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The MOU Distribution Agreement is a crucial preliminary document used when parties intend to enter into a distribution relationship but need to establish the framework and conduct due diligence before finalizing a binding agreement. This document type is particularly relevant in the Nigerian business context, where companies often need to establish clear preliminary terms while navigating local regulatory requirements and business practices. The MOU typically includes provisions for confidentiality, exclusivity during negotiations, and outlines of commercial terms, while maintaining its generally non-binding nature. It serves as a roadmap for the negotiation process and helps parties align their expectations and requirements before committing to a full distribution agreement. The document is especially valuable when dealing with cross-border transactions, new market entries, or complex distribution arrangements where detailed evaluation and negotiation periods are necessary.

1. Parties: Identification of all parties to the MOU, including full legal names, registration numbers, and registered addresses

2. Background: Context of the proposed distribution relationship, including brief description of each party's business and the purpose of the arrangement

3. Definitions: Key terms used throughout the document, ensuring clarity and consistent interpretation

4. Purpose and Scope: Clear statement of the intended distribution relationship and geographical territory to be covered

5. Proposed Principal Terms: Outline of key commercial terms including product range, proposed pricing structure, and distribution rights

6. Due Diligence: Framework for information exchange and evaluation process

7. Negotiation Process: Timeline and process for negotiating the final distribution agreement

8. Confidentiality: Protection of confidential information exchanged during negotiations

9. Non-Binding Nature: Clear statement that the MOU is non-binding except for specified clauses

10. Exclusivity Period: Period during which parties agree not to negotiate with other potential partners

11. Costs and Expenses: Each party's responsibility for costs incurred during the negotiation process

12. Term and Termination: Duration of the MOU and circumstances for termination

13. Governing Law: Specification of Nigerian law as governing law and jurisdiction