The explanation given by James Ham on the Brenden Nunes was excellent. He states that all of the exception can kick in AFTER cap space has been utilized. That was one of the driving forces to trade for TT...
This explanation from Ham simply makes no sense on any level.
First and foremost, we were already operating above the cap.
For Fox, Hield, Barnes, Bagley, Wright (pre-TT), Haliburton, Woodard and Ramsey (our guaranteed contracts) we were on the hook for $98.36M.
Let's assume (to be generous to our cap number) that although we haven't heard, that we had already waived Guy, Damian Jones, and Justin James. That leaves Metu, with an unguaranteed contract of $1.76M, who was clearly also in our cap. That makes $100.12M.
In addition, we had the cap hold for Davion Mitchell, at $4.88M. Up to a very clean $105M even.
But that's not all. Since we have re-signed Holmes (cap hold = $6.51M), Harkless (ch = $4.35M), and Davis (ch = $1.9M), we clearly didn't renounce their cap holds, so that's another $12.76M, for a minimum cap total of $117.76M. The cap is $109.14M. We were well over the cap.
Now, we may have been even farther over the cap, because there are other cap holds that we didn't necessarily free ourselves of, including the unguaranteed money of Jones and James, and holds for Guy, Whiteside, and surprisingly, a stale cap hold for Corey Brewer. And we had $5.6M worth of trade exceptions on top of that.
So let there be no doubt in anybody's mind -
we were already operating over the cap.
Second, it's clear that we didn't use cap space to sign any of the players. Outside of the fact that we didn't have cap space, we know that Harkless was signed with a Non-Bird Exception, that Len was signed with the Bi-Annual Exception, that Holmes and Davis were signed with the Early Bird exception, and Mitchell was signed with a rookie exception. If we had cap space (reminder: we didn't), then at the very least, we would have signed Len, who was not our player, with that cap space and not used the BAE on him. Since we didn't have cap space, we had to use the BAE.
Third, the Early Bird exception is not dependent on having no cap space. For instance, if a team had $5M in cap space and wanted to sign one of its Early Bird FAs to a contract starting at $10M with the Early Bird exception, they do not have to spend up to the cap before the Early Bird is available. They can simply use the Early Bird right there and then. Now, it does make sense to spend any available cap space before signing players to contracts that are larger than their cap holds (in our case, Holmes and Davis), which is why teams often do transactions in very specific orders, but again, I repeat myself
ad infinitum, we did not spend any cap space, and we did not have any cap space available to spend.
Ham's explanation, as presented above, is nonsense and rubbish. If that's what he actually said, he does not know what he is talking about. Period.