The owner of a $12m (£6.7m) Picasso painting has agreed to pay $6.5m (£3.6m) to the grandson of a Jewish woman who lost it to the Nazis.
The value of Picasso's work has shot up in the past 30 years
Femme en Blanc (Woman in White) was stolen by German forces in World War II and the heir of its original owner took legal action to retrieve it.
Marilynn Alsdorf has now said she would rather pay Thomas Bennigson than continue the costly legal dispute.
She said she did not know the painting had been looted when she bought it.
Ms Alsdorf, who bought the painting for $357,000 (£200,000) in 1975, will be free to sell it once the deal goes through.
The artwork was created in 1922 and sold to a German Jew, Carlota Lundsberg, in 1926 or 1927.
Ms Lundsberg sent it to Paris for safekeeping during World War II but it was stolen by the Nazis.
Mr Bennigson is Ms Lundsberg's sole heir.
Ms Alsdorf said she bought the painting from a reputable New York art dealer.
"She had no knowledge that there had been any impropriety at all," her lawyer Richard Chapman said.
The deal to pay Mr Bennigson was reached "considering her age and her own personal feelings", Mr Chapman added.
"It's tough when you have to foot the bill of very expensive and long-term litigation which has tremendous implications."
Mr Bennigson's lawyer E Randol Schoenberg said the outcome was "the right thing".