Free Memorandum of Understanding Template

Try out our MOU template for free to create a document that outlines an agreement between 2 parties. Use your document to set the terms of a non-enforceable contract made in good faith.

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Last Update September 13th, 2023


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What Is a Memorandum of Understanding

A Memorandum of Understanding (MOU), is a type of agreement written in good faith that provides the terms of a negotiation or transaction that will later be placed in a formal legal contract between 2 or more parties.

However, unlike a Letter of Intent, it gives a broad outline of the terms and conditions while an LOI only states the commitment to work together with another party. 

It defines the roles and responsibilities of each party involved, acting as a guide to the terms of the future binding agreement.

An MOU is typically used to provide a structure for:

  • Treaties

  • Purchases

  • Partnerships

Use our MOU template to outline a document that lays out all the terms of your agreement with another party.  

Reasons to Create a Memorandum

In certain situations, using a normal or business Memorandum of Understanding can be a significant first step to formalizing a transaction or negotiation. 

You or another party may not want to jump into signing anything and if that’s the case here are some reasons why you should use an MOU: 

  1. Builds relationships: Crafting an MOU involves open communication and negotiation between all parties involved. This collaborative process can strengthen relationships, build trust, and establish a solid foundation for future interactions.

  2. Formalizes informal agreements: A Memorandum of Understanding provides a written record of agreements that might otherwise be informal or verbal. It ensures everyone involved has a shared understanding of the agreement's terms and conditions, reducing the risk of misunderstandings.

  3. Demonstrates intent: It symbolizes the intention to proceed with a joint endeavor, establishing initial trust and mutual understanding.

  4. Provides clarity and direction: MOUs help provide a clear roadmap of what each party is expected to contribute to a partnership or project.

What Should Be Included in a Memorandum of Understanding

For the MOU to serve its purpose you have to make a document that mentions all the correct information

You and any other party involved should also be comfortable with every element that makes up the Memorandum of Understanding.

Here is what should be part of your document: 

With these details included you should have everything covered to satisfy both parties in the agreement. 

How to Write a Memorandum of Understanding

Once you are certain that you know which terms and information should be included in your Memorandum of Understanding, it’s now essential to know how to add them to your document.

Take a look at the steps below to help you draft your MOU. 

  1. Identify the parties: List all parties involved. Include full names and addresses for individuals, or full legal names and primary locations for organizations.

  2. Mention the date: Write the date that the MOU will go into effect.

  3. Define the purpose: Mention the reason that you and the other party are creating the MOU.

  4. Outline roles and responsibilities: List out the roles and responsibilities of each party. Be as specific as possible to avoid misunderstandings down the line. Each party's duties and contributions should be detailed clearly.

  5. State the terms: Include any specific terms and conditions that govern the agreement, such as confidentiality requirements, intellectual property management, or dispute resolution mechanisms.

  6. Specify resource allocation: Describe what resources each party will contribute, such as funds, staff, equipment, or facilities.

  7. Include an amendment procedure: Outline the process for making changes or amendments to the agreement.

  8. Write a termination clause: Specify under what conditions the agreement can be terminated by either party. 

  9. Add a disclaimer: State that it's an agreement made in good faith, outlining intentions and expectations.

  10. Obtain signatures: Have each party sign and date the document. This shows agreement and understanding of the contents of the Memorandum.

Take advantage of our Memorandum of Understanding template to write your document in minutes and avoid any errors.

Sample Memorandum of Understanding

If you still aren’t sure how to structure an MOU, you can check out our sample below. 

Ensure you study the correct Memorandum of Understanding format and vocabulary in the example below.

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Other Business Documents

When making certain documents related to transactions you’ll want to guarantee that you can make a fair agreement for every party involved.

Here are similar documents that can help you in various legal and business-related situations:

Reviewing these documents can help ensure that different types of formal transactions or agreements you make in the future can be made easily.

FAQs About MOU Agreement

There is confusion at times regarding how MOUs work. For example, many people want to know the differences between Memorandums of Understanding vs. contracts.

For that reason, we have answered some typical questions below regarding how Memorandums of Understanding can be used and drafted.

Is a Memorandum of Understanding Legally Binding?

In general, a Memorandum of Understanding is not considered legally binding

It is often used as a tool for outlining a mutual understanding of a shared goal or a collaborative project between two or more parties.

However, while these documents are typically non-binding certain sections within the document, such as confidentiality, intellectual property, or dispute resolution clauses, could potentially be enforceable if they are drafted in clear, explicit, and definitive terms.

Who Prepares Memorandums of Understanding?

A Memorandum of Understanding can be made by a lawyer who specializes in business law. However, this option is typically the most expensive and time-consuming. 

You can write your own MOU document with the right tools, avoiding excessive fees.

Use our easy-to-use Memorandum of Understanding template to craft your agreement in minutes.

Can an MOU be revoked?

Yes, a Memorandum of Understanding can generally be revoked or terminated, given its non-legally binding nature. 

However, the specific terms for terminating the agreement would typically be outlined in the document itself.

Most MOUs include a termination clause that specifies the conditions under which the agreement can be ended, such as a specified date or upon the completion of a project.

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