9/10/17 Letter Agreements
Instead of being in the form of a regular contract, an agreement might be embodied in a letter agreement, which is a letter that contains the terms of the agreement and is signed by the sender and the recipient. By convention, some categories of agreement, notably letters of intent, are generally in the form of a letter agreement. Don’t give a regular contract the title “letter of intent”—it sends mixed signals.
Usually the letter-agreement format is used for short agreements, but sometimes they can be quite lengthy. For example, it’s not unusual for credit agreements to be in the form of letter agreements.