Archive for June 2017

ESOPs and Divorce

So, you’re facing a divorce – something you never thought you’d have to deal with. It seems you’re spending more time in meetings with lawyers than you are sleeping these days. It’s all so complicated.  Trying to equally divide out community property and accumulated marital investments is incredibly difficult – especially when there is a privately-owned business involved comprising a large portion of the value of the community property.

What do you do when one spouse wants to remain at the helm of the business and the other wants to be cashed out of their share?  Sometimes there just isn’t enough liquid capital for an off-the-cuff buyout.  In that case, what’s the solution?

It can seem to be an unsolvable problem when the divorcing spouses cannot come to an equitable decision.  Selling half of the business usually is not an option, but at the same time, you can’t take blood from a stone.  You just don’t have the cash for a buyout that would allow a clean parting of the ways.

Is there a compromise that can work for both parties?

The answer, thankfully, is yes.

An Employee Stock Ownership Plan might be the perfect solution.  There are definite benefits to considering an ESOP in spousal asset division.  From a business perspective, choosing this option can provide significant bonuses for both parties.  It is a flexible answer to a challenging problem.

To find out more about how an ESOP can help you with dividing your marital business assets equitably, check out our blog at http://www.bsllp.com/esops-can-provide-liquidity-to-facilitate-division-of-a-family-owned-business-upon-divorce.

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EBOOK – ESOPs: Myths, Methods, and Mistakes

  • How it works
  • The ins and outs of ESOPs
  • Common misconceptions explained
  • Tips and tricks
  • Risks vs. rewards
  • How to avoid common mistakes

As baby boomers toe the retirement line, company ownership and succession planning becomes a necessary topic on the discussion table. There isn’t always an easy answer here – all business owners have different priorities when it comes to handing over the reins – but some options are more elegant and effective than others. ESOPs, or employee stock ownership plans, provide a compelling alternative, selling company ownership to employees while also offering an avenue for corporate financing and business perpetuation.

Click to download the full eBook in PDF format.

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EBOOK – ESOPs: Myths, Methods, and Mistakes

  • How it works
  • The ins and outs of ESOPs
  • Common misconceptions explained
  • Tips and tricks
  • Risks vs. rewards
  • How to avoid common mistakes

As baby boomers toe the retirement line, company ownership and succession planning becomes a necessary topic on the discussion table. There isn’t always an easy answer here – all business owners have different priorities when it comes to handing over the reins – but some options are more elegant and effective than others. ESOPs, or employee stock ownership plans, provide a compelling alternative, selling company ownership to employees while also offering an avenue for corporate financing and business perpetuation.

Click to download the full eBook in PDF format.

More

ESOP – Five Disastrous Mistakes

No matter how much you love your work, there comes a time when you need to slow down a little and start considering retirement. Your business has functioned for many years with you at the helm, and it’s hard to imagine a time when you are not in full control.  And yet, you know you have to plan for the future of your business, and that future involves a successor.

It’s scary thinking about moving on and leaving your “baby” in the hands of another.  There are a lot of options to consider, and you’re scared to make a mistake.

There are definitely pitfalls to avoid in setting up your business succession plan.  You’ve eliminated most of them but putting in the hours and the research to ensure you’ve chosen a strategy that is the best fit for your thriving business.  That’s a great first step.  And that first step is making use of ESOPs to help take your company into the future. You can definitely see how this particular plan will benefit all parties if it is implemented correctly.

But you do worry about how smoothly transitioning ownership will go.  You want to put the same effort into your business succession plan as you did into the building of your company.  It took great care to get you where you are today, and you are committed to putting that same care into its tomorrow.

In this article, you will learn about five mistakes to avoid as you incorporate ESOPs into your business.

Click to read the rest of the article on the GBH website.

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Get Your ESOP to the Finish Line in 5 Steps

So, you’ve been giving a lot of thought to your business succession plan, and you’ve put many hours and sometimes sleepless nights into the research process. There are a lot of options to consider, and you’re starting to formulate a strategy that feels right to you.

It takes a long time to wade through the various scenarios that might be best suited to your personal business situation.  Unfortunately, retirement planning takes just that—a ton of planning!  But you’re off to a great start—you know that an ESOP is a right fit for you.

ESOPs provide a wonderful way for a CEO to transition from a very active role to a more passive one.  Employees opting into an ESOP gain a real feeling of ownership, pride, and teamwork.  It’s a win-win situation for all involved.

Seeing the benefits to all parties involved was easy for you.  But trying to actually implement ESOPs into your business?  Not so much.

It’s easy to become overwhelmed by what appears to be an insurmountable task.  The sheer amount of logistical paperwork seems like a nightmare!  But like anything worth tackling, it becomes less intimidating when broken down into simple, manageable steps.

In this article, you will discover five straightforward steps to take your ESOP from just a concept to a reality.

Click to read the rest of the article on the GBH website.

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Myths about ESOPS

Business succession planning is a hot topic amongst enterprise owners today. You spent a lifetime building a company and took great care to make it the success that it is. You want to take the same amount of care in planning its transition from you at the helm to your chosen successor/s taking full control.

You’ve done your homework—you know what options are available to you.  You know you don’t want to sell the business, and you also don’t want to close it.

And you’ve taken care to choose someone you really feel just “gets” your business and can take it into the future.

One of the options you’re strongly considering is an Employee Stock Ownership Plan or ESOP.  But… you’re not entirely certain how it works or even if it’s the right plan for you.

You have a lot of questions.  Will this type of plan be attractive to my employees?  Will I have to give up too much control too soon?  Would it be fiscally wiser for me to consider an outright sale to a third party?  How much of my company’s confidential financial records do I have to expose to shareholders?

These are good questions.  A wise company owner considers every angle before making such an important decision.

Check out our blog at http://www.gbhcpas.com/blog/esops-debunking-the-top-5-misconceptions to discover the five most common misconceptions about ESOPs.

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