Withdrawal of trademark application

A friend of mine has a small company and he registered a trademark. there is a contest and opposition for the trademark from another similar one. Both applied around the same time. now the other party has reached out to compromise. my friend is willing to give up the trademark and withdraw the application provided he is compensated for expenses incurred. other party is also agreeing. is this allowed? can parties reach an agreement in a stamp paper.? What is the value of paper to use?