"They swore I was the guy who would never," Bret Michaels, who asked his on-off girlfriend of 16 years Kristi Gibson to be his wife on the Monday night finale of his VH1 reality show, Bret Michaels: Life As I Know It, tells PEOPLE. "And it feels awesome."
The rocker had been thinking about proposing but couldn't seem to find the right moment. It seemed like everyone was geared up for it to happen at the anniversary dinner the night before at Mastro's, but Michaels, 47, felt like there were too many waiters and other patrons milling around.
"I wasn't ready there because I felt really strange," he says. "It would've been like, I'm in the middle of proposing and oh, by the way, there's a Cobb salad coming."
The real moment, filmed a couple weeks ago, came spontaneously instead, in the middle of a heart-to-heart with Gibson on the balcony of their Arizona home, says Michaels (whose parents divorced when he was 15).
Psyched Out"In my mind, it wasn't supposed to happen like that – I wanted it to be a little more like the movies, where the white horse gallops up and all that stuff," he says. "But when Kristi said, 'I don't need this ring, I don't need the piece of paper, I love you no matter what,' she took the pressure off."
"She used reverse psychology on me," Michaels says, "and it worked!"
"After that, I was so in the moment, I didn't feel like there was anyone around us," says Michaels, who laughs at how their daughters Jorja, 5, and Raine, 10, responded when they heard the news.
Says the rocker: "They were like, 'What? Who? What's going on?'"
Gibson is elated, too.
"I love him for him," says Gibson, who turns 40 Dec. 25. "I've been through everything with him. A ring and a paper wouldn't make me love him more. I'm just happy he's alive."
The Best Gift"But this is the best birthday and Christmas present ever," she says. "We'll be virgins stepping into the whole engagement and marriage thing. And with our girls growing up, we'll all have the same last name."
The engagement ring – formerly their "friendship ring with mega benefits" – will probably be revamped to reflect its new special status, says Gibson, noting that their jeweler Jacquelin Nerguizian has two rows of black diamonds that may be added to the huge cushion-cut rock with pave diamonds.
Though they haven't set a date yet – "It may be the longest engagement in history," says Michaels," but my intentions are good" – Gibson has an idea of where she'd like to tie the knot.
"Ever since I was young, I always said I'd want to go to some tropical island and get married on the beach," she says, adding that she'd love a dress like the one Megan Fox wore when she wed Brian Austin Green.
"I seriously would not want a big wedding," Gibson says. "So maybe we'll go away and then have a huge kick-ass party with family and friends."
For now, Michaels is just basking in getting over his personal demons.
"It was as real and sincere as it gets, and I feel absolutely great," he says. "And hopefully it'll work."