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Question on Rip's $1 million

Posted: Thu Feb 7, 2013 9:41 pm
by cucad8
Curious if anyone knows/can show me, Rip Hamilton's contract next season has only 1 million guaranteed if waived by...whenever. Does that 1 million work the same as a standard deal where, when that player signs a new deal, the difference in amounts comes off of the previous team?
So, Chicago waives him, owes him 1 million. Say Miami signs him for 2 million, Bulls off the hook?

Re: Question on Rip's $1 million

Posted: Fri Feb 8, 2013 1:30 am
by DBoys
http://www.cbafaq.com/salarycap.htm#Q64

If another team signs a player who has cleared waivers, the player's original team is allowed to reduce the amount of money it still owes the player (and lower their team salary) by a commensurate amount. This is called the right of set-off. This is true if the player signs with any professional team -- it does not have to be an NBA team. The amount the original team gets to set off is limited to one-half the difference between the player's new salary and the minimum salary for a one-year veteran (if the player is a rookie, then the rookie minimum is used instead).

For example, suppose a fifth-year player is waived with one guaranteed season remaining on his contract for $5 million. If this player signs a $1 million contract with another team for the 2011-12 season, his original team gets to set off $1 million minus $762,195 (the minimum salary for a one-year veteran in 2011-12), divided by two, or $118,902. The team is still responsible for paying $4,881,098 of the original $5 million. Note that between his prior team and new team the player will earn a combined $5,881,098, which was more than he earned prior to being waived.

Teams and players may negotiate a waiver of the team's set-off rights. Typically this is done when a contract is altered as part of a buyout (see question number 65), but not at other times.

Re: Question on Rip's $1 million

Posted: Sat Feb 9, 2013 2:28 pm
by shrink
cucad8 wrote:Say Miami signs him for 2 million, Bulls off the hook?


For 2013-14, the 1 yr vet minimum is $788,872. If Rip signed for $2 mil, the Bulls would be off the hook for $605,564 of it.

They are completely off the hook if he signs for $2,788,872 or more.