Running a successful family firm also presents unique challenges. Family business owners have to consider not only what is good for the business, but also what is good for the family.
One important tool for a family business is the development of an ownership agreement. An ownership agreement helps the younger generation understand the risk factors, and creates a framework for resolving disputes. They also provide liquidity opportunities for all members, and shape the ownership structure of the business to support the family’s vision of the business and itself.
An ownership agreement provides answers to questions such as:
- Which family members can own shares? All family members, anyone employed by the business, or just senior management?
- Who determines if dividends are paid, and when?
- Who can participate in making major decisions such as buying other businesses or taking on debt?
- How can a shareholder sell their shares, and to whom?
Working with your business advisers, our lawyers can help you design an effective ownership agreement.
If you have a family business question or you need help with a family business planning or succession matter please contact Tako van Popta to schedule an appointment.