Xerox Corp. (XRX) said it will pay $12 million to settle a sales commissions practice lawsuit filed against the company by a group of African-American sales representatives.

The Stamford, Conn., business-machines products maker said the sales representatives had alleged racial discrimination with respect to sales territory assignments, quotas and compensation.

Xerox denies it engaged in unlawful discrimination or retaliation, but believes it is in the best interest of shareholders to settle.

The company said the settlement includes $12 million, which it accrued for in the second quarter of 2006, and that it will establish an employee task force to ensure African-American sales representatives are compensated in a nondiscriminatory manner. [MORE]