Negotiation and Drafting of Various

Commercial Contracts Today

ISSUES, RISK MITIGATION AND MANAGING THE PROCESS

Contract Law
Jentera School of Law, 20 February 2019
Arief surowidjojo
Present Typical Commercial Contracts in Indonesia

 Contracts Relating to Slow-down of Economic Growth

 Debt Restructuring:
 Debt Settlement
 Refinancing
 Sale of Receivables

 Corporate Reorganization:
 Merger
 Acquisition
 Consolidation
 Spin-off
 Asset Sale
Present Typical Commercial Contracts in Indonesia

 Contracts Relating to Infrastructure Development

 Engineering, Procurement and Construction and Turnkey Project

 Power Plant Development
 Power Purchase Agreement
 Port Development and Management
 Toll Road Development
 Train Systems and Management
 Project Financing
 Government Guarantee Scheme for Public-Private Partnership
Present Typical Commercial Contracts in Indonesia

 Contracts Relating to New Business or Development

 Joint Venture, Founders or Shareholders Agreement, Articles of

Association
 Corporate Finance: Shareholders Equity, Shareholders’ loan, Bank’s
Loan, Bond Issuance, Convertible Bond Issuance, Notes, Factoring,
Venture Capital, Initial Public Offering, Lease Finance
 Technical Assistance
 License and Management
 Employment
Present Typical Commercial Contracts in Indonesia

 Contracts Relating to Digital Business

 Ideas Development
 Start-up Establishment
 Fund Raising Mechanics (Equity and Loan)
 Public Offering
 E-Government
 E-Commerce
 Smart Contract
 IPR Protection
Issues in Contracts Relating to Slowdown of Economic Growth

 Assessment of the business and industry conditions

 Availability of fund and appetite of new investors
 Valuation of business to be bailed out
 Due diligence process
 Risks Assessment, Mitigation and Management
 Methods of Bail-out
 People’s Issues
 Impact to stakeholders
 Clash of Culture and Conflict Management
 Exit Options for Investors and Lenders
Issues in Contracts Relating to Infrastructure Development

 Feasibility of the project: technical, legal, monetary, benefits for public,

contribution to state’s finance, environmental, social, regional impact
 Foreign and/or domestic participants
 Financing structure
 Deal structure
 Government approval
 Land acquisition and people’s issues
 International or local bidding process
 Early commitment to participate
 Managing contracts with main users
 Government Guarantee Scheme
 Governing law
Issues in Contracts Relating to New Business or Development

 Feasibility of business and development

 Legal framework and deal structure
 Early commitment to enter into the transaction
 Due diligence
 Establishment of business organization
 Preparing and execution of Joint Venture Agreement, Founders (Shareholders) Agreement,
Articles of Association
 Capital structure
 Shareholding structure
 Controlling party: management, supervision, shareholding, or others (technology, market, license)
 Business activities coverage
 Dividend policy
 Management and supervision
 Governance
 Governing law, Jurisdiction, settlement of dispute
Issues in Contracts Relating to New Business or Development

 Preparing supporting contracts

 Technical Assistance Agreement

 Management Agreement
 Resourcing Agreement
 License Agreement (patent, copyright, trademark, product design)
 Marketing Agreement

 Preparing Employment Contract

 Preparing Collective Labor Agreement
 Dispute Resolution
 Exit Rules
Issues in Contracts Relating to Digital Business

 Ideas and protection of ideas

 Access to Technology
 Role of founders, angels or venture capitalists
 Methods of financing (loan, equity, convertible)
 Scale of business development
 When it’s ready for IPO
 The era after IPO: controlling party, role of founders, ideas future
development
 Competition
 Technology development