Mitre, 29, was a candidate to be non-tendered by Thursday's deadline. His deal includes an additional $200,000 in incentive bonuses: $50,000 each for 40, 55, 65 and 70 games.
He went 0-3 with a 3.33 ERA in 54 innings with New York last season. Mitre made 24 of his 27 appearances in relief.
Jerry Crasnick is a senior baseball writer for ESPN.com. Information from The Associated Press was used in this report.