The deal, according to reports, is worth $2 million.
Franson, a restricted free agent, had been sitting out of training camp. The one-year contract allows Franson, 26, to be eligible for salary arbitration next summer. He declined to file for salary arbitration during this past summer. Franson will be eligible for unrestricted free agency in two seasons.
The deal appears to be a compromise as the Leafs were looking for longer term during the negotiations and Franson's camp wanted more money annually.
"One year was important to us,” Franson told TSN via text message. "With the current cap situation a two-year deal was very difficult to get at what we felt was fair.
"A one-year [deal] was the most reasonable way for us to find a middle ground."
Franson led all Maple Leafs' defensemen last season with 29 points, which was tied for sixth among all NHL defensemen. He was fourth among all NHL defensemen with 25 assists. Franson played regularly in Toronto's top four and also saw key time on the power play.
"I want to keep progressing from last year," he told TSN, "take on a bigger role, be a consistent go-to guy, and be more productive in all areas of the game."
The signing of Franson, as well as the recent signing of forward Mason Raymond, will likely put the Maple Leafs in a bit of a salary cap bind until further roster moves can be made. Toronto's cap situation is further complicated by the suspension of star forward David Clarkson, who is ruled out for the first 10 games after leaving the bench to join an altercation during a preseason game earlier that week. Clarkson's salary during that time counts against the Maple Leafs' cap.
It also presents a possibly interesting dilemma for general manager Dave Nonis this summer as the Maple Leafs could have five defensemen on expiring deals this season. Franson, Paul Ranger, Mark Fraser, Jake Gardiner and team captain Dion Phaneuf are all in the final years of their current contracts.