Client:  Privately-held company

Annual Revenue:  $20+ million

  • Majority owner retired and was bought out by the remaining shareholders 

  • Buyout required reallocation of shareholder assets creating financial strain

  • Repeating this buyout strategy for future ownership transition was not financially viable 

  • Looking for a retention strategy for future key employees without further diluting the shareholders' ownership


  • Established a future buy-out sinking fund within a General Partnership structure 

  • Conducted financial analysis on alternative investment funding strategies

  • Utilized a premium finance strategy to mitigate cash flow

  • Layered in a Long-Term Incentive Plan (LTIP) for non-partner key employees


  • Sinking-fund successfully addressed buy-out cash flow beginning  year 3

  • Buy-sell funding was provided to the partners within the General Partnership with no additional investment

  • General Partnership model preserves step-up in basis for the remaining shareholders in order to minimize taxation

  • LTIP created a necessary retention/reward strategy for the next generation of leadership

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