Well, there goes the idea of Peyton Manning playing for the Jets.  The three-year contract extension makes Sanchez the 7th highest paid Quarterback in the NFL.  Check the jump for the full details!

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The deal includes $20.5 million in guarantees for 2012 and 2013 and $40.5 million in “new” money, bringing his total over five years to $58.25 million, according to sources. He can make an additional $10 million in escalators.

The amount of money in the contract virtually assures that Sanchez will be the starter for at least two more seasons. Sanchez, speaking to reporters for the first time since the season ended, said he wasn’t bothered by the Manning speculation.

“Not at all,” he said late Friday night on a conference call. “The best part about it is, they chose to stick with me. I’m going to be their starting quarterback for the next few years here and that’s exciting. I’m the leader of this team and I’m excited to get back.”

Tannenbaum said they decided after the season to extend Sanchez’s contract, which had two years remaining but no guaranteed money. At the same time, Tannenbaum never shut the door on Manning, fueling the speculation the Jets were mulling a quarterback change.

Perhaps it was posturing to create leverage in the negotiations, but the Manning flirtation also threatened to weaken Sanchez’s stature in the locker room. There was concern within the organization about how Sanchez would handle it, sources told ESPNNewYork.com.

Early Friday afternoon, reports began to circulate that Manning had begun to take recruiting trips and the Jets, not surprisingly, weren’t on his itinerary.

Around 7 p.m., the Sanchez deal was finalized, according to Tannenbaum, who claimed they were in negotiations for several weeks.

“We looked into that possibility as someone to add to our team,” Tannenbaum said of Manning, declining to characterize the level of interest. “We had discussions internally. We monitored the situation. As events continued to unfold, we kept pushing the extension with Mark.”

Pressed about their interest in Manning, Tannenbaum said, “When a first-ballot, Hall-of-Fame quarterback becomes available, you look into it.”

The extension is surprising because Sanchez didn’t improve as the organization had hoped, as the Jets finished a disappointing 8-8. Sanchez threw a career-high 26 touchdown passes, but he also suffered a career-high 26 turnovers, played poorly down the stretch and feuded with wide receiver Santonio Holmes. He was criticized by teammates for being “coddled.”

A few days after the season, Tannenbaum acknowledged that Sanchez “didn’t play well.” So why the long-term commitment?

“We’ve won a lot of football games with Mark as the staring quarterback of the New York Jets and that’s what really concerned us,” said Tannenbaum, noting Sanchez’s four playoff victories. “It’s not a projection, it’s not a hope, it’s not an incremental leap of faith. Here’s a three-year body of work.

“That said, we don’t have blinders on. It has to get better and it will get better. We think he’ll become more consistent. Taking a long view of things, we’re excited and encouraged by the trajectory of Mark’s career.”

Sanchez said his performance last season will fuel him and he also downplayed the well-documented rift with Holmes, claiming he’s been “in contact with him for the whole offseason” and that he has visited Holmes at his home in Atlanta.

“If anything, this past year, I learned more than my first two years combined, how to handle adversity,” Sanchez said.

Publicly, the Jets always said they expected Sanchez to be their starter in 2012, but they kept the Manning speculation alive, perhaps purposely.

They were one of 12 teams that contacted Manning’s representatives, ESPN reported. Manning was released Wednesday by the Indianapolis Colts, and by Friday afternoon it was apparent he had no intention of signing with the Jets.

Source ESPN