Moyes parted company with United on Tuesday after a disappointing domestic campaign, but a deal regarding the remainder of his contract had yet to be agreed by both parties.
However, an official statement read: "The League Managers Association and Manchester United are pleased to confirm that terms of settlement have been agreed between the Club and David Moyes in respect of the termination of his employment.
"A settlement agreement is in the process of being finalised. No further comment will be made in relation to this issue."
The LMA had previously claimed that Manchester United had dealt with the termination of Moyes's spell at Old Trafford in an "unprofessional manner".