Stock Escrow Agreement Template for Indonesia

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Key Requirements PROMPT example:

Stock Escrow Agreement

"Need a Stock Escrow Agreement under Indonesian law for holding 25% shares of a tech startup in escrow until March 2025, with specific provisions for foreign investment compliance and quarterly dividend distributions to the beneficial owner."

Document background
A Stock Escrow Agreement is a crucial document used in Indonesian corporate transactions where shares need to be held by a neutral third party pending the fulfillment of specific conditions or obligations. This agreement is commonly utilized in mergers and acquisitions, corporate restructurings, employee stock ownership plans, or as security arrangements. The document must comply with Indonesian regulatory requirements, particularly Law No. 40 of 2007 on Limited Liability Companies and relevant OJK (Financial Services Authority) regulations. It establishes the escrow agent's duties, the conditions for share deposit and release, handling of dividends and voting rights, and the mechanisms for dispute resolution. The agreement is particularly important in Indonesia's business environment where secure share transfer mechanisms and regulatory compliance are essential for both domestic and foreign investors.
Suggested Sections

1. Parties: Identifies all parties to the agreement: the depositor(s), beneficiary(ies), and the escrow agent

2. Background: Sets out the context and purpose of the escrow arrangement and the underlying transaction

3. Definitions: Defines key terms used throughout the agreement

4. Appointment of Escrow Agent: Formal appointment and acceptance of the escrow agent's role and responsibilities

5. Deposit of Escrow Shares: Details of the shares to be held in escrow, including quantity, class, and company information

6. Escrow Period: Duration of the escrow arrangement and any applicable extensions

7. Rights and Obligations of Escrow Agent: Comprehensive list of the escrow agent's duties, powers, and limitations

8. Release Conditions: Specific conditions that must be met for the release of shares from escrow

9. Release Mechanism: Procedures for releasing shares from escrow, including required documentation and timeframes

10. Voting Rights and Dividends: Treatment of voting rights and dividends during the escrow period

11. Fees and Expenses: Details of escrow agent's compensation and allocation of costs

12. Representations and Warranties: Standard representations from all parties regarding authority, ownership, and compliance

13. Indemnification: Provisions for indemnifying the escrow agent and other parties as applicable

14. Termination: Circumstances and procedures for terminating the agreement

15. Governing Law and Jurisdiction: Specification of Indonesian law as governing law and jurisdiction for disputes

16. Notices: Communication procedures and contact details for all parties

17. General Provisions: Standard boilerplate clauses including amendments, assignments, and severability

Optional Sections

1. Tax Provisions: Include when there are specific tax implications or requirements for the escrow arrangement

2. Foreign Investment Compliance: Required when shares involve foreign ownership subject to Indonesian investment regulations

3. Electronic Communications: Include when parties agree to use electronic means for instructions and communications

4. Force Majeure: Optional provisions for handling unforeseen circumstances that may affect the escrow arrangement

5. Regulatory Compliance: Include when dealing with listed companies or specific regulated industries

6. Substitute Escrow Agent: Procedures for appointing a replacement escrow agent if needed

7. Multiple Depositors: Additional provisions when there are multiple share depositors

8. Confidentiality: Detailed confidentiality provisions if not covered adequately in general provisions

Suggested Schedules

1. Schedule 1 - Share Details: Detailed description of the escrowed shares, including share certificates numbers and shareholder information

2. Schedule 2 - Release Conditions Matrix: Detailed matrix of conditions and corresponding release requirements

3. Schedule 3 - Fee Schedule: Detailed breakdown of escrow agent fees and payment terms

4. Schedule 4 - Required Documents: List of all documents required for deposit and release of shares

5. Schedule 5 - Authorized Signatories: List of persons authorized to give instructions regarding the escrow

6. Appendix A - Form of Release Notice: Standard form for requesting release of shares from escrow

7. Appendix B - Form of Release Certificate: Standard form for certifying that release conditions have been met

8. Appendix C - Compliance Certificates: Templates for various compliance certificates required under Indonesian law

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Banking & Financial Services

Investment Management

Corporate Services

Legal Services

Technology

Real Estate

Manufacturing

Energy

Mining

Telecommunications

Healthcare

Retail

E-commerce

Relevant Teams

Legal

Compliance

Corporate Secretarial

Finance

Corporate Finance

Mergers & Acquisitions

Investment

Business Development

Corporate Governance

Risk Management

Relevant Roles

Legal Counsel

Corporate Secretary

Chief Legal Officer

Compliance Officer

Investment Manager

Corporate Finance Manager

Mergers & Acquisitions Director

Transaction Manager

Chief Financial Officer

Financial Controller

Business Development Director

Company Director

Chief Executive Officer

Escrow Services Manager

Corporate Governance Officer

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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