The deal is reportedly worth $9.75 million, according to CSN Bay Area's Kevin Kurz.
Ward scored 19 goals and 15 assists for the Capitals during the 2014–15 regular season, but was especially instrumental in Washington's postseason run. He led the team in total scoring with nine points (three goals, six assists).
Know for his physical brand of play, the 34-year-old will enter his ninth season in the NHL in 2015. Ward played with Nashville for three seasons before starting a four-year tenure with the Capitals.
On Thursday, San Jose stocked up on depth by signing five minor league players. It also signed two assistant coaches to back up head coach Peter DeBoer.
The move comes 24 hours after Washington itself signed two free agent forwards.