Karl confirmed Friday he has agreed in principle to a one-year contract extension. One reason the extension, which is for $4.5 million, is for one year is there is expected by many to be an NBA lockout after next season.
"I just think it's the circumstances of what the league is,'' Karl said during All-Star Weekend, where he will be the West coach for Sunday's game. "I don't think there are going to be many coaches that sign a contract that is going to pay them in the lockout year. For me, why not be free?''
Karl had turned own a one-year extension last summer. He also had turned down a three-year, $11.25 million offer, with the third year not guaranteed. Karl is making $3 million this season.
Karl said he and Nuggets owner Stan Kroenke got together to hammer out the deal.
Karl said it will be somewhat of a distraction off him that nobody will have to talk about his contract the rest of the season. Overall, he said it didn't affect the Nuggets, who have the second-best record in the West.
"I've done it before,'' Karl said of being in the last year of a contract. "Other than (the media) driving me crazy, I don't think it's been any influence on how the team is performing.''
Denver's two All-Stars, Carmelo Anthony and Chauncey Billups, were pleased to hear the news.
"He deserves it. He earned it,'' said Anthony, who then offered up a big smile and said, "You know, you pay for winning.''
"That's great,'' Billups said. "I'm happy I'll be playing for George again next year.''
Chris Tomasson can be reached at firstname.lastname@example.org or on Twitter @christomasson