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A Memorandum of understanding (MOU) is a non binding agreement between two or more parties outlining the terms and details of an understanding, including each parties’ requirements and responsibilities.
A MOU is put in place to establish a clear understanding of how the deal will practically function and each party’s role and compensation. It is used in commercial partnerships to establish mutual goals and expectations.
A MOU may include:
- the purpose of the commercial partnership;
- the common goals of the parties;
- the roles of each party;
- any agreed upon deadlines; and
- how the parties will resolve disputes.
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