Prudential Advisors Teaming Program

Transcription

1 Prudential Advisors Teaming Program 2017 Program I n t e r n a l D o c u m e n t O n l y N o t f o r D i s t r i b u t i o n Prudential reserves the right to alter or terminate any of the programs or compensation plans described herein at any time, in its sole discretion. Programs and compensation programs may be subject to regulatory approval. Nothing contained herein is intended to create a contract of association, or a guarantee of association or compensation for any definite period of time. Association with Prudential is at-will. This means that either Prudential or the producer may end the relationship at any time, for any reason, with or without notice. This program is subject to filing and review by insurance regulatory authorities and may be revised in accordance with this process Teaming Program Page 1 of 18 Edition 4/3/17

2 TABLE OF CONTENTS 1. GENERAL INFORMATION... 3 A. Overview... 3 B. Prudential Advisors Definitions of Terms Used in the Teaming Program... 3 C. Roles on a Team TEAMING DOCUMENTATION... 5 A. Team Formation... 5 B. Reporting LICENSING REQUIREMENTS TRAINING RESOURCES SPLIT GUIDELINES ENROLLMENT REQUIREMENTS AND PROCESS COMPENSATION... 7 A. Overview... 7 B. Qualification Requirements for Growth Bonus... 8 C. Payment Determination for Growth Bonus... 8 D. First Year Maximum Payout Rate Testing... 8 E. New Team Members Joining During the Qualification Year Growth Bonus... 9 F. Experienced hires joining a Team... 9 G. Management returns to personal production and joins a team H. Team Members Leaving the Team During the Qualification Year -Growth Bonus RECOGNITION TEAM SERVICES TEAM STIPEND TERMINATION RULES CHANGES TO THE PLAN EMPLOYMENT AT WILL ADMINISTRATIVE RULES APPENDIX A: TEAMING AGREEMENT APPENDIX B: GROWTH BONUS EXAMPLES APPENDIX C: PROCESS CHECKLIST APPENDIX D: STIPEND REIMBURSEMENT PROCESS Teaming Program Page 2 of 18 Edition 4/3/17

3 1. General Information A. Overview The Teaming Program allows two or more financial professionals to establish a formal partnership between for the purpose of working together as a structured practice with an approved business plan. The financial professionals work collaboratively to serve their clients bringing together varied expertise to benefit their clients. Through the creation of a formal operational plan, the team establishes the roles and responsibilities of each member and creates plans for the sharing of compensation on a consistent basis and collectively driving overall practice growth. The team establishes goals, at least on an annual basis. Members of the team individually or the team as a whole, may employ marketing assistants, associate producers and/or alliance professionals to help them manage and grow their business. Such individuals are considered affiliates of the team, but are not considered team members. Each team will be required to have a designated Team Leader. That individual will be responsible for developing an Operating Plan for the team and securing approval from all team members as well as field management and the Practice Building area of Prudential Advisors. This requires a formal document. This administrative guide addresses the components of the Teaming Program (the Program) and provides details on requirements and guidelines as well as processes used in administering the Teaming Program. B. Prudential Advisors Definitions of Terms Used in the Teaming Program Business Plan Part of the Team Operating Plan where the Team outlines his/her vision and goals. Experienced Producer (EXP) An individual joining Prudential Advisors and having prior sales production experience with another company. Generally, these individuals are hired on to the Statutory Representative agreement Financial Professional (FP) A more experienced producer on the Statutory Representative agreement subject to an annual contract continuation requirement. Financial Professional Associate (FPA) A newer, inexperienced producer operating on the Financial Professional Associate or Statutory Representative agreements and generally in their first 14 quarters after scholarship. FPAs are subject to quarterly validation requirements. Financial Professional Emeritus (FPE) A producer who has retired from Prudential and has been granted the ability to continue to generate business as an independent contractor under the terms of the Financial Professional Emeritus agreement. Gross Distributed Revenue (GDR) The revenue Prudential Advisors receives from the product manufacturers for distributing a product. GDR is generally expressed as a percentage of premium, assets and deposits, and varies from product to product, as well as from transaction to transaction, i.e., new business, renewal, service, trail. Marketing Assistants Individuals who are employed directly by Financial Professionals, a DBA, or through a third party payroll service, and provide clerical, administrative, and/or marketing support to the Financial Professional and/or members of the team Teaming Program Page 3 of 18 Edition 4/3/17

4 Support Staff One or more Marketing Assistants who work to support the team or specific Financial Professionals on a Team. Team -- At Prudential Advisors, a Team consists of two or more Financial Professionals working together under a formal agreement between Team members and having an approved Team Operating plan. Team members will work collaboratively to serve their clients, sharing compensation on a consistent basis and collectively driving practice growth. Team Leader The individual selected from among the team members who is designated as the individual with the primary responsibility for overseeing the administration of the team in accordance with the Team Operating Plan. Team Operating Plan A documented and detailed plan on how the Team will operate. The plan includes: Shared Team Vision, Mission statement, Objectives for team members, roles & responsibilities, compensation sharing, expenses, communication and client relationship strategy. Teaming Agreement Written and signed document indicating each Team member s agreement to participate on the team in accordance with the terms of the Team Operating Plan. C. Roles on a Team 1. Team Leader The Team Leader is a critical position on a team. This individual should have strong leadership skills and take an interest in ensuring the success of others individually and as members of the team. Additionally, the individual selected as a Team Leader should have the following skills: Ability to provide vision and set goals for the Team Have an established, successful practice best suited to take on the challenges of building a Team Strong coaching and leadership skills It is strongly recommended that individuals interested in a Team Leader position have: A minimum of 2 years insurance/financial services experience Prior year personal first year combined GDR of 150,000+ A strong compliance performance record. the licenses, appointments and registrations in the states that all of the team members have such licenses, appointments and registrations. To be a Team Leader an individual MUST: Be a statutory representative or Financial Professional Emeritus Be recognition eligible Be approved by the Managing Director The following are guidelines to remain a Team Leader: Maintain 125,000 in personal full year Combined GDR per calendar year Split at least 50% of total team cases the team s new business productivity to experience positive growth by year 3 Update the Team Operating Plan every year (mandatory) 2017 Teaming Program Page 4 of 18 Edition 4/3/17

5 Best Practices for the Team leader include: Spending time each week with the Team communicating the workings of the Team on a day-to-day basis Holding periodic Team meetings to discuss and review the Team s objectives and responsibilities Provide on-the-job coaching 2. Team Member(s) To qualify as a Team Member, a producer must meet the following requirements: Be a Financial Professional (FP), Financial Professional Associate (FPA), Financial Professional Emeritus (FPE) Sign the Teaming Agreement. Be recognition eligible Be approved by the Managing Director 3. Not Eligible to be a Team Member The following associates can be part of the practice, but cannot formally participate in the Teaming Program or the program benefits, and his/her GDR does not count towards the Growth Bonus: Career Development Program (CDP) Associate Producers Professional Alliances Marketing Assistants Field Management Junior Gemini Partners If the Senior Gemini Partner feels that the Junior Partner is ready to be mentored by the Team, it can be requested that the Junior Partner transition out of the Gemini program early. 2. Teaming Documentation A. Team Formation 1. Teaming Operating Plan and Agreement A formal agreement between all Team Members and Prudential, which includes: Team Business Plan Shared Team Vision Team Mission Statement Objectives for Team Members Roles & Responsibilities Compensation Sharing Agreement Team Expenses Communication Strategy Client Relationship Strategy This agreement is signed by all Team Members, approved by the Managing Director, and filed with the Practice Building Unit Teaming Program Page 5 of 18 Edition 4/3/17

6 B. Reporting It is the Team Leader s responsibility to keep the Team apprised of the Team s progress. Field Management and Team Leaders will have access to the Teaming report found on the Performance Measurement Database. The personal production of each Team member s will be aggregated and compared to prior year to determine growth/progress of the Team. No Associate Producer aggregation, Alliance credit or conference credits will be included in any Team member s personal production. 3. Licensing Requirements All Team Members must be properly licensed, appointed, and registered at all times. Financial Professionals cannot sell a product they are not licensed, appointed or registered to sell. In addition, a Team Member cannot receive commissions on production that was earned from a product that another Team Member sold if he/she is not also licensed, appointed, and registered to sell that product. Team Members should not assist another in any way if he/she attempts to solicit, prospect or sell a product that he/she is not licensed, appointed and registered to sell. A license checking process is in place to identify any team member who was not properly licensed, appointed, and registered to sell a product that is split with another team member. Only GDR paid to licensed Team members will be used to determine eligibility and calculate the growth bonus. 4. Training Resources Field Management Building High-Performance Adviser Teams book produced by the GAMA Foundation distributed to field management Sept, 2016 Additional teaming resources can be found on PALMS Prudential Advisors Learning Management System. All other Teaming program materials can be found on the Navigator website (Navigator > Home > Practice Building > Teaming) 2017 Teaming Program Page 6 of 18 Edition 4/3/17

7 5. Split lines There are limitations to how some products may be split. Please keep them in mind when determining your split arrangements in your Operating Plan New Business Life Annuity Command Mutual Funds Maximum # of FP's that are able to split business - Electronic Application Per unique Rep ID Code 4 Maximum # of FP's that are able to split business - Paper Application if applicable 10 No limit 4 4 Maximum # of writing FP positions N/A 6. Enrollment Requirements and Process To be considered for enrollment in the Teaming Program, a full Team Operating Plan must be completed, approved by the Managing Director, the Practice Building Unit in the Home Office and the Territorial Vice President. The Team Operating Plan can be found on the Teaming website and can be completed electronically. Please refer to the Process Checklist in Appendix C. 7. Compensation The compensation offered under the Teaming Program is in addition to the compensation offered under the Premier Plus and Financial Professional Associate compensation plans. A. Overview Team Members and Team Leaders may be eligible for a Growth Bonus. Eligible Members/Leaders for bonus purposes are Financial Professionals (FP), Financial Professional Associates (FPA), and FP-Emeritus. The Growth Bonus is calculated annually at the end of the year using the following table. Growth is determined by comparing the Team s aggregate first year GDR from the current year-end to the Team s aggregate first year GDR from the prior year-end. The bonus will be payable to eligible Team Members/Leaders during the first quarter of the year following qualification, subject to maximum payout rate testing at the individual producer level. Team First Year Aggregate GDR at end of prior year Growth Bonus Rates Aggregate FY GDR Growth Over Prior Year 10% 20% 30% 40% 50% <250,000 3% 4% 5% 8% 11% 250,000 4% 5% 8% 11% 13% 500,000 5% 8% 11% 13% 15% 2017 Teaming Program Page 7 of 18 Edition 4/3/17

8 750,000 8% 11% 13% 15% 17% 1,000, % 13% 15% 17% 19% B. Qualification Requirements for Growth Bonus Team aggregate First Year GDR must grow by at least 10% year over year Team must split at least 50% of new business written during qualification year Individual Team Members/Leaders must personally credit at least 34,000 First Year GDR to qualify for his/her portion of the bonus payment To be eligible to receive the Growth Bonus, a Team Member/Leader must be assigned to the team at the end of the qualification period (year-end) and be eligible to have his/her first year GDR included in determining the Team s qualification for the Growth Bonus C. Payment Determination for Growth Bonus The Growth Bonus payment is apportioned to a Team Member/Leader based on the size of his/her individual First Year GDR credited during the qualification year Each Team Member/Leader s Growth Bonus is calculated as follows: 1. Team s aggregate Growth First Year GDR is determined (current year s aggregate Team First Year GDR minus prior year s aggregate Team First Year GDR) 2. Member/Leader s percentage of contribution to the Team s First Year GDR for the qualification year is determined (Team Member/Leader's First Year GDR credited during the qualification year divided by the Team s aggregate First Year GDR credited during the qualification year) 3. Team s aggregate Growth First Year GDR credited during the qualification year is multiplied by the Team Member/Leader s percentage of contribution (#1 times #2) 4. That result (#3) is multiplied by the Growth Bonus Rate to determine the Team Member/Leader s individual Growth Bonus payment To qualify for a bonus payment, the Team Member/Leader must be active at the time the Growth Bonus payment is made. If the Team Member/Leader is on disability or an approved leave of absence at the time of payment, the payment will be held until he/she returns to active status. Bonus payments are benefitable for FPs and FPAs. They are not benefitable for FP-Emeritus. The Growth Bonus will be paid in the first quarter of each year The Growth Bonus payment is subject to NY4228 Maximum First Year Payout Rate testing. See the Premier Plus Administrative for complete details. D. First Year Maximum Payout Rate Testing Based on applicable regulatory requirements, the Team bonus is subject to the same First Year Maximum Payout Rate Testing as the bonuses payable under the Premier Plus Compensation Plan. A maximum payout rate (cap) is applied to FPs, FPAs, and FP-Emeritus who do not produce current year net first year GDR sufficient to support payment of the bonuses paid. If testing calculations show that the bonus payment is in excess of the maximum, any such excess bonus payment will be withheld. See the Premier Plus Compensation Plan Administrative for complete details, including the maximum payout rates Teaming Program Page 8 of 18 Edition 4/3/17

9 E. New Team Members Joining During the Qualification Year Growth Bonus When a new Member joins the Team during the qualification year, his/her first year GDR from the date he/she joins the Team will be included in determining the Team s year-end Growth Bonus qualification. If he/she is an existing FP, his/her first year GDR from the prior year for the same period of time will be included in the year-over-year comparison to determine Team Growth. The new member s Growth Bonus payment in the year they join the team will be based on the First Year GDR credited to them only during the period of time they were a member of the Team. Example #1: Existing FP Smith joins a Team effective October 2, At year-end 2017 s/he has spent 13 weeks on the Team. The first year GDR for those 13 weeks of 2017 will be included in the Team s aggregate first year GDR results for In addition, FP Smith s first year GDR results for the same 13 weeks of 2016 will be included in the Team results for 2016 and used in the Team s growth comparison. When the Growth Bonus payment for FP Smith is calculated at year-end 2017, his/her First Year GDR credited during the 13 weeks of 2017 that s/he was a member of the team will be used in calculating his/her Growth Bonus payment. For FPAs who join a Team effective their date of scholarship from CDP to FPA, their GDR credited while they were in CDP will also be included toward the Team s aggregate First Year GDR results. In these situations only, the FPA may join the Team effective any Monday date. They are not held to the Teaming Program rule that members may only join a team effective at the start of a calendar quarter break. Their first year GDR credited during both CDP and the period of time they are a member of the team will be included in their bonus calculation. FPAs who join a Team effective at a date other than their scholarship date from CDP to FPA may, like other new members, only join a team effective at the start of a calendar quarter. Their first year GDR credited during the period of time they are a member of the team will be included in the Team s growth comparison, as well as their Growth Bonus calculation. Example #2: FPA Jones joins the Team upon scholarship from CDP effective May 15, At yearend 2017 s/he has 20,000 first year GDR credited that is included in the Team s aggregate first year GDR results for 2017 (5,000 first year GDR credited during CDP and 15,000 first year GDR credited while an FPA). Example #3: FPA Smith scholarships from CDP to FPA effective July 10, S/he joins a Team effective October 2, His/her GDR credited from October 2, 2017 through year-end 2017 will be included in the Team s aggregate first year GDR results for F. Experienced hires joining a Team If an experienced producer is hired directly to a team, we will consider the production reported to Recruiting & Selection as prior year production for purposes of calculating the growth bonus for the team. For example, if Recruiting & Selection determined that their average GDR from their prior company was 200,000 in first year GDR, 200,000, or a prorated portion of it, will be used as their prior year production when calculating the growth percentage for that team year over year. Example #1: Experienced hire Jones who annually averaged 200k of first year GDR at the prior company joins the team at the start of the 2 nd quarter At year-end 2017, in determining the team's growth percentage current year over prior year (2017 over 2016), 150K will be used as his/her production for the prior year (3/4 of the annual 200k average from the prior company). The current year's GDR 2017 Teaming Program Page 9 of 18 Edition 4/3/17

10 production used will be FP Jones actual net first year GDR credited while with Prudential during the 2nd, 3rd and 4th quarters of In determining the team s growth percentage year over year at year-end 2018, FP Jones prior year results (2017) will include 50k GDR attributed to his prior company (1/4 of the annual 200k average) plus the actual GDR results s/he credited while with Prudential during the 2 nd, 3 rd and 4 th quarters of The current year s GDR production used will be FP Jones actual net first year GDR credited during the full year Example #2: Experienced hire Smith who averaged 120k of first year GDR at the prior company joins the team at the start of the 4 th quarter At year-end 2017, in determining the team's growth percentage current year over prior year (2017 over 2016), 30K will be used as his/her production for the prior year (1/4 of the annual 120k average from the prior company). The current year's GDR production used will FP Smith s actual net first year GDR credited while with Prudential during the 4th quarter In determining the team s growth percentage year over year at year-end 2018, FP Smith s prior year results (2017) will include 90k GDR attributed to his prior company (3/4 of the annual 120k average) plus the actual GDR results s/he credited while with Prudential during the 4 th quarter The current year s GDR production used will be FP Smith s actual net first year GDR credited during the full year G. Management returns to personal production and joins a team If a member of management returns to personal production and joins a team, any personal production they had in the previous year will be compared to current year s production for purposes of calculating the growth bonus for the team. H. Team Members Leaving the Team During the Qualification Year -Growth Bonus If a Team Members departs the Team for any reason during the qualification year, none of his/her first year GDR will be included at year-end in determining that Team s qualification for the Growth Bonus. 8. Recognition Recognition for Teams is provided on both a national and territorial level based on Team aggregate combined GDR growth year over year. Teams are ranked based on Team total FY combined GDR average per Member GDR growth, year over year. The national and territory Team winners each receive a dinner with his/her TVP and receive a plaque. Conference credits (5k) will be awarded to a Team for recruiting and scholarshipping a new FPA to the Team. Conference credits will be earned in the year the FPA is hired and will expire at year end. Team Members attending conference based on his/her own production receive a ribbon, recognition in the program book and during general session. 9. Team Services All Teams will receive the following services: 2017 Teaming Program Page 10 of 18 Edition 4/3/17

11 A $1000 stipend to be used toward marketing your Team or to defray the cost of business coaching. The expense is to be paid out of pocket and then reimbursed once verification of payment is received. Life New Business direct contact via an 800# New Business box for Teams with 24 hour service Life Post Issue escalation box for Teams with 24 hour service 10. Team Stipend Each Team will receive an annual $1,000 stipend to be used to defray the cost of marketing your Team and/or the cost of business coaching. The expense should be paid out of pocket and reimbursed once the $1,000 limit is reached. This stipend must be used in the year in which it is earned. Unused portions will not be rolled over from year to year. Some examples of approved expenses are listed below. If you re not sure if your expense is reimbursable, call contact the Teaming office to be sure prior to spending the money. ( ) Marketing expenses examples Ordering Teaming brochures / ads / newsletters from Pru Advisors Marketing Advertising in a local paper (pre-approved ads only) Postage expense for mailing to clients Business Coaching examples Purchasing books / material on business skills Attending a class or seminar on business management Team exercises See Appendix D for Reimbursement Instructions 11. Termination Rules The Team relationship is at-will. This means Prudential, the Team leader, or any Team Member may end the relationship at any time, for any reason. A Team assessment will be conducted at the beginning of each year. During this annual assessment, the Company will determine if any active Team leader did not meet production guidelines. The Company reserves the right to dismantle the Team if the Team leader s production falls below the guideline. Furthermore, Team s aggregate split percentage on new business will be reviewed to ensure that Teams are engaged as a Team and meeting split business guideline. If a Team dissolves for any reason, each Team Member keeps his/her portion of shared commissions and GDR. If a Team Member leaves the Team for any reason, the former Team Member(s) keeps his/her portion of shared commissions and GDR. If a Team Member leaves Prudential, service responsibilities fall back on the remaining Team Members. Please note: There is no automatic reversion of commission interest. The transferability of commission interest, both vested and non-vested is subject to establish company policies and Practice Transfer rules Teaming Program Page 11 of 18 Edition 4/3/17

12 12. Changes to the Plan Prudential reserves the right to alter or terminate any of the programs or compensation plans described herein at any time, in its sole discretion. Programs and compensation programs may be subject to regulatory approval. 13. Employment At Will Nothing contained herein is intended to create a contract of employment, or a guarantee of employment or compensation for any definite period of time. Employment with Prudential is atwill. This means that either Prudential or the employee may end the employment relationship at any time, for any reason, with or without notice. 14. Administrative Rules A. Commissions This Program does not impact commission payments (including first-year, renewal, service, and trailer commissions), which are paid pursuant to the Team Member s applicable pay plan and/or commission schedule. B. Team Members may split commissions on all products provided they are each licensed, appointed, and registered for the respective product. C. Outbrokerage Access - Team Members are subject to the Company Outbrokerage lines with each of his/her access determined based on his/her individual contracts. A Team Member does not assume the Team Leader s outbrokerage access privileges or vice versa. D. Other Compensation Plans - The Teaming Program has no impact on other producer or field management compensation plans such as the Career Sales Professional (CSP), Premier Plus, Financial Professional Associate, and Gemini Compensation programs. E. Employee Referral Bonus - Any Team Member who recruits a new FPA to Prudential is eligible for the Employee Referral bonus and will receive 5,000 in conference credits. F. Team Leaders are either statutory or emeritus Financial Professionals. (An emeritus producer cannot operate under a Service Only Addendum). G. All compensation components in the Teaming Program Compensation Plan will apply towards Company benefits unless the Team Member is an emeritus Financial Professional. H. The Company reserves the right to reduce any current payment, including but not limited to recapturing amounts of previous payments, if in the Company s sole discretion, it determines that the sales activity of an FP on which a payment is based was not consistent with Company rules, practices, and/or procedures. I. The Team Member/Leader must be actively employed when the Growth payments are calculated in order to receive the payment and must be licensed, appointed, and registered in accordance with Company policy. J. There shall be no pro-ration of the Teaming Program Growth bonus payments for Team Members who leave the position or separate from the Company. K. If, at the time of a bonus payment, the Team Member is on an approved leave of absence, the payment will be held until he/she returns to active status. L. Assignment of an FPA to a Team is at the discretion of the Managing Director M. State and/or Local Restrictions - All provisions of the Teaming Program Plan are subject to individual State or Local restrictions. No liberalization of this Plan, as written, will be permitted 2017 Teaming Program Page 12 of 18 Edition 4/3/17

13 without Corporate Home Office approval and will be subject to restrictions made necessary by local statute. N. This program is subject to filing, review, and approval by insurance regulatory authorities and may be revised in accordance with this process. The Company hereby agrees to the foregoing and as set forth in the attached Appendixes. Michael Penso, CLU, ChFC Vice President, Field Support and Planning Dated: October 1, Teaming Program Page 13 of 18 Edition 4/3/17

14 15. APPENDIX A: TEAMING AGREEMENT I have read the Prudential Advisors' Teaming Program and have voluntarily made a decision to participate with the individuals identified below as a member of a team under the terms of this program. In doing so, I understand the expectations and requirements of me as an individual team member and as specified in this Operating Plan document developed for the team that I will join. I understand and accept the financial commitment that I have made to the Team s expenses. Further, I understand that my participation as a member of this team does not alter my agreement, including my registration with Pruco, as well as any appointments with Prudential and its subsidiaries. I further understand that I will continue to be responsible for adhering to all Prudential policies. I also understand that my association with Prudential continues to be atwill. Either Prudential or I may end the association at any time, for any reason, with or without notice and that Prudential may, at its discretion, require me to leave this team if I violate Prudential policies or practices, and/or if Prudential determines that the team or I am not operating appropriately under the terms of the Program. I also understand that this agreement does not alter Prudential's compensation plans or programs and I understand that Prudential will continue to reserve the right, in its sole discretion, to alter or terminate, subject to regulatory approval where necessary, any of the programs or compensation plans in which I participate. Nothing in this agreement is intended to create a contract of employment, or a guarantee of employment or compensation for any definite period of time. By signing below, I am indicating my decision to join the other individuals signing this agreement on a team. I understand that the Team Lead will be responsible for ensuring that the terms of this Operating Plan are being employed and I agree to support the Team Lead in ensuring the Operating Plan is followed. I also understand that should I fail to uphold my responsibilities to the team and, pursuant to the terms of this Operating Agreement, I may be removed from the team. Name Contract # Signature Date Name Contract # Signature Date Name Contract # Signature Date Name Contract # Signature Date By signing below I am acknowledging that I have reviewed this Team Operating Plan and find it to be sufficiently developed to address the critical aspects of team operations. I have spoken with each of the team members signing above and believe they are entering freely into this agreement with each other. I understand that this agreement does not release me from any responsibilities I may have as a manager or regulatory supervisor of the individuals above and I agree to continue to work with each of them individually in this regard. MD Name Date Managing Director signature FIRM: 2017 Teaming Program Page 14 of 18 Edition 4/3/17

15 16. APPENDIX B: GROWTH BONUS EXAMPLES The following are examples of how the Growth Bonus works. Example #1 Team consists of three Members. The Team s aggregate growth from year-end 2017 to year-end 2018 is 110,000 first year GDR. Team s first year GDR has grown by 10% year-over-year Based on the size of the Team s first year GDR and their 10% growth, the Team earns an 11% Growth Bonus Rate. That 11% bonus rate will be payable on the Team s Growth first year GDR year-over-year. Here is how each of the three Team Member s Growth Bonus is calculated: FP 1 Had 825,000 first year GDR credited in 2018, which is 68.2% of the Team s aggregate 1,210,000 first year GDR for FP 1 s Growth Bonus is determined by taking the Team s Growth FY GDR of 110,000 times 68.2% times the 11% Growth Bonus rate. FP 1 s Growth Bonus is $8,252. FP 2 Had 285,000 first year GDR credited in 2018, which is 23.5% of the total Team s 1,210,000 first year GDR for FP 2 s Growth Bonus is determined by taking the Team s Growth FY GDR of 110,000 times 23.5% times the 11% Growth Bonus rate. FP 2 s Growth Bonus is $2,844. FPA Had 100,000 first year GDR credited in 2018, which is 8.3% of the total Team s 1,210,000 first year GDR for FPA s Growth Bonus is determined by taking the Team s Growth FY GDR of 110,000 times 8.3% times the 11% Growth Bonus rate. FPA s Growth Bonus is $1,004. YE2017 FY GDR (Personal) Team s Aggregate FY GDR YE2018 FY GDR (Personal) Team s Aggregate FY GDR Growth FY GDR Growth Rate Growth Bonus Rate Proportion of FY GDR Bonus Payment FP 1 800, , % $8,252 FP 2 250,000 1,100, ,000 1,210, ,000 10% 11% 23.5% $2,844 FPA 55, , % $1,004 Grand Total $12, Teaming Program Page 15 of 18 Edition 4/3/17

16 Example #2 New Hire FPA Joins Team Mid-Year Team consists of two Members at year-end 2017 and three Members at year-end 2018, with a new FPA joining the Team during The Team s aggregate growth from year-end 2017 to year-end 2018 is 65,000 first year GDR. Team s first year GDR has grown by 20% year-over-year Based on the size of the Team s first year GDR and the 20% growth, the Team earns a 5% Growth Bonus Rate. That 5% bonus rate will be payable on the Team s Growth first year GDR year-over-year. Here is how each of the three Team Member s Growth Bonus is calculated: FP 1 Had 215,000 first year GDR credited in 2018, which is 55.2% of the total Team s 390,000 first year GDR for FP 1 s Growth Bonus is determined by taking the Team s Growth FY GDR of 65,000 times 55.2% times the 5% Growth Bonus rate. FP 1 s Growth Bonus is $1,794. FP 2 Had 130,000 first year GDR credited in 2018, which is 33.3% of the total Team s 390,000 first year GDR for FP 2 s Growth Bonus is determined by taking the Team s Growth FY GDR of 65,000 times 33.3% times the 5% Growth Bonus rate. FP 2 s Growth Bonus is $1,082. FPA Had 45,000 first year GDR credited in 2018, which is 11.5% of the total Team s 390,000 first year GDR for FPA s Growth Bonus is determined by taking the Team s Growth FY GDR of 65,000 times 11.5% times the 5% Growth Bonus rate. FPA s Growth Bonus is $374. YE2017 FY GDR (Personal) Aggregate FY GDR YE2018 FY GDR (Personal) Aggregate FY GDR Growth FY GDR Growth % Growt h Bonus Rate Proportion of FY GDR Bonus Payment FP 1 200, , % $1,794 FP 2 125, , , ,000 65,000 20% 5% 33.3% $1,082 FPA 0 45, % $374 Grand Total $3, Teaming Program Page 16 of 18 Edition 4/3/17

17 17. APPENDIX C: Process Checklist Begin by determining if Teaming is right for you and enroll by submitting an Operating Plan Determine if Teaming is Right for You Review material on the Teaming Navigator website. (Navigator > Home > Practice Building > Teaming) Complete the Fast Track to Teaming Assessment Meet with MFS and Managing Director Build Your Team Meet with Prospective Team Members Evaluate complementary skills and experience Complete Team Operating Plan Review & discuss Operating Plan with team members and finalize plan Submit Operating Plan for MD review and approval Submit Operating Plan and Team Member agreement to Teaming Program office for approval. Teaming Program office will submit an executive summary to Territory Leadership for review and approval. Team official approved and entered into the database Launch Your Team Review approved operating plan with the Team Initiate the Team s marketing plan Initiate the Team s Operating plan 2017 Teaming Program Page 17 of 18 Edition 4/3/17

18 18. APPENDIX D: Stipend Reimbursement Process Reimbursement Instructions Once the expense has been paid, you ve reached your $1,000 limit, and have a receipt for the expense, submit a reimbursement voucher. Go to Inside the Rock > My Prudential > My Career > Expense Processing Select LOGIN Expense Vouchers In the Expense Vouchers tab, hover over Non-Profit Contributions and Personal Reimbursements and click on Personal Reimbursements. For this voucher only, next to the Authorizers click on the current person s name and change it to Lisa Kent. This will allow her to review your expenses and process the reimbursement. Complete the voucher as usual and use the following codes: Account code: Center code: Invoice Description: Team Stipend Once you have completed your voucher, click on Submit and it will be sent for approval. Print out the cover sheet, attach your original receipt(s) and send to Practice Building for review. You may want to keep a copy for your records. Practice Building Unit Prudential 213 Washington Street NJ Newark, NJ When you receive notice that the voucher is approved, the voucher will be sent to Accounts Payable for payment. Please note that you will not be reimbursed unless you send these materials for review Teaming Program Page 18 of 18 Edition 4/3/17