What Happens to an ESOP When a Company is Sold?

Although Employee Stock Ownership Plans (ESOPs) are often formed to ensure the successful continuation of a business, there are times when an ESOP company is later sold to a third-party. When this occurs, ESOP participants can get nervous, wondering what will happen to their ESOP accounts when a company is sold. What to Know About…

Read More

What are the Benefits of an ESOP for an Owner?

Employee Stock Ownership Plans (ESOP) are best known for providing employees with the opportunity to become part-owners of the company they work for, improving productivity and commitment to the company. Less well-known is the fact that ESOPs are often used as an exit strategy for the owner of the company. There are numerous benefits of…

Read More

5 Factors to Consider Before ESOP Implementation

Implementing an Employee Stock Ownership Plan (ESOP) is not a quick or easy decision. It requires forethought and planning. ESOP formation forces a company to think about not only the practicalities and financials of ESOP implementation, but also the impact on the company’s culture and the business owner’s legacy vision. What is an ESOP and…

Read More

5 Reasons Your Business Does or Doesn’t Need An ESOP

Employee Stock Ownership Plans (ESOPs) are qualified retirement plans that reward employees with shares of stock of their employing company. This type of plan not only helps employees save for retirement, but also makes them shareholders and part-owners in the company. As an ESOP consultant, Aegis Fiduciary Services has witnessed these plans become increasingly popular…

Read More

Can an ESOP Company be Sold?

There are times when an ESOP company may need to consider selling the business. Perhaps it is an attractive offer from a competitor or a private equity firm. Perhaps the ESOP business leaders see an opportunity to sell that they were previously unaware of and feel it needs to be considered.  The question arises, can…

Read More

How Are Shares Allocated in an ESOP?

Employee stock ownership plans (ESOP) are qualified retirement plans that grant company shares of stock to employee participants. One common question that owners and ESOP sponsors have to address early in the formation of the ESOP is how those shares will be allocated to participants.  Who Can Participate In ESOP Shares Allocation? Anyone who participates…

Read More

An Introduction to ESOP Valuations

ESOP valuations are a critical component of every employee stock ownership plan (ESOP). Accurate valuations are most obviously necessary in order to ascertain the value of employee shares, but they are also needed well before an ESOP is established. For instance, companies need to conduct an ESOP valuation in order to determine the feasibility of…

Read More

ESOP vs ESPP – What’s the Difference?

Employee stock ownership plans (ESOPs) and employee stock purchase plans (ESPPs) are both attractive employee benefits that help participants save for retirement and build wealth. They each encourage employee investment in the business in both a literal and figurative sense, which can aid in retention efforts while boosting employee satisfaction and productivity. Many business owners…

Read More

ESOP Rules and Regulations 101

Employee Stock Ownership Plans (ESOPs) are an attractive solution for business owners and companies that want to reward their employees for their contributions to the business. They are also an effective solution for business owners who want to retire, transition out of the business, or create a succession plan. Finally, the tax advantages and corporate…

Read More

Top 5 Benefits of an ESOP

An Employee Stock Ownership Plan (ESOP) is most well-known as being a type of qualified employee retirement plan. But there are many more benefits of an ESOP – to both employers and employees. ESOP Defined At the simplest level, an ESOP is a tax-exempt trust that is set up as a defined contribution retirement benefit.…

Read More