Heat signs Patrick Beverley to a curious two-year deal
The Miami Heat signed Patrick Beverley to a two-year, $1.3 million fully-guaranteed contract on Monday. That much we know.
What we don’t know is why. Why did the Heat sign him? Why did they sign him so soon? And why did they fully guarantee his contract?
Despite the guarantee, Beverley is still far from a lock to make the regular season roster.
The Heat currently has 14 veterans under guaranteed contract. Teams can have as many as 20 players under contract during the offseason, but must pare down to 15 by the start of the regular season.
Beverley figures to compete with Kenny Hasbrouck, Shavlik Randolph, and Da’Sean Butler for the 15th and final spot. Hasbrouck and Randolph have each signed a $250,000 partially guaranteed two-year minimum salary contract. Butler should be signed shortly.
Beverley was initially selected No. 42nd overall by the Los Angeles Lakers in the 2009 NBA Draft. His draft rights were immediately traded to the Heat in exchange for a 2011 second-round pick and cash considerations.
If Beverley should fail to make the opening day roster, the Heat would lose his draft rights. Pat Riley will have wasted the $1,500,000 (and the 2011 second round pick) it took to acquire his draft rights, the $473,604 he is guaranteed for this season, the $788,872 he is guaranteed for next season, and the $788,872 in tax consequences his contract will almost certainly cause next season. That’s a total of $3,551,348. Wasted.
So why did the Heat sign him?
When a player is selected in the second round of the draft, he remains the exclusive property of the team that selected him until at least the September 6 immediately following the draft. At that point, the team needs to make a decision.
In order for the team to thereafter retain draft rights to the player, it must submit to him a “Required Tender” by September 6. The tender is an offer of a contract that affords the player until at least the immediately following October 15 to accept, has a term of one season, calls for at least the minimum salary applicable to the player, and can be fully unguaranteed.
If the team does not issue the tender by September 6, the drafting team would lose exclusive rights to the player on September 6 and the player would become an unrestricted free agent free to sign with any team.
The player can then choose whether or not to accept the tender.
Players often reject the tender.
This is a path taken by many second round draft picks who have been told that they have little chance of making the opening day rosters of the teams which selected them in the draft. They instead choose to play elsewhere, both to gain experience and to earn a living. These players know that if they instead accept their tenders, by the time they are ultimately released (after training camp, sometime in late October) most roster spots on teams around the world will have already been filled. They will have lost the opportunity to secure a roster spot somewhere, without having earned a dime in the interim. By forgoing the tender, they give themselves these several months (from July to October) to find alternate work. By rule, they once again become the exclusive negotiating property of the NBA team which selected them in the draft the following season (and this same process starts over again).
This is the path Beverley chose last year. After failing to make the Heat’s regular season roster last season, Beverley accepted a two-year, €420,000 contract (about $600,000 at the time of signing) with Greek powerhouse Olympiakos. In 41 games of Greek League and Euroleague play, Beverley contributed 3.9 points, 2.4 rebounds and 1.1 assists as a reserve, while shooting 55.7% from the field.
Players can also accept the tender.
Under this scenario, the player is under contract. It would likely be an unguaranteed one-year minimum salary contract. In Beverley’s case, if things played out this way, he would have been no different than Randolph and Hasbrouck, and perhaps Butler – competing for one of the Heat’s final roster spots on a make-good contract.
Beverley’s relationship with Olympiakos offers insight into to why the contract was offered.
The second season of his two-year, €420,000 contract was mutually terminated in June, despite his successful play. Olympiacos was in the midst of a reshaping. After a season largely considered a failure – despite the fact that they had won their first Greek Cup in eight years, and reached the Euroleague and Greek League Finals – head coach Panagiotis Giannakis had been fired and a major roster restructuring was about to ensue. Beverley didn’t want to stay without Giannakis, and the team was planning to move in a different direction. The two sides parted amicably.
Beverley wanted to try his luck in the NBA. It was a lifelong dream, and the driving force behind every decision he has made over the course of his wildly interesting, trying, tumultuous, vindicating and encouraging 21 years.
If Beverley’s mission was to exhaust all possible NBA alternatives before considering a return to Europe, accepting the tender would have been the way to go. He would then have been under contract with the Heat. If the Heat were to subsequently waive him, likely in late October, he would have become an unrestricted free agent free to try out for any NBA team. Accepting the tender would therefore have represented Beverley’s best chance of making an NBA roster, at the substantial risk of not finding work elsewhere (whether it be with another team in the NBA, in Europe, or elsewhere). He was clearly driven behind his singular pursuit.
If Beverley communicated this intention to Riley, it would certainly explain the contract offer, and quite neatly. The Heat would have been forced to offer Beverley a one-year tender anyway. Why not instead lock him up for two years?
But his August 2 signing date was still more than a month away from the Heat’s September 6 deadline.
So why did the Heat sign him so soon?
Apparently, after its overhaul was complete, Olympiakos wanted its former point guard back. And it was more than just a passing interest. According to Red Planet, a Greek media outlet, Dusan Ivkovic, the new head coach of Olympiakos, was reported as saying on July 23 that he very interested in having Beverley return.
Riley was in a position of leverage. He could have withheld the tender until the September 6 deadline, putting the Olympiakos offer at risk of being withdrawn and thus forcing Beverley’s hand to accept it or risk losing it altogether. He didn’t. It would appear that Riley did not want to lose him. One week later, Beverley was signed.
It was an interesting development, one that could have several potential roster implications.
It could mean that Hasbrouck no longer has a shot to make the Heat’s opening day roster.
Hasbrouck would now have to beat out not only the clear favorite for the spot, Da’Sean Butler, but also the man who has just received a multi-year guarantee, Beverley.
Hasbrouck, who finished last season on the Heat’s inactive list, outplayed Beverley last month with the Heat’s summer-league team in Las Vegas. Beverley, on the other hand, has shown flashes of brilliance as a disruptive defender, a trait the Heat desperately craves at the point guard position. He brings an incredible energy to the floor. And though he’s failed to show it thus far, he’s also a sneaky good three-point shooter.
Hasbrouck appeared in five games, all starts, during summer league play. He averaged 13.6 points, 2.4 rebounds and 2.4 assists, shooting 49.0% from the field and 45.0% from distance. Beverley appeared in four games, including three starts. He averaged 5.8 points, 4.8 rebounds, 2.3 steals, and 1.8 assists in 24.8 minutes, shooting 34.8% from the field and missing his only three-point attempt.
But if Beverley, Hasbrouck and Butler were all competing for the one remaining spot, and that spot has been set aside for Butler, there would still be no space for Beverley even if Hasbrouck were to be waived.
Why then offer Beverley a multi-year guarantee if he could have retained Beverley’s draft rights for nothing by forcing him back to Olympiakos? Could it be that Riley has in mind to open up a second roster spot? If not, he’s just throwing away a $3,551,348 investment.
It could mean that one of the Heat’s 14 veterans under guaranteed contract may not be safe.
So who could this at-risk player be?
We know it’s not Chalmers, Wade, James, Bosh, Anthony, Arroyo, House, Miller, Haslem, Ilguaskas or Jones. It’s probably not Pittman. Riley has an unusual affinity for Howard (despite the fact that he’s not going to contribute anything that he couldn’t otherwise provide as a coach and the fact that he caused Riley, according to Riley’s own words, the worst pain of his entire NBA life). That leaves only Magloire.
Could Beverley be competing for the roster spot that is currently being occupied by Jamaal Magloire?
None of this, however, explains the guarantee.
So why did the Heat fully guarantee Beverley’s multi-year contract?
Nothing apparent explains the multi-year guarantee.
Beverley was not like Hasbrouck or Randolph. He was not an unrestricted free agent. He did not have the option to instead sign with another team. He was the exclusive property of the Miami Heat as long as the Heat extended him a fully unguaranteed Required Tender by September 6. If he wanted to play in the NBA, he would have been forced to accept it. He would have had no other choice.
Beverley now becomes the only draft pick in the entire NBA to have tried out for his team, fail, and subsequently receive a multi-year guarantee the following season.
Perhaps a partial guarantee – perhaps the $250,000 the Heat gave to Randolph and Hasbrouck, an amount roughly equivalent to the second year salary in Greece that he had turned down – in exchange for a two-year deal would have been reasonable. His effort alone warrants that much. But certainly not a multi-year full guarantee which, if he is to be waived, not only increases team salary this year but next year as well, in what figures to be a more restrictive salary cap environment under a new collective bargaining agreement.
Despite the guaranteed contract, Beverley is no guarantee to make the opening day roster.
The battle between Beverley, Hasbrouck and Butler figures to be the most interesting, and most debated, storyline remaining this offseason. Hasbrouck brings with him the better offensive repertoire. Beverley brings with him the superior defensive ability and higher ceiling. Butler is the unknown coming off major injury.
One, perhaps two, will likely make the team. The other(s) will become an unrestricted free agent.
It should be fun.