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Buy Sell Agreement Life (Insurance)
"I need a Buy Sell Agreement Life (Insurance) for my three-partner technology consulting firm in Jakarta, where each partner will have a $500,000 life insurance policy, and the agreement should include both death and permanent disability as trigger events for the mandatory purchase of shares."
1. Parties: Identification of all parties to the agreement, including the business owners and their complete details
2. Background: Context of the agreement, including current ownership structure and purpose of the buy-sell arrangement
3. Definitions: Definitions of key terms used throughout the agreement, including technical insurance terms
4. Purchase Obligations: Core obligations of surviving owners to purchase and deceased/disabled owner's estate to sell
5. Insurance Obligations: Requirements for maintaining life insurance policies, including premium payments and beneficiary designations
6. Trigger Events: Events that activate the buy-sell provisions (death, disability, retirement, etc.)
7. Purchase Price: Method of determining the purchase price of shares/interest, including valuation mechanisms
8. Payment Terms: Structure and timing of payments, including use of insurance proceeds
9. Insurance Proceeds: Handling and distribution of insurance proceeds upon a trigger event
10. Tax Provisions: Allocation of tax responsibilities and treatment of insurance proceeds
11. Representations and Warranties: Standard declarations about authority, ownership, and accuracy of information
12. General Provisions: Standard contractual clauses including governing law, notices, amendments
1. Disability Provisions: Detailed provisions for handling permanent disability, used when disability is included as a trigger event
2. Cross-Purchase Provisions: Specific provisions for cross-purchase arrangements, used when multiple owners are involved
3. Entity Purchase Provisions: Specific provisions for entity purchase arrangements, used when the company will purchase the shares
4. Retirement Provisions: Specific provisions for retirement-triggered purchases, included when retirement is a trigger event
5. Right of First Refusal: Provisions giving existing owners first right to purchase shares, used in more complex ownership structures
6. Dispute Resolution: Detailed arbitration or mediation procedures, included for higher-value or complex arrangements
7. Family Member Provisions: Special provisions regarding transfer to family members, used when family succession is a consideration
1. Schedule A - Insurance Policy Details: Details of all insurance policies including policy numbers, amounts, and beneficiaries
2. Schedule B - Current Ownership Structure: Current ownership percentages and number of shares held by each owner
3. Schedule C - Valuation Method: Detailed methodology for business valuation, including any agreed-upon formulas
4. Schedule D - Contact Information: Complete contact details for all parties, insurers, and key advisors
5. Appendix 1 - Sample Calculations: Examples of how purchase price calculations would work in various scenarios
6. Appendix 2 - Required Notices: Forms and templates for required notices under the agreement
7. Appendix 3 - Insurance Certificates: Copies of current insurance certificates and beneficiary designations
Authors
Financial Services
Insurance
Professional Services
Small and Medium Enterprises
Family Businesses
Manufacturing
Retail
Technology
Healthcare
Construction
Professional Practices
Consulting
Legal
Finance
Risk Management
Compliance
Corporate Secretariat
Executive Leadership
Insurance
Tax
Treasury
Business Development
Business Owner
CEO
Managing Director
Partner
Chief Financial Officer
Legal Counsel
Insurance Broker
Risk Manager
Company Secretary
Financial Advisor
Corporate Lawyer
Estate Planner
Business Succession Planner
Tax Advisor
Compliance Officer
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