DEBT SETTLEMENT AGREEMENT

This Debt Settlement Agreement (hereinafter referred to as the “Agreement”) is made on [INSERT DATE ON WHICH THE AGREEMENT COMES INTO FORCE] (hereinafter referred to as the “Effective Date”) between:

[INSERT NAME OF THE DEBTOR], having registered office at [INSERT ADDRESS OF THE DEBTOR] (hereinafter referred to as the “Debtor” which expression shall, unless repugnant to the context or meaning thereof, means and includes its legal representatives, executors, administrators and permitted assigns); and 

[INSERT NAME OF THE CREDITOR], having registered office at [INSERT ADDRESS OF THE CREDITOR] (hereinafter referred to as the “Creditor” which expression shall, unless repugnant to the context or meaning thereof, means and includes its legal representatives, executors, administrators and permitted assigns).

The “Debtor” and the “Creditor” together shall be referred to as “Parties” and individually as a “Party”.

WHEREAS:

1. The Parties entered into a payment contract dated [INSERT DATE OF WHICH PARTY ENTERED INTO AGREEMENT], under which the Debtor incurred a debt owed to Creditor.
2. The Parties agree to settle the debt and all claims related thereto, without any admission of liability or wrongdoing by either party.
3. The Parties mutually agree to the terms and conditions outlined in this Agreement, which governs the working relationship between the parties.
4. The parties are duly authorized and have the capacity to enter into this agreement.
5. Both the parties affirm to understand the provisions contained herein and in case either party requires clarification as to one or more provisions, either party has had the right to seek clarifications or sought legal guidance.

NOW, THEREFORE, in consideration of the mutual promises contained herein and intending to, be legally bound, the Parties have agreed as follows:

1. DEFINITIONS
   1. ”Creditor” shall mean an individual or entity who is receiving the money from the Debtor.
   2. “Debtor” shall mean an individual or entity that is under obligation to pay the Creditor the settlement amount as specified in this Agreement.
   3. “Debt” refers to the outstanding amount owed by the debtor to the creditor, under the terms of the payment contract.
   4. “Settlement Amount” refers to the total amount or reduced amount as agreed upon by both the parties to fully settle the debt.
2. SETTLEMENT AMOUNT
   1. The Parties acknowledge that the current outstanding debt amount is [INSERT CURRENT OUTSTANDING AMOUNT].
   2. The Parties have agreed to settle this debt for a reduced amount of [INSERT REDUCED AMOUNT](Hereinafter referred to as “Settlement Amount”)
   3. The Debtor hereby agrees to pay the settlement amount on [INSERT DATE OF SETTLEMENT] and according to the terms specified in this agreement.
3. PAYMENT SCHEDULE
   1. The Debtor hereby agrees to pay the settlement amount on [INSERT DATE OF SETTLEMENT] in full and according to the terms specified in this agreement.
   2. The Debtor may prepay the amount before the due date to the Creditor.
   3. The payments shall be made through [INSERT MODE OF PAYMENT].The Creditor shall provide necessary and accurate details to facilitate the process of Payment.
4. RELEASE
   1. Upon Creditor’s receipt of the Settlement Amount in full, Creditor agrees to release and discharge Debtor from any and all claims, demands, and cause of action related to the debt.
5. DEFAULT
   1. In the event of any occurrence that may lead to a Default, the entire Settlement Amount shall become immediately due and payable, and Creditor shall have the right to pursue any and all legal remedies available.
6. APPLICABLE LAW
   1. This Agreement shall be governed by and constructed in accordance with the Laws, rules, orders and regulations of [INSERT THE COUNTRY OF APPLICABLE LAWS].
   2. The Parties shall resolve all disputes in connection with the validity or interpretation of this Agreement, unless otherwise expressly stated in the Agreement, in the following manner: 
   3. By direct negotiations between the Creditor and Debtor. 
   4. If negotiations between the parties are unsuccessful, the matter shall be referred to the competent court sitting at [INSERT THE COURT WHICH SHALL HAVE EXCLUSIVE JURISDCITION IN CASE OF DISPUTE BETWEEN THE PARTIES] which shall have exclusive jurisdiction in all matters arising there from unless otherwise agreed between the Parties in writing.
7. DECLARATION
   1. The parties hereby understand and expressly agree to the provisions laid down in the present agreement and in good faith, undertake that both parties shall follow the terms of this agreement in good conscience in order to secure better growth of both the Parties.

IN WITNESS WHEREOF, the parties, intending to be legally bound, have each executed this agreement as of the effective date.

Signed, sealed and delivered on behalf of Creditor

Name: [INSERT NAME OF THE CREDITOR]

Signature:

Date: [INSERT SIGNING DATE OF THE CREDITOR]

Signed, sealed and delivered on behalf of Debtor

Name: [INSERT NAME OF THE DEBTOR]

Signature: 

Date: [INSERT SIGNING DATE OF THE DEBTOR]