Britain's two major Olympic bodies settled the messy financial dispute Tuesday that threatened to overshadow preparations for the 2012 London Games.

The British Olympic Association dropped its legal case against the 2012 organizing committee, known as LOCOG, over its share of any surplus from the games and accepted the original contract terms.

In return, LOCOG agreed to waive rights to royalties on some British team merchandise and allow the BOA to buy extra games tickets.

"I am glad this issue has been put behind us and we can all get on with delivering games next year that will make this country proud," LOCOG chief executive Paul Deighton said.

BOA CEO Andy Hunt welcomed the "spirit of partnership and cooperation" shown by LOCOG.

"With this matter now resolved, the BOA will be able to keep its attention focused entirely on our preparations to support Team GB at the Games," Hunt said.

The conflict flared last month just as London marked the 500-day countdown to the Olympics and launched the sale of 6.6 million tickets. The dispute shattered virtually six years of harmony among local organizers in a generally smooth buildup to the games.

"We welcome the agreement between the BOA and LOCOG," International Olympic Committee President Jacques Rogge said. "This will now allow all the parties involved to fully concentrate on delivering what will be outstanding games in London next year."

The issue centered on the cash-strapped BOA's claim to a greater cut of any profit from the Olympics.

The BOA, which is entitled to a 20 percent share under a joint marketing agreement signed in 2005, claimed the figure should be calculated without the potentially money-losing Paralympic Games being taken into account.

LOCOG and the IOC insisted both events should be counted, as they have in the past. The BOA decided to file a case with the Court of Arbitration for Sport in Switzerland after rejecting a ruling by the IOC.

Under the settlement announced Tuesday, any surplus distribution will be based on the financial results of both the Olympics and Paralympics. The BOA and IOC will each receive 20 percent, with 60 percent going to British sport.

LOCOG will waive its royalty fee on two unspecified items of "iconic" British team merchandise and give the BOA the opportunity to purchase additional Olympic tickets, including for British athletes who competed in previous games.

LOCOG also said it would "proactively support" the BOA's efforts to secure more corporate sponsors.

The organizing committee agreed that Hunt and BOA chairman Colin Moynihan will be reinstated to LOCOG board meetings. The two had been barred from the meetings while pursuing legal action.