A person with knowledge of the agreement told The Associated Press that Allen will get $15.5 million guaranteed on a deal that could be worth as much as $32 million. The person requested anonymity because the terms have not been announced.
Allen's deal can be voided down to three years and $24 million, but the first two years of his salary and a roster bonus next March are fully guaranteed.
The 31-year-old Allen will take over for Julius Peppers, who signed with Green Bay as a free agent after being released by the Bears. Chicago's defense ranked 30th in the NFL last season and was 32nd and last against the run.
Allen spent the previous six years with the NFC North rival Minnesota Vikings. He had 11 1/2 sacks last season and has reached double digits in sacks for seven straight years. He is considered a solid run defender.
Allen also had talks with the Seahawks and Cowboys. His move to the Bears adds plenty of intrigue to the NFC North picture.
The Vikings acquired Allen from Kansas City in 2007 and signed him to a six-year, $73 million contract that at the time made him the highest-paid defensive player in the league. Allen was one of the most-feared pass rushers in the NFL over the life of that deal. In 2011, he had 22 sacks.
He made $17 million last season and the Vikings, who were coming off a disappointing 5-10-1 record, were looking to get younger at the position.
Minnesota signed Everson Griffen to a big contract to take Allen's place and also said goodbye to stalwart defensive tackle Kevin Williams in a revamped front four under new coach Mike Zimmer. The Vikings did express some interest in having Allen return, but it became clear early in the process that the numbers wouldn't match up.
Allen said he wasn't looking to simply chase Super Bowl rings or become a situational pass rusher at this stage of his career, so he took his time trying to find the right fit. When Allen hit the market with Peppers and the Cowboys' DeMarcus Ware, three of the most accomplished defensive ends of their generation were available. Ware signed with Denver and Peppers got a three-year, $26.5 million deal with $7.5 million guaranteed from the Packers earlier in free agency.
"He would certainly have a good fit here and a great opportunity, so we'll see how that comes together," Bears general manager Phil Emery said two weeks ago.
It came together in a big way Wednesday. Allen is by far the signature addition in a busy offseason.
Besides letting Peppers go, the Bears brought back two-time Pro Bowl cornerback Charles Tillman on a one-year deal.
They also have new defensive ends in Willie Young and Lamarr Houston. They added Ryan Mundy and M.D. Jennings to the mix at safety and signed lineman Israel Idonije, hoping to boost a defense that got shredded last season.
Injuries played a big role in that. So did poor execution.
Either way, that group took a big step back, and the Bears missed the playoffs for the sixth time in seven years. Now, maybe, they will have the defense to go with an offense that flourished in Marc Trestman's first season as coach.
If nothing else, they created a big stir by adding Allen.
"A changing of the guard in the #NFCNorth. #69 a Bear! It's looking up for this bunch! Welcome JaredAllen69," star linebacker Lance Briggs wrote on Twitter.