Sale and purchase of assets / shares
In sale purchase escrow arrangement, an escrow agent acts as an independent and neutral third party who holds the funds from the buyer as a proof of commitment in the transaction. The seller may transfer the assets/shares to the escrow agent or they may transfer directly to the buyer. Once a certain pre-agreed conditions are fulfilled, the escrow agent will release the escrowed amount to the seller.
How it works
Buyer and Seller sign a sale and purchase agreement
Buyer and Seller engage Escrow SG as their escrow agent. An escrow agreement will be signed between the buyer, seller and Escrow SG.
Buyer funds the escrow account with the escrowed amounts as agreed within the escrow agreement and the seller transfers the asset/share to Escrow SG.
The escrow arrangement is in place until:
Both buyer and seller agree that the escrow conditions for fulfilled and they agree to instruct Escrow SG to release of escrowed amounts to the seller, or
Both buyer and seller agree that the escrow conditions are not met and agree to revert the escrowed amounts to the buyer, or
Buyer and seller are in disagreement on whether escrow conditions have been met or not. Escrow SG or an independent third party will determine if the escrow conditions are met or not; and release or revert of escrowed amounts accordingly.
5. If 4a occurs, Escrow SG will transfer the asset/share to the buyer and the escrowed amounts to the seller.