Already engaged in contract negotiations with general manager Rick Sund, the Sonics initiated preliminary discussions with coach Nate McMillan and his agent, Lonnie Cooper, this week.

The talks have been described as a fundamental dialogue about the future and direction of the franchise, said CEO and president Wally Walker.

"We all want to get to the same place," he said. "We're all talking, and that's a start."

Walker initially approached McMillan about extending his four-year, $10.8 million contract in April, but McMillan insisted on waiting until the end of the season, which both sides agreed upon last summer.

During an interview last week, McMillan was noncommittal about returning to the Sonics and said he planned to travel home to North Carolina where he would speak with family about exploring options with potential suitors, or returning to the only NBA team that he has ever known.

"I was in touch all the time with Lonnie trying to figure out when is the right time," Walker said. "Now it's the right time."

Cooper was unavailable for comment yesterday. However, a spokesman for the agent confirmed yesterday that the two sides are "moving toward an agreement."

According to an NBA source, the Sonics made McMillan a four-year offer with a base salary of $3 million in the first year, an average yearly salary of $4 million and a total value exceeding $19 million if incentives are reached.

Walker declined to comment on the specifics of the negotiations.

McMillan, 40, became a hot commodity after leading the Sonics to a 52-30 record and into the Western Conference semifinals. He has a 218-188 record and an 8-8 mark in the playoffs during the past four seasons with Seattle.

McMillan had been rumored to be a candidate in Cleveland before the Cavaliers hired Mike Brown yesterday. Reports in Detroit have McMillan and former Minnesota coach Flip Saunders on the Pistons' short list of replacements if Larry Brown leaves after the season.

New York, Minnesota and Portland are also possible destinations for McMillan. The Los Angeles Lakers have a coaching vacancy, but they appear intent on reuniting with Phil Jackson.

Walker said a week ago that he'll deny any request from an NBA team to speak with McMillan and will retain exclusive negotiating rights until June 30, when NBA contracts expire.

Sund, who was unavailable for comment, said last week that he would step out of the contract talks with the Sonics and allow his attorney to handle negotiations, which began several weeks ago.

Casey contacted

Portland officially asked for permission to speak with associate head coach Dwane Casey last month, but the Trail Blazers haven't brought him in for an interview.

Casey has also drawn interest from Minnesota, which contacted the Sonics several weeks ago, but did not formally request permission.

Casey declined to comment yesterday, however. Walker confirmed that two NBA teams inquired about Casey.

Note

• The Sonics, who have the No. 25 overall pick in the draft on June 28, will work out draft prospects today, including former Washington Huskies guard Will Conroy. He's expected to compete in the NBA pre-draft camp in Chicago next week with ex-Husky Tre Simmons. Former UW guard Nate Robinson, who starred in the pre-draft camp last year, isn't scheduled to appear.

Percy Allen: 206-464-2278 or pallen@seattletimes.com