The deal is worth $35 million over four years, sources confirmed to ESPN's Bobby Marks. Melton's salary will start at $9.6 million and decline each year, sources say.
Melton was a second-round draft pick of Phoenix in 2018, but after just one season there, the Suns shipped him and lottery bust Josh Jackson to the Grizzlies as part of a multiplayer deal.
Melton mostly saw action at shooting guard for Memphis after primarily playing the point for Phoenix. One problem: He has struggled with his shot in two NBA seasons, shooting 39.7 percent from the floor and 29.4 percent from 3-point range.
But he has provided value in other areas, specifically defense. A disruptor on the perimeter, he managed 3.1 steals per 100 possessions, the most on the Grizzles among players who saw action in at least five games. And he enjoyed a 9.9% rebound rate, a high mark for a 6-foot-2 guard.