The Kings also announced Wednesday that they have extended a qualifying offer to point guard Isaiah Thomas to make him a restricted free agent.
Gay averaged 20.1 points, 5.5 rebounds and 3.1 assists in 55 games for Sacramento after being acquired in a trade from Toronto. Gay's agent, Jeff Austin, says the sides plan to discuss a potential long-term deal before Gay will be an unrestriced free agent next summer.
Thomas averaged 20.3 points and 6.3 assists in 72 games last season. Thomas is eligible to sign an offer sheet with another team next month but the Kings have the right to match any contract.