Houston Rockets coach Ime Udoka has agreed to a long-term contract extension that makes him one of the highest-paid coaches in the NBA, sources told ESPN on Thursday.

The deal is believed to be worth eight figures annually, sources said.

Udoka’s extension comes after he guided Houston to its first top-two seed in the West in seven years. In Udoka’s second season, the team went 52-30 and made its first playoff appearance since 2019-20, getting knocked out in the first round by the Golden State Warriors in seven games.

Rockets ownership, Tilman and Patrick Fertitta, and general manager Rafael Stone hired Udoka in 2023, and the sides have built a partnership on year-by-year progress and sustainability.

Houston has won 93 games under Udoka after winning a total of 59 games in the three seasons before he arrived, and it finished fifth in defensive efficiency this season. The Rockets ranked in the bottom five in defensive efficiency in 2022-23.

The New York Knicks had expressed interest in speaking with Udoka about their head coaching position, but Houston denied the request, sources told ESPN earlier this month.

Udoka joined the Rockets after he was suspended and ultimately fired by the Boston Celtics during the 2022-23 season for multiple violations of team rules. He led the Celtics to the NBA Finals in his only season as their coach in 2021-22.

Udoka’s extension marks another major piece of business for the Rockets this month. They re-signed center Steven Adams to a three-year, $39 million contract last week. Houston also has until June 29 to make a decision on guard Fred VanVleet’s $44.9 million team option, and the team is considered one of Phoenix Suns star Kevin Durant’s preferred trade destinations, sources previously told ESPN.