Pena and the Rays have agreed to terms on a three-year contract through 2010, pending the completion of a physical. The contract will pay Pena $24.125 million over three years.
"I'm thankful, I'm excited," Pena said. "I'm looking forward to great things, but most of all, I'm very grateful."
Meanwhile, the Rays have reached a deal with Kazmir on a one-year contract for $3.785 million.
According to Andrew Friedman, the Rays' executive vice president of baseball operations, Pena's deal was finalized at about 2 a.m. ET Friday and Kazmir's deal was finalized later in the morning around 11:51, nine minutes before the deadline for players and organizations to exchange arbitration figures.
"It was always our intent to avoid going to a hearing," Friedman said. "It took both sides moving some to get a deal done. ... Obviously, it takes both sides being fair. And if both sides are approaching it that way, most times you're going to get a deal done."
Pena, 29, won the American League's Comeback Player of the Year Award after finishing the 2007 season with a team-record 46 home runs and 121 RBIs. Kazmir, who turns 24 on Jan. 24, went 13-9 with a 3.48 ERA in 2007 and won the American League strikeout crown with 248.
If Pena passes his physical, his deal insures he will be with the Rays three more seasons, while avoiding the possibility of arbitration this year and next and buying out Pena's first year of free agency. Terms of the agreement also call for Pena to donate $225,000 to the Rays Baseball Foundation, the team's charitable foundation that supports youth and education programs in the Tampa Bay region.
By signing Kazmir, the Rays avoided having an arbitration hearing with their prized left-hander, who made $424,000 in 2007.
Friday's news completed a busy week for the Rays, during which time they came to terms with right-hander Dan Wheeler, outfielder Jonny Gomes and Kazmir, signed Pena to a multiyear deal, and gained depth for their infield with the acquisition of Willy Aybar.
"It is a very good day for the organization," Friedman said. "And it's been a great week. And it's just adding momentum for pitchers and catchers in less than a month."
In some respects, the Rays are taking a leap of faith that Pena can continue to play at the level that he reached in 2007. If Pena does, the Rays will have one of the bigger bargains in baseball. Meanwhile, Pena will make more money than he would have going to arbitration, and he gets to remain with a team and a situation he found to his liking.
About the Pena deal, Friedman said, "It certainly wasn't lost on us how much he enjoyed being here."
He added that knowing the player from having him in the organization, knowing what he can do, the presence he has in the clubhouse, etc., were all motivating factors for wanting to sign him to a multiyear deal.
As for the prospect of signing Kazmir to a long-term contract, Friedman said they "don't comment on long-term contract discussions."
"But we have Kaz in a Rays uniform for a minimum of three years [before he is eligible to become a free agent]," Friedman said. "But when and if [they begin to talk a long-term deal with Kazmir or any player], we prefer to handle it privately."
Pena complimented his agent, Scott Boras, and Friedman for getting the deal done. Pena also complimented the organization for its fiscal approach that should see the payroll double into the neighborhood of $40 million for the coming season.
The growing payroll "doesn't surprise me," Pena said. "I think the [Rays] are moving in the right direction. And this is just part of it. I can see how hard Andrew Friedman has worked to improve the team -- to make our team competitive in this league and in our division."
Pena made just $800,000 in salary in 2007, with another $400,000 in incentives, after signing a Minor League deal with an invite to Spring Training. Originally, he did not even make the team out of Spring Training, but was added to the Opening Day roster when Greg Norton was injured.
"You can't understand how excited I am -- not only for personal success, but for team success," Pena said. "I feel even more humble than before. And I want to make sure for one second I don't take the uniform for granted."
In franchise history, only outfielder Greg Vaughn's four-year, $34 million deal signed in 2000 and pitcher Wilson Alvarez's five-year, $35 million deal signed in 1998, compare in stature to Pena's deal.
In the period since principal owner Stuart Sternberg's group got involved with the Rays, Carl Crawford was signed to a four-year, $15.25 million deal that with options could be worth up to $35 million, and Rocco Baldelli was signed to a three-year deal for $9 million that with options could be worth $32 million.
Bill Chastain is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.