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Tracy McGrady is heading to the New York Knicks, who now have more than $9 million of additional salary cap space to use in free agency this summer.


Sources told ESPN.com that the Houston Rockets, Sacramento Kings and New York Knicks have agreed to terms that will expand the Houston-Sacramento deal into a three-way trade.

The Knicks will acquire McGrady and Sergio Rodriguez from Sacramento; the Rockets get Kevin Martin and Hilton Armstrong from Sacramento, and Jordan Hill and Jared Jeffries from New York. Watch the video for more analysis and updates.

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