How To Write a Memorandum of Understanding:
9 Steps to Follow

Jump to Section

Need help with a legal contract?

Post Project Now

Post Your Project (It's Free)

Get Bids to Compare

 Hire Your Lawyer

What Is a Written Memorandum of Understanding?

A memorandum of understanding, or MoU, is a non-binding document to show commitment and understanding of responsibilities for an agreement made between two parties. MoUs are essentially used when two parties want to write down their general understanding of a potential transaction they want to engage in.

MoUs are typically made by governmental organizations, non-governmental organizations and corporate entities when partnering with other organizations to document terms and conditions, transactions and negotiations.

Different Types of MOUs

There are different types of MoUs used for different types of contracts or services. Here are some major types of MoUs used by businesses:

Joint Venture MoU

An MoU for a joint venture agreement is used in the early stages of negotiation between two or more parties. It is also called a co-venture agreement. A joint venture agreement is a temporary business contract between two or more parties to help work towards a common goal. The agreement defines all responsibilities of the parties involved.

There are two main types of joint ventures – contractual and general joint ventures.

  • Contractual joint ventures take place when two entities partner or collaborate on a project but don't form a separate legal entity to do so. Instead, each entity maintains and keeps their own records of profits and losses.
  • General joint ventures are defined as two entities sharing their profits and losses from a specific project. Each party in the agreement has unlimited liability when it comes to the obligations of the agreement. This is often used for real estate endeavors rather than for business ventures.

Service Agreement MoU

A service contract is a legally binding agreement between a service provider and a client which outlines the terms and conditions of the services that will be provided. For example, construction contractors use a service agreement to detail the renovations that they are making to a client's home and to outline how they will be paid for it. Similarly, a business can use a service contract to hire a temporary freelancer or contractor.

A service agreement MoU would detail the services that will be provided to a business in a non-binding document. They are typically used during preliminary negotiations.

Outsourcing MoU

An outsourcing agreement is a contract formed between two or more parties, generally a company and a service provider. The service provider promises to deliver specified services, which is outsourced by the company. All outsourcing MoUs contain the following elements:

  • Service expectations
  • Any potential penalties and/or awards
  • Expected timeframe
  • Reviews
  • Potential exit strategies
Meet some lawyers on our platform

Terence B.

25 projects on CC
View Profile

Jaren J.

1 project on CC
View Profile

Melissa G.

1 project on CC
View Profile

Richard N.

32 projects on CC
View Profile

Asset Purchase MoU

An asset purchase agreement is an agreement between a buyer and a seller used to transfer ownership of an asset for a set price. The seller decides which specific assets to sell and exclude in an asset purchase agreement. These are the key elements addressed in an asset purchase MoU:

  • Who is the Asset Purchase Agreement For?
  • What Assets Are Being Purchased?
  • How much is the asset for?
  • Representation and Warranty
  • What Needs to Happen Before Closing?
  • Miscellaneous Or “Boilerplate” Language

Share Purchase MoU

A share purchase agreement is used during the purchase of shares which is essentially the purchase of a company’s operating business. The buyer of shares of a company generally will want some contractual promises about the company, known as warranties, which will continue to bind the shareholder, who is selling the shares, after the sale. A share purchase MoU discuss the following key elements:

  • Warranties
  • Share selling terms
  • Restrictive covenants

Business Relationship MoU

A business relationship MoU outlines what each organization agrees to contribute to a partnership, a timeframe for deliverables, details of collaboration, terms and conditions, payments and compensation, etc.

Here are some examples of MoU and when they are used.

How to Write a Memorandum of Understanding – Step by Step

You can write a memorandum of understanding by following the steps listed below:

  • Topic and title: Pick a title for your MoU. This should reflect the type of MoU being used. As described above, some common types of MoUs are, venture agreement MoU, service agreement MoU, and asset purchase MoU.
  • Parties involved : The beginning of your MoU should include the basic details such as names and addresses of the parties involved.
  • Agreement initiation and termination details : Your MoU should mention the effective date of the MoU, when work will begin, and the terms under which it can be terminated. If it is a one-time contract with a fixed deadline, you should also mention the date of termination.
  • Goals and responsibilities : The MoU should include a detailed description of the project, the duties, milestones and deadlines associated with it, etc.
  • Scope and Values : Outlining the scope or goal of the project along with the values of the institutions can help ensure all parties have an understanding of the long-term use of the project and their partnership.
  • Key stakeholders : The key stakeholders in the project, collaboration or partnership should also be mentioned in the MoU.
  • Timeline : The MoU outlines the terms of a partnership or collaboration. Sometimes the project also might have deadlines for deliverables. These deadlines should be mentioned in the MoU to reflect that all parties are aware and understand their timelines.
  • Terms and provisions : Your MoU can also include special requirements, terms and conditions . If your project, partnership or collaboration has any special requirements or you wish to add terms of completing the project, it should be mentioned in the statement of work.
  • Signatures : MoUs need to be signed and dated by all parties involved to reflect an understanding between all parties.

What’s Included in a Memorandum of Understanding Between Two Parties?

These are the key elements present in any MoU:

  • Points of understanding: An MOU clearly outlines specific points of understanding. It contains the names of the parties, the project on which they are agreeing, scope and responsibilities, etc.
  • Terms and Conditions : An MOU also contains the terms and conditions of the agreement. All parties need to be in agreement of the terms and conditions.
  • Party details: The MoU contains the details about all parties involved in the agreement. This generally contains the names, addresses and other contact information.
  • Purpose : An MoU clearly describes the purpose of the agreement. It also sets the duties and responsibilities, timeline and important dates for the project being discussed.
  • Signatures : All MoUs should have signatures of all parties to reflect an agreement between all parties.

Here is a sample MoU for you.

Who Writes MOUs?

MoUs are generally written by organizations or companies offering the collaboration or partnership. Since companies tend to have their own legal counsel, they can draft an MoU fairly easily. It is advisable to seek a business lawyer or a contracts lawyer who understands federal, state and local laws to draft an MoU. However, you can also draft your own MoU using templates available online.

Get Help with a Memorandum of Understanding

Do you need help writing an MoU? Post a project in ContractsCounsel’s marketplace to get free bids from lawyers that specialize in MoU drafting. All lawyers are vetted by our team and are peer reviewed for you to review before hiring.

How ContractsCounsel Works
Hiring a lawyer on ContractsCounsel is easy, transparent and affordable.
1. Post a Free Project
Complete our 4-step process to provide info on what you need done.
2. Get Bids to Review
Receive flat-fee bids from lawyers in our marketplace to compare.
3. Start Your Project
Securely pay to start working with the lawyer you select.

Meet some of our Lawyers

ContractsCounsel verified
Outside Counsel
26 years practicing
Free Consultation

I'm a business law generalist with over 24 years of experience, including as in-house General Counsel, as outside counsel through my own firm and as an attorney in an Am Law 100 law firm. My employers and clients uniformly appreciate my ability to (i) negotiate and close transactions quickly and effectively, and (ii) to make the complex simple. Among other things, I can efficiently assist you on entity formation, governance, and structure; HR issues; mergers and acquisitions; and the negotiation and drafting of all types of commercial contracts. I'm the proud recipient of multiple Martindale-Hubbell Client Distinction Awards given only to the top 5% of attorneys for quality of service.

ContractsCounsel verified
Business Attorney
14 years practicing
Free Consultation

Strategic thinking business minded Outside General Counsel here to help you with your company. I have been able to help guide business owners from startup through series A, B, & C funding and ultimately IPO's. Regardless of your plans I am here to help you succeed as you grow your business.

ContractsCounsel verified
Principal Attorney
17 years practicing
Free Consultation

Daliah Saper operates a cutting-edge internet and social media law practice that regularly leads local and national media outlets to solicit her commentary on emerging internet law issues involving cyberbullying, sexting, catfishing, revenge porn, anonymous online defamation, domain name and user-name squatting, privacy, and the latest business decisions made by social media platforms such as Facebook, Twitter and YouTube. As a litigator Daliah represents companies bringing or defending business and intellectual property disputes. (She has argued cases in a number of jurisdictions including taking a case all the way to the Illinois Supreme Court.) As a transactional lawyer she helps clients choose the right business entity, drafts contracts and licensing agreements, advises on sweepstakes and contest rules, and ensures website terms of use and privacy policies are compliant, and provides comprehensive trademark and copyright counseling. Since founding Saper Law Offices in 2005, Daliah has been named a 40 Under 40 by Law Bulletin Publishing Co., a top Media & Advertising attorney by Super Lawyers Magazine 14 years in a row, and has been repeatedly recognized as a leading media and entertainment lawyer by Chambers and Partners. For the past eleven years, she also has taught entertainment and social media law at Loyola University Chicago School of Law.

ContractsCounsel verified
Attorney
10 years practicing
Free Consultation

Mr. Mehdipour attended the University of California San Diego where he received his degree in political science. After graduating from UCSD, Mr. Mehdipour attended Southwestern University School of Law where he received his JD. Upon passing the bar, Mr. Mehdipour gained invaluable experience both in a law firm and business setting. Mr. Mehdipour uses his prior business and legal experiences to negotiate the most advantageous results for his clients.

ContractsCounsel verified
Attorney
14 years practicing
Free Consultation

Alen Aydinian is a versatile attorney with over a decade of experience working with business owners and real estate professionals. Client engagement is central to a successful attorney/client relationship. Alen personally manages all client relationships so that his clients can see how their interests are being served at every stage of the process.

ContractsCounsel verified
Founder, Victrix Legal LLC
1 year practicing
Free Consultation

I help small business owners build and protect their dreams. I always thought that I would just be a litigator. Then I joined an intellectual property clinic in law school. We were helping nonprofits and small businesses reach their goals. I fell in love with the work and decided to open my own firm so I could keep helping them. When I decided to start Victrix Legal, I decided that it would be a modern law firm designed to serve professionals. It would be different from every other law firm. In my experience, my law firms are designed to promote inefficiency and reactionary lawyering. Because in most firms, you make more money when you spend more time on a project. And you lose money if your client doesn't get sued. In my opinion, that's a built-in conflict of interest. My firm is different. I use flat fees for most basic projects to keep costs predictable for you and incentivize efficiency. I offer long-term advisory plans and legal audits to prevent issues from happening. I want my clients to see me as their business partner, not just the guy they call when they are in trouble. If any of that interests you, please reach out to me. I offer free consultations. Let's set aside some time and talk about what your legal needs are.

ContractsCounsel verified
Attorney
7 years practicing
Free Consultation

My clients know me as more than just an attorney. First and foremost, my background is much broader than that. Prior to attending the Valparaiso University School of Law, I earned a Master of Business Administration and ran a small business as a certified public accountant. Thanks to this experience, I possess unique insight which in turn allows me to better assist my clients with a wide range of business and tax matters today. In total, I have over 20 years of experience in financial management, tax law, and business consulting, and I’m proud to say that I’m utilizing the knowledge I’ve gained to assist the community of Round Rock in a variety of ways. In my current practice, I provide counsel to small to medium-sized businesses, nonprofit organizations, and everyday individuals. Though my primary areas of practice are estate planning, elder law, business consulting, and tax planning, I pride myself on assisting my clients in a comprehensive manner. Whenever I take on a new client, I make an effort to get to know them on a personal level. This, of course, begins with listening. It is important that I fully understand their vision so I can help them successfully translate it into a concrete plan of action that meets their goals and expectations. I appreciate the individual attributes of each client and know firsthand that thoughtful, creative, and customized planning can maximize both financial security and personal happiness. During my time as a certified public accountant, I cultivated an invaluable skill set. After all, while my legal education has given me a deep understanding of tax law, I would not be the tax attorney I am today without my background in accounting. Due to my far-reaching experience, I am competent in unraveling even the most complex tax mysteries and disputes. My CPA training benefits my estate planning practice, too. In the process of drafting comprehensive wills and trusts, I carefully account for every asset and plan for any tax burdens that may arise, often facilitating a much smoother inheritance for the heirs of my clients. Prior to becoming certified as a CPA, I made sure to establish a solid foundation in business both in and out of the classroom, and the acumen I’ve attained has served me well. Not only am I better able to run my own practice than I otherwise would be; I am able to help other small business owners fulfill their dreams, as well.

ContractsCounsel verified
Associate
5 years practicing
Free Consultation

Hello! I am a young attorney with four years' experience in real estate transactions, fund formation, and general corporate transactional work. I graduated in 2016 from the University of Texas - Austin and I am barred in Texas.

ContractsCounsel verified
Partner
5 years practicing
Free Consultation

I graduated from Harvard Law School and worked first for a federal judge and then a leading DC firm before starting a firm with a law school classmate. My practice focuses on company formations, early-stage investments, and mergers & acquisitions.

ContractsCounsel verified
Attorney
27 years practicing
Free Consultation

After 21 years as an in-house attorney for both large and small organizations, I formed Osensky Law in 2017 to bring my unique in-house counsel insights to entrepreneurs and smaller businesses. Unlike a traditional law firm, my focus is on delivering the kind of legal support a business wants and needs - not just technically correct legal advice, but strategic problem-solving with a focus on providing business value to clients. Since earning my law degree with honors from Tulane University Law School, I worked as in-house counsel for large multinational companies such as Georgia-Pacific and MCI, as well as smaller organizations including Georgia Technology Authority and Georgia Tech. This unique combination of experience allows me to bring together the best practices of all of them. I have led multi-disciplinary teams to achieve important business goals and have successfully negotiated many multi-million dollar deals. Now, as a business owner myself, I can relate to my clients and understand the challenges they face. I have an established reputation for providing practical advice and perspectives based on my legal training combined with over 20 years of practical hands-on experience as a business lawyer and leader. Today, with my firm Osensky Law, I advise clients on starting a new business, buying or selling a small business, and doing business with contracts.

ContractsCounsel verified
Attorney
10 years practicing
Free Consultation

G'day, my name is Michele! I work with startups, entrepreneurs and small/medium-sized businesses across the country in a wide array of industries. I help them with all of their ongoing, daily legal needs. This includes entity formation, M&A, contract drafting and review, employment, asset sale & acquisition, and business sales or shareholder exits. I'm half-Australian, half-Italian, and I've lived the last 20+ years of my life in America. I've lived all over the USA, completing high school in the deep south, graduating cum laude from Washington University in St. Louis, and then cum laude from Georgetown University Law Center. After law school I worked for the Los Angeles office of Latham & Watkins, LLP. After four intense and rewarding years there, I left to become General Counsel and VP of an incredible, industry-changing start-up called Urban Mining Company (UMC) that manufactures rare earth permanent magnets. I now work for Phocus Law where I help run our practice focused on entrepreneurs, startups, and SMEs. I love what I do, and I'd love to be of help! My focus is on providing stress-free, enjoyable, and high-quality legal service to all of my clients. Being a good lawyer isn't enough: the client experience should also be great. But work isn't everything, and I love my free time. I've been an avid traveler since my parents put me on a plane to Italy at 9-months old. I'm also a music nut, and am still looking for that perfect client that will engage me to explain why Dark Side Of The Moon is the greatest album of all time. Having grown up in a remote, and gorgeous corner of Australia, I feel a strong connection to nature, and love being in the elements.

Find the best lawyer for your project

Browse Lawyers Now

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call