Settlement Term Sheet Template
PandaTip: Lawsuit settlement conferences, if successful, should result in all the parties and attorneys present signing a Settlement Term Sheet that sets forth the terms of agreement between the parties. This is crucial because settlement conferences can be very emotional and tiring, and after people leave they may have second thoughts about their agreement, so its important to write down the terms and have everyone sign.
The following reflects the terms of settlement of the parties in the following lawsuit –
[LAWSUIT CASE NUMBER]
entered into as a result of settlement conference proceedings on [DATE].
1. [TERM 1]
2. [TERM 2]
3. [TERM 3]
4. [TERM 4]
5. [TERM 5]
6. [TERM 6]
PandaTip: These terms should include at least the following – who is going to pay money to whom, will this resolve the entire lawsuit or just a part of it, what actions need to be taken before finalization of the settlement by any party, and what are the deadlines for doing these things.
7. Attorney fees and costs. [ATTORNEY FEES AGREEMENT]
PandaTip: This often reads “will be borne by each party,” but sometimes one side agrees to pay the other’s attorney fees. This can include a substantial amount of money, so it should be agreed to in the term sheet.
8. Dismissal of case. [DISMISSAL AGREEMENT]
PandaTip: The parties should specify what actions will trigger the obligation to dismiss the case and who will file the paperwork with the court.
9. Modification of case deadlines. [DEADLINE MODIFICATIONS]
PandaTip: Often cases are settled in the midst of tight, crucial deadlines. If these need to be continued, or a request made to the court to modify them, it should be stated here.
10. Confidentiality. [CONFIDENTIALITY AGREEMENT]
PandaTip: It’s a good idea to include a confidentiality provision, either to say that the settlement terms should be held in confidence by the parties, or whether there is no confidentiality attached.
11. Written agreement. The terms set forth above will be incorporated into a formal written agreement within [TIMEFRAME FOR FORMAL AGREEMENT].
PandaTip: Timing can be very important to agreements, so make sure that both sides have an agreement on how long completion of the process will take.
12. [OTHER DETAILS]
PandaTip: This could include who is going to draft the agreement, or any other procedural details on the steps to convert this from a term sheet to a final executed agreement.
[SIGN DATE 1] _________________________________
[SIGN DATE 2] _________________________________
[SIGN DATE 3] _________________________________
[SIGN DATE 4] _________________________________
Approved as to form:
[SIGN DATE 5] _________________________________
[SIGN DATE 6] _________________________________
PandaTip: Because lawyers are often the ones to fight over any subsequent misunderstandings, and also are the ones to draft the final written agreement, it is good to have them sign off that they agree the term sheet is complete.
[SIGN DATE 7] _________________________________
[JUDGE OR SETTLEMENT OFFICER]
PandaTip: This is additional confirmation that everyone present agrees that the term sheet is an accurate reflection of the agreements made between the parties.