Law360, New York (August 25, 2016, 3:58 PM EDT) -- When I was a young neophyte lawyer, the United States Congress undertook to create a set of rules to eliminate the use of what were then called "recap freeze transactions." In essence, their mission was to eliminate certain types of transactions utilized by various tax and estate planning practitioners designed to minimize the estates of their wealthy clients and avoid the imposition of the gift tax in the process. The goal of the practitioner was to "freeze" the value of an enterprise (be it a family business enterprise or a family real estate holding company) in the hands of the senior-generation family member owners at its then-current fair market value, and then shift the appreciation into the hands of the next generation (or generations beyond) by recapitalizing the entity into preferred and common interests (the "recap freeze."). In a nutshell, the claim was that the preferred stock or partnership interests would have all of the appraised equity value retained unto it by virtue of certain liquidation preferences, a preferred coupon, and a "put right" retained by the senior generation, which the appraiser would certify was equal to 100 percent or more of the current fair market value of the business being operated, or of the real estate then held by the entity, and the common class of interests would have an initial value of $0 but was entitled to 100 percent of the growth in value of the business above the current value or the "put right value."...