The MLB Rule 5 Draft is normally held at the MLB Winter Meetings in December. 
NOTE-1: The Major League Phase of the 2021 MLB Rule 5 Draft was cancelled because of the lock-out.  

It is a mechanism that allows MLB clubs to select (draft) players off minor league reserve lists.

There is a "Major League Phase" where an MLB club can select Rule 5 Draft-eligible players off the reserve lists of minor league clubs (any minor league classification) for $100,000 ("Major League Phase" Rule 5 Draft price increased from $50,000 to $100,000 beginning with the December 2016 draft), and a "AAA Phase" where a club's AAA minor league affiliate can select Rule 5 Draft-eligible players off the reserve lists of minor league clubs of a lower classification (below AAA) for $24,000 (Rule 5 "AAA Phase" draft price increased from $12,000 to $24,000 beginning with the December 2016 draft).
NOTE: Effective December 2016, the "AA Phase" (where a club's AA minor league affiliate could select Rule 5 Draft-eligible players off the reserve lists of minor league clubs of a classification below AA for $4,000) has been eliminated.

There is no limit on the number of rounds in each phase (there could be one, there could be three, there could be five or more). As long as at least one club is still selecting players, the phase will continue, but as soon as all 30 teams have a full reserve list (so that clubs can no longer make selections) or have passed, the phase is over.

There is no limit on the number of Rule 5 Draft-eligible players any one organization can lose in a Rule 5 Draft.

Rule 5 Draft order is based upon the inverse order of winning percentages from the previous season. If the winning percentages of two or more clubs are the same, the club with the lowest winning percentage from the previous season picks first. If two or more clubs are still tied, league standings from two years back (or three years back, four years back, etc) are used to break the tie.

RULE 5 DRAFT ELIGIBILITY

1. A minor league player who was 18 or younger on the June 5th immediately prior to signing his first contract is eligible for selection starting with the 5th Rule 5 Draft following his first qualified season, and a minor league player who was 19 years or older on the June 5th immediately prior to signing his first contract becomes eligible for selection starting with the 4th Rule 5 Draft following his first qualified season.

2. If a player signs his first contract after the conclusion of the season of the MLB or minor league club to which he is first assigned (even if he signs prior to the Rule 5 Draft), the next season is considered to be the player's "first qualified season" for Rule 5 eligibility purposes. (Depending on the minor league, the conclusion of a minor league club's season could be as early as the first week of August, or as late as the second week of September).

3. A player eligible to be an MLB Rule 9 minor league free-agent who signs a minor league successor contract prior to being declared a free-agent and a free-agent with prior MLB and/or minor league service who signs a minor league contract prior to the Rule 5 Draft is eligible for selection if the player was 18 or younger on the June 5th immediately prior to signing his first contract and it is at least the 5th Rule 5 Draft since he signed his first contract, or the player was 19 years or older on the June 5th immediately prior to signing his first contract and it is at least the 4th Rule 5 Draft since he signed his first contract.

4. Any player on a minor league reserve list who has either been released or had his contract voided and then re-signs with the same MLB organization within one year is eligible for selection.

5. Any player on a minor league reserve list who has been outrighted to the minors previously in his career is eligible for selection.

6. A player on the Voluntary Retired List, Disqualified List, or Ineligible List is not eligible for selection.

7. An MLB club can designate any player on a minor league reserve list "eligible for selection" in a Rule 5 Draft even if the player would not normally be eligible, but once a player is designated "eligible for selection," he remains eligible for selection in all subsequent Rule 5 drafts.
NOTE: A club might do this if the club is planning to release the player during the off-season. 

8. A minor league player-manager who would be eligible for selection in the Rule 5 Draft if he was only a player can be selected, but if he is selected, the player-manager can reject the selection and retire. He has 30 days to decide. If he rejects the selection and opts to retire as a player, the player-manager is ineligible to be reinstated as a player for a minimum of one year.  

At present, 79 Cubs minor leaguers are eligible for selection in the 2023 Rule 5 draft. A maximum of 38 players can be placed on the AAA reserve list on the reserve list roster filing deadline in November and be eligible for selection in the Major League Phase only, and in practice most clubs leave three or more slots open on their AAA reserve list when rosters are filed for free-agents who sign a minor league contract and players who are sent outright to AAA prior the Rule 5 Draft, and to provide AAA roster slots for players who might be selected in the AAA Phase of the Rule 5 Draft.

NOTE: If not added to the MLB 40-man roster, the players underlined and in bold green below will likely be placed on the 38-man AAA Iowa reserve list so that they will be eligible for selection only in the Major League Phase of the 2023 Rule 5 Draft.

CUBS MINOR LEAGUERS ELIGIBLE FOR SELECTION IN 2023 RULE 5 DRAFT (last updated 6-4-2023):
Pablo Aliendo, C 
Elian Almanzar, RHP
Ezequiel Alvarez, INF-OF 
Jose Aquino, LHP 
D. J. Artis, OF
Max Bain, RHP 
Bryce Ball, 1B
Brad Beesley, OF 
Hunter Bigge, RHP
David Bote, INF (Article XX-D player)
Yovanny Cabrera, RHP 
Burl Carraway, LHP  
Derek Casey, RHP
Chris Clarke, RHP (Article XX-D player) 
Luis Devers, RHP
Jefferson Encarnacion, OF 
Manuel Espinoza, RHP 
Miguel Fabrizio, C-1B
Anderson Feliz, RHP 
Kohl Franklin, RHP
Richard Gallardo, RHP
Reivaj Garcia, INF
Saul Gonzalez, RHP  
Ethan Hearn, C  
D. J. Herz, LHP 
Darius Hill, OF
Porter Hodge, RHP
Bailey Horn, LHP  
Joel Jimenez, RHP 
Levi Jordan, INF 
Chris Kachmar, RHP
Caleb Knight, C
Scott Kobos, LHP
Adam Laskey, LHP 
Ben Leeper, RHP 
Luke Little, LHP 
Joel Machado, LHP
Kevin Made, INF
Nelson Maldonado, 1B
Luis Marte, RHP
Michael McAvene, RHP 
Scott McKeon, INF 
Ismael Mena, OF  
Gregori Montano, RHP 
Juan Mora, INF
Cristian More, OF 
Rafael Morel, INF 
Joe Nahas, RHP   
Jordan Nwogu, OF 
Johzan Oquendo, RHP 
Miguel Pabon, INF-C
Ezequiel Pagan, OF
Daniel Palencia, RHP 
Jack Patterson, LHP 
Fabian Pertuz, INF 
Yohendrick Pinango, OF
Reggie Preciado, INF  
Malcom Quintero, C
Sheldon Reed, RHP 
Jake Reindl, RHP
Samuel Rodriguez, LHP  
Cole Roederer, OF
Lizardo Ruiz, INF 
Cam Sanders, RHP
Yeison Santana, INF
Tyler Schlaffer, RHP
Jake Slaughter, INF
Felix Stevens, 1B-OF
Chase Strumpf, INF
Riley Thompson, RHP
Sam Thoresen, RHP
Cayne Ueckert, RHP 
Luis Verdugo, INF 
Jake Washer, C 
Andy Weber, INF 
Jacob Wetzel, OF 
Blake Whitney, RHP
Brad Wieck, LHP 
Bryce Windham, C-INF

Additionally, a free-agent who signs a 2024 minor league contract prior to the 2023 Rule 5 Draft will be eligible for selection if the player was 18 or younger on the June 5th immediately prior to signing his first contract and it is at least the 5th Rule 5 Draft following his first qualified season, and a minor league player who was 19 years or older on the June 5th immediately prior to signing his first contract becomes eligible for selection starting with the 4th Rule 5 Draft following his first qualified season.

SIX-YEAR MINOR LEAGUE FREE-AGENTS POST-2023:
Sergio Alcantara, INF (Article XX-D player) 
Craig Brooks, RHP (if reinstated from Restricted List)
Jesus Camargo, RHP (if reinstated from Restricted List)
Danis Correa, RHP 
Yovanny Cruz, RHP  
Zach Davis, OF
Stephen Gonsalves, LHP (Article XX-D player)
Carlos Guzman, RHP 
Ben Hecht, RHP 
Jordan Holloway, RHP (Article XX-D player)
Anthony Kay, LHP (Article XX-D player) 
Brendon Little, LHP 
Brailyn Marquez, LHP 
Nick Neidert, RHP 
Dom Nunez, C 
Eduarniel Nunez, RHP 
Yonathan Perlaza, OF
Samuel Reyes, RHP  
Manuel Rodriguez, RHP (Article XX-D player) 
Didier Vargas, LHP 
Luis Vazquez, INF 
Jared Young, INF-OF (Article XX-D player)

SECOND CONTRACT MINOR LEAGUE PLAYERS (see NOTE-3 below)
Michael Arias, RHP (previously released by TOR)
Andres Bonalde, LHP (on Restricted List - previously released by CUBS)
Fraiman Marte, RHP (previously released by STL) 
Francis Reynoso, RHP (ex-1B - previously released by STL) 
Welington Santana, RHP (ex-OF - previously released by BAL)
Dalton Stambaugh, LHP (previously released by BAL)
NOTE-3: With mutual consent (player & club), a second-contract minor league player who has accrued fewer than seven minor league seasons can be signed to a multi-year minor league contract with club control extending up through the player's seventh minor league season. So it is possible that one or more of the Cubs minor league second contract players are signed beyond the 2023 season (TBD).


RULE 5 DRAFT RESTRICTIONS:

1. A minor league player eligible for selection in the Rule 5 Draft cannot be added to an MLB Reserve List (40-man roster), traded to another organization, or transferred from one minor league reserve list to another within the same organization, beginning with the filing of MLB minor league reserve lists and extending through the completion of the Rule 5 Draft.

2. A Rule 5 Draft-eligible player cannot be sent outright to the minors beginning at 5 PM (Eastern) on the third day prior to the Rule 5 Draft through the conclusion of the draft.

3. A club must have as many slots open on its MLB Reserve List (40-man roster) prior to the start of the Rule 5 Draft as the number of players it selects in the Major League Phase, and an MLB club's AAA affiliate must have as many slots open on its reserve list prior to the start of the AAA Phase of the Rule 5 Draft as the number of players the affiliate selects in the AAA Phase. 

4. A club can select a player off the reserve list of one of its own minor league affiliates, but if the player is selected in the Major League Phase, the club is bound by the same Rule 5 roster restrictions as if it had selected the player off the reserve list of another club's minor league affiliate.
NOTE: This actually happened at least once a number of years ago, after a club (Atlanta Braves) inadvertently left one of its top prospects off its MLB Reserve List (40-man roster) when minor league reserve lists were submitted to the MLB Commissioner on November 20th.

5. A player eligible for selection in the Rule 5 Draft cannot be "covered up" from selection, either by agreement between two clubs or by effect (such as by concocting a phony injury and placing the player on an Injured List in an attempt to decrease a player's value when the player is not really injured). Also, a player selected in the Major League Phase of the Rule 5 Draft cannot be "hidden" on an Injured List to help the drafting club fulfill Rule 5 roster obligations (such as by leaving the player on the Injured List after he is healthy enough to play). If the MLB Commissioner believes a club "covered up" a player to avoid losing the player in the Rule Draft or "hid" a selected player on an Injured List, the offending club or clubs are subject to a penalty (TBD by the MLB Commissioner).