Explaining how LeBron’s new max contract limits the Lakers’ trade options

Well, that was the end of the pay cut that LeBron James accepted.

James agreed to a two-year, $104 million maximum contract with the Lakers on Wednesday, according to multiple reports. The deal includes a player option for 2025-26 and a no-trade clause, meaning James has complete control over his future from now on.

If James accepts his maximum salary of nearly $50 million, the Lakers would be slightly above the $188.9 million they command in the second division. His agent, Rich Paul of Klutch Sports, “is planning to discuss with Lakers general manager Rob Pelinka the possibility of accepting $1 million or more below the maximum” to keep the Lakers below the second division, according to ESPN’s Adrian Wojnarowski.

Either way, the Lakers’ proximity to the second apron will greatly limit how they can fill out their roster around James and Anthony Davis.

Teams above the first or second platform can’t acquire players via sign-and-trade, can’t recoup more salary in a trade than they send, and don’t have access to the non-taxpayer mid-level exception. The Lakers would have to shed nearly $25 million in salary without recouping any money to get far enough below the first platform to use the $12.8 million non-taxpayer mid-level exception. (In other words: DeMar DeRozan probably isn’t coming home.)

Teams higher than the second division are subject to all of those restrictions and more. They can’t add salaries in trades, they can’t send cash in trades and they can’t even receive players in return when they sign and trade their own free agents elsewhere. They also can’t use preexisting trade exceptions and they can’t trade first-round picks seven years from now.

All of these restrictions apply after the transaction, so the Lakers could add contracts in a trade as long as they don’t take in more salary than they send out and finalize the deal below the second line. Between D’Angelo Russell ($18.7 million), Rui Hachimura ($17 million), Gabe Vincent ($11 million) and Jarred Vanderbilt ($10.7 million), they have plenty of contracts that could combine to take on a larger salary and still remain below the second line after the fact.

Recently, Portland Trail Blazers forward Jerami Grant emerged as one such possibility. He’ll make $29.8 million this year, so the Lakers would have to either sell Russell and Hachimura together or one of the two to Vincent/Vanderbilt on a smaller contract (Christian Wood, Jaxson Hayes and Cam Reddish would work). However, they’d have to stay far enough below the second line after the trade to be able to add a minimum contract or two down the road.

If they traded Russell, Vincent and Wood ($32.7 million total) for Grant, they would be about $2.4 million short of the second line after the deal if James takes his full max salary. That would leave them enough room to add a minimum-salary contract ($2.1 million), but they couldn’t fit two. The math gets even more complicated if they traded Russell for Hachimura, Vincent for Vanderbilt, or Wood for Hayes or Reddish.

It would be easier for the Lakers to add Cam Johnson, who is making just $23.6 million this season. If they traded Russell and Vanderbilt for him, they would have nearly $5.3 million on the second line and only one roster spot to fill. They would have just enough wiggle room to use the taxpayer-funded MLE ($5.2 million) and remain on the second line, though they would have limited flexibility from there.

Lakers general manager Rob Pelinka has… He repeatedly lamented How the NBA’s new collective bargaining agreement ties teams’ hands in terms of trades. While willing to include draft picks in “the right deal,” other teams “are aware” of the restrictions the Lakers face and are “eager to take advantage of the Lakers if they come asking for a deal,” according to Bleacher Report’s Eric Pincus.

No one should fault James for taking his full maximum salary (or near-maximum, if he takes a small pay cut to keep the Lakers below the second line). The Lakers put themselves in this position by signing so many deals last summer with second-year player options, which Russell, Wood, Hayes and Reddish all picked up this offseason.

However, they now find themselves tied hand and foot due to the new CBA’s trade rules. That will make it much more difficult for Pelinka to find a legal, cap-friendly trade that would improve his championship prospects in the short term.

Unless otherwise stated, all statistics through NBA.com, PBP Statistics, Glass cleaning either Basketball reference. All salary information via Spotrac and information on the salary cap through Real GM.

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