CLEVELAND -- Two prolonged contract holdouts early last season hurt the Cleveland Cavaliers, damaging their chances of getting back to the NBA Finals.
They made sure it wouldn't happen again.
NBA front-office sources told ESPN.com's Marc Stein that the Cavs signed guard Delonte West to a three-year deal worth $12.6 million.
The Cavaliers hold a team option on the third year.
Cleveland wanted to limit West, a restricted free agent, to two guaranteed seasons to preserve as much financial flexibility as possible for the summer of 2010, when LeBron James is an unrestricted free agent. But West, sources said, is guaranteed $500,000 for the 2010-11 season from the Cavs in the event they decline to pick up his option.
West was acquired last season from Seattle as part of the three-team, 11-player megatrade before the Feb. 21 deadline. Filling a major void at point guard, the 6-foot-3 West averaged 10.3 points, 3.7 rebounds and 4.5 assists in 26 starts for the Cavaliers.
He was one of Cleveland's best players during the postseason, averaging 10.8 points, 3.3 rebounds and 4.2 assists in 13 games for the Cavs, who pushed the NBA champion Boston Celtics to seven games before losing in the Eastern Conference semifinals.
The Cavs didn't want a repeat of last year when forwards Anderson Varejao and Sasha Pavlovic, both restricted free agents, held out of training camp. They eventually signed deals, but when they came back both players struggled getting into shape, got injured and the Cavaliers' chemistry was affected by their absences.
The 25-year-old West can play either position in the backcourt. He will likely back up point guard Mo Williams, who was acquired in a trade this summer from Milwaukee. West could also get time at shooting guard along with Daniel Gibson, another restricted free agent signed by the Cavaliers during the offseason.
"He's a tremendous defender and he's about what we want to be about on that end of the floor," Cavaliers general manager Danny Ferry said.
Ferry said West's decision to work out at the Cavaliers' training facility this summer assured both sides that he wanted to stay in Cleveland.
"It was a very healthy thing for the process. It kept the relationship on a good, positive level," Ferry said. "He wanted to be part of what we're working toward. We've said all along that we want Delonte on this team. He's a good player and can make us a better team."
Ferry is excited about Cleveland's potential this season. Williams will give the Cavaliers a second, bona fide perimeter scoring threat to complement superstar LeBron James.
"We have guys who really love to play and love to compete," Ferry said. "We have really good depth everywhere and we have a solid balance of youth and experience."
ESPN.com senior NBA writer Marc Stein contributed to this report. Information from The Associated Press was used in this report.