FOR INDIVIDUALS
Exit Planning Questionnaire
Help Secure Your Exit With just a little information, we can help you design an appropriate exit plan that meets your needs. Business profile 1. Business Name: _______________________________________________________________________________ 2. Address: _____________________________________________________________________________________ 3. Phone Number: _______________________________________________________________________________ 4. Business Structure: C Corporation
Professional Corporation (C Corporation)
S Corporation
Professional Corporation (S Corporation)
Sole Proprietorship
Limited Liability Partnership
Partnership
Limited Liability C Corporation
5. Number of employees in the business: _____________________ 6. Number of business owners: _____________________ 7. Number of co-workers that are family members: ______________________ 8. Number of years the business has been operating: ____________________ 9. Business tax rate: _____________________ % Plans and opportunities What plans do you have for your interest in the business upon your retirement? Transfer to: Co-owners/key employees
Family member
Outside third party
When do you plan to retire from the business? ________________________________________________________ Have you determined the role of your business in your retirement planning? Yes
No
What plans do you have for the business if you or one of the co-owners dies or becomes permanently disabled? Transfer to: Co-owners/key employees
Family member
Outside third party
Business valuation Estimated value of the business: $_____________________ as of ______________________ For a business valuation proposal prepared by the home office: Please provide balance sheets and income statements for most recent three years; or Please provide business tax returns for most recent three years.
Plan design:
Sell to co-owner non-family
Sell to employee or third party, non-family
Sell to co-owner, family
Sell to employee or third party, family
If family, indicate relationship ______________________________________________________________________
Transfer to family Who will run the business? ___________________________________________________________________________ Experience/position: _________________________________________________________________________________ Does your will transfer your business to this person?
Yes
No
Are there other heirs you want to make sure are treated fairly?
Yes
No
Estimated estate taxes on business: $_____________ How will estate taxes be paid? ________________________________________________________________________ When was the last time your will/trust(s) were reviewed? _________________________________________________ Transfer to co-owner/key employee To whom would you sell the business? _________________________________________________________________ Do you have a written buy-sell agreement stating the terms and conditions of the sale?
Yes
No
When was it last reviewed and updated? _______________________________________________________________ How is the price set in the agreement? _________________________________________________________________ What are the buy-out triggers in the agreement? Death
Retirement
Disagreement
Disability
Divorce
Voluntary termination
Dissolution
How is/will the buy-out be funded? Life insurance
Sinking fund
Cash flow
Disability buy-out
Other
If funded, who is paying for the funding? Business
Owners
Key employee
Transfer to outside third party Have you identified an outside purchaser? ______________________________________________________________ Have you received an offer? __________________________________________________________________________ Do you know how the purchase will be funded? If yes, explain. Yes
No _______________________________________________________________________
_______________________________________________________________________________________________
Key person planning Does your business have owners/employees who are integral to the success of your company? Yes (Complete the Owner/Key Employee Census page.)
No
Would the death or disability of one of these key employees have an impact on the sales/profits of your company? Yes (Complete the Owner/Key Employee Census page.)
No
Do your creditors and lenders ask about key person coverage? Yes
No
To estimate the value of a key person, complete the Owner/Key Employee Census page. Disability planning (income protection) If you were too sick or hurt to work, would you be able to meet personal financial obligations without draining business profits? Yes (If yes, for how long?_________________________)
No
Have you reviewed your employee benefit offering to ensure employees are adequately protected in regard to their income and/or ability to continue saving for retirement in the event of a disability? Yes
No
Disability planning (business needs) If you or another owner became too sick or hurt to work, how long would your business be able pay expenses? ________________________________________________________________________________________________ What would happen to your business in the event a key employee became too sick or hurt to work? ________________________________________________________________________________________________ Have you established a contingency plan for transferring your business to a specific party in the event of a disability of an owner? If yes, explain how the buyer would fund the purchase. Yes
No __________________________________________________________________________
__________________________________________________________________________________________________ What are your current business-related loan obligations? __________________________________________________ __________________________________________________________________________________________________ Have you considered how you would continue to make business-related loan payments if you became too sick or hurt to work? Yes
No
DATE OF BIRTH SMOKER
* Includes inducement, training and opportunity costs.
OWNER/KEY EMPLOYEE (SALARY, BONUS & OTHER)
TOTAL COMPENSATION TAX RATE
BUSINESS INCOME
LONG-TERM BUSINESS DEBT (e.g., 0%, 25%, 50% or 75% max)
DEBT COVERAGE FACTOR
Owner/Key Employee Census
0 = NONE
% OWNERSHIP
(e.g., difficult, very difficult, impossible)
DIFFICULTY OF REPLACING OWNER/ KEY EMPLOYEE
WE’LL GIVE YOU AN EDGE® Principal National Life Insurance Company and Principal Life Insurance Company, Des Moines, Iowa 50392-0001, www.principal.com
The subject matter in this communication is provided with the understanding that Principal® is not rendering legal, accounting, or tax advice. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements. Insurance products issued by Principal National Life Insurance Co. (except in NY) and Principal Life Insurance Co., members of the Principal Financial Group®, Des Moines, IA 50392.
Not FDIC or NCUA insured May lose value • Not a deposit • No bank or credit union guarantee Not insured by any Federal government agency BB8720-08 | 12/2016 | t161220092o