The CBA Glossary

Exclusivity

As above, when an NBA team drafts a player, it gets exclusive negotiating rights to the player until the next draft. That exclusivity however only exists if the team makes a required tender (see below) by the required deadline, which is 15th July for a first-round pick, 5th September for second-round picks drafted before 2024, or 5th August for second-round picks drafted in 2024 or later. If the tender is offered, no other team can negotiate with the player, but if it is not, the draft rights are lost and the player becomes eligible for the next NBA Draft. If a team drafts a player in either round and:does not sign them, and does not make a required tender, then the player automatically becomes a rookie free agent on either 16th July (for a first-round pick), 6th September (for a second-round pick pre-2024), or 6th August (for a second-round pick in 2024 or later). ⓘArticle X (Player Eligibility and NBA Draft) Section 4 (Negotiating Rights to Draft Rookies):

(a) A Team that drafts a player shall, during the period from the date of such NBA Draft (hereinafter, the “Initial Draft�) to the date of the next Draft (hereinafter, the “Subsequent Draft�), be the only Team with which such player may negotiate or sign a Player Contract, provided that, (i) on or before the July 15 immediately following the Initial Draft (for a First Round Pick), (ii) in the two (2) weeks before the September 5 immediately following the Initial Draft (for a Second Round Pick selected in an NBA Draft prior to the 2024 NBA Draft), or (iii) on or before the August 5 immediately following the Initial Draft (for a Second Round Pick selected in the 2024 NBA Draft or any subsequent NBA Draft), such Team has made a Required Tender to such player. If a Team has made a Required Tender to such a player and the player has not signed a Player Contract within the period between the Initial Draft and the Subsequent Draft, the Team that drafted the player shall lose its exclusive right to negotiate with the player and the player will then be eligible for selection in the Subsequent Draft.

[...] (e) If a player is drafted by a Team in either an Initial or Subsequent Draft and that Team does not sign such player to a Player Contract or make a Required Tender to such player, the player will become a Rookie Free Agent on (i) the July 16 following such Draft (for a First Round Pick), (ii) on the September 6 following such Draft (for a Second Round Pick selected in an NBA Draft prior to the 2024 NBA Draft), or (iii) on the August 6 following such Draft (for a Second Round Pick selected in the 2024 NBA Draft or any subsequent NBA Draft).

If that player is not drafted again in the subsequent draft, they become a rookie free agent. Conversely, if they are drafted a second time in the subsequent draft, but still have not signed an NBA contract by the time of the next draft after that, they become a rookie free agent. Essentially, then, the rule states that everyone gets at most two drafts if required. But in practice, it is not required. [This just never realistically applies. As will be seen below, the value of draft rights in trades, plus the even greater value the market deems that picks have before they are used, means that teams do not wind up with picks they do not want. Maybe one day.]ⓘArticle X (Player Eligibility and NBA Draft) Section 4 (Negotiating Rights to Draft Rookies):

(b) A Team that, in the Subsequent Draft, drafts a player who (i) was drafted in the Initial Draft, (ii) received a Required Tender from the Team that drafted him in the Initial Draft, and (iii) did not sign a Player Contract with such first Team prior to the Subsequent Draft, shall, during the period from the date of the Subsequent Draft to the date of the next NBA Draft, be the only Team with which such player may negotiate or sign a Player Contract, provided such Team has made a Required Tender to such player by the applicable date specified in Section 4(a) above. If such player has not signed a Player Contract within the period between the Subsequent Draft and the next NBA Draft with the Team that drafted him in the Subsequent Draft, that Team shall lose its exclusive right, which it obtained in the Subsequent Draft, to negotiate with the player, and the player will become a Rookie Free Agent as of the date of the next NBA Draft.

(c) If a player is drafted in an Initial Draft and (i) receives a Required Tender, (ii) does not sign a Player Contract with a Team prior to the Subsequent Draft, and (iii) is not drafted by any Team in such Subsequent Draft, the player will become a Rookie Free Agent immediately upon the conclusion of the Subsequent Draft.

There is a small exception in the case of second-round picks who get waived. If a second-round pick signs the required tender, then the team later waives him, the team still keeps exclusive rights to either sign or convert them to a two-way contract for the season covered by that required tender. In practice, and in keeping with the above, almost all second-round picks either sign guaranteed NBA contracts or two-way deals in their first season, rather than the tenders, but the option exists nonetheless. ⓘArticle X (Player Eligibility and NBA Draft) Section 4 (Negotiating Rights to Draft Rookies):

(d) If a Second Round Pick receives and signs a Required Tender and is subsequently waived by the Team after signing such Required Tender, then the Team that made the Required Tender to the player shall have exclusive rights to negotiate with and sign (or convert) the player to a Two-Way Contract for the Season covered by the Required Tender.

"Draft and stash"

A team generally does not lose a drafted player's NBA rights just because the player stays overseas. Draft rights only convey exclusivity with regards to signing with NBA teams; if the drafted player does not sign in the NBA, they can do whatever they so choose. There is no obligation to join the NBA just because you were drafted in it. ⓘArticle X (Player Eligibility and NBA Draft) Section 5 (Effect of Contracts with Other Professional Teams):

If a player is drafted by a Team in either an Initial or Subsequent Draft and, during a period in which he may negotiate and sign a Player Contract with only the Team that drafted him, either (x) is a party to a previously existing (i) non-NBA professional basketball contract or (ii) player contract with a professional basketball team or league not in the NBA that, in either case, covers all or any part of the NBA Season immediately following said Initial or Subsequent Draft, or (y) signs either such a player contract (either (x) or (y), a “Non-NBA Signing�), then the following rules will apply:

Draftees who already have a contract with a non-NBA team, or sign one after being drafted, that runs at least part way through the following season, are called a "Non-NBA Signing" in the CBA. The drafting team keeps the player's exclusive NBA rights until one year after the player becomes available to come to the NBA. That one-year period begins when the player formally notifies the team either that he is immediately available to sign and play in the NBA, or that he intends to come to the NBA for the following season. In either case, the notice is only effective once the player is actually free from any contractual or legal obligations preventing him from signing and playing for the NBA team.

If the player notifies the team by 1st July that he will be free to join the NBA by 1st August, the team must make a required tender by 10th August (10th September in 2023). If the team fails to make that tender, the player immediately becomes a rookie free agent and can sign with any NBA team.

If the player remains overseas and signs another non-NBA contract during the one-year rights period, the NBA team can continue to hold his exclusive NBA rights for additional one-year periods. This will happen if the player has not made a genuine effort to negotiate with the NBA team, or if he has done so and the NBA team responds by making the required tender. In effect, a team can continue to retain a player's NBA rights while he chooses to continue his career outside the NBA, provided the team complies with the required procedures.

However, the NBA team cannot simply sit on those rights indefinitely without making the required offer. If the player genuinely attempts to negotiate with the team, signs another overseas contract, and the team fails to make a required tender, the player immediately becomes a rookie free agent.

If the player becomes available to play in the NBA, the team makes a required tender, and the player neither signs with the NBA team nor signs another non-NBA contract, the normal draft rights rules begin to apply - as above, If they were originally drafted in an initial draft, they becomes eligible for a subsequent draft. If he had already gone through a subsequent draft, then again as above, he becomes a rookie free agent once the one-year rights period expires.

Anyway, all this talk of "required tenders" - but what actually are they?

Tenders

In the CBA a“required tender” is an offer of a contract to a drafted player that: ⓘArticle I (Definitions) Section 1 (Definitions):

(ddd) “Required Tender” means an offer of a Uniform Player Contract to a Draft Rookie, signed by the Team, that: (i) on or before the date specified in Article X is either personally delivered to the player or his representative or sent by email or pre-paid certified, registered, or overnight mail to the last known address of the player or his representative; (ii) with respect to a First Round Pick, (A) affords the player until at least the first day of the following Regular Season to accept, and (B) satisfies the requirements of a Rookie Scale Contract set forth in Article VIII, Section 1 or 2; and (iii) with respect to a Second Round Pick, (A) affords the player until at least the earlier of (x) four (4) days before the date of the first day of the immediately following Regular Season, or (y) the immediately following October 15, to accept, (B) has a stated term of one (1) Season, and (C) calls for at least the Minimum Player Salary then applicable to the player. In addition, a Team shall be permitted to include in any Required Tender an Exhibit 6 to the Uniform Player Contract requiring that the player, if he signs the Required Tender, pass a physical examination to be performed by a physician designated by the Team as a condition precedent to the validity of the Contract.

As long as they continue to offer a "required tender", NBA teams can keep the draft rights of players in perpetuity. And this is not always a good thing for players. The deadline by which second-round draft picks have to sign their tenders - the contract offer required by teams in order to maintain draft rights on the player - is now the earlier of a) four days before opening night, or (b) 15th October. Previously, the latter date was the deadline

A tender can be immediately withdrawn, but not unilaterally - the player must agree in writing. Once the tender is withdrawn, the player immediately becomes a rookie free agent ⓘArticle X (Player Eligibility and NBA Draft) Section 4 (Negotiating Rights to Draft Rookies):

(f) A Team may at any time withdraw a Required Tender it has made to a player, provided that the player agrees in writing to the withdrawal. In the event that a Required Tender is withdrawn, the player shall thereupon become a Rookie Free Agent.

Article I (Definiions) Section 1 (Definitions):


(ggg) “Rookie Free Agent” means: (i) a Draft Rookie who, pursuant to the provisions of Article VIII, Section 3 or Article X, is no longer subject to the exclusive negotiating rights of any Team, and who may be signed by any Team; or (ii) a Non-Draft Rookie.

(g) A team can voluntarily give up its rights a team holding a player's draft rights can simply renounce them. When that happens: The team submits written notice to the NBA The NBA informs the Players Association. However: If the player currently has time remaining to accept a Required Tender, the team cannot renounce the rights during that acceptance period.

(h) When can a drafted player sign? A team holding a player's rights can begin negotiating immediately after the draft and can sign the player once league timing rules (such as the moratorium) allow.

If a player thinks a team’s qualifying offer is not valid, they must object in writing within ten days. They must explain what is wrong with the offer. The team then has fuvebusiness days to fix it; if they fix it properly, the player can no longer claim it is invalid. ⓘArticle X (Player Eligibility and NBA Draft) Section 8 (General):

(d) Any claim by a player that a Contract offered as a Required Tender pursuant to this Article X fails to meet one or more of the criteria for a Required Tender shall be made by written notice to the Team (with copies sent to the NBA and the Players Association), no later than ten (10) days after the receipt of such Contract by the Players Association. Such notice must set forth the specific changes that the player asserts must be made to the offered Contract in order for it to constitute a Required Tender. Upon receipt of such notice, if the requested changes are necessary to satisfy the requirements of a Required Tender, the Team may, within five (5) business days, offer the player an amended Contract incorporating the requested changes. If the Team offers such an amended Contract, the player and the Players Association shall be precluded from asserting that such Contract does not constitute a timely and valid Required Tender.

Use in trade

While there is a prestige to being an NBA draft pick, it does come with the caveat that that player can now only sign with that NBA team, or to whichever team said rights are later traded. This is usually not a problem, and almost every NBA draft pick signs with a team at some point. But some do not. And as long as whichever team holds their draft rights keeps offering an unguaranteed minimum salary contract as a tender (for second round picks, at least, whom this situation is almost always about) every season, or the player makes no effort to join, those draft rights remain on the books.

In practice, that usually leads only to relics. Most of the unsigned NBA draft picks currently in existence are for players who will never play in the NBA, sometimes because they do not make the grade but often because they are simply retired. In the rather extreme case of the Portland Trail Blazers, for example, they still possess the draft rights to Marcelo Nicola, a 55-year-old Italian forward now 19 years into a coaching career, including being an assistant coach of the selfsame Spurs' 2009 summer league roster. It is fair to say he is not going to play for the Blazers.

By and large, outstanding draft rights are archaic relics, kept around only because they satisfy the NBA's requirement that all parties in a trade are required to at least give up "something". It is not an unusual occurrence for draft rights to long-forgotten players to be included in trades purely for that reason, to fulfil the outgoing requirement of a trade, or at least one of its constituent parts for trade math purposes. Draft rights are also often traded at the time of the draft, for example in deals agreed to before the draft but not made until after it that involve moving up or down, and can be traded at any time after a pick is made.

Whether the draft rights being traded are those of a first-round pick or a second-round pick, their outgoing value in trade math is always zero.

Renouncements and cap ramifications

An unsigned first round pick is removed from team salary if the team and player both agree in writing not to sign any contract through the following June 30. The scale amount is returned to the team salary the following July 1. If the team renounces its draft rights, the player's scale amount is removed from the team salary permanently, and the team relinquishes its draft rights to the player (see question number 52).

If a first round pick signs with a non-NBA team, his scale amount is excluded from the team salary on the date he signs his non-NBA contract or the first day of the regular season, whichever is later. The scale amount goes back onto the team salary on the following July 1 or when his non-NBA contract ends, whichever is earlier. In other words, these cap holds are removed for players playing outside the NBA, but only during the regular season.

A team holding a player's draft rights can simply renounce them. However, if the player currently has time remaining to accept a Required Tender, the team cannot renounce the rights during that acceptance period. ⓘArticle X (Player Eligibility and NBA Draft) Section 4 (Negotiating Rights to Draft Rookies):

(g) A Team that holds the exclusive rights to negotiate with and sign a drafted player may at any time renounce such exclusive rights, except that, if the Team has made a Required Tender to the player, a renunciation shall not be permitted during the time the player has to accept the Required Tender under Article I, Section 1(ddd). In order to renounce its exclusive rights with respect to a drafted player, a Team shall provide the NBA with an express, written statement renouncing such exclusive rights. The NBA shall provide a copy of such statement to the Players Association within three (3) business days following its receipt thereof.

Other things:

● If a rookie is placed on things like military lists or other NBA administrative lists, that does not extend how long a team has exclusive negotiating rights. ⓘArticle X (Player Eligibility and NBA Draft) Section 8 (General):

(a) The placement of a Rookie on the Armed Services List, or on any of the other lists described in the NBA By-Laws, or on any other list created by the NBA, shall not extend the period of exclusive negotiating rights which a Team has to any Draft Rookie beyond the period specified in this Agreement.

● If a team trades a player’s draft rights, the receiving team gets exactly the same rights and obligations as the original team. A player bound by the rookie scale, for example, still would be. ⓘArticle X (Player Eligibility and NBA Draft) Section 7 (Assignment of Draft Rights and Effect of Void Contracts):

(a) In the event that the exclusive right to negotiate with a player obtained in any NBA Draft is assigned by a Team to another Team, in accordance with NBA procedures, the Team to which such right has been assigned shall have the same, but no greater, right to negotiate with and sign such player as is possessed by the Team assigning such right, and such player shall have the same, but no greater, obligation to the Team to which such right has been assigned as he had to the Team assigning such right.

Article X (Player Eligibility and NBA Draft) Section 8 (General):

(e) For purposes of this Article X, any rights afforded to “a Team that drafts a player� shall also be afforded to any Team to which such rights are subsequently assigned.

● If draft rights are traded before a required tender is made, the acquiring team keeps the player's rights if it makes the required tender by whichever is later: the normal deadline, or three days after the trade officially becomes final. If the trade is voided, the original team keeps the rights if they make the tender by the normal deadline, or three days after the trade is officially voided. A pending trade effectively pauses the tender deadline and gives the relevant team a three-day grace period after the trade is finalised or cancelled. ⓘArticle X (Player Eligibility and NBA Draft) Section 7 (Assignment of Draft Rights and Effect of Void Contracts):

(b) Notwithstanding anything to the contrary in Section 7(a) above, in the event that:

(i) Pursuant to Section 4 or 5 above, a Team must make a Required Tender to a player in order to retain the exclusive right to negotiate with and sign such player to a Player Contract, but has not yet made such Required Tender; and

(ii) On or before the applicable date set forth in Section 4(a) or 5(b) above, such Team engages in a trade conference call pursuant to which the Team assigns, subject to any applicable trade conditions, the exclusive right to another Team; then:

(A) if the trade is consummated, the Team to which such rights are assigned shall have the exclusive right to negotiate with and sign such player to a Player Contract, provided that such assignee Team makes a Required Tender to such player on or before the later of (1) the applicable date set forth in Section 4(a) or 5(b) above, and (2) the date that is three (3) days following the date on which the trade is consummated (i.e., the date that all conditions (if any) to the trade are satisfied); or

(B) if the trade is voided (e.g., due to the failure of a condition of a trade), the assignor Team shall retain the exclusive right to negotiate with and sign such player to a Player Contract, provided that such Team makes a Required Tender to such player on or before the later of (1) the applicable date set forth in Section 4(a) or 5(b) above, and (2) the date that is three (3) days following the date on which the trade is voided.

● In the extremely unlikely event that a team still needs to make a required tender to preserve a player's rights, but before the tender deadline, it signs the player instead, to a deal later voided by the NBA Commissioner, the team does not automatically lose its rights to the player. Instead, it keeps those rights if it makes a required tender by whichever is later: the normal deadline, or three days after the Commissioner's rejection. ⓘArticle X (Player Eligibility and NBA Draft) Section 7 (Assignment of Draft Rights and Effect of Void Contracts):

(c) In the event that:

(i) Pursuant to Section 4 or 5 above, a Team must make a Required Tender to a player in order to retain the exclusive right to negotiate with and sign such player to a Player Contract, but has not yet made such Required Tender;

(ii) such Team signs such player to a Player Contract prior to the applicable date set forth in Section 4(a) or 5(b) above; and

(iii) such Contract becomes void as a result of a Commissioner disapproval;

then such Team shall have the exclusive right to negotiate with and sign such player to a Player Contract, provided that it makes a Required Tender to such player on or before the later of (A) the applicable date set forth in Section 4(a) or 5(b) above, and (B) the date that is three (3) days following the date of the Commissioner’s disapproval.

● A team holding a player's draft rights:can begin negotiating with them immediately after the draft, but they can only sign the player once the moratorium allows. ⓘArticle X (Player Eligibility and NBA Draft) Section 4 (Negotiating Rights to Draft Rookies):

(h) Subject to the provisions of Article VII, and subject further to Article II, Section 15, a Team is free at any time beginning immediately following the conclusion of the NBA Draft to negotiate, and free at any time after the conclusion of the Moratorium Period to enter into, a Player Contract with a Draft Rookie who is subject to that Team’s exclusive negotiating rights.

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MAIN TAKEAWAYS:

Links:

1. Unsigned draft picks list - RealGM