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The NBA and National Basketball Players Association have reached agreement on a new seven-year collective bargaining agreement, promising labor peace through the rest of the decade, sources told ESPN early Saturday morning.

The tentative deal, which starts with the 2023-24 season, was announced by the league and union and is expected to be ratified by league governors and players in the coming weeks. The deal includes a mutual opt-out after the sixth year, sources told ESPN.

Among the key elements of the deal described to ESPN:

In recent years, there has been an average of three teams in this highest salary and tax range. The NBA decided punitive luxury tax penalties did not curb spending habits of some of league's wealthiest franchises to exceed cap, and league's hope is these measures will bring more parity to competition. The NBA initially wanted an upper spending limit -- essentially a hard cap -- but the union rejected that kind of monumental change in talks.

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Under these changes, Golden State's Donte DiVincenzo, Milwaukee's Joe Ingles, Boston's Danilo Gallinari, Brooklyn's Patty Mills and former Clippers guard John Wall wouldn't have been able to sign with those teams last summer. The Clippers' acquisition of Norman Powell and Robert Covington last season would also not be allowed as LA took on more money than they sent out in the deal with the Blazers.

As a counter to those spending limitations, the new CBA focuses largely on increasing opportunities for the vast majority of teams -- both above and below the salary cap. There will be new spending and trade opportunities for teams at the middle and lower spectrum of payrolls, including larger trade exceptions and new and expanded exceptions to the salary cap. Also, there's a less punitive system for teams at the lower end of the luxury tax, sources said.

Each in-season tournament game would count toward regular-season standings; the two finalists would ultimately play an 83rd game that would not count in the regular season. Winning players and coaches will earn additional prize money.

Under the current rules, Brown would be allowed to sign a four-year extension worth $165 million. With the extension rules increased to 140%, however, Brown -- who is set to earn $31.8 million in the 2023-24 season, the final year of his current contract -- would be able to reach his four-year maximum of $189 million, according to ESPN's Bobby Marks.

Similarly, Sacramento Kings All-Star center Domantas Sabonis could currently sign a four-year, $111 million extension -- one that jumps up to $121 million with the increase to 140%.

Some of the biggest success stories to emerge from the two-way pipeline include: Austin Reaves and Alex Caruso with the Los Angeles Lakers; Duncan Robinson and Max Strus with the Miami Heat; Anthony Lamb with the Warriors; Jose Alvarado with the New Orleans Pelicans; and Luguentz Dort with the Oklahoma City Thunder.

The agreement landed early Saturday morning after both sides agreed to extend a midnight ET deadline for the league to opt out of the final year of the previous CBA. NBA commissioner Adam Silver, NBPA executive director Tamika Tremaglio and negotiators on both sides -- including the NBA's Dan Rube and the union's Ron Klempner -- hammered out remaining details on the agreement, sources said.

After two extensions of the early opt-out deadline, the league's negotiations with Tremaglio and new NBPA president CJ McCollum delivered a deal months ahead of a possible work stoppage.

ESPN's Tim Bontemps and Bobby Marks contributed to this report.