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Buy Sell Agreement Life (Insurance) Template for India

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Key Requirements PROMPT example:

Buy Sell Agreement Life (Insurance)

"I need a Buy-Sell Agreement Life (Insurance) for my family-owned manufacturing business in Mumbai with 4 siblings as shareholders, where we want to ensure business continuity through life insurance funding if any of us dies or becomes permanently disabled."

Document background
The Buy-Sell Agreement Life (Insurance) is a critical business continuity planning tool used in the Indian business context. It is designed for businesses where owners want to ensure smooth ownership transition while providing liquidity through life insurance funding. This document becomes essential when business partners or shareholders want to establish predetermined terms for ownership transfer upon death, preventing unwanted third-party intervention in business operations. The agreement, governed by Indian law, includes comprehensive provisions for insurance policy management, valuation mechanisms, and transfer procedures, ensuring compliance with the Insurance Act, 1938, IRDAI regulations, and other relevant Indian legislation. It's particularly valuable for closely-held businesses, family enterprises, and professional practices where maintaining control among existing owners or predetermined successors is crucial.
Suggested Sections

1. Parties: Identification of all parties to the agreement including business owners and their details

2. Background: Context of the agreement, business overview, and purpose of the buy-sell arrangement

3. Definitions: Detailed definitions of terms used throughout the agreement

4. Purchase Obligation: Mandatory buy-sell obligations upon triggering events

5. Triggering Events: Specific events that activate the buy-sell provisions (death, disability, retirement, etc.)

6. Life Insurance Provisions: Details of life insurance policies, ownership, premium payments, and proceeds distribution

7. Valuation Method: Agreed method for determining business value and share price

8. Payment Terms: Structure and timing of payments for purchased shares

9. Restrictions on Transfer: Limitations on transfer of shares outside the agreement

10. Rights and Obligations: Ongoing rights and obligations of all parties

11. Notices: Process for giving formal notices under the agreement

12. Governing Law and Jurisdiction: Specification of Indian law application and jurisdiction

13. Dispute Resolution: Process for resolving disputes between parties

14. Termination: Conditions and process for terminating the agreement

Optional Sections

1. Tag-Along Rights: Optional provision for minority shareholders to join in sale of majority shares

2. Drag-Along Rights: Optional provision allowing majority shareholders to force minority shareholders to join in sale

3. Disability Provisions: Additional provisions for temporary or permanent disability scenarios

4. Cross-Purchase vs. Entity Purchase: Specific structure choice for purchase mechanism, used when structure isn't predetermined

5. Family Member Provisions: Special provisions for family members in family-owned businesses

6. Competition Restrictions: Non-compete and non-solicitation provisions for departing shareholders

7. Insurance Policy Management: Detailed procedures for managing multiple insurance policies, used in complex ownership structures

8. Tax Treatment: Specific provisions addressing tax implications and structuring

Suggested Schedules

1. Schedule A - Current Ownership: Details of current ownership structure and shareholding pattern

2. Schedule B - Insurance Policies: List and details of all life insurance policies funding the agreement

3. Schedule C - Valuation Formula: Detailed methodology for business valuation

4. Schedule D - Premium Payment Schedule: Schedule of insurance premium payments and responsibilities

5. Appendix 1 - Consent Forms: Standard forms for various consents required under the agreement

6. Appendix 2 - Notice Forms: Template forms for various notices under the agreement

7. Appendix 3 - Purchase Forms: Standard forms for executing purchase obligations

8. Appendix 4 - Medical Information Release: Forms for release of medical information for insurance purposes

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions














































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Relevant Industries

Professional Services

Manufacturing

Retail

Technology

Healthcare

Real Estate

Construction

Family Business

Financial Services

Consulting

Agriculture

Hospitality

Relevant Teams

Legal

Finance

Risk Management

Corporate Secretariat

Executive Leadership

Insurance

Compliance

Treasury

Corporate Planning

Relevant Roles

Business Owner

Managing Director

CEO

CFO

Company Secretary

Legal Counsel

Risk Manager

Insurance Manager

Corporate Lawyer

Financial Controller

Partner

Board Member

Estate Planner

Business Succession Advisor

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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