Oklahoma City accepted a US$3.8-million settlement Tuesday to cover its expenses from the New Orleans Hornets' temporary relocation and its share of the team's revenues from a successful first season in the city.

The offer, approved unanimously by the mayor and the city council, was included in an amendment to the team's temporary relocation agreement. It also includes terms for the team's second season in Oklahoma City and an option for a third season, a contingency for the team in case it cannot return to New Orleans as planned in 2007-08.

The total settlement includes $2.6 million to reimburse the city for expenses including temporary housing and office space for the team. The remaining $1.2 million includes the city's share of the team's estimated $40.2 million in revenue.

Also getting a share will be the Oklahoma Capital Investment Board and Oklahoma Professional Sports LLC, two organizations that shared in the financial risk of bringing the team to Oklahoma City.

After selling out half their 36 games in Oklahoma City last season, the Hornets are set to play another 35 home games in the city this season. The remaining six, including the team's home opener, will be played in New Orleans. Season ticket sales in Oklahoma City already have exceeded last year's total of about 11,500.

The new agreement says the Hornets could not relocate to another city other than New Orleans for 2007-08 ``unless otherwise directed by the NBA'' and arranges for improvements to be made to areas of the Ford Center, including both teams' locker-rooms, video boards and a players' lounge.

The settlement was a result of months of negotiations after the city rejected the Hornets' initial offer of $3.2 million.