The Athletic's Scott Agness added that the deal "does not include any player or team options."
The Pacers and Sabonis came to the agreement just before the NBA's deadline for rookie-scale extensions, which is Monday at 6 p.m. ET.
This isn't the first time Indiana squeezed in an extension prior to the deadline. Last October, the Pacers agreed to a four-year, $72 million contract extension with center Myles Turner.
Team team has shown its commitment to playing big throughout the offseason, emphasize by its selection of center Goga Bitadze with the 18th overall draft pick in June. However, the addition of Bitadze reportedly threatened Sabonis' future with the team.
The Athletic's Sam Amick reported Friday that the Pacers had "engaged in active trade talks with several teams." Ultimately, the two sides were able to come to a resolution that kept Sabonis in Indianapolis.
The next issue is how the Pacers will utilize Sabonis. The 23-year-old started only five games last season behind Turner, but he has played at forward beside Turner in the past. During his 2016-17 rookie season with the Oklahoma City Thunder, the Gonzaga product started at power forward.
Kirk Goldsberry @kirkgoldsberry
Sabonis is a potential double-double machine. He's played well in relatively few minutes. Concerns about defense and floor spacing. per @wojespn, extension 4yrs/$77M Points / Rebounds per game 2016-17: 5.9 / 3.6 (20.1 mpg) 2017-18: 11.6 / 7.7 (24.5) 2018-19: 14.1 / 9.3 (24.8) https://t.co/UlYcORYGfA
Sabonis was one of several players to receive a rookie-scale extension Monday. The Sacramento Kings agreed to a four-year, $86 million deal with Buddy Hield in the morning, per Amick. The San Antonio Spurs extended Dejounte Murray, per Shams Charania of Stadium and Athletic, and the Boston Celtics extended Jaylen Brown, per Woj.