Cleveland have signed RHP Kevin Millwood to a one-year contract worth $7 million. Millwood, 30, is coming off elbow troubles in 2004 when he earned $11 million while going 9-6 and with a 4.85 ERA in 25 starts.

Though Millwood should be a capable no. 3 starter behind C.C. Sabbathia and Jake Westbrook, it’s unclear if he’ll regain the form he flashed for Atlanta earlier in the decade. The AP outlined the financial terms thusly :

Under the deal with agent Scott Boras, Millwood is guaranteed $3 million from Cleveland. He gets a $4 million signing bonus, but that money is contingent on him not spending more than 20 days on the disabled list for a shoulder or elbow injury sustained while pitching – not fielding or batting.

Millwood also can earn an additional $1 million in performance bonuses, getting the full amount if he makes 34 starts or pitches 215 innings.

If Millwood spends 21 or more days on the DL for an injury to his shoulder or elbow sustained while pitching, he would lose 1/183rd of the signing bonus for each day on the DL, including the first 20. That reduction calculates to $21,857 per day.

Millwood said he thought teams may have shied away because of his injury. Needing some veteran help in their rotation, the Indians were willing to take a chance.

“It was definitely the best offer I got,” Millwood said.

Indians GM Shapiro acknowledged Millwood could parlay a strong 2005 season into a big free-agent deal and leave the Indians after only one year, but also said he was worth the gamble.

Because of the team’s limited payroll, “we are always extremely careful in assessing risk,” Shapiro said.