Strategy Development

• Goal & Objective Setting - determine if an ESOP can help you achieve your business and personal goals
• Feasibility Assessment and Analysis - conduct rigorous quantitative analysis to determine if an ESOP is financially feasible and advisable for your company.
• Alternatives to Consider - compare an ESOP with other potential solutions
• Cost/Benefit Analysis - determine if the benefits of implementing an ESOP for your company exceeds the benefits achieved.

Strategy Implementation

• Plan design and ESOP formation - drafting the necessary legal, corporate, shareholder and employee documents and agreements to tax qualify the plan with the IRS and make it effective in the eyes of the regulatory authorities.
• Plan trustee - the ESOP trustee ensures that the creation and maintenance of the plan adheres to fiduciary standards.
• Business valuation - must be conducted by an independent, third party qualified appraiser to establish a fair market value of the business according to Revenue Ruling 59-60.
• Financing alternatives - compare internal versus external funding for the plan. Secure financing for the ESOP if required.
• 1042 Investment planning - adherence to the requirements of IRC 1042 enabling a selling shareholder to indefinitely defer the capital gain on the sale of their shares to the ESOP.
• Repurchase obligation - forecasting your obligation to repurchase the shares of departing ESOP participants and evaluating pre-funding strategies.
• Employee communications - communication strategies to maximize employee results.
• Administration & compliance - the administrator must collect and maintain all required participant data, prepare the management and participant reports, and ensure that the plan complies with government reporting and disclosure requirements.