Memorandum of Understanding Template

What Is a Memorandum of Understanding?

A memorandum of understanding is a written agreement that shows two or more parties intend to work together. It outlines shared goals and responsibilities, helping clarify the terms of a future collaboration—without creating a binding legal contract.

MOUs are commonly used for business partnerships, joint ventures, research initiatives, and other non-financial or trust-based agreements. Under US law, an MOU is similar in function to a letter of intent. Both documents serve as a preliminary step in formal negotiations, providing clarity and structure before a binding agreement is signed.

Use an MOU to:

• Collaborate on shared projects
• Clarify roles and responsibilities
• Explore potential partnerships without legal commitments
• Define terms for a trial run
• Document mutual intent before contract negotiation

Don’t use an MOU for:

• Financial transactions or high-stakes deals
• Legal obligations or regulatory issues
• Long-term commitments with complex terms
• Situations where enforceability is a concern

How Does a Memorandum of Understanding Work?

A memorandum of understanding clearly defines the purpose and expectations of a working relationship before any formal contract is signed. Once both parties identify a shared goal and agree that collaboration is mutually beneficial, they discuss key terms such as responsibilities, contributions, and boundaries. These terms are then drafted into a simple, readable document.

Both sides review the MOU, revise it as needed, and sign it to confirm mutual understanding. While the MOU itself isn’t legally binding, it serves as a useful reference point throughout the collaboration. If circumstances change, the document can be updated or concluded accordingly.

What to Include in a Memorandum of Understanding

A complete MOU should include the following elements:

• Party information: The names, addresses, and roles of the individuals or organizations involved
• Purpose and goals: An explanation of why the agreement exists and what the parties aim to achieve
• Scope of work: A general description of the project or relationship
• Responsibilities: A detailed outline of what each party agrees to do
• Resources: Information on the time, tools, staff, or funding that each party will contribute
• Confidentiality: (Optional) Provisions for protecting sensitive information
• Governing law: The state or jurisdiction that will govern the agreement
• Termination: The conditions under which and the procedure by which the agreement can end
• Signatures: Each party must sign to indicate their mutual understanding of the agreement

Memorandum of Understanding Sample

View a sample of a memorandum of understanding below. Once you’re familiar with the MOU format, you can customize our template using our document builder and then download it in PDF or Word format.

Is an MOU Legally Binding?

No, a memorandum of understanding is not legally binding. It simply outlines the parties’ intentions for a project, negotiation, or partnership agreement. However, it should include enough details to clarify expectations as the parties continue to interact.

While the MOU itself remains non-binding, parties can add legally binding clauses. For example, they may add non-disclosure agreements to address specific concerns. Unless explicitly stated, an MOU does not require parties to fulfill its terms.

Memorandum of Understanding vs. Memorandum of Agreement

While both documents formalize working relationships, an MOU is generally less formal and non-binding. A memorandum of agreement (MOA) usually contains more detail and may be legally binding.

Choose an MOU if you’re in the early stages of a partnership and want to align on goals without legal commitments. If you’re ready to move forward with a more formal, enforceable agreement—especially one involving money or resources—an MOA may be the better fit.

Create Your MOU With Legal Templates

Drafting an MOU can feel overwhelming—especially if you’re unsure where to start. Legal Templates helps simplify the process with a guided template that includes all the essential sections and non-binding language.

Just enter your details, and we’ll format your document for you. It’s a practical way to save time, reduce confusion, and feel confident about what you’re sharing with the other party.

Frequently Asked Questions