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Boston Red Sox
Details of the deal were still being negotiated and Damon must pass a physical, a baseball official said on condition of anonymity because negotiations were not yet final.
Damon's contract with the Yankees includes a partial no-trade clause, ESPN The Magazine's Buster Olney reported.
Moving from Fenway Park to Yankee Stadium will mean a change of style and scenery for the long-haired, bearded Damon -- a fan favorite in Boston for his scrappy play and scruffy look. But New York owner George Steinbrenner bans beards and long hair.
"Sad to say bye to some of the greatest fans in the world. Unfortunately they had to see this day, but it's time for me to move forward," Damon told WBZ television in Boston. "They were coming after me aggressively. We know George Steinbrenner's reputation.
"He always wants to have the best players, and I think he showed that tonight. He and Brian Cashman came after me hard," he said, referring to New York's general manager.
Damon fills a double void for the Yankees, giving them a speedy center fielder who can cover ground and a leadoff hitter to top a potent lineup that also includes Derek Jeter, Gary Sheffield, AL MVP Alex Rodriguez, Hideki Matsui and Jason Giambi.
Bernie Williams' defense declined significantly over the past four seasons, although he is expected to remain with the Yankees as a reserve. And while Damon's arm is not much better, the two-time All-Star does cover a lot of ground, which is important in Yankee Stadium.
|OTL -- Changing Colors|
Johnny Damon's new deal with the Yankees is yet another example of how the era of free agency has changed sports forever. Signing with your team's most hated and bitter rival was something stars from previous generations would never even consider, regardless of the financial incentives. Tonight on Outside the Lines, how today's sports world has redefined the way athletes prioritize money and loyalty. Jeremy Schaap hosts (ESPN, 1:10 a.m. ET/10:10 p.m. PT)
Agent Scott Boras had been seeking a seven-year contract for Damon. The offer Damon accepted was essentially the same as the deal Matsui agreed to with the Yankees last month.
Damon said Boston did not attempt to match New York's offer. Red Sox owner John Henry said in an e-mail to The Associated Press that Damon did not go back to the team to give it a chance to top the Yankees' offer.
"A good leadoff hitter is tough to find, and I think that New York just found the best leadoff hitter in the game," he told WBZ.
Damon is the first star player to switch sides in the Red Sox-Yankees rivalry over the past few years, although role players such as John Olerud, Alan Embree, Ramiro Mendoza and Mike Myers have done it.
"We were notified at 11:55 tonight that Damon had accepted an offer from the Yankees," Red Sox president Larry Lucchino said in an e-mail to The Associated Press.
New York, baseball's first team with a $200 million payroll last season, had a relatively quiet offseason until now. The Yankees, eliminated by the Los Angeles Angels in the first round of the AL playoffs, were overshadowed by the splashy Mets, who acquired slugging first baseman Carlos Delgado from the Florida Marlins and signed free-agent closer Billy Wagner to a $43 million, four-year contract.
Damon, who turned 32 last month, led Boston with a .316 batting average. He had 197 hits and scored 117 runs.
When Myers finalized his contract with the Yankees last week, he gushed about the prospect of having Damon in New York's lineup.
"I would put the over/under on Damon scoring 125, and I'd take the over any day of the week," Myers said. "I think the fans would absolutely love him there, just his hustle and his passion for the game, the way he goes about his business. I think he'd fit in great in the clubhouse, even though I don't know what the clubhouse is."
Earlier in the day, the Yankees closed in on a $2 million, one-year contract with reliever Octavio Dotel, who is recovering from elbow surgery.
Dotel's agent, Dan Horwits, said he spoke by phone with Cashman several times Tuesday in an attempt to work out the final details.
"It's close to being done, but it's not done yet," Horwits said. "We're still going back and forth just to try to finish up some loose ends. Assuming we can do that, he'll be a Yankee. But he's not a Yankee yet."
Dotel was already talking like he's ready to sign.
"I feel very happy with this contract," Dotel said. "This team has a lot of tradition, and it pleases me to know that they want me to pitch for them."
Dotel would get a $250,000 bonus if added to the 25-man active roster and could earn $3 million more in performance bonuses based on games. His deal contains an additional $2.5 million in bonuses based on games finished, in case he is traded to another team.
He had 36 saves for Houston and Oakland in 2004 but struggled last season with Oakland, going 1-2 with seven saves and a 3.52 ERA before he went on the disabled list May 20. From April 30 to May 11, he blew four saves in five outings.
Dotel had reconstructive elbow surgery June 6 to repair a torn ligament. He hopes to be pitching by midseason.
"What I do know is that it's going to help me to go back to what I like and that is to be a closer," he said.
With the Yankees, he would join several newcomers in the bullpen: right-hander Kyle Farnsworth and left-handers Ron Villone and Myers. New York has struggled to find middle-inning pitchers in recent years, and setup man Tom Gordon left to become the Philadelphia Phillies' closer.
Several teams had sought Dotel, including the crosstown Mets.
New York allowed left-hander Wayne Franklin to become a free agent, failing to offer a 2006 contract by the midnight EST deadline. The Yankees offered contracts to pitchers Shawn Chacon and Aaron Small, who are eligible for salary arbitration.Information from The Associated Press was used in this report.