A virtual File Sharing App such as LockBox can help you securely store and manage your ESOP due diligence material. ESOPMarketplace.com clients have significantly reduced their implementation timetable.
This is the most challenging part of the process. ESOPMarketplace.com valuation advisors are well experienced to avoid pricing and other plan issues with the Department of Labor (DOL).
Plan Design refers to the structure of the ESOP Trust and the rules by which beneficiaries are selected, distributed, vested, and allocated shares.
What are the tax benefits for both the selling shareholder and the company?
ESOPs, much like all other Qualified Plans require some level of Communication. However, to gain the value with ESOPs, developing a Communication plan and Committee will excite the employees on building an "Ownership Culture."
What are the compensation and employment agreements? Top Heavy profiles.
If the demographics are heavily aged, a study to determine cash flows on stock repurchase will be required.
For complicated and or High Dollar transactions, it is imperative an independent Trustee be involved in the transaction from the beginning. By selecting the Trustee early, they can be a wealth of help in selecting advisors and protecting the selling shareholder from DOL challenges.
(Third Party Administrators) Many employee benefit plans have highly technical aspects and complex administration requirements that can make using a specialized entity, such as a TPA, more cost effective than trying to do the same processing in-house. An ESOP, for example, must remain in strict compliance with ERISA, Department of Labor, IRS and Securities and Exchange Commission laws. Failure to remain compliant can result in the ESOP being disqualified. Such disqualifications create very real problems with employees, with corporate accounting, banking relationships as well as with the IRS. Selecting an ESOPMarketplace.com TPA will save you time, money and frustration both immediately and over many years.
Unless the selling shareholder will risk taking debt, the need for an ESOPMarktplace.com investment banker or financial advisor will help the owner navigate through the challenges of financing the transaction.
By having a wealth advisor involved, a number of financial strategies will align with the transaction.