Rule 4 SBP Forfeited Draft Picks
A club could forfeit its 1st round draft pick or its 1st and 2nd rounds draft picks if the club exceeds its pre-assigned Rule 4 Draft SBP limit in a given year or over multiple years. A Rule 4 Draft pick forfeited because a club exceeded its Rule 4 Draft bonus limit will be reassigned to another club by lottery held on the same day as the Competitive Balance draft pick lottery. All MLB clubs that did not exceed its SBP limit are eligible to participate in this lottery.
As with the Competitive Balance draft pick lottery, Rule 4 forfeited draft picks can be traded, but only during the MLB regular season, and the pick cannot be traded for cash unless it is a financial adjustment made to offset the salary of one or more of the players involved in the trade. Also, a Rule 4 forfeited draft pick can be traded only once (only by the club that was awarded the pick). Once traded, the pick cannot be "flipped" to a third club.
If a player selected with a Rule 4 forfeited draft pick does not sign, the club receives a compensation selection in the next Rule 4 Draft, one slot lower than the forfeited draft pick slot from the previous season. There is no further compensation if a player selected with a compensation Rule 4 forfeited draft pick does not sign.