The Panthers reached an agreement in principle Wednesday night with former Redskins running back Stephen Davis.

Following a day of negotiations at Panthers headquarters with his agent, David Canter, Davis accepted a five-year, $15.5 million deal that will pay him more than $4 million in the first year of the contract. In addition, Davis could receive as much as $3.6 million annually in incentives that could ultimately increase the contract's worth to $36 million over five years.

Davis signed the contract Friday.

The agreement gives Davis, a native of Spartanburg, S.C., the opportunity to play close to home. Talks with the Panthers gathered steam during the past two days when the team took a more aggressive posture than the Houston Texans in trying to sign Davis.

Fantasy Focus

Only Priest Holmes and Curtis Martin outrushed Stephen Davis in 2001 (1,432 yards on a career-high 356 rushes). But a change in head coaches and offensive philosophy deflated Davis' 2002 stats. Although Davis missed four games last year with shoulder and knee injuries, he was projected for 276 rushing attempts, his lowest since 1998. A workhorse back, Davis flourishes in a run-first offense built around him. The Panthers like to run more than most squads, totaling the 13th most attempts while throwing the fourth-fewest passes last season. Carolina's starting backs Lamar Smith, Dee Brown and Brad Hoover totaled 361 attempts, but were ineffective last year. However, Davis' running skills are still strong; he's averaged 4.0 yards for three straight seasons. This projects to 1,444 yards, similar to his superb 2001 season. Overall, expect Davis to become a top 10 fantasy back again, putting him in a class with Ahman Green. Unfortunately, for Carolina's 2002 first-round pick DeShaun Foster, his career remains on hold with a knee injury and Davis' signing. -- Roger Rotter, ESPN.com Fantasy editor Check out ESPN's Fantasy Football for more news ...

Carolina and Houston were the only teams Davis visited. The Texans complicated negotiations by not making Davis a firm offer, while Carolina made a firm commitment from the start.

"Stephen wanted to be in Carolina because this was his hometown team," Canter said. "It's a great situation for him there. He wants to prove that he is one of the best backs in the NFL."

Davis, 29, has consistently been among the league's top rushers, gaining 4,155 yards from 1999 to 2001. Injuries and a new Redskins offense limited his chances in 2002; Davis rushed for only 820 yards on 207 carries and seven touchdowns.

After being released by Washington, Davis learned just how tough it was to make big money in free agency. Only seven teams showed interest in a running back at all, and most were not a good offensive fit for him.

The Tampa Bay Buccaneers, for example, only have the cap room to offer a running back a deal close to the NFL minimum. The Lions may be looking to eventually replace James Stewart, but replacing a 31-year-old Stewart with a younger Davis would not be a priority.

And while the Cowboys may be looking for a replacement for Emmitt Smith, it would be hard for that back to be Davis, who played for the rival Redskins. The Bears want to upgrade their backfield, but will wait until the draft to do so.

That left Carolina and Houston.

Philosophically, the Panthers like to load their deals with incentives, a concept that appealed to Davis. He'll receive a $2.5 million signing bonus and an additional $500,000 roster bonus. Including his base salary and workout bonuses, Davis will make $4.1 million this season.

John Clayton is a senior writer for ESPN.com.