7. Sign-and-Trade / Extend-and-Trade Deals. In some cases, one team will have the right to sign a player to a new contract of a certain size, but another team (which wants to acquire that player) will not have this right. The two teams can then agree to a trade in which the first team signs the player to a new contract that contains a clause saying the contract is only effective if the player is traded to the second team within 48 hours. This is called a "sign-and-trade" deal; in these deals, the first team grants the second team the right to talk to the relevant player. If the player and the second team agree to new contract terms, the first team signs the contract with the player and then trades him to the second team. These trades can take longer to complete: not only must the two teams negotiate the terms of a deal, but one of the teams also must make a deal with the player (involving even more salary calculations). Also, because new contracts can also have legal and tax consequences for both the team and the player, a player's lawyer or tax counsel may be involved, in addition to the player's agent, while payment schedules and other terms are discussed. The Kevin Garnett trade was the NBA's first "extend-and-trade," deal: KG signed a contract extension (that we had negotiated with him) with Minnesota, and then was immediately traded to Boston. (The extension contained a clause providing that the extension only took effect if the trade to Boston was completed.) Because it was the first deal of its kind, the collective bargaining agreement clauses governing this type of deal had never before been relevant to an actual transaction. Application of these rules by the league and the players' association for the first time added even more complexity to the deal.
