Watson's current contract, which pays him $1.1 million this season, was set to expire at the end of the campaign.
"Austin is the ultimate team player and we look forward to continuing to see him thrive and be an impactful member of our team," general manager David Poile said. "The Predators organization continues to support Austin and his family and are pleased to take this next step forward with them. His hard work, coupled with a caring environment, has him in a good place to be successful on and off the ice. Austin sticks up for his teammates and does whatever is necessary to help this team win hockey games."
Watson was suspended for 27 games - though the ban was ultimately reduced to 18 contests - last September after pleading no contest to a domestic assault charge. He was reinstated by the NHL and NHLPA in March after going through the follow-up care phase of the Substance Abuse and Behavioral Health Program.
The 27-year-old winger was drafted 18th overall by the Predators in 2010. He's notched 65 points over 265 games for his career.
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