The 28-year-old forward could have become an unrestricted free agent July 28. He scored seven points (five goals, two assists) in 28 games this season and ranked third among San Jose skaters in penalty-kill time on ice (77:49), averaging 2:47 per game while shorthanded.
"Matt brings a consistent, veteran presence to our lineup, and his speed and defensive awareness have made him a valuable part of our penalty-killing unit," Sharks general manager Doug Wilson said. "Additionally, his ability to chip in offensively gives our coaching staff a versatile option in crafting our lineup from night to night."
Nieto missed the final 28 games of the season after he was injured during a 2-1 overtime loss to the St. Louis Blues on March 19, his 500th regular-season game in the NHL.
Selected by the Sharks in the second round (No. 47) of the 2011 NHL Draft, Nieto has scored 158 points (67 goals, 91 assists) with the Sharks and Colorado Avalanche, and 21 points (eight goals, 13 assists) in 55 Stanley Cup Playoff games.
