Garza's representatives at CAA announced the new deal on Twitter: "#Cubs Matt Garza (@Gdeuceswild) agrees to a $10.25M contract to avoid salary arbitration." Garza himself revealed the contract on his Twitter account: "Business side over! Hooray! Time to focus on what really matters ... 2013 #GoCubsGo"
The Cubs were expected to make a formal announcement on Friday.
Garza avoided arbitration last year, signing a one-year, $9.5 million contract with the Cubs. There had been some discussion regarding a long-term deal for the right-hander, but that was tabled when he was limited to 18 starts because of a right elbow injury, which forced him to shut down after July 21.
Fellow Cubs pitchers Jeff Samardzija and James Russell were among the 133 Major League players who filed for salary arbitration on Tuesday.
This is the first year Samardzija and Russell are arbitration eligible, while Garza is in his final year of arbitration eligibility and will be a free agent after this season.
The two pitchers and the Cubs will exchange salary figures on Friday. If an agreement can't be reached, there will be a hearing sometime from Feb. 1-21 in front of an independent arbitrator.
Samardzija, who was 9-13 with a 3.81 ERA in his first full season as a starter, made $2.64 million last season, while Russell, who appeared in a career-high 77 games, made $512,500.
Carrie Muskat is a reporter for MLB.com. She writes a blog, Muskat Ramblings, and you can follow her on Twitter @CarrieMuskat. This story was not subject to the approval of Major League Baseball or its clubs.