Startup Terms Glossary
What is a Holdback Escrow?
Holdback escrow is an agreement that outlines how certain funds will be set aside to cover the cost of fees associated with a breach of contract by the seller in the deal. Better known as escrow holdback, this amount is usually a percentage of the total purchase price that will be held to be security for the buyer.
Holdback Escrow Examples
Example of a situation in which an escrow holdback might be needed:
- Example 1. A buyer is interested in buying a startup but negotiations have been contentious to date. The buyer may set aside money in case the seller breaches the purchase agreement or terms of the deal.
Here’s a web page about holdback escrows.
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Hi! I'm Paisley and I'm an attorney licensed in Georgia & New York with experience in intellectual property and contractual matters. I began my career at a large international firm in New York, where I advised on IP and data privacy matters in mergers, acquisitions, and other corporate transactions. I then worked at a small firm in Georgia, where I gained experience in corporate and commercial real estate matters. Today I enjoy counseling individuals and businesses looking for assistance with issues and agreements related to intellectual property, contracts, leases, internal IP protection and development, service providers, and IP strategy. I'm a proud graduate of New York Law School and Boston University's Advertising program. You can learn more about me at PaisleyPiasecki.com.
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