The commissioner's office and players union approved the deal Saturday, and the Blue Jays announced the extension Monday.
Wells' pact, the sixth-largest in baseball history, would give him a $25.5 million signing bonus, no-trade clause and guarantee him the right to opt out of his contract after four years. In addition, he could earn bonuses of $250,000 for MVP, $200,000 for World Series MVP, $150,000 for league championship series MVP and $100,000 for receiving the most votes in his league in All-Star game balloting.
"How can you not be happy?" Wells said during a telephone interview with The Associated Press several hours before terms of the deal were finalized Friday. "Like I said, my family comes first. Obviously this gives me an opportunity to set my family up for a couple of generations. That's the biggest part of this thing. And this gives me a chance to do something special in Toronto that hasn't been done in awhile."
The contract value trails only those of Alex Rodriguez ($252 million), Derek Jeter ($189 million), Manny Ramirez ($160 million),
Todd Helton ($141.5 million) and Alfonso Soriano ($136 million). It is the 13th $100 million deal in baseball history and the third of the offseason, following those of Soriano with the Cubs and Carlos Lee ($100 million) with Houston.
Wells is due $5.6 million next season in the final year of his old contract. The extension calls for a $25.5 million signing bonus, payable in three $8.5 million installments each March 1 in 2008, 2009 and 2010. He will receive a salary of just $500,000 in 2008 and $1.5 million in 2009, but his salary jumps to $12.5 million in 2010 and $23 million in 2011. Wells receives $21 million in each of the final three seasons.
Under the extension, Wells has the right to terminate his agreement after the 2011 season and become eligible for free agency. In addition, he will donate $143,000 annually to the Jays Care Foundation.
Wells hit .303 with 32 homers and 106 RBI last season and is due $5.6 million next season. He would have been eligible for free agency after next season.
He thought about trying to play with hometown Texas Rangers.
"The ballpark is 20 minutes from my house. It's obviously a temptation, but [with] everything that I've gone through with Toronto and the relationships I've built there, it's tough to leave," Wells said.
General manager J.P. Ricciardi is working to finalize the deal.
"We've said all along we're going to make every effort to sign him," Ricciardi said.
The contract will be the largest in franchise history -- dwarfing the $68 million, four-year deal that Carlos Delgado got from Toronto in 2000.
"How can you not be happy? This gives me a chance to do something special in Toronto that hasn't been done in awhile."
Ricciardi inherited Delgado's contract when the team's payroll was around $50 million, but it will be more than $90 million next season. A stronger Canadian dollar and ownership of the Rogers Centre is allowing the team to spend more.
In the final month of the season, Rogers Communications chief executive officer Ted Rogers agreed that the team needed to increase its $72 million payroll to compete with New York and Boston in the AL East. The Blue Jays finished second in the division, trailing New York, which had an opening-day payroll of $198 million. Boston ($120 million) finished third.
Ricciardi said retaining Wells gives Toronto one of the best lineups in baseball.
"I know Gibby likes him in the third hole. We like our lineup. We think it's as good a lineup as there is in the American League," Ricciardi said.
The Blue Jays signed pitchers A.J. Burnett and B.J. Ryan to long-term contracts worth $102 million last year, but have been less active thus far this winter. After signing DH Frank Thomas to a two-year, guaranteed $18 million contract, general manager J.P. Ricciardi missed out in his efforts to sign pitchers Ted Lilly and Gil Meche.
Toronto could have traded Wells if it didn't get an extension.
The Blue Jays didn't include Wells in advertisements this winter, leading many to speculate that they wouldn't re-sign him.
Wells, 28, said the contract doesn't necessarily mean he'll retire a Blue Jay. The contract is expected to include an opt-out clause.
"It all depends on where my career is," Wells said.
Information from The Associated Press was used in this report.