The catch: Only Hart’s $12 million salary this season is guaranteed.
Will Guillory of The Athletic:
Structure of Josh Hart’s three-year, $38 million deal to return to New Orleans, sources tell @TheAthleticNBA:
Year 1: $12M guaranteed
Year 2: $12.96M non-guaranteed (June 25 date)
Year 3: $12.96M player option, non guaranteed (June 25 date)
— Will Guillory (@WillGuillory) August 19, 2021
The Pelicans are effectively paying Hart – who held a $5,236,739 qualifying offer – more this season in order to gain more team control.
Because he’s not on a one-year contract, New Orleans can trade him without his consent. The Pelicans also aren’t on the hook for any money beyond this season.
The third year is a clever way to create a de facto mutual option, which isn’t directly allowed. If Hart plays well enough to have his second-year salary guaranteed, he can choose to hit unrestricted free agency in 2023 rather than wait until 2024. But the Pelicans aren’t obligated to pay him in that third year, either.