Tom Brady has agreed to a three-year, $27 million contract extension with the Patriots, a deal that will keep him with New England through the 2017 season, a league source confirmed to ESPNBoston.com's Mike Reiss.
The extension includes a $3 million signing bonus along with annual salaries of $7 million in 2015, $8 million in 2016 and $9 million in 2017, when Brady will turn 40, according to the source.
Brady's relatively modest deal frees up $15 million worth of salary-cap space for the Patriots in the 2013 and 2014 seasons, a league source told ESPN.
Though other quarterbacks recently have signed deals nearly twice as lucrative, Brady has made it clear he wants to play until he's 40 and finish his career with the Patriots, whom he led to Super Bowl wins for the 2001, 2003 and 2004 seasons, and losses in the big game after the 2007 and 2011 seasons. Monday's extension should help New England maintain a competitive team around the two-time NFL MVP.
The Patriots gained $8 million in salary-cap space this year and $7 million in cap room next season. Brady's cap numbers, which were scheduled to be $21.8 million in each of the next two offseasons, now will be $14.8 million this season and $13.8 million next season.
Brady and the Patriots started discussing the extension about a month ago, according to a league source. Brady was willing to accept this deal, the source said, because of the trust that exists between the two-time Super Bowl MVP and the team.
Brady feels that in giving New England this cap flexibility, the source said, he trusts the Patriots will add the right players to finish his career with the best chance to win another Super Bowl.
Sports Illustrated reported earlier Monday that Brady and the Patriots had agreed to the extension.
Brady has been the most successful quarterback of his era as well as one of the NFL's best leaders.
His skill at running the no-huddle offense is unsurpassed, and he's easily adapted to the different offensive schemes New England has concentrated on through his 13 pro seasons.
The Patriots have gone from run-oriented in Brady's early days to a deep-passing team with Randy Moss to an offense dominated by throws to tight ends, running backs and slot receivers.
Brady holds the NFL record for touchdown passes in a season with 50 in 2007, when the Patriots went 18-0 before losing the Super Bowl to the Giants. He has thrown for at least 28 touchdowns seven times and led the league three times.
Last season, Brady had 34 TD passes and eight interceptions as the Patriots went 12-4, leading the league with 557 points, 76 more than runner-up Denver.
ESPNBoston.com's Mike Reiss and Field Yates, ESPN NFL Insider Adam Schefter and The Associated Press contributed to this report.