Contract Agreement Letter


A contract agreement letter is a letter that is signed between two parties who are willing to enter into a contract either verbal or oral. A contract becomes valid when there is an offer from the side of one party, acceptance from the other with a mutually decided consideration. Although, the words contract and agreement differ in terms of being legally binding in nature, in a layman’s language one usually understands a contract and an agreement to be synonymous in nature.

This letter is strictly formal in nature and hence it becomes an important document for works of filing of correspondences. It is crucial to understand that this letter must be short and precise and must entail all the conditions on which the contract stands (that have been mutually decided by the parties). Use of lucid language is encouraged for writing these letters, this helps in keeping confusions at a bay.


Given below is the sample of an agreement of contract which might be of help:


Mahendra Kakrania

Paradise island



Premchand Mathur

Brigade road


15th July, 2017


Subject: Contract agreement letter


Dear Mr. Premchand,

This is to bring to your notice that in accordance with our meeting in Oberoi Mumbai regarding the supply of raw materials for your steel manufacturing plants. I would like to reiterate the conversation that we had and back it up for legal documentations. In the conference, we had decided that for the next fifteen years (15 years), I Mahendra Kakrania of VYC India Ltd. would be supplying you (owner of Royal Manufacturers) with raw materials to run your steel plants in various parts of India for which VYC India Ltd. would receive 12% of the profits of Royal Manufacturers along with the costs that will be borne to extract the raw materials. Such is the agreement due to the extraction of rare nature of our raw materials which is absolutely being done in accordance with law.

I would also reiterate that if in the case of breach of contract, both VYC India Ltd. and Royal Manufacturers would attempt to settle the matter by way of arbitration for which the arbitrator would be appointed as per the then circumstances. Kindly sign and send to us a copy of this letter so that the both of us can start with our decided works. Looking forward to a healthy relationship between us and a prosperous business.

Thanking you

Yours sincerely

Mahendra Kakrania

VYC India Ltd.

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