The terms of the deal are believed to be as follows per Chris Vernon at cvernon.com:
Memphis receives J.C. Navarro. Washington will receive a first round pick from the Grizzlies (contrary to what has been reported, I am told that this is how it will break down). I will try to make this as simple as I can, but it is a little tricky.
'08 if the Grizzlies select 20 or further down, it goes to the Wizards (top 19 protected)
'09 if the Grizzlies select 17 or further down, it goes to the Wizards (top 16 protected)
'10- '12 the Grizzlies pick is lottery protected
'13 - the pick is top 12 protected and if it has not been given, cash considerations will be given to the Wizards.
Face value, this deal isn't a great one, because we are, in fact, potentially giving up a 1st round pick for a player who can only sign a one-year deal. A player that's not a big name or a proven contributor, I might add. Most of the people who are opposing this deal see it in those terms.
However, if you weigh in all the factors, you'll see that this is a low-risk deal. First, unless he signs a contract, we're not parting with anything. Second, the draft pick is lottery protected, so there is a strong possibility that it will be rolled over to the following year's draft anyways. Third, Navarro's friendship (and loyalty) to Gasol make it a strong bet that he'll be ready to re-sign with the Grizzlies next offseason without holding us over the proverbial barrel. Fourth, this move will be the "cherry on top" in meeting Gasol's various requests over the past few seasons, since he's already been provided with two capable young point guards and the big man he's been in need of for the past 4 years. Acquiring his best friend -- who isn't exactly a sub-standard shooter, by the way -- should lay to rest the last of his concerns about the team being willing to do what is necessary to not only compete and move towards being a contender, but to also prove that they feel he is the cornerstone that they want to build around.
I don't believe in kowtowing to a player's demands simply for the sake of "keeping them happy", but since we all seem to recognize that Navarro will likely be a solid pro and will upgrade the overall talent level of the team, I see this as a positive move for the franchise as a whole, not just for Pau. The Heat and Lakers were both working to acquire Navarro's services, so I'm fairly certain that he has the talent level to make an impact in the NBA.