New York Knicks: What really happened with Jeremy Lin’s offer sheet?

Linsanity ended when Jeremy Lin signed a “poison pill” offer sheet with the Houston Rockets, which the point guard claims he tried to avoid so he could stay with the New York Knicks.

In an hour-long interview that will air on MSG Networks on Friday at 5:30 PM EST, former New York Knicks star Jeremy Lin said he tried to avoid signing an expensive offer sheet with the Houston Rockets in 2012 so he could stay with the Knicks.

But what really happened that led to the divorce between the Knicks and the point guard who took over the sports world for two weeks in the February preceding his sudden exit?

First, let’s understand the decision in front of the Knicks at the time. On July 5, 2012, when Adrian Wojnarowski was still breaking stories for Yahoo, he reported that Lin had agreed to a four-year, $28.8 million offer sheet with the Rockets. At that point in time, it was expected the Knicks would match the offer, despite it being back-loaded at $9.3 million in each of the final two seasons as a disincentive for New York to match due to luxury tax implications.

According to Lin in his recent interview with MSG Networks, he asked his agent to have Houston lower their offer so the Knicks could match it.

“I remember when Houston gave the offer,” Lin explained. “I promise you, I had just finished a workout and got into my car and got the phone call from my agent and I said to him, ‘Can you tell Houston to lower the offer, this is too much. Can you tell someone to lower the offer’, because I wanted to go back to New York and I wanted New York to match.”

But the Knicks viewed the negotiations leading to him signing with the Rockets differently. According to Frank Isola, the Knicks became infuriated when they believed Lin asked for more money from Houston, not less.

The original offer sheet reported by Woj included two $9.3 million payments in the final two years of a four-year contract. The final offer sheet that Lin signed included a balloon, “poison pill” payment of $14.9 million in the third year of a three-year, $25.1 million deal. According to Isola, it was the revision in the contract that infuriated owner James Dolan and led the team to letting their newfound marketing machine walk away that summer.

Had the Knicks matched the offer sheet, the balloon payment in the third year of the deal would have cost the team at least $35 million in luxury tax penalties. Meanwhile, under the rules of the CBA at the time, the Rockets would only be charged a cap hit of the average annual value of Lin’s contract, or $8.3MM, over three years, instead of facing the spiked amount in the final year of the deal, like the Knicks would have.

Whether the changes in the terms of the offer sheet are Lin’s fault, or the shrewd workings of Rockets general manager Daryl Morey, or a combination of both, we can leave for debate. Either way, the Knicks weren’t exactly pulling out all of the stops to woo arguably their most popular player since Patrick Ewing to stay in New York. As the offer sheet negotiations were playing out, the Knicks were actively trying to recruit All-Star point guard Steve Nash. They ended up signing veteran guards Jason Kidd and Raymond Felton.

Since leaving the Knicks, the relationship between the team and Lin has been frigid, to characterize it mildly. It was surprising when the Knicks announced they would celebrate his time with the franchise over the past week, as it is the first time they have publicly acknowledged his achievements in New York since he signed that fateful offer sheet.

Over 35 magical games with the Knicks, Jeremy Lin averaged 14.9 points and 6.2 assists before his season was cut short due to a knee injury. He rose from obscurity to superstardom when he averaged 23.9 points, 9.2 assists, and 2.4 steals over eleven games in February of 2012.