SETTLEMENT AGREEMENT AND MUTUAL RELEASE

(the “Agreement”)

[// GUIDANCE: This universal template is drafted for litigation settlements where (i) the governing law is selectable by the parties, (ii) the chosen court has exclusive jurisdiction, (iii) there is NO arbitration or jury-trial waiver, (iv) no party seeks injunctive relief, and (v) the settlement amount operates as a liability cap. Bracketed items must be completed or deleted during customization.]

TABLE OF CONTENTS

1. Definitions
2. Settlement Payment & Dismissal of the Action
3. Mutual Releases
4. Representations & Warranties
5. Covenants
6. Events of Default; Remedies
7. Risk Allocation
8. Dispute Resolution; Governing Law
9. General Provisions
10. Execution

I. DOCUMENT HEADER

This Settlement Agreement and Mutual Release (the “Agreement”) is entered into and made effective as of [EFFECTIVE DATE] (the “Effective Date”) by and between:

1. [PARTY A LEGAL NAME], a [State] [corporation/limited liability company/individual/other] with its principal place of business at [ADDRESS] (“Party A”); and
2. [PARTY B LEGAL NAME], a [State] [corporation/limited liability company/individual/other] with its principal place of business at [ADDRESS] (“Party B”, and together with Party A, the “Parties”, and each, a “Party”).

Recitals

A. Whereas, disputes have arisen between the Parties in the civil action styled [CAPTION], pending in the [FULL NAME OF COURT] under Case No. [CASE NUMBER] (the “Action”);
B. Whereas, the Parties desire to fully, finally, and irrevocably settle the Action and any and all other Claims (as defined below) on the terms and conditions contained herein; and
C. Whereas, in consideration of the mutual promises set forth herein and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the Parties agree as follows.

NOW, THEREFORE, the Parties agree as follows:

II. DEFINITIONS

For purposes of this Agreement, capitalized terms have the meanings set forth below. Defined terms may be used in the singular or plural form and shall have correlative meanings.

“Action” – Has the meaning given in Recital A.

“Affiliate” – With respect to a Party, any entity controlling, controlled by, or under common control with that Party.

“Agreement” – This Settlement Agreement and Mutual Release, including all Exhibits and Schedules.

“Claim(s)” – Any and all past, present, or future claims, counterclaims, cross-claims, controversies, causes of action, liabilities, debts, damages, judgments, executions, demands, obligations, agreements, costs, expenses (including reasonable attorneys’ fees), or losses of whatever kind, whether known or unknown, whether in law, equity, contract, tort, statutory, or otherwise.

“Court” – The court identified in the caption of the Action.

“Dismissal Order” – A stipulation of dismissal with prejudice in substantially the form attached hereto as Exhibit A.

“Effective Date” – The date first written above.

“Party” / “Parties” – Has the meaning given in the introduction.

“Settlement Amount” – The total sum of [USD $____] to be paid by [Payor Party] to [Payee Party] pursuant to Section 2.1.

III. OPERATIVE PROVISIONS

2. Settlement Payment & Dismissal of the Action

2.1 Payment Obligation.
a. Payor: [IDENTIFY] shall pay to [Payee] the Settlement Amount via [wire transfer/certified funds] to the account designated in writing by Payee no later than [NUMBER] business days after the Effective Date (the “Payment Deadline”).

b. Taxes. Payee shall be solely responsible for all taxes, assessments, and governmental charges, if any, associated with receipt of the Settlement Amount. The Payor will issue any required tax reporting forms.

2.2 Filing of Dismissal. Within three (3) business days following confirmed receipt of the Settlement Amount, counsel for the Parties shall execute and file the Dismissal Order with the Court, requesting that the Court retain jurisdiction solely for purposes of enforcing this Agreement.

2.3 Costs & Fees in the Action. Except as expressly provided in Section 6.3, each Party shall bear its own attorneys’ fees and costs incurred in connection with the Action and the negotiation and execution of this Agreement.

[// GUIDANCE: If the Settlement Amount will be paid in installments, insert installment schedule, acceleration provisions, and interest.]

IV. REPRESENTATIONS & WARRANTIES

4.1 Mutual Authority. Each Party represents and warrants that:
a. It has full power and authority to enter into and perform this Agreement and to consummate the settlement contemplated hereby;
b. This Agreement has been duly executed and delivered by such Party and constitutes its legal, valid, and binding obligation enforceable in accordance with its terms; and
c. The execution, delivery, and performance of this Agreement do not and will not violate any judgment, order, contract, or obligation applicable to such Party.

4.2 No Assignment of Claims. Each Party represents that it has not assigned or otherwise transferred any Claim released under this Agreement.

4.3 Survival. The representations and warranties in this Section 4 shall survive the execution and delivery of this Agreement.

V. COVENANTS

5.1 Confidentiality of Settlement Terms. Except as may be required by law, regulation, or court order, the Parties shall keep the existence and terms of this Agreement strictly confidential and shall not disclose them to any third party other than their respective counsel, insurers, accountants, or tax advisors who have a need to know and are bound by confidentiality obligations no less protective than those herein.

5.2 Non-Disparagement. Each Party agrees not to make any statement, written or oral, that discredits, disparages, or harms the reputation of the other Party or its Affiliates with respect to any matter related to the Action or this Agreement.

5.3 Further Assurances. Each Party shall execute and deliver such additional documents and take such further actions as may be reasonably necessary to effectuate the intent of this Agreement, including cooperation with respect to the filing of the Dismissal Order.

5.4 No Injunctive Relief. The Parties expressly agree that neither Party shall seek, and the Court shall not grant, injunctive or other equitable relief for any alleged breach of this Agreement; the sole and exclusive remedy for a breach shall be monetary damages and/or entry of judgment under Section 6.2.

VI. EVENTS OF DEFAULT; REMEDIES

6.1 Events of Default. The following shall constitute an “Event of Default” under this Agreement:
a. Payor fails to timely pay the Settlement Amount in full; or
b. Any representation or warranty made by a Party in Section 4 is materially false when made.

6.2 Cure Period. Upon an Event of Default, the non-defaulting Party shall provide written notice specifying the nature of the default. The defaulting Party shall have ten (10) calendar days from receipt of such notice to cure the default (the “Cure Period”).

6.3 Remedies. If the default is not cured within the Cure Period:
a. The non-defaulting Party may apply to the Court for entry of judgment in the amount of the unpaid Settlement Amount, plus interest at [___]% per annum from the Effective Date, together with reasonable attorneys’ fees and costs incurred in enforcing this Agreement.
b. The Parties agree that such judgment shall be the sole and exclusive remedy and shall be limited to the Settlement Amount, accrued interest, and enforcement costs.

VII. RISK ALLOCATION

7.1 Mutual Releases.
a. Release by Party A. Effective upon receipt of the Settlement Amount and filing of the Dismissal Order, Party A hereby irrevocably releases and forever discharges Party B and its Affiliates, successors, assigns, officers, directors, employees, and agents (“Party B Released Parties”) from any and all Claims arising out of or relating to the Action or the matters alleged therein.
b. Release by Party B. Effective upon payment of the Settlement Amount and filing of the Dismissal Order, Party B hereby irrevocably releases and forever discharges Party A and its Affiliates, successors, assigns, officers, directors, employees, and agents (“Party A Released Parties”) from any and all Claims arising out of or relating to the Action or the matters alleged therein.

[OPTIONAL—California Parties Only]
c. Section 1542 Waiver. The Parties expressly waive and relinquish all rights under California Civil Code § 1542 (and any analogous law of any jurisdiction), which provides that a general release does not extend to claims that the creditor does not know or suspect to exist in his or her favor at the time of executing the release.

7.2 No Admission of Liability. This Agreement is the result of a compromise and settlement. Nothing contained herein shall be construed as an admission of liability or wrongdoing by any Party, which is expressly denied.

7.3 Limitation of Liability. Each Party’s aggregate liability arising under or related to this Agreement shall in no event exceed the Settlement Amount actually paid. The foregoing limitation shall not apply to a Party’s fraud or intentional misconduct.

7.4 No Indemnification. The Parties agree that the mutual releases in Section 7.1 fully and finally resolve all potential indemnification claims among them with respect to the Action; no separate indemnity obligations survive.

7.5 Force Majeure. No Party shall be liable for any delay in performance directly caused by acts of God, war, terrorism, or other events beyond that Party’s reasonable control; provided, however, that this Section does not excuse a Payor’s obligation to make the Settlement Amount within thirty (30) days after the force majeure event ceases.

VIII. DISPUTE RESOLUTION; GOVERNING LAW

8.1 Governing Law. This Agreement and any dispute arising hereunder shall be governed by and construed in accordance with the internal laws of [CHOICE OF LAW STATE], without giving effect to its conflict-of-laws rules.

8.2 Exclusive Jurisdiction & Venue. The Parties irrevocably submit to the exclusive jurisdiction of the state and federal courts located in [COUNTY, STATE] (the “Chosen Courts”) for the resolution of any dispute arising out of or relating to this Agreement, and waive any objection based on forum non conveniens or similar doctrines.

8.3 No Arbitration; No Jury Waiver. The Parties expressly opt out of any arbitration requirements and do not waive the right to a jury trial; any dispute shall be resolved in the Chosen Courts by a judge or jury as applicable law provides.

IX. GENERAL PROVISIONS

9.1 Amendments; Waivers. No amendment or waiver of any provision of this Agreement shall be effective unless in a writing signed by each Party. No waiver of any breach shall be deemed a waiver of any other or subsequent breach.

9.2 Assignment. Neither Party may assign or delegate its rights or obligations under this Agreement without the prior written consent of the other Party, except that either Party may assign this Agreement to a successor in interest in connection with a merger or sale of substantially all assets, provided the assignee assumes all obligations hereunder.

9.3 Successors & Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.

9.4 Severability. If any provision of this Agreement is held invalid or unenforceable, such provision shall be reformed to the minimum extent necessary to make it valid and enforceable, and the remaining provisions shall remain in full force and effect.

9.5 Entire Agreement; Integration. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior or contemporaneous agreements, negotiations, or understandings, whether oral or written.

9.6 Counterparts; Electronic Signatures. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one instrument. Signatures transmitted by facsimile, PDF, or other electronic means shall be deemed original signatures and fully effective.

9.7 Headings. Section headings are for convenience only and shall not affect interpretation.

9.8 Interpretation. The terms “include,” “includes,” and “including” are deemed to be followed by “without limitation.”

9.9 Construction. The Parties acknowledge that they have participated equally in the negotiation and drafting of this Agreement and that no ambiguity shall be construed against either Party on the basis of authorship.

X. EXECUTION

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date.

[// GUIDANCE: Attach the Stipulation of Dismissal as Exhibit A (one-page form referencing FRCP 41(a)(1)(A)(ii) for federal cases or applicable state rule), plus any required schedules for payment wiring instructions.]

END OF DOCUMENT