An agreement that is not binding can be described as a non-binding agreement. It is a type of agreement that is not legally enforceable, nor is it binding on the parties who entered into it. The purpose of a non-binding agreement is to provide a framework for discussion and negotiation on a particular issue, without either party committing to any specific actions or outcomes.

Non-binding agreements come in various forms, such as letters of intent, memorandums of understanding, and term sheets. These types of agreements are commonly used in business negotiations, where parties are attempting to reach a consensus on a particular issue but are not yet ready to enter into a binding agreement.

One of the major benefits of non-binding agreements is that they allow parties to explore ideas and possibilities without the fear of legal repercussions. This freedom promotes creativity and open dialogue, which can lead to better outcomes for both parties.

Non-binding agreements can also serve as a step towards a binding agreement. They provide a framework for negotiations, and once the parties have reached a mutual understanding, they can move onto drafting a binding agreement that reflects their agreement.

However, it is important to note that non-binding agreements should not be taken lightly. Parties should still enter into them with clear intentions and expectations, as they can still have reputational implications. If either party reneges on the agreement or behaves improperly during negotiations, it can affect their reputation in the business community.

In addition to the reputational implications, non-binding agreements can also have limitations in terms of their enforceability. If the parties enter into a non-binding agreement and one party breaches it, the other party may have limited legal recourse to enforce the agreement.

In conclusion, non-binding agreements can be a valuable tool in negotiations, allowing parties to explore ideas and possibilities in a non-threatening and creative environment. However, it is important to enter into them with clear intentions and expectations, and to understand the limitations of enforceability.