114. How does it work when the league expands? Can the league also contract?To supply an expansion team with its initial complement of players, the league holds an expansion draft1 prior to that year's NBA draft. Existing teams are allowed to protect up to eight players (including restricted free agents) from being selected in the expansion draft, but every team must expose at least one player who can't possibly become a free agent as the result of the exercise or non-exercise of an option or ETO. Unrestricted free agents can neither be protected from nor selected in the expansion draft, and are essentially ignored. Restricted free agents (see question number 42) may be selected, but become unrestricted free agents upon selection (with the caveat that they cannot then re-sign with the team from which they came). No team may lose more than one player in an expansion draft.
Some players may become unrestricted free agents due to the invocation or non-invocation of an option or ETO (see question number 57). The league uses their status on the day of the expansion draft -- i.e., if a player has invoked his option or ETO by the day of the expansion draft, then he is treated as a free agent. If a player has not invoked an option or ETO by the day of the expansion draft, then he is treated as being under contract (so it is possible for an expansion team to select a player in the expansion draft who then invokes his option, becomes an unrestricted free agent, and signs elsewhere).
Andre Drummond........$28,751,775 - Player Option
Dante Exum................$9,600,000
Negotiations between some combination of Drummond, ET (Expansion Team) and a third team interested in Drummond in June would not be what the league wants teams to be doing. Since ET is unlikely to be a contender in its first season, taking Drummond in the expansion draft might not be the best course of action because he could opt out and become a free agent leaving ET with absolutely nothing. If Drummond decides to stay with his contract and ET is unable to move him, then ET will have an overpaid center while working with a lower salary cap.
Probably the best course of action for ET is to be prudent and not draft players with a large salary unless it can be classified as a really good move. ET will probably be looking for additional assets in its first few seasons and flipping Exum at $9.6 million for an unwanted contract plus incentive should be much much easier than flipping Drummond at $28.75 million for an unwanted contract plus incentive.
