Document background
The MOU Distribution Agreement serves as a preliminary document used when parties wish to formalize their intent to enter into a distribution relationship while maintaining flexibility for detailed negotiations. It is particularly useful in complex distribution arrangements where parties need to establish basic commercial understanding before committing resources to detailed contract negotiations. This document, governed by German law, typically precedes a full Distribution Agreement and outlines key terms such as territory, product scope, and basic commercial conditions. The MOU may contain both binding elements (such as confidentiality and exclusivity of negotiations) and non-binding elements (such as commercial terms), making it a versatile tool in German commercial practice. It's especially valuable when parties need to secure internal approvals, conduct due diligence, or align on fundamental business terms before proceeding with a comprehensive agreement.
