What needs to happen for Celtics to pull off Gordon Hayward sign-and-trade

Gordon Hayward is joining the Charlotte Hornets. How he gets there from a transactional standpoint still remains a question mark two days after the decision was made.

Initially, Rick Bonnell of the Charlotte Observer reported that the Hornets were preparing to stretch Nicolas Batum’s $27 million contract in order to open up the necessary additional salary cap room (about $9 million) in order to give Hayward his four-year, $120 million deal. Charlotte taking this stance with the Batum contract likely served two purposes in the hours of the Hayward signing.

1. It allowed them to commit to Hayward’s camp with no other necessary contingencies about moving other players on the roster to open up the money.
2. It allowed them to be a pretty good place from a leverage standpoint when the Boston Celtics approached them about a sign-and-trade deal for Gordon Hayward.

Two days later, that’s where we are right now in some form. League sources tell Bostonsportsjournal.com that the two sides continue to negotiate about a potential sign-and-trade deal as of Monday morning. Let's take a look at where both sides stand in the discussions and where things go from here

Why the Celtics will be pushing hard for a sign-and-trade

Losing Hayward is a big loss for the Celtics. Losing Hayward without any way of replacing him and his $34.1 million salary for the 2020-21 season would be an even bigger blow so that’s what Ainge is trying to avoid by getting a sign-and-trade done here. If the Celtics convince the Hornets (and Hayward) to allow them to sign-and-trade Hayward to Charlotte for no returning salary, they will get a trade exception worth roughly $28 million (equivalent to the first year of Hayward’s new deal). That trade exception would last for a full calendar year if it’s created, giving the Celtics the flexibility to take back salary up to $28 million in the form of one or multiple players in upcoming trades without having to send out matching salary.

This is very important for the Celtics’ team building right now since they have little movable salary on the roster. Their core (Tatum, Brown, Walker) isn’t going anywhere and everyone else on the roster makes $5 million or less on rookie or cheap deals except for Marcus Smart and new signing Tristan Thompson. Without a big trade exception in place for the Hayward departure, adding any future notable trade targets to Boston's roster gets very challenging if they are making significant salaries.

Why the Hornets should be open to a sign-and-trade

Waiving Batum is a solution to sign Hayward outright for Charlotte. However, it is not a move that comes without consequences for Charlotte. They will take a dead cap hit of $9 million for the next three seasons by waiving his $27 million salary this year, effectively tying up nearly 10 percent of their cap on nobody. That will limit their flexibility going forward to add new players to the roster so ultimately, therecould be better methods for them to clear the cap room with the help of the Celtics and potentially a third team.

Additionally, even if they are committed to waiving Batum, they should still be open to a sign-and-trade with the Celtics for another reason: Boston being willing to include enough draft compensation with Hayward to make it worth their while.

Last year, Boston sign-and-traded Terry Rozier to a Hornets team without the necessary cap room to sign him outright so they got a higher second-round pick in the deal out of it from Charlotte. Given how desperate of a spot that the Celtics are in here with the possibility of having Hayward walking away for no compensation, I’d expect Ainge to be offering (at minimum) two second-round picks for the ability to do a sign-and-trade and create a massive trade exception.

Will a sign-and-trade eventually happen?

The bet here is yes but it really comes down to how high a price the Hornets are asking the Celtics to pay in order to facilitate such a deal. The Hornets don’t necessarily want to help out an Eastern Conference team much so the ask could be as high as a future (protected) first-round pick in order to get a deal done. Is that worth the price for the Celtics? Probably, but it may be too steep in Ainge’s mind unless there is a subsequent deal to be made to help the team with the trade exception.

There’s also the possibility that a third-team could become involved here to allow the Hornets to get some assets and avoid taking the Batum cap hit. Charlotte has some movable salary on their roster including Terry Rozier ($18.9 million), Cody Zeller ($15.4 million), Malik Monk ($5.3 million) and a bunch of minimum deals. The Celtics technically could take one of Zeller (unlikely) or Rozier (also unlikely) or try to find a third team to absorb one of those players (with some draft compensation in it for them) which would create the necessary cap room for the Hornets to bring Hayward aboard in a sign-and-trade and not waive Batum too. It’s possible Charlotte just prefers to dump Batum anyway no matter what (to clear the roster spot) but doing it by outright trading him would help their cap future a lot more than taking the dead cap money for a few years.

Ultimately, the Celtics are working through a bunch of various trade scenarios to figure out a solution to all these issues and assessing how much it is worth it for them to create the trade exception in terms of draft compensation. Given the lack of leverage the Celtics have here, they are probably going to have to give up more than they want to lock in a big a trade exception. Still, that’s better than the alternative of limited flexibility going forward with no way to replace Hayward’s money.

Ainge lost his bet by losing Hayward outright and now he’s going to have to pay the price.