Week 11

Question 1

Financial advisor

Answer 1

Insurance
Life insurance
Critical illness
Disability

Retirement planning
For the older generation
For the next generation

Question 2

Accountant

Answer 2

Corporate reorganization Estate freeze

Tax planning At death
With preferred shares

Question 3

Lawyer

Answer 3

Shareholders Agreement
• With predetermined exit strategies

Domestic Agreement
• Prenups, marriage contracts, co-habitation
agreements

Power of attorneys
• For business assets vs. care

Wills & estate planning
• Dual wills

Question 4

Letter of intent

Answer 4

Is signed so that in case something were to happen to one or all of the owners, this letter would state that the succession plan needs to be
continued

Don’t want to see the whole family endorse the plan and then have the owner(s) die and the plan be put aside

This letter should be signed once the active family members endorse the Succession Plan (the
recommendations, family business rules, and guiding principles in my report)

Ideally, the non-active family
members will have read the report
as well

Question 5

Shareholder agreement

Answer 5

A comprehensive shareholders agreement is the foundation upon which the family business and the
family execute their succession plans.

It is the legal framework that governs the family business and the family and links them together.

When the next generation ascends into the ownership
ranks of the family business, a comprehensive shareholders agreement will be needed.

In the interim, the succession process/plans will be governed by the succession Guiding Principles, Family
Business Rules and the grooming plans.

Question 6

Shareholder agreement Template:

Answer 6

Z is a founding owner whom has transferred
ownership control to his 2 children X & Y

He continues to work in the business

Hence the Service contract for Z as an
appendix

Z would have preferred shares
X & Y would have common shares (voting &
growth)