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NBA salary cap - Wikipedia. The NBA salary cap is the limit to the total amount of money that National Basketball Association teams are allowed to pay their players. Like many professional sports leagues, the NBA has a salary cap to control costs, defined by the league's collective bargaining agreement (CBA). This limit is subject to a complex system of rules and exceptions and as such is considered a . Under the CBA ratified in December 2.
For the 2. 01. 5–1. The league continued to operate without such a cap until 1. NBA's teams and ensure competitive balance for the League in the future.
Before the cap was reinstated, teams could spend whatever amount of money they wanted on players, but in the first season under the new cap, they were each limited to $3. Under the 2. 00. 5 CBA, salaries were capped at 5. BRI) and lasted for six years until June 3.
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This is done to allow teams to keep their own players, which, in theory, fosters fan support in each individual city. By contrast, the NFL and NHL caps are considered hard, meaning that they offer relatively few (if any) circumstances under which teams can exceed the salary cap.
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The NBA version of the . MLB does allow teams to spend as much as they want on salary, but it penalizes them a percentage of the amount by which they exceed the soft cap. The percentage increases as the number of consecutive years a team exceeds the cap grows, resetting only when a team falls under the cap. Maximum individual contracts under the NBA. The maximum salary of a player with 6 or fewer years of experience is either $2.
For a player with 7–9 years of experience, the maximum is $3. Under the 2. 01. 1 CBA, the salary cap was based on players receiving 4.
BRI), while the calculation of maximum salaries used a lower figure of 4. BRI. This difference will be eliminated in the 2. CBA, with the same 4. BRI used for both cap and maximum salary calculations. A Designated Player is eligible for a 5- year contract extension, instead of being held to the standard 4- year restriction. All teams are limited to having a maximum of two Designated Players contracted on their roster at any time (one which they have created from one of their own rookie contracts, and one which they have acquired from another team). In addition, teams may use their Designated Player slots on any combination of their own rookie contracts, their own veteran contracts, or players acquired in trades.
Through the 2. 01. All- Star Games, or be named to an All- NBA Team twice (at any level), or be named MVP.
Officially titled the . Should the player fail to fulfil the criteria before the start of his Designated Player contract, he will receive the standard five year, 2. Designated Player contract. James Harden of the Houston Rockets and Anthony Davis of the New Orleans Pelicans had such a clause in their contract extensions, but both failed to meet the criteria. George, who had made the All- NBA third team in 2. Players who come off rookie contracts at the end of the 2. Had these criteria been part of the 2.
CBA, Rose would still have qualified for a 3. NBA season when he was named MVP. Contracts. His contract was initially drawn up before the lockout—during which the Derrick Rose Rule was implemented—but was officially approved under the provisions of the 2.
CBA. This led some people. The 2. 01. 1 CBA allowed all of the teams that were trying to lure Durant to offer him the same initial salary of $2. The extension cannot last more than five years after the expiration of the player's current contract (or five years for a player who is a free agent when signed), but can be negotiated and signed one year before the current contract expires. The extension can be offered to a team's own free agent as well as a player with time left on his contract. Cousins' contract with the Kings was not set to expire until 2. DVPE after the 2. Kings were apparently unwilling to make.
All four were named to one of the three All- NBA teams for that season; two were already eligible under the new criteria. The players' union and owners negotiated a special dispensation allowing them (and presumably other veteran stars in similar situations) to sign DVPE contracts should they otherwise qualify. The exceptions are as follows: Mid- level exception. The amount of the MLE and its duration depend on the team's cap status. The MLE was initially set at $5 million for a duration of four years for teams that are over the cap either before or after the signing, but under the luxury tax apron, which is $4. M above the tax line. Teams above the luxury tax apron have an MLE that was initially set at $3 million with a three- year duration.
Teams with cap room, previously ineligible for the MLE, have a new MLE, initially $2. The MLE was frozen at the stated levels through the 2. Teams with cap room were previously ineligible for the MLE. In a new feature, the apron will change from season to season, with the percentage change (up or down) set at half of the rate of change of the cap for that season. Like the mid- level exception, the bi- annual exception was also split among more than one player, and was used to sign players for up to two years, with raises limited to 8% per year. This exception was referred to as the .
Free agents who qualify for this exception are called . In essence, the Larry Bird exception allows teams to exceed the salary cap to re- sign their own free agents, at an amount up to the maximum salary. To qualify as a Bird free agent, a player must have played three seasons without being waived or changing teams as a free agent. Players claimed after being amnestied have their Bird rights transferred to their new team. Other players claimed off waivers are not eligible for the full Bird exception, but may qualify for the early Bird exception. Prior to an arbitrator ruling in June 2.
Bird rights. It also means that when a player is traded, his Bird rights are traded with him, and his new team can use the Bird exception to re- sign him. Under the 2. 01. 1 CBA, Bird- exception contracts can be up to five years in length, down from six under the 2. CBA. Free agents who qualify for this exception are called . Players that are traded or claimed off waivers have their Bird rights transferred to their new team.
Prior to an arbitrator ruling in June 2. Bird rights. Early Bird contracts must be for at least two seasons, but can last no longer than four seasons. If a team agrees to a trade that would make a player lose his Early Bird Rights, he has the power to veto the trade. A much- publicized example for this was Devean George, who vetoed his inclusion into a larger trade during the 2. Dallas Mavericks to the New Jersey Nets. Non- Bird exception.
Under this exception, teams can re- sign a player to a contract beginning at either 1. Contracts signed under the Non- Bird exception can last up to four years (down from six under the 2.
CBA). Minimum Salary Exception. In the case of two- year contracts, the second- season salary is the minimum salary for that season.
The contract may not contain a signing bonus. This exception also allows minimum- salary players to be acquired via trade. There is no limit to the number of players that can be signed or acquired using this exception. Traded Player Exception. Teams with a trade exception have up to a year in which they can acquire more salary in other trades (Trade #2, #3, etc.) than they send away, as long as the gulf in salaries for Trade #2, #3, etc. This exception is particularly useful when teams trade draft picks directly for a player; since draft picks have no salary value, often the only way to get salaries to match is to use a trade exception, which allows trades to be made despite unbalanced salaries. It is also useful to compensate teams for losing free agents, as they can do a sign and trade of that free agent to acquire a trade exception that can be used later.
Note this exception is for single player trades only, though additional cash and draft picks can be part of the trade. Disabled Player Exception. The maximum salary of the replacement player is either 5.
This exception requires an NBA- designated doctor to verify the extent of the injury. Under the 2. 00. 5 CBA, a team could sign a player under this exception for five years; the 2. CBA now allows this only for one year.
An offer sheet is a contract offer of at least two years made by another team to a restricted free agent. For any other player to be a restricted free agent, he must be at most a three- year NBA veteran, and his team must have made a Qualifying Offer for either 1.
The maximum first- year salary in an offer sheet is the mid- level exception. The second- year salary can be raised a maximum of 4. The third year salary is limited to the maximum a team has available in their salary cap. The salary in the fourth season may increase (or decrease) by up to 4. The offer sheet can only increase in the third season if it provides the highest salary allowed in the first two seasons, the contract is fully guaranteed, and it contains no bonuses. Through the 2. 01. In some cases, the offering team can exploit a loophole to create what is referred to as a poison pill for the player's original team, potentially forcing the original team to pay the luxury tax by the third season, as the Houston Rockets did in order to sign Jeremy Lin and .
This could discourage them from matching the offer sheet. If the original team matches, and has enough cap space to absorb the average annual salary of the offer, it can choose to take cap hits of either the actual contract payouts or the average of the contract in each season. The 2. 00. 5 CBA allowed teams to use exceptions on non- first- round picks, with the extension named the . In 2. 00. 3, Gilbert Arenas, who had been a second- round pick in 2. Washington Wizards after his original team, the Golden State Warriors, were unable to match the offer since they were over the salary cap. The salary cap for the upcoming year is not set until the league's audit is completed by the end of the period.