???about transfering family business to son...

suz1023December 31, 2005

i'm new here,,but not too new to being a caregiver. i've cared for my mom for three years,and in august she moved into assisted living and is very happy there. unfortunately my husband started to lose weight rapidly in september,and on dec. 9th we got a diagnosis of a very deadly and aggresive cancer. so we've started chemo and he has had to stop work. he will be out at least until mid june,,maybe (probably)longer. thank god his youngest son had just been laid off and was ready to step in and manage the business for his dad. (for a paycheck).he's always wanted to take over the business,and has lots of ideas. he's very good at it,and he is highly motivated to make a gajillion dollars. his dad has been slowing down for the past few years,(now we know why) so truthfully the business hasn't been operating at anything like peak performance.

the son has been on the job for less than a month. today he and his dad discussed the future. dad and i were thinking that son will work for a year or so to learn what he needs to know,,then we'll sell him the business for a reasonable price with no interest. son totally disagrees,,says the business is virtually worthless,and since he plans on bringing in new accounts and making more money,,that when his dad passes the business will just become his.

this scares me to death. i can't go to work while i care for my husband,,what will i do without a business to sell or provide some income for me?? i know i need a business accountant or lawyer to help us with this,,and i'll get one,,but this evening we're feeling very bad about this. i see son's point in that the business is failing,,on the other hand,,he's getting paid to manage the company and make it more profitable. he wants to be a partner,and give dad a percentage for new business,,shoudn't dad give him a percentage,,like a comission for new sales? i'm dizzy trying to decide what's fair, and know that if my husband's son walks away now,,there will probably be no business very soon,,so i'm greatful that he has stepped in,,but wondering if he's being fair to us. does that make sense.

if you've gotten this far,thankyou. we've only gone through the first round of chemo,and it went pretty well. i imagine i'll be here more as time goes on.

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LFPB4

I think that you can be given a life time interest in the business with a certain income based on gross profit. Then at your death, your part of the business would go to the son. You need to see a lawyer about this as soon as possible. You have no way of knowing when the cancer may put your husband in a condition where he would not be able to make decisions. Time is essential.
PB

    Bookmark   December 31, 2005 at 10:46PM
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suz1023

how kind of you to respond. i will make an appointment with our attorney first thing monday morning. i was thinking the same type of plan as you,,my husband's son seems to feel otherwise. we are very saddened by this.

    Bookmark   December 31, 2005 at 10:49PM
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lasershow

Be careful when doing business with friends or relatives. It's very difficult to be objective when you've got a whole other relationship in the middle of the business relationship. A good attorney is essential, and I'm glad you're planning to make an appointment first thing tomorrow.

    Bookmark   January 1, 2006 at 1:07AM
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LFPB4

It doesn't sound as if there is a good relationship going on here between the son and father. Keep in mind that as of now, your husband can do anything he wants to with the business. If he transfers the business to his son, anything could happen and it might be terrible for both of you. The son doesn't sound as if he wants to consider his dad's wishes. I would be very wary of including him in ownership in any way as long as your husband is alive. Keep him on salary or let him go.

    Bookmark   January 1, 2006 at 9:33AM
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lisa11310

Let me make an important point here. If hubby becomes unable to take care of himself and would eventually need to be "placed" somewhere for long term care, that business would be seen as an assett that could be TAKEN from you if his care cost became more than you can afford. The only way to protect the business is to get it out of his name. A good laywer should be able to help you draw up a contract that would allow you a monthly income from the business without OWNING it and being at risk of loosing it. Theres a lot to consider here. Good Luck!
Lisa

    Bookmark   January 2, 2006 at 11:07AM
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londondi

Giving the business out right to the one son may cause problems with other children your husband may have. Even if they don't want the business, they might be upset if the son received it free and clear

    Bookmark   January 2, 2006 at 12:42PM
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sharlee

Hi,
Hope you & your DH are getting along as best you can this week of The New Year. Do let us know about the attorney visit as that sounds like the first thing to do.

When my father turned 80 he decided to retire from his construction business & my brother stepped in after many years earning the privilege to do so. My DB did have to prove himself & now 10 yrs later he is going part-time instead of retiring. Our father died this year & I never felt anything but pride for the company still being in business. It is possible for this to occur with the right attitude of family members if that might be a concern in your case.
Take care of yourself & your DH. This is such a difficult time & I pray that your family will surround you with love.

Sincerely, Sharlee

    Bookmark   January 4, 2006 at 12:27AM
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momj47

Any updates?

    Bookmark   January 19, 2006 at 12:59PM
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