Steeves has been a sensational player for the Toronto Marlies. Last season, he had 27 goals and 57 points in 65 games. Moreover, he has played seven games in the NHL and has one assist to show for it. The Leafs like what they've seen, so they figured a two-way contract would be a great way to reward him for his efforts.
According to Puck Pedia, the contract is worth $775K if he plays in the NHL. However, he will only get $300K while in the minors. $350K is guaranteed, so no matter what, it's not like Steeves is making a bad living or anything.