Spacely Express Plan and Action Items.pdf

Spacely Express Plan and Action Items.pdf

E XIT M AP ® F INAL P LAN AND A CTION I TEMS

C LIENT : P ETUNIA AND C OSMO S PACELY T ITLE : CEO AND P RESIDENT C OMPANY : S PACELY S PROCKETS A DVISOR : J OSEPH “J OE ” T AKAGI C OMPANY : N AKATOMI T RADING E MAIL : JT AKAGI @ NAKATOMITRADING . COM . LUN P HONE : 265-753-337-7093

I NTRODUCTION

Nakatomi Corporation Level Five, Corridor 17 Luna Base 26555141-993537

2 | P a g e ©Copyright 2020. The ExitMap® logo and the term “Exit Map” are registered trademarks, and the contents of ExitMap® Express™ including all the tools and materials referenced herein, are the property of MPN Incorporated, San Antonio, TX. Circular 230 Disclosure (or other appropriate disclaimers) Pursuant to U.S. Treasury Department Regulations, we are required to advise you that, unless otherwise expressly indicated, any federal tax advice contained in this communication, including attachments and enclosures, is not intended or written to be used, and may not be used, for the purpose of: (i) avoiding tax-related penalties under the Internal Revenue Code or; (ii) promoting, marketing or recommending to another party any tax-related matters addressed herein. Implementation of a successful transition plan takes a team. Some of the action items herein are best handled by your CPA or attorney. Others may be executed by you or an employee. Still others may require the skills of a financial planner or insurance broker. Of course, if you feel that any of the actions suggested here would be best handled by our firm, we would be pleased to propose on those. We wish you the best success in the next phase of your business life! Sincerely, Joe Takagi President Nakatomi Trading Dear Mr. and Mrs. Spacely, This plan is the result of our work together over the last few months. We did our best to have it reflect the goals and objectives you shared with us, but of course we can modify anything you wish. You have done an excellent job in building Spacely Sprockets into a thriving company with a positive future. That future should be secured and accelerated by passing the business to your daughter Angela. The strategies and action items developed for your plan reflect your input combined with practical analysis and our experience in planning.

T ABLE OF C ONTENTS

I) Overview of the Plan Elements II) Owner Goals and Objectives x Action Items III) Financial Analysis x Action items IV) Planning Analysis x Action Items V) Revenue/Profit Analysis x Action Items VI) Operations Analysis x Action Items VII) Exhibits x Exhibit A: ExitMap® Analysis

x Exhibit B: Business Baseline Responses x Exhibit C: Personal Vision Worksheet x Exhibit D: Distance to Goal Triangulation x Exhibit E: Cash Flow Calculator x Exhibit F: Cash Flow Illustrator x Exhibit G: Seller’s Sanity Check x Exhibit H: Owner Centricity Score x Exhibit I: Management Succession Worksheet

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O VERVIEW OF THE P LAN E LEMENTS

1) Timeframes i) You wish to step back from daily operations no later than December 31, 2601. ii) You intend to leave the business entirely no later than December 31, 2603.

2) Transfer of the business i) The business will be sold to your daughter Angela for $7,500,000, financed by a ten year note at 5% interest, held by you. ii) The transfer will be made December 31, 2603. This will be concurrent with your retirement and Angela’s assumption of the CEO title. iii) From 2597 to 2601, Angela will assume the duties of ownership, and gradually take on all of your managerial responsibilities. iv) The value of the business will be frozen at its current level. No increases in profitability will be calculated in the final selling price. v) In the event of Angela’s termination for any reason, the company will be offered for sale to a third party. 3) Restructuring i) The sale will be of the stock in the corporation. No restructuring or new entities are anticipated. 4) Target proceeds i) Your post-tax proceeds are estimated at $5,500,000, which together with your current liquid assets should be ample to fund your retirement plans. ii) Payments on the note will be limited to 70% of the company’s free cash flow. 5) Life After i) Following your retirement, you plan to return to Earth which you will maintain as your primary residence, travel to see family, and engage your passion for space racing.

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O WNER G OALS AND O BJECTIVES

Timeframes : Your plan to step back in three years looks eminently achievable. The Management Succession Worksheet highlights areas where Angela needs more training, and of course she should begin looking for her replacement as head of marketing as soon as possible. Once you have Angela handling all of your ownership duties, the last few years of your activity in the company should be focused on a mentoring and advisory role. Buyers: We have created this plan as a stock sale to ensure capital gains treatment on the proceeds. With a family transfer, however, here are substantial tax avoidance mechanisms that you may want to consider. Pricing: Your anticipated selling price of $7,500,000 is sufficient to fund your retirement, appears to be a fair value for this company, and has terms that are easily borne with current cash flow. Life after the Business: Your plan to relocate to Earth will consume most of the first few years after retirement. Afterwards your travel and hobby plans should encompass at least half of your time in planning and execution. You may want to develop an additional activity to consume some additional time, but it is not an immediate concern. ; A CTION I TEMS x Consult with an expert in tax for advantageous methods of transfer in family situations. x You may want to hire a business coach to assist you in prioritizing areas to delegate, and in handing them off in an orderly manner. x Begin conversations with your banker now about replacing your personal guarantees and the conditions for creditworthiness after you are no longer the chief guarantor.

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F INANCIAL A NALYSIS

Practicality: Your plan is funded by ample cash flow. Annual note payments in the vicinity of $950,000. Accounting Standards: The Company does not currently operate with an annual budget. It is not accounting for warranty agreements on an accrual/amortization basis. Financial statements are accurate, but typically not available until 45 days after the end of the month. Economies of Scale: Over the last few years the Company has grown at a steady rate of between 4% and 5% annually, but gross margins remain flat in a narrow 29%-30% range. ; A CTION I TEMS x Consider a professionally prepared valuation for the business as support for the selling price to Angela. Make certain that such appraisals have room for growth between now and your planned final sale. x Determine what resources are needed to complete monthly operating statements in a timelier manner. x Begin a formal budgetary process with weekly cash flow analysis. x Check with outside tax experts on revenue recognition, especially for R&D and warranty sales. x Perform common-size analysis on COGS components to determine why there are no economies of scale.

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P LANNING A NALYSIS

Continuity: The Company has no Business Continuity Instructions in the event of your sudden absence from the business. There is no buy/sell agreement in place, and no other shareholder to assume legal control of the company in your absence. Management : George Jetson is the oldest member of the management team, and by your retirement, he will be 63 years old. Mary Marie-Marisol is not currently capable of replacing him. Estate Planning: You’ve expressed a desire to see your children treated “equally” by your estate. If Angela has fully paid for the business, equal division of your estate should not be an issue. Income Continuation : There is no provision for income to Petunia in the event of your death. ; A CTION I TEMS x Develop a comprehensive Business Continuity Plan. x Create a Management Transition Plan, including deadlines for transferring skills and responsibilities to Angela. x Bonus a small percentage of ownership to Angela now and in conjunction with a buy/sell agreement that will transfer the stock on the same or similar terms as anticipated at your retirement. x Consider a modified “stay” bonus for George Jetson to ensure an orderly retirement with a well-trained replacement. x If your note from the sale of the business is still being paid, those proceeds will be divided among your children. Consider modifying your will to reflect that. x Prepare a Resolution for your Board of Directors to allow payment of your then-current salary to Petunia until the accelerated sale of the business to Angela is completed.

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R EVENUE /P ROFIT A NALYSIS

Sales Management: There is considerable concern regarding your sales manager. He maintains virtually all major customer relationships for himself, discusses openly his recruitment by your competitors, and is plain about his expectation of ownership side-by-side with Angela. Vendors: You maintain most key vendor relationships, with your purchasing manager acting primarily in inventory control. Pricing: Your quoting system, where customers offer you the opportunity to beat the best competitive price they’ve received, is fraught with potential issues. Competitors: The Company is chiefly getting competitive price information from a biased source, its customers. o Related products that are not sold entirely on low price bids o Packaging products in bundles where the Company’s breadth of offerings and fill rate would be a differentiator. o Breaking out the Company’s warranty policy as a renewable contract x Create sales incentives that encourage salespeople to take on more of the customer relationship role. x Develop a Stock Appreciation Rights agreement or other form of virtual equity for Rollo Tomassi that: o Is coupled to non-compete and confidential information agreements. o Pays in installments following his retirement or separation, and is void if he works for any competitor during the term of the installments. x Upgrade purchasing capability either through training for Chick Itall or by hiring a higher level manager. ; A CTION I TEMS x The Company should be investigating the following:

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O PERATIONS A NALYSIS

Management Capability: Your current management team is capable, but could not presently run the Company without you. The Management Succession Worksheet identifies a number of areas where transfer or delegation of duties is recommended. Key Employees: George Jetson is capable, and committed to the company for his career. His boy Elroy, however, is a high risk for being poached, especially after his father retires. Procedures: Operating procedures are weak or nonexistent. Policies: Sally Mustang functions more as a benefits clerk than a true HR professional. Culture: The Company has a Mission Statement, but most employees do not know what it is. Technology: Elroy Jetson does an excellent job of maintaining the Company’s computer- based systems. Accounting, HR tracking, purchasing, and Customer Relationship Management systems are robust. Unfortunately, many if not most of their capabilities are not being utilized. ; A CTION I TEMS x Of primary importance is the lack of any backup for Rollo Tomassi, who is simultaneously your biggest flight risk. Essentially you must choose to either dramatically increase his compensation and incentives, or find a replacement. x In either case, a second in command for sales has to be part of the plan. x We also recommend a virtual equity agreement for Elroy, but with the additional provision that he find and train a second in command for his areas. x Accounting, sales and purchasing personnel should be further trained on the capabilities of their HAL 9001 system. x We recommend that you undertake a cultural education program for your entire workforce. Group development of Core Values including their application to the daily workings of the Company.

9 | P a g e ©Copyright 2020. The ExitMap® logo and the term “Exit Map” are registered trademarks, and the contents of ExitMap® Express™ including all the tools and materials referenced herein, are the property of MPN Incorporated, San Antonio, TX.

10 | P a g e ©Copyright 2020. The ExitMap® logo and the term “Exit Map” are registered trademarks, and the contents of ExitMap® Express™ including all the tools and materials referenced herein, are the property of MPN Incorporated, San Antonio, TX.

E XHIBIT A

T HE E XIT M AP ® A NALYSIS ©

This is a copy of your original 40 page Analysis report. It includes a breakdown and feedback from of each of your responses to the Assessment questionnaire that you completed.

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S AMPLE R EPORT

P REPARED 10/19/2017 FOR : C OSMO S PACELY P RESIDENT , S PACELY S PROCKETS A DVISOR : J OHN F. D INI , MPN I NC . E XIT M AP C ODE : N152J01

W ELCOME

This 40 page Analysis contains customized, response by response feedback to your Assessment answers. It is divided into the four business categories. Each category section is organized so that the response with the highest Challenge Index comes first, followed in order according to the urgency and difficulty of improvement efforts.

U SING THE E XIT M AP

As the name implies, The ExitMap is a direction finder for successful transitions. An exit strategy requires financial, operational, legal and tax planning, but first it requires a company that can support the plan. The ExitMap is not intended to replace the professional knowledge of advisors, but rather to assist them in developing a broader, more comprehensive view of your business outside of any single SURIHVVLRQDO¶V own area of expertise. Your advisor will choose which areas to debrief first, based upon priorities, impact and his or her area of specific expertise. Implementing all, or even most of the suggestions in this Analysis will likely require the assistance of several professionals. As an ExitMap Affiliate, you advisor has committed to consulting in a team environment. Begin your journey to increased value and control over your transition with an initial debriefing, but with the understanding that maximizing the return from one of the biggest financial events of a lifetime will require more than a few discussions.

T HE A NALYSIS R ESULTS

Your transition readiness is categorized by four key areas which are carried forward from the Assessment to a more detailed break down in the Analysis.

Finance: The current state of preparedness in understanding business value and tax issues. Planning: Current progress in preparing successors, emergency plans and a post-ownership vision. Revenue/Profit: A look at how business trends will appear to potential buyers and lenders. Operations: The preparedness of your client's employees, systems and processes for new leadership.

Each functional category shows an overall preparedness score, as well as an estimate of the urgency and difficulty levels of needed improvement. Urgency factors are heavily influenced by the time frames to exit that you selected in the Assessment. Difficulty factors reflect the complexity of change, or the challenge of developing FDSDELOLWLHVWKDWFXUUHQWO\GRQ¶WH[LVW

©2017 MPN Inc.

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O VERALL E XIT P REPAREDNESS

67.4%

Your ExitMap Preparedness Score is 67.398%.

Your Assessment score indicates that you have at least several areas of functional accomplishment that are ready, or nearly ready, for a successful transition. Consider developing a timeline between your current personal liquidity, the amount you need after a transition, and the required proceeds to be realized from your equity in the business at the time you leave.

E XIT P REPAREDNESS S NAP S HOT

100

78.1%

80

67.4%

67.0%

59.1% 58.1%

60

40

20

0

Overall Exit Preparedness

Financial Preparedness

Planning Preparedness

Revenue/Profit Preparedness

Operations Preparedness

O VERALL U RGENCY F ACTOR

52

0

20

40

60

80

100

O VERALL D IFFICULTY F ACTOR

55

0

20

40

60

80

100

©2017 MPN Inc.

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In the completed Express™ report, this space will be occupied by the full 40-page ExitMap ® Analysis© which contains an in-depth breakdown of the responses from the client’s initial Assessment© questionnaire. We have removed the pages to save space in this sample. To see the full set of Advisor reports, take the Advisor’s Test Drive at www.ExitMap.com.

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E XHIBIT B

B USINESS B ASELINE © R ESPONSES

PLANNING

A detailed review of your personal and company information as discussed in Module #1.

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T HE E XIT M AP ® E XPRESS B USINESS B ASELINE

Company Information: Company Name __________________________________ DBA ____________________________ Address _________________________________________________________________________ ________________________________________________________________________________ Year Founded _____________________ First Year of Current Ownership _____________________ Entity Type: _______________________________ Taxed As: ______________________________ Subsidiary or Affiliate Companies: Name __________________________________ Relationship ______________________________ Entity Type: _______________________________ Taxed As: ______________________________ Name __________________________________ Relationship ______________________________ Entity Type: _______________________________ Taxed As: ______________________________ Name __________________________________ Relationship ______________________________ Entity Type: _______________________________ Taxed As: ______________________________ None Real Estate: Property Owner ___________________________________________________________________ Lease Term ____________________________ or Mortgage Balance ________________________ Estimated Value: ______________________ if held by same owner, plan after transition: ________ Business Value: Owner Estimate of Value ____________________________ Source: ________________________ If outside valuation, Date: __________________________ By: _____________________________ Spacely Sprockets N/A 9999 Universal Way Galaxy City, Titan Base 75869328-475461 2530 2530 S Corporation S Corporation Amalgamated Galactic Properties 10 years plus 2 10-yr. renewals $7,500,000 Owner Estimate

Financial Information (last three years) : Current Date: Current Year Estimate

2 nd Prior Year

3 rd Prior Year

Prior Year

7/14/2097

2096

2095

2094

2093

Revenue COGS Gross Profit

6,555,730 4,336,424 2,219,306

6,258,744 4,409,533 1,849,211

5,998,421 4,258,997 1,739,424

5,667,433 3,997,312 1,719,541

G&A Expenses Pre-Tax Profit

840,312

844,930

839,779 899,645

854,615 865,277

1,378,994

1,004,281

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The ExitMap ® Express Business Baseline FRQW¶G

Organizational Chart: Number of Employees _______________________ Please attach an organizational chart: Owners, Executives, Managers and Supervisors 68

Key Employees: Name ________________________________________ Title_______________________ Gender: _____ Tenure _______________________ Salary _____________________ Age _____________ Employment Agreement? ______ Flight Risk? _____ Ownership expectations? _____ Name ________________________________________ Title_______________________ Gender: _____ Tenure _______________________ Salary _____________________ Age _____________ Employment Agreement? ______ Flight Risk? _____ Ownership expectations? _____ Name ________________________________________ Title_______________________ Gender: _____ Tenure _______________________ Salary _____________________ Age _____________ Employment Agreement? ______ Flight Risk? _____ Ownership expectations? _____ Name ________________________________________ Title_______________________ Gender: _____ Tenure _______________________ Salary _____________________ Age _____________ Employment Agreement? ______ Flight Risk? _____ Ownership expectations? _____ Name ________________________________________ Title_______________________ Gender: _____ Tenure _______________________ Salary _____________________ Age _____________ Employment Agreement? ______ Flight Risk? _____ Ownership expectations? _____ Name ________________________________________ Title_______________________ Gender: _____ Tenure _______________________ Salary _____________________ Age _____________ Employment Agreement? ______ Flight Risk? _____ Ownership expectations? _____ 26 years $110,000 51 George Jetson Controller 22 years $127,500 58 Elroy Jetson Chief Engineer 6 years $84,000 29 Angela Spacely-Kane Vice President 14 years $140,000 41 Rollo Tomassi Sales Manager 17 years $163,000 48 Mario Hsiang Production Manager M F M M N N N N N Y N Y N N Y Y

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The ExitMap ® Express Business Baseline FRQW¶G

Owner Information: Owner #1:

Inidividual

Owner Type: (Individual, Joint Property, Entity (ESOP, Trust)) _____________________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _______ Gender: _____ % of Ownership: _______ Spouse: Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Children: Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Notes: ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ George Jetson is Petunia's younger brother, and Elroy is her nephew. Petunia is not active in the day to day operations of the business. Rollo Tomassi has ownership ambitions, and is a flight risk if they are not met Petunia Jetson-Spacely 4/13/2564 63 51% Cosmo Spacely 7/11/2630 67 President Jupiter Spacely 47 Venus Spacely M 12/15/2555 9/9/2557 45 Angela Spacely-Kane F 3/2/2561 41 Vice President F M F Y N N Y

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The ExitMap ® Express Business Baseline FRQW¶G

Owner Information: Owner #2:

Individual Cosmo Spacely (information above) 49%

Owner Type: (Individual, Joint Property, Entity (ESOP, Trust)) _____________________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _______ Gender: _____ % of Ownership: _______ Spouse: Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Children: Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Notes: ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Cosmo is 49% owner and is active in all operations. For planning purposes, Cosmo is the transferring owner Cosmo is aware of Rollo Tomassi's ownership ambitions, but is opposed, and unconcerned about any outcome.

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The ExitMap ® Express Business Baseline FRQW¶G

Owner Information: Owner #3:

Owner Type: (Individual, Joint Property, Entity (ESOP, Trust)) _____________________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _______ Gender: _____ % of Ownership: _______ Spouse: Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Children: Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Name: ( First, Middle, Last) _________________________________________________________ DOB: __________ Age: _____ Gender: _____ Active? _____ Title? ______________________ Notes: ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________

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The ExitMap ® Express Business Baseline FRQW¶G

Owner #1 Financial Expectations: Name: ______________________________________________________________ Current liquid holdings (stocks, bonds): _____________________________________ Current Real Estate owned (exclude home): Total Value: __________________________ (Less) Mortgages: _____________________ Net Present Value: _____________________ Annual Income stream: ____________________ Other Income: ____________________________________ Source: _________________________ Cosmo and Petunia Spacely $2,750,000 $750,000 $250,000 $500,000 $25,000 $25,000 annuity

Total Needed for Retirement: ___________________________ If third party estimate, by: ______________________________ Expected Date for Receipt of all Funds: __________________ Legacy Expectations: (for principle/client owner only) Intended Buyer: ___________________________________________ Quantify the answers below from 1 (not important at all) to 5 (extremely important): Personal/Family Legacy: How important is: Keeping control of the business in the family? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Distributing ownership equally to all children? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ ✔ $6,500,000 Sandy Hill CFP December 31, 2612 Angela Spacely-Kane ✔ ✔

✔

Balancing your estate between active and non-active children? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining an income stream to non-active family in your absence? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Personal/Family Legacy: How important is: Employee Security? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining business identity? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining culture? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining customer relationships? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining vendor relationships? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining current location? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Which one of the issues above is most important to you? _____________________________________ ,VWKHUHDFRQWLQJHQF\SODQIRUGDLO\RSHUDWLRQVLQWKHHYHQWRIWKLVRZQHU¶VVXGGHQDEVHQFHIURPWKH business? _____ ✔ ✔ ✔ ✔ ✔ ✔ ✔ Willing to accept some reduction in proceeds to secure legacy issues.

N

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The ExitMap ® Express Business Baseline FRQW¶G

Owner #2 Financial Expectations: Name: ______________________________________________________________ Current liquid holdings (stocks, bonds): _____________________________________ Current Real Estate owned (exclude home): Total Value: __________________________ (Less) Mortgages: _____________________ Net Present Value: _____________________ Annual Income stream: ____________________ Other Income: ____________________________________ Source: _________________________

Total Needed for Retirement: ___________________________ If third party estimate, by: ______________________________ Expected Date for Receipt of all Funds: __________________ Legacy Expectations: (for principle/client owner only) Intended Buyer: ___________________________________________ Quantify the answers below from 1 (not important at all) to 5 (extremely important): Personal/Family Legacy: How important is:

Keeping control of the business in the family? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Distributing ownership equally to all children? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Balancing your estate between active and non-active children? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining an income stream to non-active family in your absence? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Personal/Family Legacy: How important is: Employee Security? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining business identity? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining culture? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining customer relationships? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining vendor relationships? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining current location? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Which one of the issues above is most important to you? _____________________________________ ,VWKHUHDFRQWLQJHQF\SODQIRUGDLO\RSHUDWLRQVLQWKHHYHQWRIWKLVRZQHU¶VVXGGHQDEVHQFHIURPWKH business? _____

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The ExitMap ® Express Business Baseline FRQW¶G

Owner #3 Financial Expectations: Name: ______________________________________________________________ Current liquid holdings (stocks, bonds): _____________________________________ Current Real Estate owned (exclude home): Total Value: __________________________ (Less) Mortgages: _____________________ Net Present Value: _____________________ Annual Income stream: ____________________ Other Income: ____________________________________ Source: _________________________

Total Needed for Retirement: ___________________________ If third party estimate, by: ______________________________ Expected Date for Receipt of all Funds: __________________ Legacy Expectations: (for principle/client owner only) Intended Buyer: ___________________________________________ Quantify the answers below from 1 (not important at all) to 5 (extremely important): Personal/Family Legacy: How important is: Keeping control of the business in the family? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Distributing ownership equally to all children? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___

Balancing your estate between active and non-active children? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining an income stream to non-active family in your absence? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Personal/Family Legacy: How important is: Employee Security? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining business identity? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining culture? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining customer relationships? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining vendor relationships? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Maintaining current location? 1 ___ 2 ___ 3 ___ 4 ___ 5 ___ Which one of the issues above is most important to you? _____________________________________ ,VWKHUHDFRQWLQJHQF\SODQIRUGDLO\RSHUDWLRQVLQWKHHYHQWRIWKLVRZQHU¶VVXGGHQDEVHQFH from the business? _____

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The ExitMap ® Express Business Baseline FRQW¶G

Current Advisors: Accountant: Name: ____________________________ Cred: ______ Firm: _______________________________ Phone: ____________________________ Email: ____________________________ Tax? _____ Audit? _____ Valuation? _____ Other? ____________________________ Estate Planning Attorney: Name: __________________________________ Firm: __________________________________ Phone: ____________________________ Email: ______________________________ Will? _____ Trust? _____ POAs? _____ Other? _______________________________ Business Attorney: Name: __________________________________ Firm: __________________________________ Phone: ____________________________ Email: ______________________________ Buy/Sell? _____ Business Continuity Instructions? _____ Financial Planner/Wealth Manager: Name: ____________________________ Cred: ______ Firm: _______________________________ Phone: ____________________________ Email: ______________________________ Financial Plan? _____ Fee Only, Fee Based or Commissioned? ____________________ Business Insurance Agent: Name: __________________________________ Firm: __________________________________ Phone: ____________________________ Email: ______________________________ Life Insurance Agent: Name: __________________________________ Firm: __________________________________ Phone: ____________________________ Email: ______________________________ Appraiser/Valuation Professional: Name: ____________________________ Cred: ______ Firm: _______________________________ Phone: ____________________________ Email: ______________________________ Oscar Nunez State Farm Jack Ripper CPA Ripper and Mender PC Carson Plantem Will and Trust Partners FLP for Income Real Estate Nolo Contendre Dewey, Cheatum and Howe Sandy Hill CFP Apex Legacy Asset Management Fee Only Y Y Y N Y Y N N Y

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E XHIBIT C

P ERSONAL V ISION © W ORKSHEET

PLANNING

You completed this worksheet in order to develop and confirm your specific Goals and Objectives .

15 | P a g e ©Copyright 2020. The ExitMap® logo and the term “Exit Map” are registered trademarks, and the contents of ExitMap® Express™ including all the tools and materials referenced herein, are the property of MPN Incorporated, San Antonio, TX.

Personal Vision Guide

Defining your Personal Vision (PV) is one of the most important things you can do for yourself and your business. It is a 5 to 10 year plan that identifies what you want your business to do for you.

Owner: ____________________________ Date: _____________________________ May 17, 2097 Cosmo and Petunia Spacely

Company: __________________________ Spacely Sprockets

As an owner, you run a company for your own benefit. You assume the risks, and put in the effort, with an expectation of results. Clearly defining that objective helps keep your focus and balance. Although developing a Personal Vison can be a done as an independent exercise by any business owner, we recommend utilizing this worksheet and working with a trusted advisor who can help you identify your goals. Note: After completing the worksheet, you will be able to draft the final version of your Personal Vision which you should limit to 100 words