According to recent studies, closely-held businesses represent 47% of the nation’s gross domestic product. Unfortunately, these same surveys indicate that 70% of those businesses will not survive the transition from the first generation to the second. Of those that do survive the transfer through the first generation, only 17% survive a transfer to the third generation, and less than 10% will survive a transfer to the fourth generation. The defining characteristic of those businesses that survive is the quality of their succession plan.
For a closely-held or family-owned business, a succession plan is as important as an estate plan is to an individual. Transitions in ownership and management are inevitable – having a sound succession plan in place protects the business, its owners and their families. Our practice in this area is firmly rooted in decades of providing legal counsel to smaller businesses.
We assist our clients in creating comprehensive succession plans individually tailored to the unique characteristics and needs of their businesses and families. Depending on your goals, plans may provide for inter-generational transfers or sales to third parties. They may also include traditional estate planning documents and business documents such as buy-sell agreements, management agreements, voting trusts, family limited partnerships and life insurance plans.