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Old 07-02-2012, 12:33 PM   #62 (permalink)
sticking to his guns... is stuck to his guns...

Join Date: Jul 2010
Location: Cambridge, ON
Posts: 5,303

Originally Posted by Bankiz View Post
thanks that one point what more claer than before.

another question so :
what is really a cap holds, and how it really works for the capspace or the capacity to acquire a fa in the free agent market ?
Cap holds exist because of the existence of Bird Rights. Bird Rights allow a team to go over the cap to sign their own free agents. However, what if a team, such as the Raptors, tried to sign another team's free agent with their cap space and then re-sign their own free agents? This is not what Bird Rights are supposed to be for - they are for keeping your team together, not adding to it.

So a rule was put in place that if you have a free agent that you own the rights to, they take up room in your cap to prevent you from using that cap space to sign other free agents. This is called a cap hold - as you are effectively "holding" cap space for that free agent.

To use an example, let's look at the current Nash/Bayless conundrum. The Raptors have a free agent they want to re-sign, Bayless. They also have about 10 million in cap space to sign Steve Nash. If they were to sign Nash with that 10 million, they could theoretically then sign Bayless as well - going over the cap - since they have his Bird Rights.

However, the cap hold rule stops this. Bayless is expected to sign a contract no larger than 2.5X his previous contract (this is a generic amount from the CBA). As such, a cap hold for that amount is sitting on the Raps' payroll. If they want the cap hold to go away, they either have to sign Bayless (at which point his salary counts against the books instead of the cap hold) or renounce their rights to him. If they renounce the rights, they can no longer go over the cap to sign Bayless - so the potential abuse of the Bird Rights clause is no longer a problem.

So, to summarize, cap holds are basically a way to ensure that teams do not abuse the Bird Rights to their free agents.
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