Jurisdiction(s):
United Kingdom

Key definition

Memoranda of understanding definition

What does Memoranda of understanding mean? A memorandum of understanding (MOU) sets out the parties’ shared objectives, headline terms and process for a proposed transaction or collaboration before substantive contract negotiations. It is not defined by legislation; the term is descriptive and used across corporate, commercial, public sector and cross-border contexts, often interchangeably with “heads of terms” or “letter of intent”. MOUs are usually marked “subject to contract” and intended to be non-binding as to the final deal. Specific provisions can, however, be binding if clearly drafted, for example confidentiality, exclusivity/no-shop, cost allocation and access to information, as well as governing law and jurisdiction. Enforceability turns...

Corporate authorisation and signing policy: definitions, delegation and approval thresholds (contracts, guarantees, indemnities, extraordinary items and expenses) with board-to-manager spending limits matrix for commercial organisations

Published by a LexisNexis Risk & Compliance expert

Precedents

Any words or expressions cited in these signing/authorisation limits are set out in the ‘Terms’ table—see section 1...

1 Terms

Contract: An oral or written arrangement between two or more parties that creates obligations enforceable or otherwise recognised at law, and which binds [ Insert organisation’s name ], whether or not it is expressly labelled a contract. Examples include:

leases
licences
guarantees
indemnities
agreements
letters of intent
Memoranda of understanding
statements of work
Non-disclosure (or Confidentiality) agreements
click-to-accept online terms
‘shrink-wrap’ licence agreements and extensions
amendments or Variations to any Contracts

Extraordinary Items: Expenditure that is either not included in Board-approved budgets, exceeds Board-approved budgets, or falls outside the ordinary course of business...

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Elizabeth Bourlet

Elizabeth is an experienced, commercially-minded solicitor with a combination of professional and business qualifications. Elizabeth has a breadth and depth of experience gained from holding senior positions both in private practice and in significant corporate entities in a wide range of industries and sectors, including: retail ' a national garden centre group and a major national DIY group, luxury brands, manufacturing, the water industry, IT and the public sector. Elizabeth has a particular interest in drafting, negotiating and managing commercial contracts of all kinds: general terms and conditions of purchase and supply, supply of services, IT and major systems implementation, marketing, utility supplies, telecoms, supporting the rationalisation of suppliers and the establishment of cost effective group-wide initiatives, including outsourcing and insourcing. Preparation for GDPR has also been a key part of her recent assignments, as has Corporate Social...

Web page updated on 22/05/2026

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