The $32.323 million contract pleased both Udrih and coach Reggie Theus, who said he made a strong recommendation to top executive Geoff Petrie to keep Udrih.
He averaged 12.8 points, 4.3 assists, 3.3 rebounds and 32 minutes in 65 games with the Kings. Udrih also scored a career-high 27 points against the Spurs on Nov. 26.
"I did not want to start the season without a point guard -- no, I did not want to go that route," Theus said during a news conference at former Kings star Chris Webber's restaurant. "Geoff and I talked quite a bit about our priorities, and we were both in agreement that Beno was one of our top priorities."
Udrih spent his first three seasons with the San Antonio Spurs before signing with the Kings as a free agent Nov. 1. He decided to re-sign with Sacramento after talking with the New York Knicks, Miami Heat and Los Angeles Clippers.
"They were all offering a shorter term," Udrih said. "So I wasn't really interested in that. I wanted a longer-term contract, so I decided with Sacramento, of course."
With the Kings, Udrih had his most productive NBA season since joining the Spurs as the 28th overall draft pick in 2004. He won two championships with San Antonio, but fell out of favor and eventually got traded to Minnesota, which immediately released him.
The Kings signed Udrih when Bibby was sidelined with a thumb injury for two months.
In 51 starts, Udrih averaged 14.4 points and 5.0 assists for Sacramento.
"I feel great getting this opportunity after spending three years with San Antonio," said Udrih, who averaged just 5.2 points in San Antonio. "Me and my agent decided right away to come [to Sacramento], because it would be a great opportunity for me to get playing time."
While Udrih is happy to be back with the club, the Kings don't know what to make of Ron Artest's recent statements about Sacramento. Artest didn't opt out of the final year of his contract last month, but immediately said he regretted not doing so.
"I just don't think you can overreact one way or the other [to Artest's comments]," Petrie said. "But he's still a terrific player, he's on our team, and we will try to work through the summer with him. He made a choice, he's got a contract, and he is a member of our team. That's where it is."
Artest will earn $7.4 million for the 2008-09 season. Theus said he's only concerned about Artest helping the Kings on the court.
"The contract is something Artest will have to work out when the opportunity presents itself," Theus said. "He'll deal with it the way he needs to."