Pitcher Cliff Lee reached an agreement on a deal to rejoin the Philadelphia Phillies late Monday night, a Texas Rangers team source told ESPNDallas.com's Richard Durrett.

Lee personally notified the Rangers that they were out of the running while Lee's agent informed the New York Yankees that the left-hander would be signing elsewhere, according to another source.


Lee's deal with Philadelphia is for five years with a vesting option for a sixth, a source said.

ESPN The Magazine's Buster Olney confirmed that the Yankees received word late Monday that they're no longer in the picture for Lee, while Durrett confirmed that the Rangers had also been eliminated from the Lee sweepstakes.

New York's last offer to Lee was a six-year, $138 million proposal with a player option for the seventh year, a source told Olney. Texas' best offer, according to reports, topped out at six years and more than $20 million annually.


Lee had been weighing offers from the Yankees and Rangers against a spirited late bid by his former team, the Phillies. After acquiring Lee via a trade with the Cleveland Indians during the 2009 season, Philadelphia traded the lefty to the Seattle Mariners and then executed a trade with the Toronto Blue Jays to bring in Roy Halladay prior to the 2010 season.


By bringing Lee back, Philadelphia will sport a rotation featuring Halladay, Roy Oswalt and Cole Hamels.


Joe Blanton, who went 9-6 last season with the Phillies, could be on the move, a source said.

Lee, 32, joins Carl Crawford of the Boston Red Sox and Jayson Werth of the Washington Nationals as the third free agent to sign a contract of more than $100 million this offseason.


Both the Rangers and Yankees have made serious runs at Lee in recent weeks, sending emissaries to his home in Little Rock, Ark., and going beyond their initial packages to add years and dollars to their offers.

Baseball sources said the Phillies, who had been lurking on the periphery, jumped into the process with fervor after the winter meetings in Florida last week.

In his first stint with Philadelphia, Lee posted a 7-4 record with a 3.39 ERA during the regular season before helping lead the Phillies to a World Series appearance against the Yankees. Lee went 2-0 with a 2.81 ERA against New York, but the Phillies fell to the Yankees in six games.


Despite, in essence, being traded away by the Phillies in order to acquire Halladay, sources said Lee developed a fondness for his teammates and the city of Philadelphia and would be interested in returning if the Phillies could come up with a package that's competitive with the Yankees and Rangers.

Lee has a career record of 102-61 with a 3.85 ERA in nine seasons with Cleveland, Philadelphia, Seattle and Texas. He's 7-2 with a 2.13 ERA in the postseason over the past two years, and was unbeaten in October before suffering back-to-back losses to San Francisco Giants in the World Series.