The free agency season officially starts Thursday night at 9pm Pacific.  Any player whose contract has expired or who was released is a free agent.  But the type of free agent they are depends on how long the player has been in the league.  Technically speaking, it is based on the number of "accrued seasons" the player has.  An accrued season is.one where a player spend six or more weeks on the active or inactive roster or on injured reserve (time on the practice squad does not count).

The three types of free agents are:

1. Exclusive rights free agents - have less than three accrued seasons
   
2. Restricted freed agent (RFA) - have three (but less than four) accrued seasons
   
3. Unrestricted free agent (UFA) - have four more accrued seasons

Restricted Free Agent - The player's previous team has the option of making a "qualifying tender" offer by February 28.  If they do not offer a tender or if the tender is withdrawn, the player becomes an unrestricted free agent.  By offering a qualifying tender, the player's previous team has seven days to match any offers the player receives.  However, depending on the salary that the prior team offers in the tender, the team will also be entitled to draft pick compensation from the team that signs the player.  These different levels are described below.  Since draft picks are involved, all offers from new teams must be received by April 18.  After April 18, the player's rights remain with the original team.

a) A tender of $927,000 guarantees a right of first refusal, but no draft pick
b) A tender of the greater of $927,000 or 110% of the player's prior year salary gives the team the right of first refusal and a draft selection in the round the player was initially chosen (if drafted)
c) A tender of the greater of $1.47 million or 110% of the prior year salary gives the team a 2nd round draft pick as compensation
d) A tender of the greater of $2.017 million or 110% of the prior year salary gives the team a 1st round draft pick as compensation
e) A tender of the greater of $2.562 million or 110% of the prior year salary gives the team a 1st and 3rd round draft pick as compensation

Unrestricted free agents - These players are free to negotiate with any team and their prior team does not receive any compensation, other than the exceptions below.  (One interesting quirk I just learned is that if a UFA has not signed by the start of training camp, then that player's previous team may regain his exclusive right.  To do this, the team has to offer a tender to that player for 110% of his prior year's salary by June 1.)

A team also has the ability to "tag" up to two UFA by February 21.  There are two different types of "franchise"tags" as well as a "transition"tag.  A team may only use one franchise tag in any given year, but they may use two transition tags if they do not use the franchise tag (or they may use no tags at all - as Denver did this year)

a) "exclusive" franchise tag - The team must offer a one year tender for the greater of 120% of the player's previous salary, the average of the top 5 salaries at his position at the end of the 2007 season or the average of the top 5 salaries at the position at the end of the RFA signing period on April 18.  By using the exclusive franchise tag, no other team may negotiate with the player

b) franchise tag- I believe this is the most common form.  The team must offer the greater of 120% of the prior year's salary ir the average of the top 5 players at the position at the end of 2007.  Players who are given this tag may negotiate with any other team, but their previous team has seven days to right to match any offer or to receive two 1st round draft choices from the new team.

c) Transition tag - The team must offer a tender for the greater of 120% of the prior year's salary or the average of the top 10 salaries at his position in 2007.  The team has the right to match any offer the player receives, but is not subject to any draft compensation.

To give the previous teams time to respond, all offers to tagged players must be made by July 15.  Before that date, the player and current team may sign a multiyear contract.  After July 15, only a one year contract is allowed.

Sorry this was not too brief, but like the salary cap there are quite a few scenarios to cover.  I hope that at least this manages to clear things up a bit.  As usual, feel free to make any corrections or ask questions in the comments.

(Also, the Broncos have four RFA in 2008.  Because Karl Paymah and Dominique Foxworth were drafted in the third round, I think they will get the $927,000 tender (option b).  Somewhat paradoxically, Chris Myers and Hamza Abdullah will probably get offered a higher tender ( $1.47 million - option c) because they were drafted so low)