The Miami Heat have already filled two of their three two-way slots by signing center Vlad Goldin and forward Myron Gardner, and the third and final two-way contract could be used to bring back guard Dru Smith.
Dru Smith No Longer Eligible For Two-Way Contract
However, the issue is that Miami cannot offer Smith a two-way contract this time around because he is no longer eligible, according to Anthony Chiang of the Miami Herald.
Although Smith is eligible to sign a two-way contract with any other team, he’s not eligible to sign another one with the Heat because he has already been on a two-way contract with Miami during three different salary cap years.
According to the latest collective-bargaining agreement, “no team may sign or convert a player to a two-way contract, or acquire a two-way contract by means of assignment, if, as a result, the player would or could be under a two-way contract for any part of more than three (3) salary cap years with the same NBA team.”
Per Chiang, Smith signed two separate two-way contracts with the Heat during the 2022-23 salary cap year, signed a two-way deal with Miami in July 2023 before being converted to a standard contract in October 2023 during the 2023-24 salary cap year, and also spent last season on a two-way deal during the 2024-25 salary cap year.
Smith Averaged Career-High Numbers Before Achilles Injury In 2024-25
Two-way contracts do not count toward the salary cap or luxury tax and allow for players to be on their NBA team’s active list for as many as 50 regular-season games. Two-way players are also ineligible for the postseason.
Despite playing on a two-way contract, Smith was a key contributor in the Heat’s bench rotation last season before suffering a non-contact Achilles injury in late December.
Smith, who turns 28 in December, averaged 6.2 points, 2.6 rebounds, 1.6 assists, 1.5 steals, and 19.1 minutes per contest last season, while shooting 50.8% from the field and 53.3% from 3-point range in 14 games (one start).
The 6-foot-3 Smith has been a critical member of the Heat’s developmental program since he went undrafted out of Missouri in 2021. He has spent parts of his first three NBA seasons with the organization.
While Smith is not eligible to sign another two-way deal with the Heat, the team does have space on its roster to bring him back on a standard contract.
Miami Heat Have 14 Players Signed To Standard Contracts
Per Spotrac, the Heat currently have 14 players signed to standard contracts. Miami has one open roster spot since 15 players on standard contracts is the regular-season limit.
During the offseason, NBA teams are allowed to have a maximum roster size of 21 players. Two-way players don’t count toward the 15-man regular season roster limit, but they do count toward the 21-man offseason limit.
The Heat could offer Smith a standard contract, but a regular deal with guaranteed money would push them further into luxury tax territory. Miami is about $1.3 million above the luxury-tax threshold.
Signing Smith to a standard minimum contract would add about $2.3 million, bringing the Heat to roughly $3.6 million above the luxury tax line.
Because Smith remains a restricted free agent, the Heat can match outside offers in free agency to retain him.