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Douglas I. Friedman, Esq. Friedman & Downey, P.C. 205-879-3033 doug@fdlawfirm

Allegis Advisors Group. Pinnacle Sales Conference. Park City, UT, September 27, 2010. Douglas I. Friedman, Esq. Friedman & Downey, P.C. 205-879-3033 doug@fdlawfirm.com. Douglas I. Friedman, JD., CLU Friedman & Downey, P.C. Counselors-at-Law Birmingham, AL 205-879-3033.

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Douglas I. Friedman, Esq. Friedman & Downey, P.C. 205-879-3033 doug@fdlawfirm

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  1. Allegis Advisors Group Pinnacle Sales Conference Park City, UT, September 27, 2010 Douglas I. Friedman, Esq. Friedman & Downey, P.C. 205-879-3033 doug@fdlawfirm.com

  2. Douglas I. Friedman, JD., CLUFriedman & Downey, P.C.Counselors-at-LawBirmingham, AL 205-879-3033

  3. You Can't Succeed Yourself: How to Cut Back, Kick Up and Get Out

  4. . . . of the runner in the New York City Marathon I am reminded of the story . . .

  5. That decision did not take planning

  6. . . . is directly related to the import of the decision. The amount of planning . . .

  7. Why Succession Planning? • For you • Your family • Your employees

  8. Practical Issues • Keep spouses out of business • Change in health • Estate liquidity

  9. Current Estate Tax Law • Exemptions increase to $3.5 Million (2009) • No estate tax in 2010 • Sunset provision

  10. What is your plan?(a/k/a “exit strategy”) No right answer

  11. Three Questions • What is it worth? • Who will buy? • On what terms?

  12. Importance of Valuation • For you, your family, IRS • Be careful with formulas • An art … not a science

  13. Who is Buyer? • The business (stock redemption) • Another owner (cross purchase) • An outsider (cross purchase)

  14. Terms of Agreement • Triggering event (e.g., death, disability, retirement) • Time of Payment (Lump sum, installments, both) • Source of funds

  15. Why Life/Disability Insurance? • Provides money when needed • Reduce or eliminate installment risk • Is what it is - - insurance

  16. Concerns: Majority Shareholder • Control • Flexibility • Over everything

  17. Solutions: Not Bilateral • I can buy you out • You can’t buy me out • You have no choice

  18. Solutions: Not all transfers • I can transfer to my child • I can transfer to third party • You can’t

  19. Business Succession Planning is like . . . . . . a Marathon

  20. What to do? • Keep running (move thoughts ahead) • Lose your shorts? (focus on big picture) • Concentrate on finish line (what do I want?)

  21. And always remember: You are in control

  22. I returned from Atlanta . . .

  23. When Dad Died • We knew nothing • Liquidated business • Sold buildings

  24. Did Dad Have a Plan???? Don’t do what my father did!

  25. Get in the Race!

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