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50 50 Profit Sharing Agreement for Indonesia

50 50 Profit Sharing Agreement Template for Indonesia

This document is a comprehensive profit sharing agreement governed by Indonesian law, structured to establish a 50-50 partnership arrangement between two parties. It outlines the terms and conditions for equal profit distribution, management responsibilities, and operational procedures in accordance with Indonesian Civil Code (KUH Perdata) and relevant business regulations. The agreement includes detailed provisions for capital contributions, financial management, dispute resolution mechanisms, and compliance with Indonesian tax laws and investment regulations. It serves as a legally binding framework for equitable business collaboration while ensuring adherence to local legal requirements and business practices.

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What is a 50 50 Profit Sharing Agreement?

The 50-50 Profit Sharing Agreement is essential for businesses seeking to establish equitable partnerships in Indonesia. This document is particularly relevant when two parties wish to combine their resources, expertise, or capital while maintaining equal control and profit distribution. It is commonly used in joint ventures, business partnerships, and collaborative projects across various sectors in Indonesia. The agreement must comply with Indonesian legal requirements, including the Civil Code (KUH Perdata), Investment Law, and relevant tax regulations. It typically includes detailed provisions for capital contributions, profit calculation methods, management rights, and dispute resolution procedures. This type of agreement is particularly important in the Indonesian business context, where clear documentation of profit-sharing arrangements is crucial for legal compliance and effective business operations.

What sections should be included in a 50 50 Profit Sharing Agreement?

1. Parties: Identification and details of the parties entering into the profit-sharing agreement

2. Background: Context of the agreement and brief description of the business venture

3. Definitions: Definitions of key terms used throughout the agreement

4. Scope of Collaboration: Detailed description of the business venture and each party's role

5. Capital Contributions: Details of initial and ongoing capital contributions from each party

6. Profit and Loss Sharing: Mechanism for calculating and distributing profits and losses on a 50-50 basis

7. Management and Control: Decision-making processes and operational control provisions

8. Financial Records and Reporting: Requirements for maintaining financial records and reporting obligations

9. Bank Accounts and Financial Management: Provisions for managing joint bank accounts and financial operations

10. Term and Termination: Duration of the agreement and conditions for termination

11. Confidentiality: Protection of confidential information and trade secrets

12. Dispute Resolution: Procedures for resolving disputes between parties

13. Governing Law: Specification of Indonesian law as the governing law

14. General Provisions: Standard contractual provisions including notices, amendments, and severability

What sections are optional to include in a 50 50 Profit Sharing Agreement?

1. Non-Competition: Restrictions on parties engaging in competing businesses, recommended when parties have other business interests

2. Intellectual Property Rights: Provisions regarding ownership and use of IP, necessary when the venture involves creation or use of intellectual property

3. Insurance: Requirements for business insurance coverage, recommended for high-risk ventures

4. Employee Management: Provisions regarding hiring and managing employees, needed when the venture will have employees

5. Exit Strategy: Procedures for party exit or business sale, recommended for long-term ventures

6. Force Majeure: Provisions for handling unforeseen circumstances, recommended in uncertain business environments

What schedules should be included in a 50 50 Profit Sharing Agreement?

1. Schedule A - Business Plan: Detailed business plan including operational strategies and projections

2. Schedule B - Initial Capital Contributions: Itemized list of initial capital contributions from each party

3. Schedule C - Profit Calculation Methodology: Detailed methodology for calculating distributable profits

4. Schedule D - Management Structure: Organizational chart and management responsibilities

5. Schedule E - Financial Reporting Templates: Standard templates for required financial reports

6. Appendix 1 - Required Licenses and Permits: List of necessary business licenses and permits

7. Appendix 2 - Bank Account Details: Details of designated bank accounts for the venture

Authors

Alex Denne

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

Jurisdiction

Indonesia

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions

















































Clauses







































Relevant Industries

Retail

Manufacturing

Technology

Agriculture

Food and Beverage

Real Estate

Construction

E-commerce

Professional Services

Tourism and Hospitality

Mining

Creative Industries

Trading

Digital Services

Transportation and Logistics

Relevant Teams

Legal

Finance

Business Development

Operations

Compliance

Risk Management

Corporate Affairs

Commercial

Strategy

Investment

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Business Development Manager

Legal Counsel

Partnership Manager

Investment Manager

Operations Director

Finance Director

Company Secretary

Commercial Director

Risk Manager

Compliance Officer

Managing Partner

Business Owner

Joint Venture Manager

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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