No Mariners player has gone all the way to an arbitration hearing since pitcher Freddy Garcia in 2003.
According to USA Today, Smoak's deal will pay $2.63 million for 2014. If he accumulates 525 plate appearances this season, the '15 option kicks in at $3.65 million, with a $150,000 buyout clause.
Smoak asked for $3.25 million for 2014 when each side filed numbers in the case last month, while the Mariners countered with an offer of $2.025 million.
The 27-year-old hit .238 with 50 RBIs and a career-high 20 home runs last season, despite being placed on the 15-day disabled list in June with a right oblique strain. He hit 17 of those homers in his final 85 games after coming off the DL on June 18.
The 6-foot-4, 230-pounder played in 131 games last year and led the team with 30 two-out RBIs, while also ranking fifth among American League first basemen with a .995 fielding percentage.
His .334 on-base percentage and .412 slugging percentage were both the best of his career.
Smoak is in his first year of arbitration eligibility. If the Mariners exercise the 2015 option, he'll have one more season of arbitration before becoming a free agent in '17.
Seattle acquired Smoak from the Rangers on July 9, 2010, as a part of the Cliff Lee trade. He was originally selected by the Rangers in the first round (11th overall pick) of the 2008 First-Year Player Draft out of the University of South Carolina.
Greg Johns is a reporter for MLB.com. Follow him on Twitter @GregJohnsMLB as well as his Mariners Musings blog. This story was not subject to the approval of Major League Baseball or its clubs.