Pittsburgh, PA -- (Sports Network) - The Pittsburgh Penguins agreed to terms with head coach Michel Therrien on a three-year contract Friday.

Therrien, who had been in the final year of a contract extension, led the Penguins to a 47-27-8 record a season ago. Pittsburgh took home the Atlantic Division crown in the regular season for the first time since winning the Northeast Division title in 1997-98.

"Michel has done a tremendous job with our team over the past two-and-a-half seasons," said team general manager Ray Shero. "He had one year remaining on his previous contract and we could have simply talked about an extension. But we thought that, based on the success we've had together, it was time to negotiate a new deal, starting with an increase in compensation for the 2008-09 season."

In addition, he guided the Penguins to the Stanley Cup Finals for the first time since the franchise won back-to-back Cups in 1991-92. The Detroit Red Wings ended the ride, besting the Penguins in six games.

"I'm excited to have a new three-year contract with the Penguins and am looking forward to continued success here in Pittsburgh," Therrien said. "We still have a lot of work to do, though, because we fell short of our biggest goal last season."

Therrien, who was promoted to head coach in December, 2005 in place of Ed Olczyk, has gone 94-51-19 in the last two seasons at the helm. He was a finalist for the Jack Adams Award as the league's top coach in 2006-07 after the club made a 47-point improvement from the previous campaign.

Over parts of six seasons as an NHL head coach, the 44-year-old native of Montreal holds a 185-198-22 record with the Canadiens and Penguins.