Every contract negotiation for a second-round pick begins in the backdrop of the required tender – a one-year offer, surely unguaranteed at the minimum, a team must extend to maintain exclusive negotiating rights on a player. The team would love to add three more unguaranteed years at the minimum, securing the possibility of cheap production without committing anything. Of course, players would never go for that.
So, teams entice players with larger guarantees. Essentially, the teams are buying upside on the backend of the contract by promising to pay more in the early years. The higher guarantee, the longer the contract the player is willing to sign.
But Suns No. 32 pick Davon Reed – represented by Stephen Pina of Andy Miller’s agency – fell on the wrong side of the guarantee vs. flexibility curve.
Reed received the second-smallest guarantee among any second-rounder to sign a standard contract this year – $1,504,736 (his $815,615 minimum salary this year plus $689,121 of his $1,378,242 minimum salary next year). Yet, Reed also locked in for the maximum-allowable four years with the final two seasons unguaranteed at the minimum.
By contrast, the only other second-rounder to sign a four-year deal – Celtics’ No. 37 pick Semi Ojeleye – received a $2,193,857 guarantee (his full $1,291,892 salary this season plus enough of his salary next season to equal the minimum over two years). Thomas Bryant – the Lakers’ No. 42 pick – was guaranteed just his $815,615 minimum salary this season, but at least he locked in for only two years.
Reed’s contract blunder is already looking more costly.
If this stalls Reed’s career, he’ll walk away with just $1,504,736 – $1,195,264 less than the guarantee to the player drafted just before him (the Pelicans’ Frank Jackson) and $923,506 less than the player drafted just after him (the Magic’s Wesley Iwundu).
If Reed gets healthy and becomes a positive NBA contributor, Phoenix will reap the rewards while paying him the minimum the next four seasons.