From Knicks Board: Childress Found Loophole in CBA??

[magicfan4life05]

I thought this was a great post on the knicks board, and wanted to share it with you kind people...I dont know why tho...

Josh Childress may have found a loophole in the CBA



From Chris Broussard's ESPN blog a few days ago :

As for Atlanta's other free agent, Josh Childress, I'm told the Hawks are offering a five-year deal that begins at slightly more than the $5.5 million mid-level exception. So he's looking at a deal that could approach $7 million annually.

That's much more than any other NBA team is willing to pay him. He hasn't gotten a mid-level exception offer from another team, so the only leverage he has is overseas, where he's considering a three-year, $20 million offer from Olympiakos in Greece.

Three years, $20 million versus five years, roughly 34 million. What's the difference, other than more security with the NBA offer?

Both Smith and Childress should return to Atlanta.

http://sports.espn.go.com/espn/blog/ind ... sard_chris

Broussard was almost certain Childress would return to Atlanta but he forgot two things :
- his contract in Europe is tax free
- he can opt-out of his contract at the end of every season of his 3yr deal.

You may ask "where's the loophole ? I don't get it !".

Here it is :

Under CBA rules, Josh Smith is a restricted FA but the Hawks can match only NBA Contracts. So Josh Childress can sign with Olympiacos in Greece and the Hawks can't do anything about it but they still have his rights !
The Hawks tendered Childress a QO, he declined and left the NBA. The Hawks can give him another QO in 2009 and they can do that every season to prevent him to join another NBA team without their consent.

Here you still wonder "where's the loophole if Childress is still restricted ?"

Well, here it is guys :

Josh Childress can remain a restricted FA and the Hawks can keep his rights but the problem is he will still have his restricted FA status and thus a caphold of 300%. As Josh Childress QO is worth $4,844,355, he will count for around $15M against the Hawks cap as long as the QO is in effect.
The CBA states that the QO will expire at the deadline date (usually october 1st) if the QO isn't withdrawn by the team or accepted by the player. If the QO expires while no move has been made by either the player or the team then the team keeps ROFR (Right of first refusal) status. Meaning they will keep the rights on the player for the upcoming season and will be eligible to tender another QO to the player for the next season.

For the Hawks, it means nothing this season because even though the QO counts against the cap, it's not included in luxury tax calculation. But if the Hawks tender a new QO to Josh Smith in 2009, he will count (again) against their cap for $15M. Problem is Mike Bibby's gigantic contract expires at the end of the season and the Hawks can have massive room under the cap to sign free agents next summer.
Basically they may not tender a QO to Josh Childress and he will become an unrestricted free agent in the NBA (even if he's still under contract in Europe).
As Josh Childress can opt-out of his contract with Olympiacos, he could return to the NBA as an unrestricted FA next season.

Now you may think Josh Childress could so the same by taking the Hawks QO and become unrestricted next summer but the QO is a one year contract for only $4.8M while Josh Childress will get around $7M (tax free) in Greece and will have the security of a 3yr contract and the flexibility to opt-out if he doesn't like it in Greece and has an opportunity in the US. There's no CBA in Europe and less restrictions on player movement.

It's not a problem because it's only Josh Childress and the Hawks can sign a better FA next summer but what if it was a better player ? Imagine if Josh Smith did the same thing ?
Obviously rookies like Chris Paul or Deron Williams will always get an extension even before their rookie contract expires and good rookies will still be signed to lucrative $70M+ contracts when they hit restricted free agency.

But you'll always have players who haven't fulfilled their potential and remain questiomarks (like Curry, Chandler or Crawford were in Chicago). Players like Josh Smith or Luol Deng are lowballed by their teams right now. So these players can break their restricted FA status and still get the security of a 3yr contract in Europe. I don't think Euro teams can pay $60M but it's not far fetched to think a guy like Deng (who's british) wouldn't mind playing in Europe if a team offered him a 3yrs $30M contract with the possibility to opt-out at the end of each season. Then Deng could return as an unrestricted FA the next year and would have the possibility to pick his team.

It can give some leverage to players like Deng or Smith.

It's not huge and it won't create problems for great players but role players who are lowballed by their original teams can use Euro teams contracts as a way to unchain themselves and avoid restricted free agency status.

ARTICLE VII: BASKETBALL RELATED INCOME, SALARY CAP, MINIMUM TEAM SALARY, AND ESCROW ARRANGEMENT

Section 4. Determination of Team Salary.

Subject to Section 4(a)(2)(ii) above, until a Team’s Veteran Free Agent re-signs with his Team, signs with another NBA Team, or is renounced, he will be included in his Prior Team’s Team Salary at one of the following amounts (“Free Agent Amounts”):


(1)

(i) A Qualifying Veteran Free Agent, other than a Qualifying Veteran Free Agent described in Section 4(a)(1)(ii) or (iii) below, will be included at 150% of his prior Salary if it was equal to or greater than the Estimated Average Player Salary, and 200% of his prior Salary if it was less than the Estimated Average Player Salary.

(ii) A Qualifying Veteran Free Agent following the second Option Year of his Rookie Scale Contract will be included at 250% of the player’s prior Salary if it was equal to or greater than the Estimated Average Player Salary, and 300% of his prior Salary if it was less than the Estimated Average Player Salary.

(iii) A Qualifying Veteran Free Agent following the first Option Year of his Rookie Scale Contract will be included at an amount equal to the maximum Salary that the Team may pay the player using the Qualifying Veteran Free Agent Exception applicable to such player pursuant to Section 6(b)(1) below.


ARTICLE XI: FREE AGENCY

Section 4. Qualifying Offers to Make Certain Players Restricted Free Agents

(i) From the day following the Season covered by the second Option Year of a First Round Pick’s Rookie Scale Contract through the immediately following June 30, the player’s Team may make a Qualifying Offer to the player. If such a Qualifying Offer is made, then, on the July 1 following such Season, the player shall become a Restricted Free Agent, subject to a Right of First Refusal in favor of the Team (“ROFR Team”), as set forth in Section 5 below.

(c)

(i) A player who receives a Qualifying Offer must be given at least until the October 1 following its issuance to accept it, but in no event may a Qualifying Offer be accepted after the March 1 following its issuance.

(ii) If a Qualifying Offer is neither withdrawn nor accepted and the deadline for accepting it passes, the Team’s Right of First Refusal shall continue, subject to Section 5(a) below.

Section 5. Restricted Free Agency

(a) If a Restricted Free Agent does not sign an Offer Sheet with any Team by March 1 of the Season for which the Qualifying Offer is made, and does not sign a Player Contract with the ROFR Team before that Season ends, then his ROFR Team may reassert its Right of First Refusal for the following Season by extending another Qualifying Offer (on the same terms as the prior Qualifying Offer) on or before the next June 30. A ROFR Team may continue to reassert its Right of First Refusal by following the foregoing procedure in each subsequent year in which that Restricted Free Agent does not sign an Offer Sheet with any Team by March 1 of the Season for which the Qualifying Offer is made, and does not sign a Player Contract with the ROFR Team before that Season ends. In each Season in which a Team reasserts its Right of First Refusal by extending another Qualifying Offer in accordance with this Section 5(a), the Team may also elect to simultaneously provide the player with a Maximum Qualifying Offer (on the same terms as the prior Maximum Qualifying Offer). Any such Qualifying Offer and Maximum Qualifying Offer shall be governed by the provisions of Section 4 above.

[10scott10]

what i am more shocked by iks that the guy has a copy of the CBA.

I have never seen one floating around the net.

I need a link

[Flash3]

Keep it in the Childress thread, don't create new ones.

Thanks!

[magicfan4life05]

well heres the link to that thread


im lookin for cba link


viewtopic.php?f=24&t=827731