Various media reports placed the value of the contract at $19 million. Baez passed a physical and met with the local media at a press conference.
"I prefer to sign here on the East Coast in the American League, and they gave me a very good deal," Baez said. "That was part of the decision."
The former Devil Ray said that four or five teams were interested in him but that coming back to the American League East tempted him. In addition, he admitted that he wants to be a closer, but understands that his role with the Orioles will be as a setup man for Chris Ray.
"I want to be a closer, no question," he said. "It's what I like to do, but I'm very happy to be here. I'm very happy to help the team win ballgames."
Mike Flanagan, the Orioles' executive vice president for baseball operations, said that Ray will remain the closer but that Baez will "be ready to help."
Flanagan said that he'd love to see a situation in which Ray has to save a bunch of games in a row and needs a break -- then they'd turn to Baez. But the bottom line is that this signing gives the Orioles more bullpen depth.
"We're working on the bullpen, [and] today was a big step," Flanagan said. "[We were] in dire need of [help in] the bullpen. More experience will help."
Flanagan added that acquiring someone with the experience Baez has will be a big plus, as the Orioles needed help in the middle innings and occasionally at setup. The Orioles' bullpen had the second-highest ERA (5.25) in the Majors in 2006, as well as 21 blown saves in 56 chances.
This move simply adds depth, as did last week's signing of 35-year-old Jamie Walker to a three-year deal worth $12 million. Walker, a left-hander, went 0-1 last season with a 2.81 ERA in 56 games for the AL champion Detroit Tigers.
"Danys gives us a strong right arm to add to our bullpen," Flanagan said. "We've said the bullpen was a target area for us, and this signing and last week's addition of Walker have greatly improved our ability to hold leads and get to our closer."
Ray, the 24-year-old righty who held opponents to a .193 batting average last season, will continue as the closer, with Baez and Walker solidifying the setup roles.
"Danny is extremely excited about going back to the AL East," Baez's agent, Greg Genske, told various media outlets on Sunday night. "He's happy to be going back to the East Coast and playing in Baltimore."
Baez, who turned 29 in September, has pitched six seasons in the Major Leagues, compiling a 31-37 record with 111 saves and a 3.79 ERA in 341 games. An American League All-Star in 2005, when he saved 41 games for Tampa Bay, he had the second-best percentage in the AL for holding inherited runners from scoring (18.8 percent) from 2001 to 2005 among relievers with 100 inherited runners or more.
He split the 2006 season between the Los Angeles Dodgers and Atlanta Braves, his first time pitching in the National League, going 5-6 with nine saves and a 4.53 ERA in 57 games. He had a 3.94 ERA before allowing four runs in one-third of an inning in his final outing for Atlanta on Aug. 22. He underwent an emergency appendectomy and was placed on the disabled list three days later, and missed the remainder of the season. Before being sidelined, he was on pace to match his appearances (67) and innings pitched (72.1) from the previous season.
Baez began 2006 as the Dodgers' closer after being acquired in a trade with Tampa Bay in January. He pitched to a 4.35 ERA with nine saves in 46 games for the Dodgers before being traded to the Braves on July 28 with third baseman Willy Aybar for infielder Wilson Betemit. He made 11 relief appearances for Atlanta before being sidelined by the appendectomy. He finished the season with only two home runs allowed in 59 2/3 innings pitched, ninth-best among NL relievers, and his ratio of 2.56 walks to nine innings pitched was 13th-best in the league.
Baez said on Monday that he was glad to have passed his physical and that he is at 100 percent once more. The right-hander said that he could have come back for the 2006 season's final week, but the games didn't mean anything, so the Braves let him sit out.
He also said that working with pitching coach Leo Mazzone is intriguing to him.
"That's one of the [interesting] things," Baez said. "You always want to have a good pitching coach, a guy that's got experience and a guy you know is going to help you. I'm very proud to be here and to have the opportunity to work with him."
The additions to the bullpen further strengthen a pitching staff that includes a rotation of Erik Bedard, Daniel Cabrera, Kris Benson, Adam Loewen and newcomer Jaret Wright. Bedard won 15 games last season and posted a 3.76 ERA.
Jeff Seidel is a contributor to MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.