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Business Sale Agreement for Indonesia

Business Sale Agreement Template for Indonesia

A comprehensive legal document governed by Indonesian law that formalizes the sale and purchase of a business, including its assets, operations, and sometimes shares. The agreement complies with Indonesian corporate law, particularly Law No. 40 of 2007 on Limited Liability Companies, and addresses crucial aspects such as asset transfer, employee transitions, warranties, and post-completion obligations. It includes detailed provisions for purchase price, payment terms, conditions precedent, and various representations and warranties, while ensuring compliance with local regulatory requirements and business practices.

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What is a Business Sale Agreement?

The Business Sale Agreement is a crucial document used in Indonesian business transactions when one entity wishes to sell and another wishes to purchase an existing business. It is essential for transactions governed by Indonesian law, particularly complying with Law No. 40 of 2007 on Limited Liability Companies and related regulations. The document comprehensively covers all aspects of the business transfer, including asset sale, employee transitions, liabilities, warranties, and post-completion obligations. It requires careful consideration of local regulatory requirements, tax implications, and business practices specific to Indonesia. The agreement typically involves detailed due diligence and may require various governmental approvals depending on the business sector and transaction size.

What sections should be included in a Business Sale Agreement?

1. Parties: Identification of the seller and buyer, including complete legal names, registration numbers, and addresses

2. Background: Context of the transaction, brief description of the business, and purpose of the agreement

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

4. Sale and Purchase: Core transaction terms including the business assets being sold and purchase price

5. Purchase Price and Payment: Detailed payment terms, including payment method, timing, and any adjustments

6. Conditions Precedent: Conditions that must be satisfied before completion of the sale

7. Pre-Completion Obligations: Obligations of both parties between signing and completion

8. Completion: Process and requirements for completing the transaction

9. Post-Completion Obligations: Obligations of both parties after completion

10. Seller's Warranties: Warranties regarding the business, assets, liabilities, and operations

11. Buyer's Warranties: Warranties from the buyer regarding capacity and authority

12. Employee Matters: Treatment of employees and related liabilities

13. Confidentiality: Obligations regarding confidential information

14. Non-Competition: Restrictions on seller's future business activities

15. Governing Law and Dispute Resolution: Choice of law and dispute resolution mechanisms

16. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

What sections are optional to include in a Business Sale Agreement?

1. Intellectual Property: Detailed provisions for transfer of IP rights, when the business owns significant IP assets

2. Property Lease Assignment: Provisions for transferring property leases, when business premises are leased

3. Environmental Matters: Specific provisions for environmental liabilities, particularly relevant for manufacturing businesses

4. Tax Indemnity: Specific tax-related indemnities, when complex tax implications exist

5. Earn-out Provisions: Structure for additional payments based on future performance, when part of purchase price is contingent

6. Third Party Consents: Process for obtaining necessary third party approvals, when key contracts require consent for transfer

7. Transition Services: Terms for post-completion assistance from seller, when complex operational handover is needed

What schedules should be included in a Business Sale Agreement?

1. Schedule 1 - Business Assets: Detailed list of all assets included in the sale

2. Schedule 2 - Excluded Assets: List of assets specifically excluded from the sale

3. Schedule 3 - Properties: Details of all business properties, owned or leased

4. Schedule 4 - Intellectual Property Rights: List of all IP rights owned or used by the business

5. Schedule 5 - Employee Information: Details of all employees, including terms of employment

6. Schedule 6 - Material Contracts: List and details of key business contracts

7. Schedule 7 - Warranties: Detailed warranties given by the seller

8. Schedule 8 - Permitted Encumbrances: List of permitted liens or encumbrances on assets

9. Schedule 9 - Completion Obligations: Detailed list of actions required at completion

10. Schedule 10 - Form of Transfer Documents: Templates for various transfer documents required

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

Document Type

Sale Agreement

Cost

Free to use
Relevant legal definitions










Clauses













































Relevant Industries

Manufacturing

Retail

Technology

Healthcare

Hospitality

Construction

Financial Services

Professional Services

Transportation

Agriculture

Mining

Energy

Education

Real Estate

Consumer Goods

Media and Entertainment

Telecommunications

Relevant Teams

Legal

Finance

Corporate Development

Human Resources

Compliance

Tax

Operations

Risk Management

Corporate Secretariat

Business Development

Mergers & Acquisitions

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Managing Director

Business Development Director

Corporate Lawyer

Legal Counsel

Finance Director

Company Secretary

Compliance Officer

Tax Manager

Human Resources Director

Operations Director

Risk Manager

Business Owner

Commercial Director

Merger & Acquisition 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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