On Monday, Miami Heat guard Tyler Herro signed a four-year contract extension with the team worth $130 million. According to sources, $120 million is fully guaranteed. But the deal also includes $10 million in incentives.

Tyler Herro’s contract incentives include $1 million for winning MVP, $1 million for winning Defensive Player of the Year, $1 million for earning an All-NBA First-Team selection, $1 million for receiving an All-NBA Second-Team selection, and $500,000 for earning an All-NBA Third-Team selection.

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Furthermore, the third-year guard must play in 75% of regular season games. Barring a major injury, Tyler Herro should have no problem appearing in 62 games. Plus, incentives are capped at $2.5 million per season.

While winning DPOY is a long shot, even if he wins the award and receives an All-NBA honor, the most he can earn in added bonuses each season is $2.5 million.

Tyler Herro’s $10 million in incentives with Heat are based on games played and All-NBA honors

It should also go without saying that if Herro wins MVP and DPOY in the same season, he’ll receive an All-NBA First-Team selection as well. The strange wording is based on salary cap regulations within the CBA.

Of course, Herro’s $5,722,116 team option was exercised for the 2022-23 season on September 3, 2021. This is part of the rookie scale contract he signed with the Heat in 2019.

Heat president Pat Riley released this statement on Herro’s multi-year deal: “Tyler is an impact multi-faceted player and we are excited to have him signed for the next 5 years. His improvement every year since we drafted him has led to this day. We believe he will continue to get better.”

Head coach Erik Spoelstra also commented on Herro’s re-signing. “It is gratifying for everybody involved,” said Spoelstra. “Everybody in our organization, for Tyler, his family, his representation.”

Last season, in 66 appearances, Tyler Herro averaged 20.7 points, 5 rebounds, and 4 assists per game. The third-year guard shot 44.7% from the field and 39.9% from 3-point range as well. He went on to win Sixth Man of the Year.

On October 23, 2021, in the Heat’s 102-91 loss against the Indiana Pacers, the guard became the first player in franchise history to record at least 30 points and 10 rebounds off the bench.

If Tyler Herro plays like he did last season, he’ll have no problem receiving at least a $1 million bonus in the 2022-23 season. Regardless, the guard’s future is set with the team.