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Phoenix Suns negotiations with Eric Bledsoe should still be tempered with patience, laced with incentives

The Phoenix Suns have until Halloween, October 31, to agree to a contract extension with young combo/point guard Eric Bledsoe or Bledsoe will become a restricted free agent in July. Even so, that still leaves the Suns in control of Bledsoe's future.

Mark J. Rebilas-USA TODAY Sports

The Class of 2010 - NBA players taken in the first round of the 2010 NBA Draft - can be extended beyond the 2013-14 season if they sign that extension before November. That leaves only a week for negotiations to solidify into a deal.

Newly acquired Eric Bledsoe is one such player up for extension, despite never being a regular starter in the league. No details have surfaced but conventional wisdom says that Bledsoe's agent, Rich Paul, would expect an eight-figure annual salary (10+ million per year) for his client because that's the size of deal signed a year ago by guards Stephen Curry and Ty Lawson.

Steph Curry and Ty Lawson, though, had already been starters in the NBA and proven their big-minute production. Bledsoe has not, though he's shown glimpses this preseason that his production can translate. On the down side, Bledsoe turnover rate remains high on big minutes, while his spotty jumper has not improved.

Therein lies the dilemma:

  • If Bledsoe does produce 15 points, 5 assists, 5 rebounds, 2 steals and stifling defense, he deserves $10+ million per year.
  • If he can up that scoring average into the high teens while dropping his turnover rate, he'd be worth even more.
  • If he comes up short on those 15-5-5 numbers due to defenders sagging off his jumper, reducing his driving and passing lanes, then Bledsoe shouldn't get more than $7-9 million per year.

You can guess that Rich Paul, Bledsoe's agent, wants the "more" category while the Phoenix Suns would prefer to hedge their bets and get him to sign in the "less" category. He really hasn't proven himself yet, so the chasm is understandably there.

McDonough toed the line well on KTAR the other day.

"With Eric, there's more projection. Some would say there's more risk, but I'd also counter that there's more upside," McDonough said on "Burns and Gambo". "He does some unique things athletically. I think he's the best shot-blocking guard in the league. If he plays extended minutes, which he will for us, I think he might lead the league in steals. He has a unique potential."

Again, that's all projection. In the end, Bledsoe is likely to be overpaid for his work.

A perfect solution just might be an incentive-laced contract. Under the CBA, there are two kinds of incentives: those that are "likely" and those that are "unlikely".

The determination of whether an incentive is likely or unlikely is based on whether the criterion was achieved in the previous season. For example, if a player had seven assists per game the previous season, then an incentive based on seven assists per game would be classified as likely to be achieved, but one based on eight assists per game would be classified as not likely.

This is a gold mine for Eric Bledsoe and the Phoenix Suns. With Bledsoe never having played starter minutes, any incentives based on per-game averages would be deemed "unlikely" least in 2013-14. Every year, the likely/unlikely incentives are re-evaluated for the next season.

There is a cap though.

Unlikely bonuses in any season are limited to 15% of the player's regular salary in that season. In the first season of a contract the base salary, likely bonuses and unlikely bonuses must all fit within the salary cap or exception.

That's two minor gotchas in one sub-quote from Coon's FAQ on the CBA.

Unlikely bonuses are limited to 15% of a player's base salary. Let's assume the Suns signed Bledsoe to a base salary of $8 million per year. A 15% bonus would then be $1.2 million, making his 2014-15 salary $9.2 million. There's no reason for Bledsoe to accept a $9.2/yr contract right now. Better to wait for RFA offers next summer, in a summer with very few point guards on the market.

But, that 15% kicker bridges the gap between $10 million/year and $11.5 million/year, stretching a potential extension from $40 million over four year to a potential $46 million over that same period if all incentives are met. The former number can more easily be swallowed by the Suns, while the latter is more palatable for Bledsoe and his agent.

This is where the negotiations might just lead, and are likely the only way a deal can get done. The Suns could offer up to 15% in incentives if Bledsoe just does what he's supposed to do - actually hits 15-5-5, or if he is top-5 in steals, or something along those lines.

Still, the agent would like it all guaranteed in case of injury or other factors out of Bledsoe's control, like playing time and scheme. That's why you don't see a lot of stats-based incentives.

All bonuses, likely or unlikely, must fit under the cap in year 1. So, even though a goal of 6.5 assists/game might be considered unlikely, that 15% kicker still counts against next summer's cap room.

"If we're not able to work out a deal (by Oct. 31), we would start next summer with Eric as a restricted free agent, but obviously we're hoping to get something done before that," the general manager, Ryan McDonough, said on the "Burns and Gambo" radio show the other day.

An incentive-laden deal that varies Bledsoe's future earnings up to 15% based on production would be the best deal for the Suns this fall.

If they wait until next summer to match another team's offer, that offer is much more likely to be full guaranteed.

Still, the Phoenix Suns still hold all the cards even if Bledsoe plays out the year, and his contract, without signing anything. He will be a restricted free agent, and those guys just don't leave their teams without the team initiating it through a sign-and-trade deal. Two summers ago, Nicolas Batum and Roy Hibbert became RFAs, along with Eric Gordon, and all got matched by their team despite the offers being high. This summer, Tyreke Evans was a goner but Sacramento still got Greivis Vasquez for him because they held Evans' rights.

The Suns will be fine either way. No need to overpay Bledsoe.

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