SEATTLE, Washington (AFP) - The SuperSonics ownership and the city of Seattle reached a settlement which will see the National Basketball Association relocate the franchise to Oklahoma City, the league announced Wednesday.

The agreement came just hours before a judge was to rule on a contentious arena lease dispute between the new owners and civic officials in the US western seaboard city.

Under terms of the deal, owner Clay Bennett and his backers will pay the city 45 million dollars. Seattle gets to keep the team name, logo and colours with the hope of attracting a relocated or new franchise.

The city would also receive another payment of 30 million dollars if Seattle doesn't get another NBA franchise within five years.

"We believe this is a fair and appropriate resolution to the litigation involving the Sonics and the City of Seattle," said Bennett.

"We are pleased that the uncertainty is lifted for our players, staff and Oklahoma City fans who can now make plans for the immediate future.

"We have a business to run and this settlement allows us to make the best decision for the franchise and allow the City of Seattle to begin planning its own NBA future."

Said NBA commissioner David Stern, "We are pleased that the Sonics and the City of Seattle have settled their litigation.

"While the decision has been made to relocate the Sonics to Oklahoma City, the NBA continues to regard Seattle as a first-class NBA city that is capable of serving as home for another NBA team."

The SuperSonics had called Seattle their home for over 30 years and was seeking to hold the owners of the Sonics to the remaining two years of the team's KeyArena lease.

Season ticket holders have filed a class action lawsuit that contends they were tricked into buying tickets under the belief that the Sonics would be staying in the city.

The Sonics have alleged that they are losing money at KeyArena, thereby necessitating the move to Oklahoma City, Bennett's hometown. The move is effective immediately and the team name, colour and new logo are in the planning stages.

The Sonics are the first NBA franchise to relocate since the Hornets left Charlotte for New Orleans in 2002. Ironically, the Hornets also spent parts of two seasons in Oklahoma City in the aftermath of Hurricane Katrina.