Spanish football giants Real Madrid confirmed that the club had reached an agreement with Croatian international midfielder Luka Modric to extend his contract until the end of June 2018.
Modric joined the European Champions in the summer of 2012 for €30 million ($35 million), plus in incentives from Tottenham Hotspurs, reports Xinhua.
"I am very happy and this is a very important day for me," said Modric on the club website on Wednesday.
His original contract was for five years, but his excellent form has earned him another year on his deal and a pay-rise, although the club has not stipulated the quantities involved.
"I want to thank the club for the confidence they have shown in me and I want to return that confidence by doing the best I can," Modric added.
The midfielder also looked ahead to Friday's return leg of the Spanish Supercup, which sees Real Madrid need to score at least one goal away to local rivals Atletico after a 1-1 draw in the Santiago Bernabeu on Tuesday.
"The first title I won with the club was the Spanish Supercup, now I feel very confident we can win again and it will be very important to win another title after lifting the European Supercup," he concluded.