A source says the defenceman agreed to terms on a one-year deal.
Franson, 26, had four goals and 25 assists during a career year in 2013. He's expected to play top-four minutes this season.
"Franny's back!" centre Nazem Kadri wrote on his Twitter account.
His signing does put the Leafs in a crunch against the salary cap, especially considering right-winger David Clarkson is suspended for the first 10 games of the regular season.
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