Memorandum of Understanding (template)


Memorandum of Understanding template

What is a Memorandum of Understand?

A Memorandum of Understanding (MOU) is a legal document that provides for the basic terms and conditions for entering into an agreement between two or more people.

A memorandum of understanding is important because it provides the roadmap on how a certain act will be performed by parties. For example, if two companies want to merge and form a new company, they may prepare the MOU to lay down the terms and conditions of doing the deal.

The Memorandum of Understanding must contain, two or more parties, objectives, duration, rights, duties, and responsibilities of the parties, termination clause, confidentiality clause, dispute settlement clause, force majure, etc.

Memorandum of Understanding Template

The following is the template of the memorandum of understanding.

MEMORANDUM OF UNDERSTANDING (MOU)

This MEMORANDUM OF UNDERSTANDING is made and entered into on …………… day of ……………………. 20.

BETWEEN

A AND B OF [INSERT PHYSICAL AND POSTAL ADDRESS] of one part

AND

X AND Y [INSERT PHYSICAL AND POSTAL ADDRESS] of the other part

The parties to this Memorandum of Understanding are individually referred to as the “Party” and collectively referred to as “Parties”

WHEREAS the parties are interested in carrying on a business of………… jointly at ………………………

WHEREAS, this Memorandum of Understanding shall provide for the basic terms and conditions for entering into the agreement.

NOW, THEREFORE, in light of mutual terms and conditions promises contained herein and other good and valuable consideration, the receipt, and sufficiency of which is hereby acknowledged the parties agree as follows:

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OBJECTIVES

The main objective of this Memorandum is to agree on……………and promotes…………………………as well, as…………………………

The specific objective of this MOU will be identified by the consultation of parties.

DURATION

This MOU shall be operational upon signing and will have an initial duration of……year(s).  All activities conducted before this date within the vision of the joint collaboration will be deemed to fall under this MOU.

UNDERTAKING BY THE PARTIES

A AND B has agreed to engage in the financing and/or contract financing and technical expertise in regards to the concession.

X AND Y will ensure total compliance with all legal and regulatory requirements by obtaining all relevant permits prior to the commitment of any business

RIGHTS

The parties to this Memorandum of Understanding reserve the right to sell their equity stake in the company.  The transfer of shares will be in good faith and any prospective buyer will be a party capable of achieving the realization of the Venture.

CONFIDENTIALITY

Each of the parties shall keep confidential and not without the prior written comment of the other party disclose or divulge to any party the contents of this agreement or any agreement entered into pursuant to this agreement except as may be required.

EXCLUSIVITY

The parties hereto agree to act in an exclusive arrangement with each other for as long as is necessary and economically viable.

TERMINATION

In the event of either party commits a breach of any of the provisions of this Memorandum of Understanding, the other party shall without prejudice to other rights and remedies available, have the right to terminate this Memorandum of Understanding, by giving the defaulting a thirty (3) days notice in writing.  Specifying inter alia nature of the alleged default and the intention of termination.

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Force majeure

No party shall be liable for any delay, hindrance, or prevention frustration in the fulfillment of the Memorandum of Understanding by reason of force majeure which shall include but not be limited to war, civil commotion, fire, flood, and earthquake.

DISPUTE RESOLUTION / ARBITRATION

Any dispute, controversy, or claim arising out of or relating to or in connection with this Memorandum of Understanding or the breach, termination, or validity thereof shall be resolved between the parties amicably.

In the event that the dispute does not get resolved, shall be finally settled by arbitration in accordance with the ………… laws and Rules of Arbitration.

IN WITNESS whereof the parties have executed this Memorandum of Understanding by their duly authorized representatives, as of the date hereof

See also: Agreement for settlement of debt sample

SEALED with the common seal   )
of the said A AND B and delivered)       ……………………………..
to us in our presence this ………… )           COMMON SEAL
day of …………………….. 20..         )

FULL NAME:         ………………………………………

SIGNATURE:        ………………………………………

POSTAL ADDRESS: …………………………………….

QUALIFICATION: ………………………………………

FULL NAME:         ………………………………………

SIGNATURE:        ………………………………………

POSTAL ADDRESS: …………………………………….

QUALIFICATION: ………………………………………

SEALED with the common seal   )
of the said X AND Y and delivered)       ……………………………..
to us in our presence this ………… )             COMMON SEAL
day of …………………….. 20…      )

FULL NAME:         ………………………………………

SIGNATURE:        ………………………………………

POSTAL ADDRESS: …………………………………….

QUALIFICATION: ………………………………………

FULL NAME:         ………………………………………

SIGNATURE:        …………………………………….

POSTAL ADDRESS: …………………………………..

QUALIFICATION: …………………………………….

see:  Loan Agreement Sample

Isack Kimaro

Editor-in-chief and founder of sherianajamii.com. Holder of Bachelor of Laws (LL.B) from Mzumbe University and Post Graduate Diploma in Legal Practice from the Law school of Tanzania. Lawyer by profession and blogger by passion.

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