an ETO following the fourth season is traded during the fourth season of his contract, then his entire trade bonus is charged to the team salary that season. If the player does not invoke his ETO that summer (locking in the fifth season), the allocation of the trade bonus does not change -- none of the bonus is charged to the fifth season. In other words, the allocation of a trade bonus always reflects the state of the contract at the time of the trade.

1 Since a player's maximum salary is the greater of the league-wide maximum and 105% of his previous salary (see question number 23), the player could be entitled to more of his bonus depending on his salary in the previous season."

[NYG]

viewtopic.php?f=2&t=1607489

7. If you add Carmelo Anthony's 15% Trade Kicker (8,125,785) to his 2017-18 salary (26,243,760), it makes his incoming salary in a trade equal to $34,369,545.

8. Using the 125% + $100,000 trade rule that would apply to most teams ((34,369,545 minus 100,000 = 34,269,545) and (34,269,545 divided by 125% or 1.25 = $27,415,636)), the team receiving Carmelo Anthony would need to send out $27,415,636 in total salary.


Anything else I should add?

"7 is not how that works. So then 8 is wrong as well.

http://www.cbafaq.com/salarycap.htm#Q100"

[NYG]

?

[BdeRegt]

Don't feel like doing math right now. I will say that it is unlikely that Melo's trade kicker is applied. Under new CBA, it can be waved. With Melo being so restrictive of only approving a trade Houston, I would predict that the trade kicker will be waved to make the deal easier. Basically though, Melo has a trade bonus and has one guaranteed year left on his contract so bonus would apply in full to Melo this year.

[NYG]

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