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5 rules for extending NBA players like DeMar DeRozan, Stephen Curry and Taj Gibson

The deadline for early extensions for former first-round picks entering their fourth seasons has passed. A bunch of players, including DeMar DeRozan and Stephen Curry, picked up new deals. These are the rules GMs should abide by when considering these deals.

Dave Sandford

Clearly, we need a rulebook for general managers facing decisions on early extension for players in the final year of their rookie deals. Clearly, we need to acquire a time machine, set it for yesterday and deliver a copy of said rulebook to Toronto.

Seven players ended up with extensions. Blake Griffin (back in July) and James Harden scared up max extensions worth $78 million or so over five years. Stephen Curry signed for four years, $44 million. DeMar DeRozan signed for something around $38-42 million over four. Jrue Holiday signed for $41 million over four. Taj Gibson signed for $38 million over four. Ty Lawson landed a four-year, $48 million deal.

Some of these players (Griffin, Harden apparently, Curry) are likely worth it. Some (DeRozan, DeRozan, DeRozan) are dicey. But all could find a place in our rulebook.

1. Give your superstars the max ASAP for as long a term as possible.

This is known as the Kevin Love rule. The draft is the NBA's great equalizer. Crummy, non-glamour teams can land superstars via strokes of luck and good scouting. Minnesota landed Love in 2008 through a bit of luck (two lesser player going ahead of him) and good scouting. But GM David Kahn (who wasn't around when Love was drafted) didn't want to give the power forward a full five-year max a year ago. There's noise around the rationale: some report he's reserving it for Ricky Rubio (his own genius draft pick), others say he wanted flexibility. Regardless, Love signed a four-year extension when eligible for and interested in five, and Love got an early termination option after Year 3 in the process.

Rookie deals are usually the best contracts in the league. Second contracts for superstars are next in line. By not locking up his superstar for as long as possible, Kahn shrunk the value of that second contract. BAD MOVE. No cases apply in 2012; Oklahoma City couldn't have offered Harden a fifth year, having given that one bullet to Russell Westbrook. The Clippers did the right thing by quickly offering Griffin a five-year max.

2. Don't give out contracts based on good personality and physical talent alone. You need production.

I'm trying to figure out how the Raptors -- led by two-time Executive of the Year Bryan Colangelo -- convinced themselves that DeMar DeRozan will play up to a $10 million annual salary over the next four seasons. It's all about potential. DeRozan's just 23, so you'd expect him to get better over time. But seriously, how can you have watched DeRozan last season, analyzed his statistics and come to the conclusion that reasonable realization of his potential will add up to a value of $10 million at age 24, 25, 26 and 27? No reading of the data we have suggests it plausible. The data might not even suggest it possible.

The problem might be that Toronto's braintrust knows DeRozan is an exceedingly good guy, a fine teammate and a hard worker. They are too close to the situation. That sort of intimate knowledge of personality helps when you have a lazy boil you're considering paying (Andray Blatche, anyone?). But I think it hurts you when you use it to convince yourself that a player like DeRozan will become a star -- $10 million is star money -- because he wants it and deserves it.

Until he gets a long-range jumper or some real defensive chops, he's not going to be worth it. No amount of sunshine, high fives and smiles can change that.

3. Don't bid against yourself.

GMs need to honestly ask themselves what other team could conceivably pay this absurd amounts to their players in restricted free agency. First, you need cap space to bid on a restricted free agent. Then, you need a need. How many teams with needs at shooting guard will have cap space in 2013? Maybe three or four? Would any of them spend $40 million on DeMar DeRozan, barring massive improvement this season? Here's a clue: O.J. Mayo, who is almost assuredly better than DeRozan right now and only a year older, signed a two-year, $8.2 million deal in the offseason ... as an unrestricted free agent. There was no reason to believe that, unless he improved enough to deserve it, DeRozan would be getting an Eric Gordon offer in restricted free agency. It just doesn't happen for players of that production level.

4. Don't be afraid of restricted free agency.

This is a companion rule to No. 3. Remember: the worst that can happen in restricted free agency is that you have to overpay. By overpaying in advance, you avoid that worst-case scenario by ... invoking the worst-case scenario! It's mind-boggling. Some players get overpaid in restricted free agency. The Raptors know all about that, having overpaid for restricted free agent Landry Fields in the offseason. But you don't have to match if you don't want. If you feel you need to keep the player, then you match. It's pretty straight-forward. There's some weird idea out there that restricted free agency should be avoided. This applies only in very specific cases: when the max is obvious, numbers improvement is guaranteed or there's a virtual guarantee someone will offer a max and you can get it done for cheaper. In other cases, let the idea of restricted free agency wash over you. It's not so bad, really.

5. Look at what other teams are doing.

Markets work funny in pro sports, but you can get a good gauge on relative value any given contract period by taking a gander at what other teams are doing. The Nuggets were first up (after Griffin's deal months ago), and they got Lawson for an average of $12 million. That should signal to the Sixers that they should be paying no more than about $8-9 million a year for Holiday. (They'll be spending more than $10 million.) Earlier on Wednesday, the Warriors reached a $44 million agreement with Curry. That should tell the Raptors and Sixers they are offering too much for their guards. Comparing bigs to smalls is tough, but to see Gibson get a smaller deal than Holiday or DeRozan was a little shocking. Perhaps that informed the Bulls' thinking: if teams are dropping $10 million a year on players like that, we should lock up Taj ASAP.

These contracts don't exist in vacuums. They should be informed by what else is going on in the league. The Raptors knew low-production, higher potential guards like Brandon Jennings and Tyreke Evans weren't getting deals. They knew Lawson and Curry were getting deals in the $11-12 million range. They didn't need to pull this trigger at $10 million. It was wholly out of whack with the rest of the market.


The Hook is a daily NBA column by Tom Ziller. See the archives.