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The Buy-Sell Agreement Life (Insurance) is a crucial business succession planning tool used in the Philippines to ensure business continuity and provide financial security in the event of an owner's death. This agreement is particularly important for closely-held businesses, partnerships, and family-owned companies operating under Philippine jurisdiction. It mandates that each owner maintain life insurance policies with sufficient coverage to fund the purchase of their business interest, with proceeds payable either to the company or surviving owners. The agreement complies with Philippine insurance and corporate laws, including the Insurance Code (RA 10607) and Corporation Code (RA 11232). It typically includes specific provisions for business valuation, transfer procedures, and payment terms, ensuring a smooth transition of ownership while providing liquidity for the deceased owner's estate. This type of agreement is especially relevant in the Philippine business context, where family-owned businesses and closely-held companies form a significant part of the economy.

1. Parties: Identification of all parties to the agreement, including business owners and any corporate entities involved

2. Background: Context of the agreement, including current business ownership structure and purpose of the buy-sell arrangement

3. Definitions: Defined terms used throughout the agreement, including insurance-specific terminology

4. Purchase Obligation: Terms triggering the obligation to purchase shares/interest upon death of an owner

5. Life Insurance Requirements: Details of required life insurance policies, coverage amounts, and maintenance obligations

6. Purchase Price: Methodology for determining the purchase price of business interests

7. Payment Terms: Structure and timing of payments, including use of insurance proceeds

8. Transfer Process: Procedures for executing the transfer of business interests

9. Representations and Warranties: Standard declarations about authority, ownership, and accuracy of information

10. Tax Provisions: Allocation of tax obligations and responsibilities

11. Term and Termination: Duration of agreement and circumstances for termination

12. General Provisions: Standard legal clauses including governing law, notices, amendments, etc.