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The Key Man Agreement is essential for Malaysian businesses seeking to protect themselves against the loss of crucial employees whose death, disability, or departure would significantly impact the company's operations or financial stability. This document is particularly relevant when a company identifies individuals whose unique skills, relationships, or knowledge are fundamental to its success. The agreement typically includes provisions for insurance coverage, details the obligations of both the company and the key person, and specifies how insurance proceeds will be utilized. It must comply with Malaysian legal requirements, including the Contracts Act 1950 and relevant insurance regulations, while also addressing corporate governance requirements under the Companies Act 2016.

1. Parties: Identifies the company and the key person(s) entering into the agreement

2. Background: Sets out the context of the agreement, including the key person's role and importance to the business

3. Definitions: Defines key terms used throughout the agreement

4. Key Person Role and Responsibilities: Details the specific position, duties, and responsibilities of the key person

5. Insurance Arrangements: Specifies the terms of the key man insurance policy, including coverage amount and premium payment responsibilities

6. Company Obligations: Outlines the company's commitments regarding insurance maintenance and premium payments

7. Key Person Obligations: Details the key person's commitments, including medical examinations and cooperation with insurance requirements

8. Beneficiary Arrangements: Specifies how insurance proceeds will be used and distributed

9. Termination: Sets out circumstances under which the agreement can be terminated

10. Confidentiality: Establishes confidentiality obligations regarding business information

11. General Provisions: Standard contract clauses including governing law, notices, and amendments