Indiana Pacers coach Nate McMillan has reached an agreement in principle on a contract extension that will take him through the 2020-21 season, league sources told ESPN on Wednesday.

McMillan, who would've entered the final season of his original three-year deal, delivered one of the NBA's most impressive coaching performances last season. In the aftermath of the Paul George trade to Oklahoma City, McMillan led the Pacers to a 48-34 record and a seven-game first-round series against Cleveland in the Eastern Conference playoffs.

Under McMillan, Victor Oladipo -- acquired in the George trade -- blossomed into an All-Star and the NBA's Most Improved Player.

McMillan is 90-74 in two seasons as the Pacers' head coach after serving as the team's associate head coach for three seasons under Frank Vogel.

McMillan, 53, is 568-526 in 14 seasons as a head coach with Indiana, Portland and Seattle.