This is a template letter for the sending, by one contracting party to the other, of a contract for signature by that other contracting party. The letter is short, easy to edit, and contains a number of different options. The main options are as follows.
First, the contract may or may not be in some previously agreed form. In situations where it is appropriate to negotiate contract terms, the parties should agree the form of a contract before dispatching a copy for signature. In other cases, it may be acceptable to dispatch a copy without having the other party's approval to the terms.
Second, the contract may come into force: (i) only after the contract has been signed by the recipient, returned to the sender, and counter-signed by the sender; (ii) immediately upon signature by the recipient party; or (iii) upon the return of the duly signed contract to the sender, providing it is received within some defined period following the date of the letter. The advantage of sending out unsigned documents is that the sender retains control of the decision to contract and the timing of contract execution. If the contract is sent out already signed by the sender, then it will usually amount to a contractual offer.
Contracts often include express terms to help determine when they come into force, and you will need to ensure that the terms of the contract are consistent with the terms of the letter.
Generally, it is important to maintain a degree of formality when negotiating contracts, although it is not uncommon for a contract to come into force without any formalities. The basic requirements of an English law contract - offer and acceptance, consideration, intention to create a legal relationship, etc - do not preclude the conclusion of a contract without signatures, without formal written terms or, indeed, without any documentation at all. For this reason, it is often sensible to mark all pre-contract communications relating to the terms or conclusion of a contract with the words "subject to contract" or similar.