The Baltimore Orioles and first baseman Glenn Davis agreed yesterday to terms of a one-year contract that will pay him a club-record $3.275 million and enable the sides to avoid a salary arbitration hearing that had been set for Thursday.

Davis, a consistent long-ball hitter acquired from the Houston Astros on Jan. 10 for outfielder Steve Finley and pitchers Pete Harnisch and Curt Schilling, had been seeking $3.65 million after making $1.985 million last season. The Orioles had been offering $2.9 million. Davis's and the club's submissions set arbitration records.

By splitting the difference with the Orioles, Davis becomes their first $3 million-a-year player. He will be making nearly $1 million more than their flagship player, shortstop Cal Ripken Jr. Ripken, who will make $2.3 million this year, the third of a four-year contract.

"This is the happiest I've ever been with a contract because of the way the Orioles dealt with me," Davis said through a club spokesman. "I really didn't want to go {to arbitration} and I don't think the club did. In this case, with me going to a new club, arbitration wouldn't have created a good atmosphere."

And the Orioles are trying to create as good an atmosphere as possible because Davis will be eligible for free agency at the end of the upcoming season.

As for the prospect of concluding a contract that would keep him in Baltimore after this season, Davis said yesterday's agreement is "a very good step for the future and I'm optimistic right now."

The Orioles, who settled with second baseman Bill Ripken over the weekend, still have one more arbitration candidate to deal with -- pitcher Jeff Robinson. Robinson, acquired last month from the Detroit Tigers for catcher Mickey Tettleton, made $410,000 last season. He is seeking $750,000 and the Orioles are offering $465,000. His arbitration hearing is scheduled for Feb. 20.

However, the Orioles, a year away from moving into their new stadium, still are not finished with Davis. It is believed they were prepared to give him a two-year contract, but that he was seeking a four- or five-year deal. Meanwhile, the arbitration date loomed.

One of Davis's agents, Mike Moye, said their desire was to discuss a one-year contract now, then tackle a multiyear agreement. He said discussions about that may begin during spring training, which starts next week.

"We wanted to give Glenn time to get used to being a Baltimore Oriole and get down to spring training," Moye said. "Then we can talk about a multiyear deal."

Asked how he felt about Davis's chances of reaching a multiyear agreement with Baltimore, Moye said he preferred to describe himself as "open-minded" rather than optimistic. Orioles officials hope to sign Davis to another contract by the July all-star break. If they can't, they believe their chances of keeping him will start to diminish.

Orioles General Manager Roland Hemond indicated the club is hoping Davis will enjoy playing in Baltimore to the point that it will become a factor in the negotiations.

Yesterday's agreement "gives Davis an opportunity to play in Baltimore and see how he feels about the atmosphere and the whole situation here," Hemond said. "We think he will find it to his liking."

As for Cal Ripken's feelings about Davis making so much more money than he is, Hemond said: "Being the gentleman and character that he is, I'm sure Cal Ripken understands the process. I'm sure he recognizes that we are trying to add to the ballclub, that we are trying to improve all the players by adding a player of the ability of Glenn Davis."

Several players from other teams also avoided arbitration by agreeing to contracts yesterday.

Blue Jays third baseman Kelly Gruber signed a three-year contract that the Associated Press said will amount to $11 million, which would make Davis and him the 35th and 36th players drawing $3 million single-season salaries. Cardinals second baseman Jose Oquendo accepted a four-year contract extension for $8.5 million.

First baseman Rafael Palmeiro agreed to a one-year contract for $1,475,000 with the Rangers, avoiding arbitration scheduled for Friday. Athletics shortstop Walt Weiss agreed to a one-year, $780,000 contract, but first baseman Mark McGwire remains headed for Friday arbitration.

It also appeared that Pittsburgh pitcher Doug Drabek will go through with his arbitration hearing today. He asked $3.35 million and the Pirates offered $2.4 million, before offering to settle at $2.7 million. The Pirates also face hearings with Bobby Bonilla, Barry Bonds and Jose Lind.

In one-year compromise signings, Indians outfielder Chris James agreed to $1,367,500; Red Sox pitcher Joe Hesketh, $465,000; Yankees shortstop Alvaro Espinoza, $610,000; Angels outfielder Dave Gallagher, $367,500; Expos catcher Nelson Santovenia, $282,000.

The Cardinals signed free-agent catcher Rich Gedman to a minor league contract. The Dodgers had an arbitration hearing with right-hander Tim Belcher, and invited free-agent left-hander John Candelaria to training. Left-hander Tim Birtsas, unable to win a steady spot in Cincinnati's bullpen, signed with Japan's Yakult Swallows.