Escrow Agreement

Bahman Eslamboly

Form reviewed by Bahman Eslamboly, Attorney at FindLegalForms

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This Escrow Agreement is between the seller of a business, the buyer of the business and an escrow agent. Under this agreement, the escrow agent agrees to hold a certain sum of money in an escrow account until the buyer and seller agree to release these funds once all terms regarding the business purchase are concluded. The escrow agent agrees to invest the escrow funds in an interest bearing account and to disburse these funds only upon explicit written directions to do so. This agreement sets out the terms of this arrangement including the amount of the funds and how the escrow funds will be delivered to the agent. It is crucial this type of agreement be set forth in writing. A written Escrow Agreement will prove invaluable in the event there are disagreements between the parties regarding the funds in escrow.

This Escrow Agreement includes the following provisions:
  • Parties: Sets forth the name of the seller, the buyer and the escrow agent;
  • Funds in Escrow/Delivery: The set amount of funds to be deposited into the escrow account and how the funds will be delivered to escrow agent (certified check, wire transfer);
  • Investment of Escrow Funds: Sets forth that escrow agent will invest the funds in an interest bearing account selected by the seller and that interest earned on these funds will be held or reinvested until disbursed;
  • Disbursement of Funds: Scenarios under which funds will be disbursed (through direction of seller to buyer, at request of buyer, joint direction of both buyer and seller, and disbursement of funds after first anniversary date);
  • Duties and Responsibilities: Sets out that escrow agent shall have no duties or responsibilities regarding the account other than those set forth in this agreement;
  • Resignation or Removal: Sets forth that escrow agent may resign or be discharged from its duties under this agreement by giving sixty days written notice to buyer and seller at which time a successor escrow agent will be appointed;
  • Signatures: The seller, buyer and escrow agent must sign the agreement in the presence of witnesses;
  • Schedules/Disbursement of Funds: Schedules A, B and C set out the specific directions regarding disbursement of the escrow funds.

Protect your Rights and your Business by using our attorney-prepared forms.

This attorney-prepared packet contains:
  1. General Instructions
  2. Escrow Agreement
State Law Compliance: This form complies with the laws of all states

Escrow Agreement

Product Details

Product Escrow Agreement
Country United States
Pages 13
Dimensions Designed for Letter Size (8.5" x 11")
Printer compatibility Designed to print on all ink-jet and laser printers
Editable Yes (.doc, .wpd and .rtf)
Format Microsoft Word
Adobe PDF
WordPerfect
Rich Text Format
Platform Windows Compatible
Mac Compatible
Linux Compatible
Availability In Stock. Instant Download
Usage Unlimited number of prints
Category Escrow Agreements
Product number #28833
Download time Less than 1 minute (approx.)
Document Access Via secret online address
Email with download links
Email with attachment upon request
Refund Policy 60 days, no-questions asked, 100% money back guarantee

Frequently Asked Questions

An escrow agreement is a legal document that outlines the terms under which an escrow agent holds funds on behalf of the buyer and seller during a business transaction. It specifies how and when the funds will be disbursed once the conditions of the sale are met.

The parties involved typically include the seller of the business, the buyer, and the escrow agent. Each party has specific roles and responsibilities as outlined in the agreement.

The funds in escrow are held by the escrow agent until the buyer and seller fulfill the conditions of the sale. The escrow agent may also invest the funds in an interest-bearing account, with the interest being handled according to the terms of the agreement.

Yes, the escrow agent can resign or be removed from their duties by providing written notice to the buyer and seller. A successor escrow agent will then be appointed to take over the responsibilities.

In the event of a dispute, the escrow agreement provides a framework for resolving the issue. It is advisable to refer to the specific terms outlined in the agreement and seek legal counsel if necessary.

While not all business transactions require an escrow agreement, it is highly recommended for transactions involving significant sums of money or complex conditions. It helps protect the interests of all parties involved.

This escrow agreement is designed to comply with the laws of all states. However, it is always advisable to consult with a legal professional to ensure that all local regulations and requirements are met.

Is This Form Right For You?

Use This Form If:

  • Individuals who are involved in the sale or purchase of a business may require an escrow agreement to ensure that funds are securely held until all conditions of the sale are met. This protects both parties from potential disputes over the funds.
  • Situations requiring the safeguarding of large sums of money during a business transaction often necessitate an escrow agreement. This form provides a structured process for managing the funds and ensures that they are only released when both parties agree.
  • To comply with legal standards and best practices in business transactions, parties may opt to use an escrow agreement. This formalizes the arrangement and provides a clear framework for the handling of funds, thereby minimizing risks associated with the transaction.
  • For those entering into complex business deals, an escrow agreement can serve as a crucial tool to manage financial exchanges. It outlines the responsibilities of the escrow agent and the conditions under which funds will be disbursed, ensuring transparency and accountability.
  • Businesses looking to establish trust with their partners may find an escrow agreement beneficial. By using this form, they can demonstrate a commitment to fair dealings and provide a sense of security regarding the financial aspects of the transaction.

Do Not Use If:

  • – This form is not appropriate for informal transactions where trust exists between the parties and no significant funds are involved. In such cases, a simple handshake or verbal agreement may suffice.
  • – If the transaction does not involve the sale or purchase of a business, using an escrow agreement would be irrelevant. This form is specifically tailored for business transactions.
  • – In situations where the parties are unwilling to adhere to written agreements, using an escrow agreement would not be effective. Both parties must be committed to the terms laid out in the document.
  • – If the escrow funds are not substantial enough to warrant the use of an escrow agent, it may be unnecessary to utilize this form. Smaller transactions may be better served by simpler arrangements.
  • – For transactions that are not legally binding or lack enforceability, an escrow agreement would not provide the intended protections or benefits.

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