01:00 AM EDT on Sunday, April 9, 2006

Cubs general manager Jim Hendry agreed yesterday to a two-year contract extension through the 2008 season.

"It's something that I don't take lightly," said Hendry, who was in the final year of his contract. "It's a great, great franchise."

Since assuming the general manager duties from president Andy MacPhail in 2002, Hendry has orchestrated trades for Derrek Lee, Aramis Ramirez, Kenny Lofton and Juan Pierre, signed reliever Ryan Dempster and hired manager Dusty Baker. He also traded Sammy Sosa to Baltimore in February 2005 after the slugger wore out his welcome.

The Cubs won the N.L. Central and came within five outs of capturing the pennant before losing Games 6 and 7 of the 2003 NLCS to Florida. After going 89-73 in 2004, the Cubs stumbled to 79-83 last season.

"We have all the confidence in the world that he's capable of getting us to the World Series," MacPhail said.

Hendry, who joined the organization in 1994 as player development director, faces two big issues: the status of Lee and Baker. Both are seeking extensions in the final year of their contracts.

One day after saying he would break off negotiations for the rest of the season if the sides did not reach an agreement yesterday, Lee softened his stance.

"There could be loose ends if it does work out, so you can't really put in on (Saturday)," Lee said before yesterday's game against the St. Louis Cardinals. "If there's a gap, we'll see. But it sounded like they're getting close."

Hendry said formal negotiations with Baker have not begun. "I really haven't set a time frame. I feel the same way about Dusty Baker as I did the day we signed him."

OTHER GAMES

JAYS ACTIVATE ZAUN: The Blue Jays activated catcher Gregg Zaun from the disabled list yesterday and designated catcher Jason Phillips for assignment. Zaun was sidelined with a right-calf injury in spring training.

ORIOLES ADD HALAMA TO PEN: The Baltimore Orioles fortified their thin bullpen yesterday, purchasing the contract of veteran reliever John Halama and designating left-hander Eric DuBose for assignment. Halama went 1-0 with a 2.25 E.R.A. in eight games with Baltimore this spring before being optioned to Triple-A Ottawa on April 1. DuBose pitched in two games this season, including 3 2/3 innings Friday night against Boston in which he gave up four runs, eight hits and three walks.

Getting Halama could cost Baltimore the services of DuBose, who is out of options and could be claimed on waivers by another team.