■ Family Business
Continued From Page 12
Gibbons P.C.
By Robert F. Coyne, Esq.,
Director, Corporate Dept.
We represented an out-of-state,
family-owned service company
in the sale of half of its New Jer-
sey-based business. The deal in-
volved rights to buy the rest of the business at a
later date, at a price based on the future perfor-
mance of the company. We suggested, and were
able to negotiate from the buyer, a minimum
floor on the future purchase price. This relieved
the family of significant worry over the opera-
tion’s potential expenses and debt levels and
avoided fights with their new partner over con-
trol of decisions affecting the financials. Our
change to the sale structure allowed the family
to continue to make decisions in the best inter-
est of the company, rather than be exclusively
focused on a narrow financial formula.
Greenbaum, Rowe, Smith &
Davis LLP
By W. Raymond Felton, Esq., \
Co-Managing Partner, Chair,
Corporate Department
Our firm’s business law prac-
tice includes the representation
of numerous family-owned businesses led by
siblings, spouses, multi-generational family
members or some combination of such rela-
tionships. These clients face not only the chal-
lenges that any business does, but also certain
unique challenges that family relationships
can foster. We have had multiple situations
where, with prudent planning, we have been
able to establish governance and other mech-
anisms that enabled productive relationships
among family members within the business
setting. Some of the most trying circumstanc-
es have involved the breakdown of the family
dynamic (in a divorce, for example), where the
former spouses decided to stay together as
business partners for the good of their com-
pany. It would be presumptuous to think that
lawyers can impose peace on ex-spouses who
refuse to acknowledge each other, however we
have found that when individuals are willing
to cooperate in good faith, an agreeable res-
olution of operating issues can be attained.
The key to success on this front is always to
listen carefully to the goals and concerns of
the principals involved.
Norris McLaughlin, P.A.
By Oren M. Chaplin, Esq.,
Member,
Business Law Practice
The founding owners of a close-
ly held business were struggling
with how to transition owner-
ship and management by way of an internal
succession to the next generation. While some
of the founders were directly related to the next
generation, none of the next generation were re-
lated to each other, and the founders also had
children not involved in the business. Through
multiple business consulting sessions with all
affected parties, and, at times, heated discus-
sions and negotiations, we helped the company
navigate the sensitive issues arising from the
different generations and from the addition
of non-related parties to the management and
ownership group. We helped bridge the gap be-
tween the founders’ need to capitalize on their
exit and the next generation’s need to land on a
solid financial and legal foundation from which
they could operate the business. The result was
a series of redemption, operating and other
agreements that structured the relationship be-
tween the parties and how the company will be
managed into the future. Today, the founders
are mostly paid out, and the business under the
management and ownership of the next gener-
ation has increased revenues, expanded opera-
14 COMMERCE www. commercemagnj.com
tions to include new products and services, and
recently established a subsidiary to focus on a
sub-segment of the company’s target market.
Riker Danzig Scherer
Hyland & Perretti LLP
By Jason D. Navarino, Esq.,
Partner,
Tax and Corporate Groups
Riker attorneys work with fam-
ily business owners every day to
generate creative yet practical legal and tax solu-
tions to present and future business problems.
We leverage our strength across a wide array of
practice areas to implement the best solutions
for clients. As a recent example of our interdis-
ciplinary team approach, Riker bankruptcy at-
torneys worked with a family business facing
a devastating potential liability in pursuing
a Chapter 11 strategy that ultimately led to a
manageable settlement of the underlying claim.
The business then faced two new challenges—
figuring out how to take advantage of tax basis
in sister companies to allow for the deduction
of the loss in the defendant entity, and then seg-
regating assets to limit future exposure to simi-
lar claims. Riker tax and T&E attorneys devised
a strategy to addresses both of these challenges,
which was then quickly and successfully imple-
mented by Riker corporate and tax lawyers.
Sills Cummis & Gross P.C.
By Ted Zangari, Esq., Chair,
Outside General Counsel
Multi-Disciplinary
Practice Group
A third-generation manufactur-
ing business was at a crossroad.
Family members wanted to continue the busi-
ness, but the facility was outdated and the land
value had grown exponentially. Our Family
Owned Real Estate team—comprised of attor-
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