George Graham has reached an agreement with Tottenham over his claim for unfair dismissal.
A meeting was held between Graham and Spurs on Tuesday and a deal was finally struck yesterday, preventing the case from going before an arbitration panel.
Graham, who was sacked by Spurs at the end of March, had launched a claim for more than £2million against the club.
However, he has settled on a payment of less than £1million, and that brings the long-running dispute to an end.
The finer details of the documentation to complete the settlement are still being finalised, but the deal is expected to be signed by both parties tomorrow.
Although the case did not preclude Graham from seeking another job, the fact it is now over will enable him to step up his bid to return to Premiership club management.
Both sides have agreed not to disclose the exact amount that will be paid in compensation.
However, Tottenham are duty-bound under Stock Exchange rules to include the figure when they publish their annual accounts shortly.
PA