Engagement Letter

In an investment banking context, an engagement letter sets out the terms of the engagement of the investment bank, be it for capital raising, M&A, restructuring, or whatever. A good engagement letter is tailored to the specific situation at hand. It lays out the client’s objectives and expectations; outlines what the client considers to be a successful transaction in the context of the engagement; lists the obligations assigned to each party; and the fee and compensation schedule and dependencies.