Why Should Companies Consider Succession Planning?

The success of a company depends on the quality of its leaders and the management team they put in place. Often times, owners of a business spend a great deal of time and resources to put a management team in place that is capable of driving profitability and competitiveness while instilling the right corporate culture in the company. Such positive measures in turn benefits the owners and current leaders of the company. The question is what happens... Read More

Advantages of Employee Stock Ownership Plans

Advantages of Employee Stock Ownership Plans Company can use tax-deductible corporate earnings to buy shares from selling shareholders Creates a market for the stock of the shareholders Shareholders with management responsibilities will have the flexibility to sell gradually and ease out of the business over a number of years Allows financing of corporate acquisitions through the ESOP on a tax-advantaged basis Enhances corporate performance and... Read More

What are the rights of ESOP participants?

An ESOP is a qualified, defined contribution plan similar to a 401k plan structured to primarily invest in the employer’s stock. Technically, it’s a type of stock bonus plan that benefits the participants and allocates company stocks to the participants. In effect, the employees ultimately receive company stocks at no out of pocket cost to them. The allocation of company stocks to employee accounts is not a taxable transaction and there... Read More