Court records show the charge was dropped on Wednesday.
A spokesperson for the City of Scottsdale confirmed the parties reached a settlement.
"I just want to reiterate again just how sorry I am for my actions, my behaviour," Matthews said Friday.
News broke during the pre-season in September that Matthews faced a charge following an alleged incident outside the player’s condominium in May.
A female security guard has said she was sitting in her locked car when a group of men, including Matthews, allegedly tried to get inside the vehicle in the early morning hours of May 26.
In the police report, the woman said she confronted the group, who she believed to be intoxicated, and during that interaction Matthews withdrew from the conversation, dropped his pants and grabbed his buttocks.
The security guard said Matthews, then 21 years old, kept his underwear on.
Matthews was not arrested.
"I never meant to cause any distress to this woman," Matthews said. "I can assure you I’ve learned from my mistakes and my actions, and its something for myself to just strive every day to be better in every aspect of my life."