Legend Has It…

In the movies, we see it time and time again–the slick Wall Street villain committing the hostile corporate takeover of a do-good company, placing a closely-held family-owned business at risk of dissolution. More often than not, this drama plays out during a high-stakes boardroom showdown, where gasps are heard, tears are shed, and insults are hurled. Fortunately, however, the nefarious villain is usually outwitted in the last act, the business is saved, and peace is once again restored.

In reality, however, good doesn’t always triumph over evil. And more importantly: real life corporate takeovers are often preventable by thoughtfully-constructed Shareholder Agreements aimed at protecting family businesses from invasive outside forces. Shareholder Agreements can stipulate many different rules in service to this mission. Requiring stockholders to occupy seats at the boardroom table in order to facilitate unified plans for a company’s goals, is one such proviso. Articulating restrictions on stock transfer–replete with reasonable exceptions to these limitations, is another prudent bylaw. In fact, there are seemingly endless methods of securing a company’s long-term stability. But don’t just take The Practitioner’s word for it…

This week’s co-guest article contributors, Daniel Crosby and N. Todd Angkatavanich, know a thing or two about protecting family businesses from slipping into the wrong hands. One of their helpful hints that resonated loudest with The Practitioner was their suggestion to print all stock transfer restrictions in easy-to-read legends, on the back of each and every stock certificate, in order to discourage the unlawful selling of shares. After all, obliterating the threat of complicated legal entanglements is The Practitioner’s modus operandi!

Of course, the suggestions so far mentioned barely scratch the surface. Read this week’scompanion article for more detailed wisdom, and let me know what you think. And as always: don’t hesitate to send ideas for future blog entries and articles. Because when it comes to strengthening family enterprises, there is no such thing as too much inspiration!

About the Contributors:

N. Todd Angkatavanich is a partner at Withers Bergman, LLP. Todd has authored numerous articles in publications such as Trusts & Estates, Estate Planning, ACTEC Journal, BNA/Tax Management Estates, Gifts and Trusts Journal, Private Wealth, Private Asset Management and other publications.


Daniel Crosby was formerly Special Counsel at Withers Bergman LLP. He is currently an Associate in the corporate department at Dewey & LeBoeuf where he advises clients on mergers and acquisitions, private equity and corporate law matters.


Be sure to look for The Practitioner: Wednesday Edition next week in your email or online, when we feature our next guest article: “Marketing Your Family Business Consultancy Through the CPA Portal” by Lance Woodbury.

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Yours in Practice,

The Practitioner