Tripartite Agreement For Escrow Account Template for India

The Tripartite Agreement For Escrow Account is a crucial legal instrument used in India when parties need a secure mechanism for handling conditional financial transactions. This document is typically employed in situations such as large commercial transactions, real estate deals, project financing, or merger and acquisition transactions where funds need to be held securely by a neutral third party (usually a bank) until specific conditions are met. The agreement is structured in compliance with Indian banking regulations, particularly the Banking Regulation Act, 1949, and RBI guidelines, and includes detailed provisions for account operation, fund release mechanisms, and the responsibilities of all parties involved. It provides protection to all stakeholders by ensuring that funds are properly managed and disbursed only when predetermined conditions are satisfied, making it an essential tool in complex financial transactions in the Indian market.

1. Parties: Identifies and provides details of the three parties: Account Holder/Depositor, Escrow Agent (Bank), and Beneficiary

2. Background/Recitals: Sets out the context and purpose of the escrow arrangement and references any underlying transaction

3. Definitions: Defines key terms used throughout the agreement for clarity and consistency

4. Appointment of Escrow Agent: Formal appointment of the bank as escrow agent and acceptance of the role

5. Escrow Account Establishment: Details of the escrow account setup, account type, and initial deposit requirements

6. Deposit Requirements: Specifies the amount, timing, and method of deposits into the escrow account

7. Operation of Escrow Account: Rules and procedures for managing the escrow account, including authorized signatories and operational controls

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

9. Escrow Agent's Rights and Responsibilities: Detailed duties, obligations, and rights of the escrow agent

10. Fees and Expenses: Details of escrow agent's fees and allocation of costs among parties

11. Representations and Warranties: Standard representations and warranties from each party

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

13. Term and Termination: Duration of the agreement and circumstances for termination

14. Governing Law and Jurisdiction: Specifies applicable law and jurisdiction for dispute resolution

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

16. Miscellaneous: Standard boilerplate provisions including amendments, assignments, and severability