Insurance Funding. The acquisition and ownership of life insurance policies on the lives of one or more of the Shareholders to provide funding for the various purchase options and obligations under this Agreement shall be agreed upon, from time to time, by the Controlling Shareholders and summarized on Schedule D.
Insurance Funding. 28 (h) Severance Liabilities..................................................28 (i)
Insurance Funding. To Sellers' Knowledge, with respect to each Plan that is funded wholly or partially through an insurance policy, there will be no liability of any of the ASIG Entities as of the Closing Date that has not been either paid or assumed by Sellers pursuant to the terms of this Agreement or fully reserved against on the Closing Balance Sheet and Net Assets Report.
Insurance Funding. The Employer, in its discretion, may apply for and procure as owner and for its own benefit, insurance on the life of the Executive in such amounts and in such forms as the Employer may choose. The Executive shall have no interest whatsoever in any such policy or policies, but the Executive shall, as a condition precedent to the receipt of any benefits under this Agreement, cooperate with the Employer in undergoing any medical examinations and providing any information reasonably necessary in connection with such insurance policies.
Insurance Funding. To provide cash to purchase the stock of a deceased Shareholder, each Shareholder may apply as owner and beneficiary for a life insurance policy on the life of his/her co-Shareholder(s). In addition, the Corporation may apply as owner and beneficiary of a life insurance policy on the life of any Shareholder. The policies purchased to date or any policies hereafter acquired shall be listed on the attached Schedule of Life Insurance. Within 30 days of a policy anniversary, the policy owner shall transfer to the insurer sufficient cash premiums necessary to maintain the policy or policies owned by the policy owner, as provided above and shall provide the insured Shareholder evidence of the transfers. While this Agreement remains in force, the policy owner shall provide written notice to the insured Shareholder of the policy owner’s intent to exercise any of the policy rights, options, or privileges. This Paragraph constitutes written notice to each Shareholder that the Corporation intends to insure the Shareholder’s life for the maximum face amount for which the Shareholder may be insured and that the Corporation shall be the beneficiary of the death benefits under all such insurance policies. The signature of each Shareholder to this Agreement constitutes a written consent to being insured on such terms and that such coverage may continue (subject to the provisions of this Agreement) even if any employment of the Shareholder with the Corporation is terminated, regardless of cause and regardless of whether the termination is by the unilateral decision of the Corporation, the unilateral decision of the Shareholder, or by mutual consent of the Corporation and the Shareholder.
Insurance Funding. To provide cash to purchase the stock of a deceased Stockholder, Trustee shall apply, as owner and beneficiary, for a life insurance policy upon the life of each Stockholder, in an amount equal to the purchase price-valuation established under Article III, but not less than the amounts set forth below. Such policies purchased to date or any policies hereafter acquired shall be listed on the attached "Schedule of Life Insurance." Trustee will hold title to policies on each Stockholder's life, and correspondingly, each Stockholder obtains equitable title to the insurance on each other Stockholder's life in the following amounts: INSURED POLICY AMOUNT STOCKHOLDER'S EQUITABLE INTEREST Name Interest CHAD M. LITTLE $750,000 XXAD M. LITTLE 51% LONNIE A. WHITTINGTON $500,000 XXXXXX X. WHITTINGTON 24.5% JAMES A. LAYNE $500,000 XXMES A. LAYNE 24.5% Within 30 days prior to each policy anniversary each Stockholder shall transfer to the Corporation (with notice of such transfer being simultaneously sent to the Trustee) sufficient cash for premiums necessary to maintain his equitable interest on each policy or policies on his co-Stockholders, as provided above, and shall provide the insured Stockholder evidence of such transfers. Where the "split dollar" technique is employed, the Corporation shall timely pay its premium share under the arrangement. The Corporation shall immediately thereafter remit such cash premium contribution(s) to the insurer. In the event a Stockholder fails to transfer such cash premiums within such period, the insured Stockholder may pay the premium to the insurer, and such premium advances shall be added to the purchase price of his stock interest. While this agreement remains in force, the Trustee shall provide written notice to the Stockholders of his intent to exercise any of the policy rights, options, or privileges.
Insurance Funding. An insurance Buy-Sell Agreement is often recommended by business-succession specialists and financial planners to ensure that the arrangement is funded and to guarantee that there will be money when the exit event is triggered. In these instances, the insurance proceeds are set off against the amount required be paid by the remaining owners to buy out the exiting owner. Where an exit event occurs which is not covered by insurance funding, pre-agreed finance or instalment arrangements are followed. It does not matter what business structure has been used to own or run the business or if there is more than one entity involved in running the business. There are certain tax and capital gains advantages of setting up an insurance Buy-Sell Agreement. In particular, payment of life insurance proceeds may be excluded from the application of capital gains tax. However care should be taken in relation to proceeds paid for trauma or other non-life cover because failure to pay the proceeds to the injured party or his/her relative may result in capital gains tax. Another aspect to consider is linking your life insurance policies to superannuation accounts. Depending on your circumstances, this may be advantageous as contributions to super funds are tax deductible, whereas contributions to personal life insurance policies are not. Also, considering what type of insurance protection is being taken is important - asset cover (against an owner’s equity), debt cover (against liabilities of the business) or key person cover (against the loss from reduced revenue or goodwill), the types of transaction that will flow from the payment of the insurance proceeds and any subsequent tax consequences of these transactions.
Insurance Funding. It is contemplated that the Company will acquire an insurance policy in connection with the funding of the obligations assumed by it under this Agreement. With respect to any such policy, the following shall obtain:
(a) Employee (or any designated beneficiary of Employee, as the case may be) shall have no rights with respect to, or claim against, such policy, except as expressly provided by the terms of such policy.
(b) Such policy shall not be deemed held under any trust for the benefit of Employee or his beneficiaries, or held in any way as collateral security for the fulfillment of any obligations of the Company under this Agreement, except as may be expressly provided by the terms of such policy.
(c) Such policy shall be and remain a general, unrestricted asset of the Company.
(d) In the event that the payment of benefits under any such policy shall be challenged as not payable for any reason other than nonpayment of premiums by the Company, the Company shall assign such policy to the Employee (or to his designated beneficiary or his Estate, as the case may be) and such assignment shall be in discharge of any and all obligations accruing to the Company under this Agreement.
Insurance Funding
