The most precious asset of any business is its executive team. Part of the struggle that closely held (and public) companies face is their ability to attract and retain key employees. An executive bonus plan may be an effective strategy to hire away from your competition and keep your top people with your firm.

1. Attract. Retain. Succeed.
Executive Bonus Plans funded with
whole life insurance
LI7248 CRN201203-130967

2. Important Information
The information provided is not written or intended
as specific tax or legal advice and may not be
relied on for purposes of avoiding any Federal tax
penalties. MassMutual, its employees and
representatives are not authorized to give tax or
legal advice. Individuals are encouraged to seek
advice from their own tax or legal counsel.
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3. Agenda
A critical business challenge
What do executives want?
Executive Bonus Plans…
A simple & effective solution
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4. Attracting and retaining talent
How critical are top performers to your success?
How do you attract them?
How do you lock them into your business?
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5. Rewarding talent
How do you reward top performers?
What additional “selective” benefits have you
considered offering?
Profit sharing? -- Supplemental Executive Retirement Plan?
Non-Qualified Deferred Compensation? -- Incentive stock?
High admin expense?
Too complex?
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6. Defined benefit pension plans face extinction
Savings burden
and…
Investment risk
shifted to
employees…
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7. Americans saving less
Consumption
Epidemic…?
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For additional information on how this statistic is calculated, go to www.bea.gov.

8. Emerging affluent in need
Compensation
Discrimination
at
higher incomes
How will your executives live on 20% of
their income in retirement?
How will you? 8

9. Other factors
Longer life spans
Uncertainty surrounding the future of Medicare and
the overall cost of health care
The impact of market volatility on retirement
account balances
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10. Executives need YOUR help!
They feel that retirement savings programs are the
most valuable benefits a company can provide
14%
Most Valued Benefits to Executives
15%
Other
Stock Options
71% Retirement Plans
They also rely on their employer for over half of their
life insurance coverage
SOURCE: The Value of Executive Benefits, LIMRA 2006 10

11. The executive bonus solution
What is an Executive Bonus Plan?
A fringe benefit funded with whole life insurance
Provided to a select group of key executives and/or
business owners
Helps provide protection during working years
Helps provide supplemental income1 during
retirement
1 Distributions under the policy (including cash dividends and partial/full surrenders) are not subject
to taxation up to the amount paid into the policy (cost basis). If the policy is a Modified Endowment
Contract, policy loans and/or distributions are taxable to the extent of gain, and if the owner is
under 59 ½ the distribution is also subject to a 10% tax penalty. Access to cash values through
borrowing or partial surrenders will reduce the policy’s cash value and death benefit, increase the
chance the policy will lapse, and may result in a tax liability if the policy terminates before the death
of the insured. 11

12. How does it work?
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13. What are the benefits?
To the business
Effective recruiting and retention tool
A selective benefit
Easy to implement and administer
Immediate income-tax deduction
To the executive
Owned by executive
Generally income tax-free death benefit
Tax-advantaged growth and access to cash1
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14. Plans can be designed…
To reward top performers
To address retirement and protection needs
To help minimize or eliminate the executive’s
after-tax costs
So bonuses can create a strong incentive to stay
with your company
To stay within your budget
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15. Wrap Up
Businesses need a simple, effective, and flexible
way to attract, retain, and reward
Executives are looking to their employers for help
Additional sources of retirement income1
Life insurance protection
Executive Bonus Plans offer a simple and effective
solution to both business and executives
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16. Next steps
Confidential Business Profile
Establish objectives to address your needs
Select a time to review a plan proposal
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17. © 2010 Massachusetts Mutual Life Insurance Company, Springfield, MA. All rights reserved. www.massmutual.com.
MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual)
and its affiliated companies and sales representatives. 17