A source told ESPN.com's Chris Sheridan that the Celtics made Davis an offer of a third season that would have kept him in green through the 2011-12 season, but Davis chose instead to do a deal that allows him to become an unrestricted free agent in the summer of 2011 -- at the completion of his fourth NBA season.
Davis will receive $5 million in base salary and can earn an additional 500,000 per season for meeting certain weight clauses, a source told ESPN.com's Chad Ford.
Some expected Davis' value to be higher after he performed admirably in the playoffs filling in for the injured Kevin Garnett, but his restricted free-agent status and the tight NBA financial climate limited his options. By turning down a guaranteed third year, Davis will become unrestricted one year earlier than he would have had he been drafted in the first round and been subject to the NBA's rookie salary scale.
The Celtics also signed free agent Shelden Williams on Monday, adding a second young forward to a frontcourt that broke down last season in the playoffs. Davis, who's 23, and Williams, who will be 26 by opening night, give Boston some youth at a position that has shown its age.
"We've got a lot of veterans and we also have a lot of young guys," general manager Danny Ainge said. "I don't think we needed to add a bunch of older, aging guys."
Garnett missed the entire playoffs last spring, Leon Powe went down early in the postseason with a knee injury and Brian Scalabrine was coming off multiple concussions as the Celtics bowed out in the conference semifinals. Davis was pressed into the starting lineup and went from 21 minutes per game to 36 while bumping his scoring average from 7.0 points to 15.8 a game.
"Glen really came into his own last season in the second half when he got a chance to play," Ainge said. "He wants to play. Just like all young players, he wants a more significant role."
This offseason, Ainge made forward Rasheed Wallace his top target, signing him to a three-year deal. And now the frontcourt is complete, with Davis and Williams ready to come off the bench.
"We have some guys who are getting up there in age. I think it's important to surround our Big Three and Rasheed with young guys," Ainge said. "We feel like we've got one of the best front lines in all of basketball. We have six really good basketball players on our front line right now. It's a long season; we're going to need all the bodies we can get."
Ainge said he believed all along that Davis would be back, but it took the two-year pro out of Louisiana State a while to realize that restricted free agency wasn't going to be the lucrative payday he expected. Other teams may have stayed away because they assumed the Celtics would match any offer.
"You could have called me," Ainge told Davis' girlfriend. "I would have told you he'll be back. ... We came through. We like Glen more than anybody else out there."
Davis said the offseason has been an education about the business side of basketball -- especially how it affects young players with limited options.
"I feel like I've grown up so much this whole summer in terms of being a professional and being an adult," Davis said. "The Celtics organization is a great thing to be a part of."
Williams knows what he means.
The fifth overall draft pick out of Duke in 2006, he played in plenty of big college games -- including a third-round loss in the 2006 NCAA tournament to Davis' Louisiana State team. But in three seasons with Atlanta, Sacramento and Minnesota, Williams has never appeared in an NBA playoff game.
Now he's back in a place with high expectations.
"I assume it will be similar to what it was in college," he said. "For me to come in here and fill out my role -- whatever that might be -- it's an exciting time."
Information from ESPN.com's Chris Sheridan and The Associated Press was used in this report.