Can Quillio draft escrow agreements?
Yes. I draft escrow agreements for M&A retentions, software source code escrow, and document holding arrangements. The key is clear release conditions that do not require the escrow agent to exercise legal judgment — the agent should be executing mechanical instructions, not resolving disputes.
Release conditions
I draft release conditions as objective triggers — a specific date, a joint notice signed by both parties, or a judgment of a named court. Subjective triggers ("if Party A considers Party B in breach") push legal decisions onto the agent and I flag these.
Agent duties and liability
The escrow agent's duties should be limited, specified, and usually paid. Liability should be limited to gross negligence or wilful misconduct. I draft so that the agent is not expected to verify factual claims or interpret contracts.
Dispute mechanics
Where the parties disagree on a release trigger, I draft a dispute mechanic — either the agent holds until a court order, or the funds are paid into court. Time limits on disputes are important — an indefinite standoff benefits no one.
Common issues
- Escrow agents are reluctant to sign complex agreements — confirm before drafting
- Source code escrow needs technical specifications — involve the engineering team
- Tax on escrow releases can be complex — flag for accountant review
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