The second round of talks began on 20 March in Luena. Both sides were optimistic that peace was within their grasp. Kamorteiro said that "many politicians have used the same expression, but I am not a politician, I am a soldier, so when I speak of peace I really mean it."
The UNITA team included the main Generals, and this time was headed by Marcial Dachala, Information Secretary, and Alcides Sakala, Secretary for Foreign Affairs (both earlier considered dead). Gato was again absent, but later claimed that the UNITA negotiating team was in regular contact with him at his base somewhere in Moxico in order to harmonise their positions.
During talks, the government news services reported a very good atmosphere between the negotiators, with UNITA delegation members in free and friendly chats with their FAA partners and with members of the public. Kamorteiro was reported seen openly driving around Luena roads in his jeep, and his colleagues spotted at discos and night clubs.
On 23 March FAA regional military commanders joined the talks, and on 25 March the talks were suspended for consultations. There was still some nervousness from abroad. The 'external mission' asked the government for the venue of the talks to be changed to a location with better access for press and other observers (i.e. Luanda), and with greater scope for monitoring by the UN and the Troika as foreseen in the Lusaka Protocol.
Talks were dominated by the technicalities of a ceasefire and the detailed definition of all aspects related to the quartering and demobilisation of UNITA's forces. A Joint Military Commission (CMM) was formed, with observer status for the UN and the Troika as well as a technical group consisting of military experts from the FAA and UNITA, and UN and Troika representatives. In accordance with the status of the negotiations as military talks, political issues such as the role of UNITA leaders in state and government structures, vacant parliamentary seats, and longer-term issues such as elections and the constitution were left for later.
The military agreement was signed on 30 March, paving the way for the official signing on 4 April. It had been widely expected that Gato would sign for UNITA, but he failed to attend. Journalists in Luena were initially told that the helicopter sent to fetch him could not land because of heavy rain. When the helicopter arrived, it was carrying the former UNITA Commander-in-Chief General Samuel Chiwale who claimed that Gato "had too much work" to allow him to attend. Chiwale assured reporters that General Gato would be present at the ceremony in Luanda on Thursday 4 April which would be witnessed by Gambari and the Troika ambassadors. On that day, the two Commanders-in-Chief (Armando da Cruz Neto and Kamorteiro) signed the Memorandum. Dispelling any fears of a Savimbi-like snub to the agreement, Gato attended and was received by Dos Santos after the ceremony.
The sense that the Luena Memorandum had been a pact between two parties to the exclusion of other political forces remained. While it succeeded in ending the war, and not withstanding the warm words of the peace plan, it left other political and social forces out in the cold. On 3 April, the eve of the signing ceremony, President dos Santos gave a speech to the nation about forgiving and forgetting, national reconciliation, reconstruction, and care for those in need. In response, the leader of the National Front for the Liberation of Angola, Holden Roberto – the only surviving leader of Angola's three original liberation movements – called for a commission to prepare "a national dialogue without exclusion" to guarantee peaceful transition to democracy and national reconstruction.
The agreed amnesty provisions heightened the sense of an exclusive two-party pact. UNITA and the FAA were granted a blanket amnesty by parliament, approved unanimously days before the signing. It was the first time that a proposal was passed unanimously by the Assembly, but the reaction from observers was less warm. On 11 April Gambari met with Gato and reiterated that the UN would not recognise the amnesty since war crimes had to be prosecuted. The amnesty was also questioned by 63 smaller political parties in a letter to the President. Gato (and even Holden Roberto) considered Gambari's intervention unwelcome and as potentially destabilising of the prevailing positive mood.