Learn how to write a cover letter when you have no work experience and review our template and example for guidance. Writing a settlement agreement is far more complicated than it appears.If you are trying to settle anything that is NOT a small claims matter? A settlement agreement and release, also known as a mutual release and settlement agreement, is a legal document between parties of a claim. Use this model settlement agreement proposal letter to enter discussions with an employee about ending their employment relationship. This letter proposes a settlement agreement where there is an existing formal discipline, performance or redundancy issue, outlining the terms of the offer. Settling Litigation: The Power of a WellCrafted Agreement. Stuck in a legal battle that feels like an endless war? Approval, no settlement payments will be sent out and the lawsuit will continue. If that is what you want to happen, you must object.