What is Going on With the Nikola Mirotic Failed Deal?

Nikola Mirotic signed a two-year $25 million deal with the Chicago Bulls in the summer of 2017. The contract was structured so that he would have the power to veto any trade in the first year of the contract, unless his 2018-2019 team option was exercised. The CBA allows the Pelicans or Bulls until June 29, 2018 to exercise the option for the 2018-19 season. Mirotic wants the option exercised by the Bulls prior to the trade, or at least have a commitment from the Pelicans that it will be exercised, before he approves the trade. If the option is exercised, then Mirotic no longer has the option to veto the trade. According to league sources, the Pelicans do not want to commit $12.5 million to Mirotic on next season's payroll because of the luxury tax.

If the trade is accomplished, irrespective of whether Mirotic’s option is exercised, the Pelicans will acquire his bird rights, and he can resign with New Orleans under the full bird rights exception. Thus, it is not a matter of if the Pelicans can resign him, but a matter if the teams prefers to pay the tax. Mirotic fears that if he approves the trade without his 2018-19 option being exercised, then he will lose out on the $12.5 million for the next season and also lose his bird rights since he would have to sign with another team as a free agent. The bird rights are important because it allows a player to sign a more lucrative contract. He is fearful that he would essentially be a rental for the season, and that fear is founded because the Pelicans are likely viewing him as an expiring contract in lieu of shipping out Omer Asik’s contract. Furthermore, from a strategic perspective, the team is likely looking to resign Cousins, which would mean the front line would be Cousins and Davis, making Mirotic the odd man out, and an expensive contract to come off the bench.