Call it a Memorandum of Understanding (“MOU”), Term Sheet, Summary of Terms or any other title, but don’t skip it. Too often parties are eager to “close the deal” and to our suggestion to start with an MOU say they don’t want to waste any time and go right ahead with a full-blown agreement.Whether it’s an investment agreement, license agreement, services agreement, mutual co-operation agreement or any other agreement, it is advisable to start with detailed understandings of the principles of the engagement, and here are five reasons why:
1.An MOU can be of 1-2 pages which specify the main principles of the engagement. Unlike a full definitive agreement which, depends on the complexity of the engagement, can be of many more and will require time and effort for both parties to review and mark.
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