LINCOLN, Neb. -- Nebraska's departure from the Big 12 Conference will cost the university more than $9 million.

The Big 12 and the university announced a settlement on Tuesday in which the conference will withhold $9.255 million in conference distributions rather than the estimated $19.4 million the Big 12 had sought to withhold under its bylaws.

"We feel the long-term benefits of entering into the Big Ten, both academically and athletically, will make this a very good investment," athletic director Tom Osborne said.

Under the settlement mediated by Eric Green of Boston, Nebraska can reduce its penalty to $8.755 million if the Cornhuskers are one of two Big 12 teams to play in a BCS bowl game this season.

Chancellor Harvey Perlman said the BCS condition was negotiated because Nebraska would be creating a $4 million to $5 million windfall for the Big 12 if it and another conference team make it to one of the high-profile bowl games.

The $19.4 million the Big 12 originally wanted to keep from Nebraska represents 80 percent of the projected distributions that would have been paid to Nebraska for 2009-10 and 2010-11.

Nebraska becomes an official member of the Big Ten on July 1, 2011.

The Big Ten distributed $22 million to each of its schools last year. Over the past four years Nebraska received approximately $10 million annually in revenues from the Big 12.

Conference distributions are divided among member schools mostly from revenues derived from football and men's basketball television contracts, bowl games and the NCAA men's basketball tournament.

"I think everybody knew there was going to be a dispute," Big 12 commissioner Dan Beebe said in a teleconference Tuesday night. "They were firm in their positions, we were firm in ours, and we worked out the compromise."

When Nebraska's move to the Big Ten was announced in June, Perlman, a former law professor, said he didn't think Nebraska should be required to pay a penalty because the Big 12 was in a state of flux, with some schools negotiating with the Pac-10.

"I still think we had a very significant legal argument that would have prevented them from imposing any penalty," Perlman said Tuesday. "I'm also cognizant of the risks associated with litigation. What I think is the law may not turn out to be the law.

"I'm disappointed, as an academic, that my curiosity about the legal claims won't be resolved. But when you look at everything, I think it made sense in this setting to get this behind us and avoid the risks of litigation."

Colorado officials also negotiated an early exit with the Big 12 so the Buffaloes could play in the Pac-10 next season, instead of having to wait until 2012. Colorado agreed to have $6.863 million withheld from its conference revenue in order to leave on June 30, 2011.

"We are pleased that, with this issue behind us, the Big 12 is poised to begin the transition to its exciting future as a 10-member Conference beginning in July," Beebe said in a statement.

Beebe, who was to hold a teleconference with reporters Tuesday night, added that negotiations with Nebraska were "collegial and respectful."

"I appreciate the cooperation of chancellor Harvey Perlman and Nebraska staff," Beebe said. "The Big 12 has enjoyed its relationship with Nebraska and wishes it well in the future."

Information from The Associated Press contributed to this story.