Dan Haren became a free agent after the Los Angeles Angels failed to work out a trade and then declined the pitcher's 2013 option.
Haren, a three-time All-Star from 2007-09, gets a $3.5 million buyout under the deal, which included a $15.5 million club option for 2013.
Hours earlier on Friday, the Angels agreed to trade Haren to the Chicago Cubs for closer Carlos Marmol. But the deal fell apart, a person familiar with the negotiations told The Associated Press.
The person spoke Friday night on condition of anonymity because the trade did not get completed.
Marmol's contract gives him the right to submit a list of up to five teams he can't be traded to without his consent. The person said Marmol told the Cubs he would consent to the trade, but would not say whether the reliever provided his written consent.
The trade agreement was first reported by the Chicago Sun-Times. A spokesman for the Cubs declined to comment.
The Angels had until midnight EDT on Friday to exercise Haren'...