An MOU is a tool for deal making, relationship formation, and business structuring.
It is used by companies, not-for-profit organisations, and governments.
Although a memorandum of understanding ("MOU") has no specific status in law, it's a very useful tool when drafted well.
There are many situations in which MOUs are used and in which they are very effective and suitable as compared to the alternatives.
A choice is often made by clients in consultation with a business lawyer between drafting an MOU, or a contract, deal memo, terms sheet, or heads of agreement.