Learn why 30% of Privately held companies have turned to ESOPs and ESOTs.

1. The Dr. Joe's Solution: The Medical Management Corporation Model All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

2. Dr. Joe's Medical Management Corporation Model: Dr. Joe Case Study Joe Smith, M.D. is a Plastic Surgeon with a 20-year old practice Practice is Subchapter S Professional Corporation 100% owned by Dr. Joe (Age 53). He has two other Doctors working for him as independent contractors. 14 Full time employees. Revenues = $4 mm Payroll = $1 mm Salary and K-1 income to Joe = $800K 1 Key employee: Daughter Jane Smith (P.A.) $25K in annual non-deductible business expenses All materials protected by Copyright. ©2011 by Doug Berkey. None of the follo wing may be reproduced in any form without the express written consent of Doug Berkey.

3. What Does Dr. Joe Want? Reduce his tax bill (currently pays approximately $360K in taxes on $800K income) Defer some income (he only needs his current salary from the practice to meet his lifestyle needs) Wants to reward and motivate Jane Smith Wants to Practice Medicine instead of being an administrator All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

4. Solution: Dr. Joe's Medical Management Corporation (MMC) 7 STEP PROCESS Step One: Form new S Medical Management Corporation (MMC). File S election with IRS. Step Two: Adopt Key Person Agreement. Step Three: Adopt KESOP. Step Four: Sell new MMC stock to KESOP. Step Five: Adopt Management Contract. Pay Management Fee from Dr. Joe to MMC. Step Six: MMC pays Admin fee to Professional Administrative Co. Step Seven: MMC funds insurance contracts, and funds KESOP. All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

5. Dr. Joe's Medical Management Corporation (MMC) Structure Contribution Management Fee Joe Smith, P.C. KESOP MMC Key Person and Salaries Contracted Medical Administrative Services Joe: Salary and Key Man Jane Smith: Salary and Key Man Collections And Factoring All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

6. Step One: Form New S Medical Management Corporation (MMC) • Form MMC. File S election with IRS. Joe owns MMC and authorizes 10,000 shares common stock to be issued to himself. Capitalizes with $10,000. MMC All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

7. Step Two: Adopt Key Person Agreements • Set up Key Person Insurance Contracts for Joe and Jane Smith. This highly flexible arrangement allows for tax-free accumulation of funds for practitioner and key employees. MMC Joe DC Jane Smith DC All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

8. Step Three: Adopt ESOP/401(k) • Form KESOP Trust. KESOP designed to invest in Common Stock of MMC. All qualified employees of Joe Smith, P.C. and Medical Management Corporation are eligible to participate in ESOP. KESOP All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

9. Step Four: Sell 100% of the new MMC Stock to KESOP for $10,000 Promissory Note. (10,000 Shares SMC Stock) Joe KESOP MMC ($10,000 Promissory Note) All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

10. Step Five: Pay Management Fee from Dr. Joe to MMC. Adopt Management Contract. • Management Fee is paid to MMC for management services rendered (e.g. asset management and management retention). An analysis of the quantitative and qualitative factors coupled with the fact that Dr. Joe is a growing practice allow for a deductible Management Fee of 25% of Gross Revenue ($1,000,000) to be paid to SMC. MMC Joe Smith, P.C. Management Fee ($1,000,000) All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

11. Step Six: Pay Administrative Fee from MMC for Medical Administrative Services • Administrative Fee is paid from MMC for specific Administrative Services & Benefits Human resource administration Employer regulatory compliance and safety management Practice cash flow management Payroll and employee benefits administration Risk management and cost containment Quality training and quality assurance Comprehensive financial and retirement planning Medical Services, Inc. MMC Administrative Fee ($27K) All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

12. Step Seven: MMC pays non-deductible expenses, funds Key Personcontracts, and funds KESOP. 3% Contribution ($33K) Management Fee ($1,000,000) Dr. Joe KESOP MMC $27K Contracted Medical Administrative Services $400,000 Key Person $500,000 Salaries Joe: Salary $400K Key Person $300K VUL Split Dollar Jane Smith: Salary $100K Key Person $100K VUL Split Dollar Medical Services, Inc. All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

13. Financial Summary of Dr. Joe Smith Case Study Total Tax Savings $201K ($447K x marginal Fed and State combined rate of 45%). Total Key Person set aside - $400K. $400,000 X 10 Years = $4,000,000 @ 7.15% = $5,817,365 All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

14. Dr. Joe's Medical Management Corporation: A Very Powerful Tool Variety of applications virtually infinite. Can be custom tailored to fit the unique needs of the small Practitioner. Deductible Management Fee and Compensation arrangements extremely flexible. Application has backing of Major International Accounting Firms, Law Firms and Fortune 500 Insurance Company Compliance Departments. All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.

15. How to Contact Us Fill the form on this webpage with your name and Email and we will reply ASAP. All materials protected by Copyright. ©2011 by Doug Berkey. None of the following may be reproduced in any form without the express written consent of Doug Berkey.