Sample Memorandum of Understanding binding Two Parties

Sample Memorandum of Understanding binding Two Parties

What is a Memorandum of Understanding?

A Memorandum of Understanding between companies is a contract-like document that is not legally binding on the parties unless confidentiality and non-competition agreements are included.

It is essentially a collection of key points of an agreement between two parties negotiating a contract; a Memorandum of Understanding is simply the agreement signed before the final contract in this regard. Memorandums of Understanding are also abbreviated as MOUs.


Main purposes of a Memorandum of Understanding

Thus, among the purposes of the Memorandum of Understanding we can include:

  • The declaration that the parties are currently negotiating.
  • Clarifying the main points of an operation for the benefit of all parties.
  • Determine the other party’s willingness to carry out the transaction.
  • Gather the advances made in each of the negotiations.
  • Provides guarantees if the deal falls through during the negotiation process.


Below is a sample Memorandum of Understanding between Company X and Company Y

NB: Company X and Y are IT-based in structure


Memorandum of Understanding


Company X


Company Y


This Memorandum of Understanding (MOU) sets for the terms and understanding between Company X and Company Y to provide the following service; content writing, blog content, marketing, web maintenance, web optimization, construction of future websites.



This partnership is very vital because, it provides the cornerstone and structure for any possibly impending binding contract which may be related to legal, and financial issue



The purpose of this MOU is to develop and establish policies and procedures that will promote and sustain a market for Company X and Company Y and intend to maintain a product or service that meets or exceeds all business and industry standards.

This MOU is going to create a platform where Company X and Company Y can go in join the venture creating future business.

Another goal of this MOU is to join resources in gaining a large market share by the two-party. In addition, this MOU to save as a legal provide binding Company X and Company Y


The above goals will be accomplished by undertaking the following activities:

  1. Content writing: Company X shall write and edit all projects regarding content writing to Company Y Content writing is text and material used in building a website.
  2. Blog writing blog: Company X shall write blog content for Company Y Blog writing is any information relating to news, current events, discovery, business, and so on.
  3. Marketing: Company X and Company Y must market all the service they offer and also recommends their services to their customers.
  4. Web maintenance: Company Y has the obligation of maintaining the website of Company X in case of needs arises. Web maintenance has to do with malfunction of the site, system attack by hackers, virus or any other means.
  5. Web optimization: Also, Company Y has the responsibility of providing the service of web optimization to Company X. Web optimization has to do with adding new information to the website or modifying certain information to the site.
  6. Construction of future website: Company Y shall be responsible for building future or upcoming websites of Company X with considerable price or no fee attached.

Related: Sample Articles of Association for Nonprofit Organization


Neither party to this Memorandum of Understanding may assign or transfer the responsibilities or agreement made herein without the prior written consent of the non-assigning party, for which approval shall not be unreasonably withheld.

A third party (external auditor or a lawyer) may be called to evaluate the effectiveness and adherence to the agreement at the end of every two months or any time with the consent of the two parties.



Each partner will be obliged to contribute 20% financial support in case of need, however, this MOU is not a commitment of funds.



This MOU is at-will and may be modified by mutual consent of authorized officials from Company X and Company Y. This MOU shall become effective upon signature by the authorized officials from Company X and Company Y and will remain in effect until modified or terminated by any one of the partners by mutual consent. In the absence of mutual agreement by the authorized officials from Company X and Company Y this MOU shall end on ___________________________

(state the date)


Contact Information

Company X                                                                                                                  

(Name & Signature of CEO)

Location of Company X

Contact Number of Company X

Fax address of Company X

E-mail address of Company X


Company Y

(Name of CEO)

Location of Company Y

Contact Number of Company Y

Fax address of Company Y

E-mail address of Company Y


Further Readings 

Letter Writing: Notice of Rent Increase in House Rents to Tenants

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