Letters of Understanding
Tuesday, April 17th, 2007Many clients come to us with help with reaching a contractual agreement to buy or sell a small business. Typically, when the client first comes to see us, he has verbally talked to the buyer or seller and deal in principal may have been agreed upon. However, nothing is in writing. If a verbal agreement has been reached in principal, it is important to place it in writing. This can be done through a letter of understanding. A sample letter of understanding is as follows:
Dear Sir or Madam
This will confirm that which we discussed during our
telephone conversation earlier today.
It is agreed that your firm, (name of firm) , will
provide the technical support for the (name of project)
while we will provide the technical equipment, to your
specifications, and all funds necessary, up to (ceiling
amount) to complete the (intent)
If this meets with your understanding of our conversation,
please sign a copy of this letter and return it to my
office. Upon our receipt of this verified letter, we will
forward same to our attorneys for final contract drafting
and revisions.
It was a pleasure speaking with you, and I hope to join you
soon for a toast to our mutual success in the (project)