Ubaldo Jimenez is officially a free agent. The Indians exercised their 2014 option on Jimenez, but he immediately voided it (which he had the right to do due to his being traded to Cleveland by Colorado, there he signed the deal), and will instead become a free agent. This news was expected, but there was some uncertainty over when it would happen.
The Indians must now decide whether or not to make Jimenez a $14.1 million qualifying offer. If he declines that offer, and goes on to sign with another team, the Indians would receive a compensation draft pick between the 1st and 2nd rounds of next June's draft. It is a certainty that the Indians will choose to give him the QO, perhaps as soon as today, or as late as Monday afternoon.
It is a near certainty that Jimenez will then decline that offer, because he would become one of the top three starting pitchers on the free agent market, and land a 3 or 4years deal for something in the $12-15 million per year range. The only scenario in which he accepts the option would be if he believes he can have a full season as good as his second half was in 2013 (he was the best pitcher in the American League after the All-Star break), in which case he could take the QO, hit free agency again in a year, and seek a contract in the neighborhood of 4 years, $80 million. I don't expect that to happen though, as the risk of negative regression and/or injury is too great when he's already in line for a very large deal now.
Jimenez will probably be too expensive for the Indians to keep. I think the budget they're likely to keep has room for his contract, but would limit them to signing anyone else for more than roughly the league minimum, so I anticipate they'll sign a cheaper arm (perhaps Scott Kazmir), and leave themselves some money for a bat and/or relief pitcher.