Oakley had been scheduled to go to trial Friday.
Charles Oakley's attorney outside of court. pic.twitter.com/nMUcYjpJeA— Candace McCowan (@CandaceMcCowan7) August 4, 2017
Oakley received a one year ban from Madison Square Garden and the former Knick then vowed to sue owner James Dolan over his February arrest at the arena, following his court appearance Friday morning.
Assault charges will be dismissed and sealed if Oakley stays out of trouble for the next six months as part of the agreement entered in court in Lower Manhattan.
But as an additional condition, Oakley cannot set foot in Madison Square Garden for the next year.
The arrangement required Oakley to admit to nothing, so he and his attorney declared victory outside the courtroom.
"Like I said from day one, I wasn't wrong," Oakley said.
Attorney Alex Spiro announced that Oakley would be suing Dolan over the run-in, which resulted in Oakley striking one security guard in the face with a closed fist and pushing others.
He was then charged with two misdemeanors of assault, two misdemeanors of harassment and one misdemeanor of trespassing.
Oakley had first vowed to fight the charges, but his attorney said the former Knick has better things to do with his time.
"This was a personal issue between him and Mr. Dolan, the security guards that were involved were sort of dragged into this as was Mr. Oakley," said Spiro.
Oakley became a fan favorite when he played for the Knicks from 1988 to 1998, but he's had a falling out with the organization and particularly Dolan in recent years.
On February 8, he sat a few rows from Dolan at a game against the Los Angeles Clippers.
Security approached Oakley early in the game, and the fracas ensued before Oakley was removed from the building and handcuffed.
Oakley was banned from the arena after the incident, but Dolan lifted it shortly after meeting with Oakley and NBA commissioner Adam Silver.
Oakley, known as candid, unfiltered and Michael Jordan's de facto bodyguard, said nothing was really settled in the meeting.