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Difference between Player Option & Early Termination?

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Komodo
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Difference between Player Option & Early Termination? 

Post#1 » by Komodo » Fri Jan 8, 2010 3:17 pm

So I was looking at salaries and noticed that Bargnani has an Early Termination clause for the 2014-15 season. What's the difference between a Player Option and an Early Termination?

click here http://www.shamsports.com/content/pages ... aptors.jsp
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Re: Difference between Player Option & Early Termination 

Post#2 » by Shaazzam » Fri Jan 8, 2010 3:24 pm

# Player Options give the player the right to invoke the option. There can be only one option year.

# Player Early Termination Options (ETOs) give the player the right to terminate the contract early. An ETO can't occur prior to the end of fourth season of the contract (which implies that the contract must be for at least five seasons).

Here's a summary of the differences between an option and an ETO:

* Options can occur only when one season remains on the contract, while ETOs can occur when two seasons remain if the contract is for six seasons.
* Options can be included in any multiyear contract, but ETOs are allowed only with five or six year contracts.
* Options can be held by the player or the team, but ETOs are always held by the player (i.e., there's no such thing as a team Early Termination Option).
* Option years may not have a lower salary than the previous season. ETOs have no such restriction.
* A contract with a player option can be extended when the option is not exercised. A contract with an ETO may not be extended if the ETO is exercised.
* When determining the amount of a trade bonus (see question number 85), option years are not counted as part of the remaining value of the contract, but years following an ETO are counted.



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Re: Difference between Player Option & Early Termination 

Post#3 » by distracted » Fri Jan 8, 2010 3:34 pm

Shaazzam wrote:
* A contract with a player option can be extended when the option is not exercised. A contract with an ETO may not be extended if the ETO is exercised.


http://members.cox.net/lmcoon/salarycap.htm#Q50


This is the most interesting point to me. Does this mean that if he exercises we lose his bird rights, or just that we have to wait until the end of the year to re-sign him as opposed to extending him when he first triggers the ETO?

When is an ETO exercised? At the beginning of the last year before the ETO (like an option can be), or at the end of the last year.
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Re: Difference between Player Option & Early Termination 

Post#4 » by Komodo » Fri Jan 8, 2010 4:30 pm



Very helpful. Thanks Shaazzam. So, I guess the only thing I don't understand is this:

* A contract with a player option can be extended when the option is not exercised. A contract with an ETO may not be extended if the ETO is exercised.


What does that even mean?
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Re: Difference between Player Option & Early Termination 

Post#5 » by MacDaddy » Fri Jan 8, 2010 5:18 pm

komodo19 wrote:


Very helpful. Thanks Shaazzam. So, I guess the only thing I don't understand is this:

* A contract with a player option can be extended when the option is not exercised. A contract with an ETO may not be extended if the ETO is exercised.


What does that even mean?


it means a player who is underpaid can choose not to exercise an option and then sign an extension at a higher salary than the option year would have had, but a player cannot exercise an ETO and then sign an extension. They would have to negotiate a new contract, typically a player would not exercise an ETO unless they planned to leave the team they were on because they had enormous FA value and there were teams with cap space.
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Re: Difference between Player Option & Early Termination? 

Post#6 » by Komodo » Fri Jan 8, 2010 6:29 pm

MacDaddy wrote:
komodo19 wrote:


Very helpful. Thanks Shaazzam. So, I guess the only thing I don't understand is this:

* A contract with a player option can be extended when the option is not exercised. A contract with an ETO may not be extended if the ETO is exercised.


What does that even mean?


it means a player who is underpaid can choose not to exercise an option and then sign an extension at a higher salary than the option year would have had, but a player cannot exercise an ETO and then sign an extension. They would have to negotiate a new contract, typically a player would not exercise an ETO unless they planned to leave the team they were on because they had enormous FA value and there were teams with cap space.


I see. So a player can choose not to exercise their ETO, but can negotiate a new contract prior to their ETO option year. At which point the new contract extension would kick in and replace the final ETO option year. Or they could exercise their ETO and become an UFA. I think lol
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Re: Difference between Player Option & Early Termination? 

Post#7 » by Three34 » Fri Jan 8, 2010 8:47 pm

What's the difference between a Player Option and an Early Termination?


Nothing significant, really.
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Re: Difference between Player Option & Early Termination? 

Post#8 » by Rembokz » Fri Jan 8, 2010 8:48 pm

Sham wrote:
What's the difference between a Player Option and an Early Termination?


Nothing significant, really.


That about sums it up

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