The Protectors of the Saltire. William Speir

accomplished Regulatory Compliance attorney who helped his clients resolve compliance issues and remain in compliance as federal and state regulations changed. His law offices were in the building on top of the Commandery, which made sense because he owned the building.

      Law was James Anderson’s second career. He had started his professional life as a military “consultant” and instructor. He loved the work, but when his wife wanted to start having children, he knew that he couldn’t keep traveling all the time. He sold his company to his employees and started attending law school – never guessing that someday his son would end up working for his old company.

      James loved the law, and he loved his work. But he realized that it was time to start planning for the future. Changes needed to be made.

      The two men entered James’ office and sat down. Philip Adams and Henry Rutledge were James’ two Senior Associates. They had been with the firm for years, and James relied on them heavily.

      “I appreciate both of you being available for this meeting,” he said as he closed the office door and joined the two men at the conference table. He took out two sets of contracts and continued.

      “I’ve decided that it’s time to make some changes within the firm. I’m at a point in my life where I need to start looking towards retirement. Before I can do that, though, I need to make sure that the firm, its clients, and its associates are taken care of.”

      He handed each of the men one of the contracts.

      “I’d like to offer each of you a partnership in the firm.”

      The two men looked at James with surprise. This was completely unexpected.

      “I don’t want to discuss this right now,” James said to the two men. “I want you to read through the contract I’ve given you first, and we’ll reconvene later this afternoon. Before that, though, I want to walk you through the major points outlined in the contract.

      “First, you’ll be buying into the partnership by buying me out of a percent of the firm’s value, which can be found in the audit statement in Appendix One. You won’t be buying me out of the entire firm all at once. This will be a gradual buy-out over time. We need time to transfer my clients to you, transfer your clients to your associates, and work out a transition plan with all of the clients so they see this as a positive change. You two have been handling most of the work for our clients for some time, so this won’t be hard, but you know people don’t like change.

      “To start with, I’ll retain 52% of the firm as Senior Managing Partner. Each of you will have a 24% stake in the firm. Later, after the second buy-out, I’ll own 40% of the firm and you’ll each own 30%. After the third buy-out, I’ll own 20% and each of you will own 40%. After the final buy-out, you’ll each own 50% of the firm.

      “I’ve arranged loans for each of you to be used for the buy-outs to help with the capital outlay of this transaction. The repayment will be built into your partner share payouts. Details on this can be found in Appendix Two, which includes the repayment schedule.

      “Second, there are a couple of conditions that are stipulated on page two. The name of the firm will be changed to ‘Anderson, Rutledge, Adams and Associates.’ Once changed, the name of the firm won’t be changed again, regardless of how you modify the partnership after I’m retired. I’ll retain my office here and have full access at my discretion for as long as I choose. You two will be getting equivalent offices as soon as the building facilities people can make the changes to floor space to accommodate the larger sizes and the moved walls. I retain ownership of the building, which shouldn’t be a problem since my ownership of the building was always separate from the firm. The firm will always maintain an office in this building as long as I’m alive.

      “Third, partner compensation is shown on page four. You’ll see that the payouts are based on the number of partner shares you own, which is equivalent to the percent of the firm you’ll have purchased from me. I believe you’ll have no problems with the amounts shown. This is also based on the assumption that business will either remain steady or will grow over time. It’ll be your responsibility to ensure that.

      “Well, that’s about it,” he said. “Let’s reconvene at three this afternoon and work out any of the final details. You can give me your decisions then. However, you aren’t to discuss this with anyone in the office, including each other, until contracts are signed and a formal announcement can be prepared for the staff and the clients. Any leaks, and the deal’s off, understand?”

      The two men nodded in agreement. James stood up, signaling that the meeting was over. The other two men stood and quickly shook James’ hand in gratitude.

      When they left his office, James sat down at his desk and called his wife’s number. “Hi, honey,” he said when she picked up the phone.

      “Hi, babe,” Theresa Katherine Anderson, or “Tracy” as she liked to be called, replied. “How did it go?”

      “They were shocked, as expected. No one should have seen this coming. I think they were pleased, though, but we’ll know for sure this afternoon. I wouldn’t let them discuss anything until they read the contract and attachments.”

      “Do you think they’ll have a problem with any of the clauses?”

      “No, they’re fairly standard and more generous than most firms provide. They should sign the contract as-is by this evening.”

      “What’s the timeline you communicated to them?”

      “I want to be semi-retired by year-end and fully-retired within six months after that. That’s how the buy-out schedule was drafted.”

      “Call me when your meeting is over?”

      “You bet. I love you, honey.”

      “I love you, too, babe,” Tracy responded.

      At three o’clock sharp, Adams and Rutledge were standing at James’ office door. As expected, they had no issues with the contract at all. There were some questions to clarify a couple of the more intricate points regarding how the loans would work, but in the end both men signed the contract. James added his signature below theirs, and he had his administrative assistant come in and notarize the paperwork. Once that was done, James contacted the bank handling the loans and authorized the transfer of funds. The partnership was in place.

      James shook hands with his new partners and immediately called for a staff meeting in the office library. Once all of the associates and staff had taken their places, James informed them of the changes that would be happening.

      “First of all, I want to tell you that you’re all doing an outstanding job. Client satisfaction is at an all-time high, and you should all be very proud of your work and your contributions to the firm. Second, I need to let you know that there are going to be some changes happening over the next 18 months.

      “The biggest change is to the name of the firm. Effective immediately, we’re known as ‘Anderson, Rutledge, Adams and Associates.’ I have made Philip Adams and Henry Rutledge partners in the firm. All stationery needs to be changed, as do all templates, invoices, and work papers. The name on the door will be changed by the end of the week. I’ll be staying with the firm, but my day-to-day involvement will be phased out over the next 18 months until I eventually retire. This transition will be gradual to ensure that our clients aren’t affected and to ensure that each of you isn’t negatively affected either.”

      The associates and staff applauded and congratulated Adams and Rutledge for their promotions. Both men were well-liked and very good at their jobs. James held up his hand and continued when the applause died down.

      “A formal announcement will be going out to the clients in the morning. Please don’t say anything to any client until you’ve been notified that the announcements are out and that it’s OK to do so.”

      At that moment, James’ Administrative Assistant came into the library wheeling a cart filled with champagne bottles and glasses. “I think a celebration is in order,” he said as