Shams Charania of The Athletic and Stadium first reported the news Thursday.
The deal will bind Waiters to the Lakers for the remainder of this season, but as Charania noted, Waiters will need to take advantage of his latest opportunity:
Memphis is overachieving and has a real shot of making the playoffs. Sitting in the eighth seed, the team owns a 3.5-game advantage on the ninth-place Portland Trail Blazers.
Although earning a postseason trip would be a pleasant surprise for the team, the front office is looking more toward the future.
Based on how his career has unfolded, Waiters probably wasn't the kind of player to add to a locker room full of younger players still in the development phase.
His departure from Miami brought an end to a tumultuous final season with the Heat. He received a one-game suspension for conduct detrimental to the team in October and a 10-game ban for the same reason in November.
ESPN's Brian Windhorst and Adrian Wojnarowski reported Waiters had a "panic attack" on a team flight after "consuming a THC-infused edible."
He made only three appearances for Miami this season before the Heat moved on.
Since his once-burdensome contract—he re-signed with the Heat for four years and $52 million in 2017—no longer factors into the equation, Waiters was bound to generate some interest following his departure from Memphis.
He's averaging 13.2 points per game over his career while shooting 41.2 percent from the field and 34.8 percent from beyond the arc. Occasionally, he has the kind of game that makes fans remember the potential that helped him become the No. 4 pick in the 2012 draft.
In addition to his issues away from the court and inconsistent scoring, though, Waiters hasn't played more than 46 games since the 2015-16 season. Every time he started building some forward momentum in South Beach, a new injury would sideline him.
Having expended so much to acquire Anthony Davis, the Lakers didn't have enough assets to swing a major trade prior to the deadline. They were unable to land Marcus Morris Sr., who instead headed to the Los Angeles Clippers.
Marc Stein of the New York Times reported Feb. 6 that Los Angeles planned to look at JR Smith, which showed how wide a net general manager Rob Pelinka was casting.
Waiters might be able to provide the instant scoring the Lakers have lacked at times this year, especially when they have to rest Anthony Davis or LeBron James.
Signing Waiters carries obvious risk for Los Angeles, but landing significant difference-makers at this stage of the season is nearly impossible. General managers largely look to the buyout market and free agency to improve around the margins rather than transforming their rosters.
If Waiters can enjoy a standout performance in a playoff game, he will have justified the Lakers' investment.