Roy Halladay and the Phillies have come to an agreement on a contract that would put in motion a three-team trade that would send the Toronto Blue Jays ace to Philadelphia, sources told ESPN The Magazine's Buster Olney.
Halladay was taking his physical Tuesday morning, sources said.
The parties have agreed on a three-year deal, running 2011 to 2013 at $20 million a year, plus a $20 million vesting option for 2014, according to sources.
The status of the other portions of a companion deal that would include the Seattle Mariners, however, is still uncertain at this point.
As of early Tuesday morning, the Phillies were to send their Cy Young Award winner, Cliff Lee, to Seattle, in exchange for pitching prospect Phillippe Aumont and outfielder prospect Tyson Gillies, sources told ESPN.com's Jayson Stark.
In addition, ProspectInsider.com reported that the Phillies would get a third Mariners prospect, right-hander Juan Ramirez.
The Phillies were to send outfielder Michael Taylor, catching prospect Travis d'Arnaud and pitcher Kyle Drabek to Toronto, sources told ESPN.com.
The Blue Jays, as part of the Halladay deal, would fork over $6 million to the Phillies, according to CSNPhilly.com.
On Tuesday, sources said the Blue Jays would take Taylor and trade him to Oakland for Brett Wallace, the corner infielder and former No. 1 pick whom the Athletics got in the Matt Holliday trade in July.
If all of the names being bandied about wind up in this deal, the Phillies would get back what Baseball America rates as the Mariners' top two pitching prospects, plus Gillies, an outfield prospect they view as being similar to Taylor. So although the Phillies would be giving up two of their most highly regarded prospects in Drabek and Taylor, they would look at this deal as not significantly depleting their system for the long haul.
In effect, the Phillies would be trading one Cy Young (Lee) for another (Halladay). And while that may seem difficult to understand from afar, the Phillies clearly view it as a swap that enables them to keep one of those Cy Youngs well into the future -- a less likely scenario if they held on to Lee.
Although the Phillies have done next to no actual negotiating with Lee, they heard enough rumblings that Lee wanted a CC Sabathia-type contract that they believed it would take a five-year or six-year deal to keep the 31-year-old left-hander. And the Phillies have an organizational philosophy that precludes deals longer than three years for starting pitchers.
The Mariners, meanwhile, were looking for a top-of-the-rotation starter to pair with Felix Hernandez. And Halladay, who has a no-trade clause, wasn't an option because he wouldn't approve a trade to Seattle. So the Mariners opted to deal for Lee after it became clear their other top target, John Lackey, was bound for Boston as a free agent.
Before turning to Seattle, multiple sources say, the Phillies first attempted to complete a two-team deal with Toronto alone for Halladay. However, the Phillies refused -- as they had last summer -- to include both Drabek and top position-player prospect Domonic Brown in that trade. So they began looking for another team that could help them meet the Blue Jays' price.
Halladay, 32, is 148-76 lifetime with a 3.43 ERA. He won the 2003 Cy Young Award and finished in the top five in the Cy Young voting four other times.
Halladay went 17-10 with a 2.79 ERA in 32 starts for Toronto last season. He threw 239 innings and led the league with nine complete games.
The Phillies acquired Lee from the Indians on July 29 for four minor leaguers.
Lee quickly became Philadelphia's ace. He posted a 3.39 ERA in 12 starts for the Phillies and then went 4-0 with a 1.56 mark in five postseason outings, including 2-0 in the World Series.
Lee, the 2008 AL Cy Young Award winner with Cleveland, will make $8 million in 2010 and then be eligible for free agency.
Information from ESPN The Magazine senior writer Buster Olney and ESPN.com's Jayson Stark and Jerry Crasnick was used in this report.