Finance
Breaking up is hard to do — so have a plan Breakup dos and don’ts
■ Do decide how decisions will be made.
A legal roadmap can avert costly problems in the event of a split update it periodically as events change. ■ Do address what to do if an owner dies,
“If the case goes to court, the partners gets disabled or leaves the company.
BY MARTIN C. DAKS Legal Issues could lose control,” Hays said. “In New Jersey, ■ Do set forth how each party’s ownership
WHEN TWO OR MORE people get together to judges have a lot of power and can wind down interest will be valued.
start a business, the odds are that they’ll quick- format — will help to determine the kind of and liquidate a firm. But judges generally do ■ Do include noncompete clauses.
ly address concerns like the money or other agreement that’s needed, she said. not want to be in the position of running a ■ Don’t make it easy to break up the company.
assets each stakeholder will contribute, and But the important step is to execute it as business themselves.” ◆ — Martin C. Daks
other ownership and compensation issues. early as possible, before trouble strikes, and to E-mail to mdaks@njbiz.com
But even as they’re preparing to launch their
new business, the partners should also be
planning how they’ll handle a breakup, busi-
ness lawyers say.
“You start a business hoping that it will
last forever,” said Raymond Felton, a co-man- BANKS 130
aging partner with the Woodbridge law firm
A
Greenbaum, Rowe, Smith & Davis LLP. “But it 733 oak valley savings bank Responsible Lending Corporation
doesn’t always work out that way, and in this Station Ln Sommerville ....................................... 908 555 0920 Blew Cr Highland Park ....................................... 732 555 9856
weak economy, we’re seeing more quarrels 846 Retiree Services Company .................................. 732 555 4646
Omnipresent Savings Bank
between owners that lead to splitting their Notting Dr Metuchen .......................................... 732 555 7498 revive community bank
companies apart.”
A business split can be driven by a failure,
Pacific East National Bank ................................... 732 555 2031
Pine Lane Bank & Trust
Branches
Great Plains Dr Green Brook .......................... 732 555 4649
B
or one partner may just lose interest in the 500 Cranbury Rd N Brunswick .................................. 732 555 6695 Business Dr E Brunswick ................................ 732 555 3098
C
PremierOne Credit Union RiverJoin Asset Management
company, said William R.Watkins, a partner 674 Holbrook Dr Colonia .......................................... 732 555 6438 Button Cove Edison ........................................... 732 555 9894
in the Summit office of law firm Lindabury, Ronsmith Partners, Inc.
092 Professional Bank ................................................ 732 555 1689
McCormick, Estabrook, & Cooper P.C. Ayer Av S Brunswick .......................................... 732 555 7819
Prime Loan Savings Bank
In one case, a New Jersey-based residen-
tial and commercial developer was owned by
040
PERSONAL BANKING
rooted community savings
Bennington Place Somerset ................................ 732 555 9480 D
two unrelated families, and operated prof- R W Asset Management
700
COMMERCIAL BANKING
E
itably under its founders for many years, said High St Freehold .............................................. 732 555 7819
Felton, who worked on the case, “but when the 000 Safe Savings Bank
SINCE 1869
owners’ sons took over the company, they Burr Av Raritan ................................................. 908 555 7194
146 Rues Rd Edison ................................................. 732 555 8635 SaySo Personal Savings Bank
started to squabble, the business suffered and
F
Principle Park Trust Porter Rd Piscataway ........