Osgood and Wings general manager Ken Holland met for dinner Monday night in British Columbia, where both have summer homes, in hopes of moving closer to a new contract.
"In terms of numbers (salary), we're not that far apart," Holland said.
Legace and Osgood were the goaltending tandem last season, with Legace eventually earning the No. 1 job after Osgood was slowed at the start of the season because of a groin injury.
Osgood, 33, appeared in 32 games with a 20-6-5 record, 2.76 goals-against average and .897 save percentage.
Osgood and Legace can become unrestricted free agents Saturday.
But the Wings told Legace this month they won't re-sign him.
The Wings believe Osgood could be a valuable veteran reserve for whoever comes in as the new starter.
Holland also is hoping to close on deals with prospective free agents Nicklas Lidstrom and Brendan Shanahan. Holland will talk soon with the agents for each.
Holland also expects to talk with Steve Yzerman this week. Yzerman hasn't decided if he wants to return.
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This is a really bad move.