EARLY BIRD EXCEPTION -- This is a weaker form of the Larry Bird exception. It also allows teams to exceed the cap to re-sign their own free agents, but with more limited contracts than the Larry Bird exception. To qualify for this exception the player must play for
two seasons without clearing waivers or changing teams as a free agent (see question number
32 for details and nuances to this rule). A team may use the Early Bird exception to re-sign its own free agent for up to 175% of his salary in the previous season (not over the maximum salary, of course) or 105% of the average salary in the previous season3, whichever is greater (see question number
31 for the definition of "average salary"). Early Bird contracts must be at least two seasons in length, which prevents teams from using the Early Bird to sign a one-year contract, then signing the same player with the full Larry Bird exception the following season. Early Bird contracts can be up to four years in length, with raises up to 8% of the salary in the first season of the contract. Early Bird is also a component of the Veteran Free Agent exception, and qualifying players are called "Early Qualifying Veteran Free Agents" in the CBA.