A "SuperMax" Extension or also known as the Designated Player rule allows for an NBA player to receive increased compensation based on certain criteria being met. The increased salary allows for the first year salary of the extension to be 30% or 35% of the designated league year cap based on credited experience and performance awards (All-NBA, Defensive Player of the Year or Most Valuable Player). Players are able to receive a yearly raise up to 8% of the first year salary.
A player who is signed to a Designated Player extension can only be signed from the end of the offseason moratorium through the last day before the regular season. Furthermore, being signed to this extension type means a player cannot be traded for one year after the extension has been signed.
Designated/"SuperMax" Extension Types
Designated Rookie Extension
Player is entering the 4th year of rookie scale contract, maximum salary starts at 25% of the cap (30% based on criteria below) with a maximum of six (6) years (which includes the remaining year on the current contract).
A player with fewer than seven (7) years of experience and mets the criteria for the 30% of the cap is said to be eligible for the "Derrick Rose Rule," name for Derrick Rose who won the MVP during his third season in the NBA.
Designated Veteran Extension
Player has 7 or 8 years of experience and has 1 or 2 years remaining on their current contract (all with with the same team or was traded during first four years in the NBA) and meets the criteria below is eligible for a maximum salary that starts at 35% of the cap with a maximum of six (6) years (which includes the remaining years on the current contract).
Who applies for this increase:
(A) Players finishing their rookie scale contract and other players having been credited with four (4) years of service can receive a starting salary up to 30% of the cap.
(B) Players finishing their rookie scale extension or other players having seven to nine (7-9) years of experience can receive a starting salary up to 35% of the cap.
At least one of the following must apply:
(A) Player was named to All-NBA First, Second or Third team in most reason season or both of the two seasons prior to the most recent season.
Based on 2021 offseason, player was named to any All-NBA team in 2020-21 OR was named to any All-NBA team in 2018-19 AND 2019-20.
(B) Player was named the Defensive Player of the Year (DPOY) in most reason reason or both of the two season prior to the most recent season.
Based on 2021 offseason, player was named to DPOY in 2020-21 OR was named as DPOY in 2018-19 AND 2019-20.
(C) Player was named Most Valuable Player (MVP) in any of the three most recent seasons.
Based on 2021 offseason, player was named as MVP in 2018-19, 2019-20 or 2020-21.