Memorandum of Agreement (MOA) template
Use this free Memorandum of Agreement template to formalise the terms of your relationship with your counterparty.
Use this free Memorandum of Agreement template to formalise the terms of your relationship with your counterparty.
A Memorandum of Agreement, often abbreviated to 'MOA', is a written document that delineates a cooperative relationship between two parties. It's an arrangement that both parties willingly enter, acknowledging their commitment to a common project or goal.
This form of contract outlines the specific responsibilities, roles, and expectations of each party that is involved in the agreement. It stipulates the parameters and guidelines within which the parties are expected to operate. It also sets out the consequences they might face if they fail to uphold their side of the agreement.
As with many legal documents, a Memorandum of Agreement becomes a legally enforceable contract once both parties formalize their acceptance. This acceptance happens when parties sign the MOA, either digitally or by traditional wet ink signature.
A Memorandum of Agreement functions by formally detailing a collaborative relationship between two or more parties. Each party is obliged to fulfill certain duties or tasks that contribute towards a shared objective, which is clarified within the document.
Even though the responsibilities might only be implemented in the future, the specifics of the obligations are generally determined at the time of the agreement. This means that all parties can anticipate and prepare for their duties under the agreement. It puts them both on the same page regarding the duties they owe to each other for the project that follows.
When parties sign a Memorandum of Agreement, they aren't irrevocably committing to the responsibilities outlined in the contract. They can still modify or withdraw their participation. Signing an MOA simply establishes the framework of cooperation for the future, if they choose to proceed.
The purpose of a Memorandum of Agreement is to establish a structured partnership between two parties, with a legal framework to bolster it.
By outlining a roadmap for cooperation, MOAs enable entities to work together towards a common goal, fostering a sense of shared responsibility and understanding. This can help the parties to align their individual objectives with the collective aim of the agreement, making collaboration easier and more predictable for everyone.
A Memorandum of Understanding (MOU) is generally broader than a Memorandum of Agreement (MOA), and less likely to bind the parties to specific tasks and timelines. An MOU is more about defining the roles and responsibilities and broad outlines of a collaboration, to facilitate more detailed discussion about a shared project. An MOA sets out more detailed terms, conditions and commitments and is likely to refer to a specific project that you're ready to undertake together.
Lots of stakeholders can play a role in the formulation, execution, and oversight of Memoranda of Agreement. A typical MOA will involve the following key actors:
Once the terms have been standardized and an MOA template has been approved, legal and finance departments can usually step back, as long as they have successfully equipped project managers to independently manage these agreements.
To help you understand which elements should be incorporated when creating your Memorandum of Agreement template, we've laid out the typical elements of an MOA below.
Just like other contract types, like Statements of Work, MOAs aren't exclusive to legal professionals; they are also intended for non-expert parties involved in the agreement. Therefore, it's crucial to draft MOA templates with clarity for all participants. Including clear definitions is an effective way to do this.
You want your MOA template to clarify any technical terms that are necessary and remove any that are not. This ensures the MOA is easily understood by all parties and guarantees they understand their obligations under the agreement.
A vital part of an MOA template is the section that details the extent and nature of the agreement. This area usually outlines the shared goal or project and explains the roles and responsibilities of each party in achieving this objective.
You can get a steer on these elements by downloading the Memorandum of Agreement sample available above.
Every MOA template should include a section that elaborates on the period the agreement will be effective. This could either be a fixed period or could be dependent on certain conditions or milestones.
This way, all parties are aware of the timeframe within which they are expected to fulfill their obligations and how this period is determined, promoting full transparency.
An MOA, like most contract templates, should also lay out the specific duties and deliverables expected from each party. The template should clearly delineate these obligations, ensuring that everyone understands what they need to do to fulfill the agreement.
Many MOA templates will also outline the process for terminating the agreement and any terms related to dispute resolution. This gives the parties clear guidance on how conflicts are to be handled and the procedure if one or more parties wish to exit the agreement.
We've discussed who handles MOAs, but what does this workflow entail in more detail? Well, it depends on how organizations choose to implement MOAs, and whether they have an MOA template on hand.
For organizations that function without an MOA template, the process can be quite taxing. It involves crafting each agreement, reviewing it internally, and obtaining the required approval.
If the legal team has to do this every time a new collaborative project or partnership is initiated, it makes for an unscalable process that could hold back company growth.
Fortunately, it’s commonplace for legal teams in 2023 to work instead from a Memorandum of Agreement template. Most organizations will have formulated templates for straightforward contracts like MOAs or MSAs and stored them in shared contract repositories for project managers to utilize.
Having an MOA template at hand and ready for customization eliminates the need for project managers to wait for the legal team’s assistance when initiating a new partnership or project. This accelerates the process of establishing collaborations and seizes opportunities more efficiently.
It also means that the bulk of MOA terms are standardized, reducing room for errors and inconsistencies.
However, even if legal teams have created an MOA template, there’s still a fair amount of administrative work required on the part of project managers to finalize them. When these agreements are managed in Word, project managers need to manually enter all of the new partner’s details and update the specifics within the agreement to suit their particular circumstances.
This can be painful as Word documents are static files, so modifying an MOA template often involves creating new versions and copying certain sections of the agreement into a new file to update the specifics.
Even with an MOA template available, handling these agreements manually can be a repetitive and labor-intensive process for project managers.
Fortunately, this is a process that can be streamlined by using automation.
Contract automation software can alleviate this administrative burden by automating the most time-consuming aspects of contract management. Using an all-in-one contract management platform like Juro, organizations can manage MOAs more effectively with the help of the following features:
If you're looking for a scalable way to create, negotiate, sign and share Memoranda of Agreement, from easy-to-set-up templates, our team of specialists at Juro can help you to explore the benefits of automating MOAs. Hit the button below to find out more.
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