Know more about letter of agreement
The letter of agreement is between two parties that intend to carry out a business with each other. When the two parties want to carry out a business they must do it most transparently. They must see to it t at all the terms and conditions are agreed upon. But if not documented there is always a possibility that any one or both parties may take an about terms from their agreed terms and conditions. To avoid such bitter situations from arising, all the terms and conditions are written down and signed by both the parties along with the date of signing. This is known as letter of agreement.
Contents of letter of agreement
- The letter of agreement should contain a few important points and these are:
- The project type
- The project descriptions
- The cost that is estimated to be involved in carrying out the project
- Payment types, terms and conditions of payment
- Other issues that may apply
To avoid any misunderstanding and therefore any type of conflicts between the two parties the letter of agreement should have everything put on the paper clearly and in a language understandable by both the parties. There is no format as such of the letter of agreement because different parties may agree on different issues but few things like the name and address of both the parties, the above mentioned issues regarding the business itself and the signature of the authority of both the parties must be made along with the date.