Mike D'Antoni has resigned as coach of the Los Angeles Lakers, the team announced Wednesday night.
D'Antoni's resignation ends the brief tenure of the Lakers' third coach in less than three years. He took over from interim coach Bernie Bickerstaff early in the 2012-13 season and finishes 67-87 with the team. Mike Brown lasted just 71 games after replacing 11-time NBA champion Phil Jackson before the 2011-12 season.
The Lakers and D'Antoni have been discussing his future with the team since the season ended, multiple sources told ESPN.com's Ramona Shelburne. Last week he asked them to pick up the team option on the final year of his contract to empower him to coach without constant speculation about his job status.
But, sources said, when the Lakers said they were unwilling to do that, the team and his representatives began working out a solution that was amenable to everyone. The Lakers and D'Antoni agreed on a settlement that will pay him more than half of the $4 million he was owed for next season, according to a source with knowledge of the situation.
The settlement also includes a provision in which the Lakers would recoup some of the money if D'Antoni lands another job this year, another source said.
"Given the circumstances, I don't know that anybody could have done a better job than Mike did the past two seasons," general manager Mitch Kupchak said in a statement. "On behalf of the Lakers, we thank Mike for the work ethic, professionalism and positive attitude that he brought to the team every day. We wish him the best of luck."
D'Antoni's agent, Warren LeGarie, told ESPNLosAngeles.com that his client and the Lakers "hit an insurmountable impasse" and that "Mike will no longer be the Laker coach."
The Lakers will begin a coaching search, but a source tells ESPN.com that their immediate focus is on the NBA draft, where they will have at least a top-nine pick, and free agency, where they have enough salary-cap flexibility to sign a maximum-contract level free agent.
Lakers great Magic Johnson, who was sharply critical of D'Antoni's coaching style, hailed the news on his Twitter account.
Happy days are here again! Mike D'Antoni resigns as the Lakers coach. I couldn't be happier!
- Earvin Magic Johnson (@MagicJohnson) May 1, 2014
D'Antoni has also coached the Nuggets, Suns and Knicks. He reached two Western Conference finals with Nash in Phoenix before having much less success in New York.
"Whenever a coach isn't there anymore, for whatever reason, all of us in the fraternity feel badly,'' San Antonio's Gregg Popovich said after the Spurs' playoff victory Wednesday over Dallas. "He is a heck of a coach and heck of a guy. You always feel badly when something like that happens. I just hope that what he wants is going to be what happens for him. He is a special guy.''
D'Antoni's departure will allow the Lakers' franchise overhaul to begin in earnest after their worst season since 1957-58 in Minneapolis. Los Angeles missed the postseason for just the second time in the 17-season career of Bryant, who occasionally clashed with D'Antoni.
The Lakers have not settled on the type of candidate they will be looking to hire, according to a team source.
"It could be a young, up-and-coming guy, it could be a low-cost coach on a short-term contract, it could be a big-name coach on a big-money contract," the source told ESPNLosAngeles.com's Dave McMenamin. "It could be anyone."
But the Lakers do not expect to have a coach in place before the draft lottery on May 20, according to the team source, as the pick they land in June's upcoming draft -- which will be anywhere from No. 1 through No. 9 -- surely will shape what kind of coach the team will be looking for.
Several Lakers players quickly weighed in Wednesday evening on the news of D'Antoni's departure.
"All of this is crazy and unexpected, don't know what to say," guard Jordan Farmar said in an email to ESPN.com.
Jodie Meeks, who was third for the Lakers in scoring with 15.7 points per game, complimented D'Antoni and the way he steered the Lakers.
"Nothing but great things to say about him, man," he said. "Loved playing for him and wish him the best! Would play for him any day!"
After joining the Lakers on short notice last season, D'Antoni was unable to assemble a contending team immediately around Bryant and Dwight Howard, who struggled to embrace the pick-and-roll game so important to D'Antoni's offense.
Los Angeles won 45 games last season despite its awful start under Brown. But the Lakers lost Bryant to a torn Achilles tendon late in the regular season and were swept in the first round by San Antonio.
Howard left the Lakers as a free agent last summer, fleeing to Houston for less money to escape the Lakers' drama and high expectations.
Bryant played in just six games this season after breaking a bone near his knee in December, and Los Angeles never had a consistently competitive team in his absence. Nash also missed most of the season with various injuries, but the 40-year-old point guard hopes to play again next season.
Bryant publicly called D'Antoni's job status into question at a news conference in March announcing his left knee injury would sideline him for the remainder of the season.
"You got to start with Jim and Jeanie and how that relationship plays out," Bryant said of the Buss siblings who run the Lakers on the basketball and business sides. "It starts there and having a clear direction and clear authority. And then it goes down to the coaching staff and what Mike is going to do, what they're going to do with Mike, and it goes from there. It's got to start at the top."
Earlier in the season, Bryant expressed disdain for the style of basketball D'Antoni favors, a style that has been adopted by many teams around the league.
"It's more of a finesse game," Bryant said before the Lakers played the Bulls in January. "It's more small ball, which, personally, I don't really care much for."
ESPN.com also reported earlier the season that Bryant and D'Antoni's relationship had deteriorated to the point where the two rarely spoke to each other, and it is unclear whether D'Antoni had a sit-down with Bryant before deciding to step down as coach.
D'Antoni realized he would take the blame for the Lakers' woes this season, and the veteran coach seemed comfortable with the prospect when the team packed up for the summer.
"Every coach should be under scrutiny," D'Antoni said two weeks ago. "Some coaches get fired even after the best years they've ever had. ... There's always things we could have done better, and it's easier with hindsight. Things don't always go smoothly. For the most part, our guys were very competitive. For us, there are some silver linings in there, but in hindsight, it's disappointing for everybody.''
ESPN.com's Ramona Shelburne, ESPNLosAngeles.com's Dave McMenamin and The Associated Press contributed to this report.