IRS: Most Price Protection Payments Received by ESOP Participants Are Currently Taxable

Highlights

  • Price protection agreements are designed to protect employee stock ownership plan (ESOP) participants from the transitory diminution in stock value that often follows a second-stage ESOP transaction.

  • The IRS has ruled that when, as a result of a price protection agreement, an ESOP participant receives payment for distributed shares in excess of the shares' current fair market value, the excess amount must be treated as ordinary income from employment.

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SCJ Alliance Transitions to 100% Employee-owned Company

October was a month filled with excitement for SCJ Alliance employees and President/CEO Jean Carr. "I was privileged to announce to our employees that SCJ is now a 100% employee-owned company," Jean shared. "Being a 100% employee-owned company is a way for our founders and previous owners to reward our employees for their dedication and commitment, as well as preserve our unique culture."

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Integrity Marketing Group Announces Employee Ownership Plan; Nearly $50 Million Paid Out to Employees

DALLAS — December 10, 2019 — Integrity Marketing Group, LLC ("Integrity"), Integrity Marketing Group, LLC ("Integrity"), the nation's largest independent distributor of life and health insurance products, today announced the completion of a new Employee Ownership Plan. The plan provides meaningful ownership to all of Integrity's eligible employees who have at least one year of tenure, at no cost to them.

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HR&A Advisors Names Longtime Partner Eric Rothman as Chief Executive Officer

NEW YORK, Dec. 10, 2019 /PRNewswire/ -- HR&A Advisors, Inc. (HR&A), a leading, national consulting firm providing services in real estate, economic development, and public policy, announced that current firm President Eric Rothman will become Chief Executive Officer on January 1, 2020. John Alschuler, who founded the firm and has served as Chairman, will remain an active Partner and Chair of HR&A's Board of Directors. HR&A's Vice Chairman Candace Damon will remain an active Partner and lead the HR&A Board's oversight of business strategy. The announcement accompanies broader strategic management changes to strengthen the firm's client focus and its growing impact on the vitality of urban communities nation-wide and globally.

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New Belgium Brewing to be acquired by Kirin Holdings, and employees will profit

These are competitive times for breweries, but even in a year of acquisitions and mergers, New Belgium's announcement yesterday that it plans to sell to Tokyo-based Kirin Holdings was huge news. New Belgium—brewer of Fat Tire, the Voodoo series of IPAs, and award-winning Belgian-style beers—is the fourth-largest craft brewery in America, and has been a pioneer in the industry since its founding in 1991. It's also employee-owned—offering an Employee Stock Ownership Plan, or ESOP—which makes it an interesting anomaly in terms of acquired breweries. (Other ESOP breweries include Odell, Modern Times, Harpoon, and soon, Rhinegeist.)

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DIXIEPLY is now 100% employee-owned

Dixie Plywood and Lumber Company (DIXIEPLY), a leading wholesale distributor of building materials, is proud to announce it has become 100% employee-owned through an Employee Stock Ownership Plan(ESOP). The ESOP was announced to DIXIEPLY's employees on November 1st by Dan Bradley, President of the 75 year old company. The ESOP became effective October 31, 2019. Management and personnel will remain the same and the Bradley family will continue to play a role on the board of directors.

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Michigan Bills Would Encourage Employee Ownership

The Michigan Democratic Caucus announced a bill (H.B. 5202) that would provide an income tax deduction equal to 50% of the gain from the sale or transfer of a business to one or more employees or from the conversion of a business to an employee-owned business. Joseph Tate (D-2nd District) introduced the bill on November 6.

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STV Signs Definitive Agreement with The Pritzker Organization to Recapitalize STV and Position the Company for Future Growth

NEW YORK and CHICAGO, Oct. 29, 2019 /PRNewswire/ -- STV Group, Inc., ("STV") and The Pritzker Organization, L.L.C. ("TPO") announced today that the Tom Pritzker Family Business Interests ("PFBI") advised by TPO have agreed to recapitalize the ownership of STV. STV is a leading engineering, architectural, program/construction management, planning, and environmental professional services firm, with corporate headquarters in New York, NY, and Douglassville, PA. Under the terms of the agreement, TPO will purchase shares in STV owned by the company's Employee Stock Ownership Plan ("ESOP") and partner with current management to leverage STV's existing strength to drive future growth.

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MKSK landscape architecture firm to become employee-owned

The Columbus landscape architecture firm MKSK will become employee-owned under a plan announced Wednesday. The firm's 100 employees will accumulate shares that they can cash in upon retirement. The company, which has seven offices in the region, is the latest of several central Ohio firms to become employee-owned.

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100% ESOP Owned PFSbrands CEO Shawn Burcham on open-book management and the rewards of risk-taking

Shawn Burcham founded Pro Food Systems (PFSbrands) over 20 years ago because he believed that he could run a wholesale food and equipment company better than the competitor he was working for at the time. PFSbrands is parent company to Champs Chicken, Cooper's Express, and BluTaco, in addition to being 100% employee owned and completely run with open-book management. Ladders spoke with PFSbrands founder and CEO Shawn Burcham to find out more about open-book management companies, the reward of taking risks, and employee stock ownership plans (ESOP).

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