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Thread: A Realistic Look at JO's chances of Opting out.

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    Pacer Junky Will Galen's Avatar
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    Default A Realistic Look at JO's chances of Opting out.

    The Bones
    Jermaine O’Neal signed a seven-year, $123 million contract, the maximum allowed, on July 16, 2003. According to ESPN, and Storyteller's site, JO will make $19,728,000 this year. After this season he has an (ETO) Early Termination Option, which gives him the right to terminate his contract early. JO was born on Oct 13, 1978, so right now he is 28 years old and in his prime. He will turn 29 years old right before the regular season starts this year.


    Currently
    (2007) $19,728,000..... age 29, this coming season.
    (2008) $21,352,500......age 30
    (2009) $22,995,000......age 31

    If JO opted out he would be opting out of $44,347,500.00 million dollars.


    Extension?
    JO could sign an extension for up to 4 years with raises of 10.5% each year. (NBA raises are not compounded) The only way I see that happening is if he leads a team to the NBA championship this year. That won't happen, even the Lakers couldn't afford to extend both Kobe and JO. Just for example JO would be making.
    (2010) $25,409,475.....age 32
    (2011) $27,823,950.....age 33
    (2012) $30,238,425.....age 34
    (2013) $32,652,900.....age 35
    Total $116,124,750

    After actually putting the figures down, I would have to say that would be a JO fantasy, because it's not happening!

    Well on second thought, it being LaLa land I guess if he was traded to the Lakers and they won three straight championships with him as a major piece it would be possible. Kobe makes a hair less than JO so the Lakers would be paying two players about $65 million at the end of JO's extension.


    ETO Invoked
    Okay now lets see what a more relistic outcome tells us. If he invokes his ETO, he would have three options.

    One) He could then resign with the Pacers for six years with 10.5% raises each year.
    Two) He could be part of a sign and trade to another team, and still get the above.
    Three) Or he could opt out and just sign with another team. His maxamum would be 5 years with raises of 8%.


    The Math
    If JO is still with the Pacers next year and opts out, or hes traded and opts out, his likely expectations are about that of Vince Carter's. Carter just opted out and resigned with New Jersey for a rumored "$66 million guaranteed -- which includes four years plus a partial guarantee for a fifth year -- and could make as much as $80 million." Carter is 30 years old. That means Carter will start his new contract at around $13 million. So starting JO at $13m, and giving him 10.5% raises for six years his contract would look like this.
    (2008) $13,000,000.....age 30
    (2009) $14,365,000.....age 31
    (2010) $15,973,325.....age 32
    (2011) $17,540,024.....age 33
    (2012) $19,381,726.....age 34
    (2013) $21,416,807.....age 35
    Total $101,676,882

    If he started at $14 million you would add $1,547,000 million for each of 5 years. That would be $7,735,000 million more, or $109,411.882 million total.




    Now if he opts out and just signs with another team his maximum would be 5 years with raises of 8%.
    (2008) $13,000,000.....age 30
    (2009) $14,040,000.....age 31
    (2010) $15,163,200.....age 32
    (2011) $16,376,256.....age 33
    (2012) $17,686,356.....age 34
    Total $76,265,812

    For the purpose of comparing six year periods.
    (2013) $19,543.423.....age 35
    That would be his pay in the first year if he signed a contract extension. An extension is doubtful at age 35 though. If he did sign an extension the total would be $94,809,235 over six years when including the first year of his extension.

    The reality is he would probably sign a new contract and get the minimum of about $6 million, which would be a total of $82,265,812 over six years.



    Status Quo
    Now lets look at the figures if JO doesn't opt out. He would be starting his 32nd year so lets say he signs a new contract starting at $10 million a year.

    (2008) $21,352,500.....age 30
    (2009) $22,995,000.....age 31
    (2010) $10,000,000.....age 32 Conjuncture. If he would start at $13m, this obviously would be the way to go.
    (2011) $11,050,000.....age 33
    (2012) $12,210,250.....age 34
    (2013) $13,492,326.....age 35
    Total $91,100,076


    Wrap
    Over a six year period the figures are thus;

    $116,124,750....If he signs an extension. Obviously JO would think he would have a better chance of signing an extension with a team like the Laker's.

    $101,676,882 to $109,411.882.....if he opts out and either resigns with the Pacers or does a sign and trade at either $13 or $14 million. If he thinks he can resign for more than $14 million he will obviously opt out.

    $76,265,812 to $82,265,812.....if he just signs with another team and leaves the Pacers with nothing.

    $91,100,076.....if he doesn't opt out.

    Basically it comes down to what you think JO is going to be worth at certain periods in his life. If this coming year is a year like the past couple he probably won't opt out. If he has a MVP type year he no doubt will.

    My conclusion is I see no way JO just walks and leaves the Pacers with nothing. That could cost him $40 million dollars.
    Last edited by Will Galen; 08-06-2007 at 09:55 PM.

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    Member indyman37's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Will Galen View Post
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    My conclusion is I see no way JO just walks and leaves the Pacers with nothing. That could cost him $25 million dollars.
    I remember like right after the season, someone asked JO if he would even consider opting out. He insisted that he wouldn't opt out and leave the Pacers with nothing. Something about how he wants the best situation for both teams and that he felt he owed it to the organization and it's fans. Sorry, I'm too lazy to look for the link.

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    Feed the big fella. Infinite MAN_force's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Just based on statements he has made in the past I doubt he opts out and screws us over. He seems to appreciate this franchise and what we have done for him, and he seems like a class guy.

    Although I do think he is far more concerned about championship contention than money... I mean if I had like 80 million dollars in the bank I cant imagine, well any amount of money really mattering at all.

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    Administrator/ The Real Jay ChicagoJ's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Vince Carter isn't a post player, and we know post players command salary premiums over wing players and guards.

    I know what you're trying to do, but if that is the best comparison you need to add a "post player premium."
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Considering Darko just got 9 and has done little, if JO opts out I seriously doubt he's taking a paycut at all.

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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by 2Cleva View Post
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    Considering Darko just got 9 and has done little, if JO opts out I seriously doubt he's taking a paycut at all.
    Bingo! We have a winner.

    He also won't take much of a paycut if he plays out his contract. He just may get fewer seasons on the new contract. But knowing the NBA, he'll get another max contract from somebody.

    Look at Peja. Somebody will pay the $$$.
    Why do the things that we treasure most, slip away in time
    Till to the music we grow deaf, to God's beauty blind
    Why do the things that connect us slowly pull us apart?
    Till we fall away in our own darkness, a stranger to our own hearts
    And life itself, rushing over me
    Life itself, the wind in black elms,
    Life itself in your heart and in your eyes, I can't make it without you


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    Pacer Junky Will Galen's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Jay View Post
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    Vince Carter isn't a post player, and we know post players command salary premiums over wing players and guards.

    I know what you're trying to do, but if that is the best comparison you need to add a "post player premium."
    I did say, "Basically it comes down to what you think JO is going to be worth at certain periods in his life." That was my guess.

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    It Might Be a Soft J JayRedd's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by 2Cleva View Post
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    Considering Darko just got 9 and has done little, if JO opts out I seriously doubt he's taking a paycut at all.
    I believe Darko is getting $7 million per. It's 3 years for $21 million, no?

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    100 Miles from the B count55's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Oh, without a doubt, JO's taking a pay cut if he opts out. Best case scenario, he's looking at VC/Ben Wallace type money...in the $15 to $16 million dollar a year range.

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    Jimmy did what Jimmy did Bball's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    But it doesn't matter if he opts out or if he doesn't... both are not good for the Pacers and our long term future.

    -Bball
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Bball View Post
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    But it doesn't matter if he opts out or if he doesn't... both are not good for the Pacers and our long term future.

    -Bball
    Not really cutting 20 million in salary can only result in good things, considering how bad the team is, and how we would have to overpay a guy to come here. Something we haven't been able to do because of having JOs contract

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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Bball View Post
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    But it doesn't matter if he opts out or if he doesn't... both are not good for the Pacers and our long term future.

    -Bball
    Bingo!

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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Pacersin2033 View Post
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    Not really cutting 20 million in salary can only result in good things, considering how bad the team is, and how we would have to overpay a guy to come here. Something we haven't been able to do because of having JOs contract
    We can and do go over the cap to sign our own FA's. So depending on the Lux Tax scenario and what existing players we'd need to sign either immediately or in the immediate future, it wouldn't suddenlt be 20 million we'd have available to us to sign an outside FA if JO left.

    I'm sure a capinator can predict fairly accurately what we'd be able to pay an outside FA if JO opted out and I'm fairly comfortable in saying it wouldn't be JO's 20mil.

    -Bball
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    Pacer Junky Will Galen's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Bball View Post
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    We can and do go over the cap to sign our own FA's. So depending on the Lux Tax scenario and what existing players we'd need to sign either immediately or in the immediate future, it wouldn't suddenlt be 20 million we'd have available to us to sign an outside FA if JO left.

    I'm sure a capinator can predict fairly accurately what we'd be able to pay an outside FA if JO opted out and I'm fairly comfortable in saying it wouldn't be JO's 20mil.

    -Bball
    Jermaine O'Neal........$19,728,000
    Troy Murphy.............$9,206,349
    Mike Dunleavy..........$8,219,008
    Marquis Daniels.........$6,373,900
    Jamaal Tinsley............$6,300,000
    Jeff Foster.................$5,500,000
    Ike Diogu..................$2,286,360
    Danny Granger..........$1,516,800
    Shawne Williams........$1,470,360
    David Harrison...........$1,734,316
    Kareem Rush.............$770,610 (a)
    Stephen Graham.........$770,610
    Guaranteed................$100,000 (b)
    ----------------------------
    Total................$63,976,313..........($3,888, 687) under the lux tax as of this date.

    Removing JO's salary puts us at $44,248,013.

    The NBA salary cap for 2006-07 is $55,630,000.
    The luxury tax threshold is $67,865,000

    We would be $11,381,987 under the cap.

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    Default Re: A Realistic Look at JO's chances of Opting out.

    Thanks for crunching the numbers Will.

    The Ben Wallace and Vince Carter comparisons are completely flawed. Both were older at the time of the deal. Ben Wallace only impacts one side of the floor and Vince Carter is a perimeter player.

    The original figures are also a misrepresentation, specifically the projections for 2013-2014. So he won't get 20mil in free agency that year but a team will willingly pay it just because he happens to be in his sixth year? Best case scenario, he gets a team option for that year in which case it's unlikely the team exercises it. Nobody wants to guarantee, 20+ mil to a 35 year-old, especially one with a significant history of injuries. So a better representation would be (over the next 5 years):

    1) Opt-out and stay or S&T: 80mil
    2) Opt-out and sign with another team: 76mil
    3) Don't opt-out: 78mil

    Don't forget option #3 comes with the risk of any major injury before 2010 having a significant impact on his value.

    The posts about JO not wanting to screw over Indy are valid but only to a certain extent. If a team under the cap simply refuses to send out any players and JO is set on going there, there's simply nothing you can do about it. Teams aren't interested in helping other teams when they don't need to. Exhibit A: Chicago stealing Wallace from the Bulls
    Last edited by gng930; 07-18-2007 at 03:51 PM.

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    Default Re: A Realistic Look at JO's chances of Opting out.

    Thank you very much Galen.

    See if JO opted out and we end up trading away our first rounder for a headband(a possible move judging by actions as of late), and Rush, Graham, and Harrison are not resigned we would have 13+ million to offer to a player

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    Member naptownmenace's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Will Galen View Post
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    The NBA salary cap for 2006-07 is $55,630,000.
    The luxury tax threshold is $67,865,000

    We would be $11,381,987 under the cap.
    We would be a little further under the cap because the cap usually increases each year, based on league revenue of the previous season.

    But I think the chance of JO opting out of his deal has to be less than 5%. He'd be an idiot to opt out... and I definitely don't think he's an idiot.

    The only chance the Pacers have of getting back under the cap is if they can trade for somone with an expiring high-dollar contract. A player like Antwan Jamison ($16,360,095) and a future draft pick and/or cash would be a good deal for the Pacers to pursue if they want some cap-space after next season.
    Quote Originally Posted by vnzla81
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    Larry is not coming back, he didn't have a meeting with Orlando for not reason, yeah he is coming back to the NBA but not to the Pacers, the notion that he is a taking a year off and then come back is absurd.
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    Jimmy did what Jimmy did Bball's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by naptownmenace View Post
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    We would be a little further under the cap because the cap usually increases each year, based on league revenue of the previous season.

    .
    But also the amount we pay other players goes up due to their own yearly increases. Plus, we'd either be signing one (or more) of our own or leaving room to do it the following season.

    So we're back to what I said in the first place. Dropping JO's 20 mil salary isn't going to leave us 20 mil in cap space.

    To tell you the truth, as long as Walsh is in the FO it would mean the Simons save 20 million because we wouldn't be spending any of that on a FA. We'd spend the MLE (probably) and that would be the end of the story. Then it would be reading the local press about our wonderful draft pick and the up and coming young guys.

    The Pacers do not choose to be players in the star player FA market.

    -Bball
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    Pacer Junky Will Galen's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Bball View Post
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    The Pacers do not choose to be players in the star player FA market.

    -Bball

    What any of us think is happening in the front office isn't necessarily true.

    In your case I think you went on tilt a long time ago and it's effecting your view of management. You now just see what you want to see.

    You say the Pacers do not choose to be players in the star player FA market? However, Walsh and one of the Simon brothers flew to Florida to negotiate for Tracy McGrady?

    All you posters out there that want new management, what makes you think someone new would be better? It sure appears to me that getting lucky with ping pong balls has more to do with contending consistently in the NBA than anything else. Get a Shaq or Duncan and you are all set for ten years, and even then you have your ups and downs.

    We have good management! We were contenders in the late 90's and reached the finals in 2000. We started a rebuild and 4 years later we were contenders again and won 61 games. We are now rebuilding again and in a short time will be contenders again.

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    Jimmy did what Jimmy did Bball's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Will Galen View Post
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    What any of us think is happening in the front office isn't necessarily true.

    In your case I think you went on tilt a long time ago and it's effecting your view of management. You now just see what you want to see.

    You say the Pacers do not choose to be players in the star player FA market? However, Walsh and one of the Simon brothers flew to Florida to negotiate for Tracy McGrady?
    That would've been a sign and trade.


    All you posters out there that want new management, what makes you think someone new would be better?

    Because we can't let the fear of it being worse stop us from trying to improve what we have now (which is not very good and hasn't been for quite some time).

    It sure appears to me that getting lucky with ping pong balls has more to do with contending consistently in the NBA than anything else. Get a Shaq or Duncan and you are all set for ten years, and even then you have your ups and downs.
    You won't be getting lucky with the ping pong balls if management puts the entire focus on just making the playoffs. You'll always be middle of the pack...

    Although, the boat has so much so sailed on Walsh that we might not be able to stay middle of the pack under him so maybe we'll be getting those ping pong balls afterall. But I have no faith he'd make the right pick. He's way past his window of effectiveness.

    We have good management! We were contenders in the late 90's and reached the finals in 2000. We started a rebuild and 4 years later we were contenders again and won 61 games. We are now rebuilding again and in a short time will be contenders again.
    We started a rebuild in '99 because he so misjudged the team that they made the finals in spite of him, not because of him.

    But back to the topic at hand, keeping JO at this point is the worst option of all for us as long as we're getting something tangible in return. The truth is, people aren't knocking down our doors to get him so our bargaining power isn't that high. Of the teams that would be interested, we just need to negotiate their best deal and pull the trigger. But we can't assume JO is far and away their best target and only option.

    JO opting out or not opting out are both net losers for the Pacers.



    -Bball
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    -John Wooden

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    It Might Be a Soft J JayRedd's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Quote Originally Posted by Will Galen View Post
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    We would be $11,381,987 under the cap.
    Quote Originally Posted by naptownmenace View Post
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    We would be a little further under the cap because the cap usually increases each year, based on league revenue of the previous season.
    It would likely be say $2 million more, putting us around $13.5 million under the cap if JO opts out next summer. But we'll also likely be offering extensions to both Danny and Ike simultaneously with being FA market players.

    I believe Danny and Ike would still be only receiving the final-year dollar value on their rookie deal in the coming 08-09 season ($2.9 million for Ike, $2.3 million for Danny) so we would technically still have all of that $13.5 million to play with, but with both of those guys probably commanding around $7 million per year starting in 09-10, we'd be beginning to flirt with luxury tax land in the years to come if we went out and spent much over $10 million on a free agent.

    Of course, other things can change and we could shave other contracts away by then....but that should be factored into the current outlook somewhat.
    Last edited by JayRedd; 07-19-2007 at 10:42 AM.

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    Default Re: A Realistic Look at JO's chances of Opting out.

    JO won't opt out for the exact same reason that we haven't been able to trade him: there are serious concerns about his health right now and that will result in a sizable cut in his salary. I think that he'll miss a similar number of games next year, which will only further put these concerns to light.

    If I was a GM there is no way I'd pay JO VC type money. VC had injury concerns earlier in his career but he's been healthy for a decent time now. With the beating JO takes, I wonder if his knee will ever be all that good.

    I almost understand the overspending on Darko because there is a chance you could catch him in reaching a prime and he becomes a great player. With JO, you're going to most likely get 18 and 10 or so for 60 games, for about two years, with ALL of those numbers decreasing in the future. For Darko, you get a healthy player who can give you possibly 16 and 8 for 5-6 years in 70+ games.

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    Pacer Junky Will Galen's Avatar
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    Default Re: A Realistic Look at JO's chances of Opting out.

    Bump

    With all the new talk about JO opting out I thought this thread should be bumped.
    Last edited by Will Galen; 08-06-2007 at 11:01 PM.

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    Default Re: A Realistic Look at JO's chances of Opting out.

    JO isnt opting out. If he was, he wouldn't be so keen on getting traded THIS summer.

    2013 Pacers Digest NBA 2K13 Champion (Xbox 360)

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    Default Re: A Realistic Look at JO's chances of Opting out.

    I'll also betcha JO has dreams of making some extra endorsement and promotions dough in a major market, something he's not getting much of in is his current situation.

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