The Rockets have likely offered Terry a veterans minimum contract, a significant pay cut from his $5.8 million salary last year, and according to MyFoxHouston's Mark Berman, the JET thinks that's insufficient. Berman also reports the Pelicans, trying to accumulate veteran leadership for a deeper playoff run next year, have made Terry an offer.
The Rockets have 13 players under contract right now, and for weeks we've been operating under the assumption that the final two roster spots would be occupied by Terry and Montrezl Harrell, who remains unsigned (and remember: second-round picks usually get contracts, but not always). But that assumption may have been unwarranted.
Terry has expressed desire to return to Houston, but he's a prideful 37-year-old (he'll be 38 by opening night). The Pelicans won't be a bottom-dweller: he'd certainly have plenty of room to bomb from deep with The Brow commanding double-teams and guys like Tyreke Evans, Jrue Holiday and Eric Gordon drawing attention. Him taking more money to play in New Orleans would certainly make sense for him, since he's a major injury away from retirement, in all likelihood.
But Terry was good last year! Maybe he wants a two-year contract to take him until he's almost 40, and the Rockets won't commit. There's also no indication that the Pelicans' offer was, in fact, more than the Rockets', only that Terry felt Daryl Morey's money was insufficient, and now the Rockets have competition.
It's unclear what Plan B for the Rockets would be. They have Ty Lawson and Patrick Beverley on roster, but, other than James Harden, nobody else is remotely capable of handling the ball. That roster spot has to go to a point guard. Norris Cole is still a free agent and has two rings from his time playing major minutes for the Heat. But the Rockets can only offer their championship contending roster to compete with other bidders, not more money.
Of course, the last three paragraphs could be rendered moot in minutes if Terry elects to stay with his best chance to win another ring. Such is the nature of the beast of free agency writing. But this is the last guy we're writing about before we can truly talk with certainly about what the Rockets' 15-man roster looks like.