ESOP Services, Inc. (“ESI”) specializes in all aspects of Employee Stock Ownership Plans for both private and public companies throughout the U.S. and internationally. With clients in a broad diversity of industries, ESI emphasizes the financial aspects of ESOPs, while coordinating the many diverse elements necessary to establish a successful ESOP. The firm is experienced in the preliminary analysis, plan and financial transaction design, implementation, financing, and operation of ESOPs. Services are also provided through affiliated offices by leading ESOP practitioners. This synergistic approach allows clients to obtain experienced professional assistance on a cost-effective basis.

  • Preliminary Assessment
  • Phase I ~ The Decision Package
  • Phase II ~ Turnkey Implementation

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ESOP Services recently lent me a financial model to use in my MBA class at Oxford University.
They spent a lot of time customizing it for me. In the end the class I used it in was one of the most successful I have ever taught. The model was a huge part of the giant success we had with the class and the simulation. I am incredibly grateful that ESOP Services was willing to share the model with me.

I can say categorically that the class would not have been
nearly as good if they had not done what they did.

John Hoffmire
Said Business School, University of Oxford

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Preliminary Assessment

We offer a confidential preliminary assessment of cash flow and tax savings for companies interested in ESOPs.
Please visit our  Preliminary Assessment link for more information.

Phase I ~ Decision Package

Valuation Assistance

Assist in the proper selection and engagement of an experienced independent appraiser who is familiar with the company’s industry and the requirements of ESOP appraisals. The purpose of the appraisal engagement will be to provide a preliminary value of the company that will be incorporated into the ESOP feasibility study.

Financial Analysis

Prepare detailed financial projections for a ten-year period. These analyses determine the long-term effects of various ESOP transactions and contributions and will estimate the effect of ESOP operations on earnings, book value, cash flow, the value of existing shareholders’ interests, percentage changes in ownership, etc.

Repurchase Obligation Projection

The ESOP repurchase obligation will be projected for a fifteen-year period.

Design Feature Analysis

An evaluation assessing the implications of the various design features available for Employee Stock Ownership Plans will utilize those features which best serve client objectives

Feasibility Report Preparation and Presentation

The results will be presented in person in a comprehensive report that fully discusses the implications, options, and recommendations on structuring the ESOP transaction to best accomplish corporate and shareholder objectives.

Phase II ~ Turnkey Implemenation

ESOP Design and Installation

ESI will arrange for the preparation of the legal documents necessary to install an ESOP. These services include the preparation of the ESOP itself, the Trust document, Summary Plan Description, corporate resolutions, and the documents necessary to obtain a Favorable Determination Letter from the IRS. We develop and negotiate the transaction on the basis of the financial analysis to address the needs of the sellers, buyers, the corporation and its employees and use the flexibility of ESOPs to provide “win-win” situations. Transactions include the sale of a minority or majority interest, as well as the divestiture of a subsidiary or division of a parent company.

Transaction Structure and Design

ESI develops and negotiates the transaction on the basis of the financial analysis to address the needs of the sellers, buyers, the corporation and its employees and use the flexibility of ESOPs to provide “win-win” situations. Transactions include the sale of a minority or majority interest, as well as the divestiture of a subsidiary or division of a parent company.

Financing

ESI will assist you in structuring financing for any leveraged ESOP transaction and work with financial institutions that are experienced in ESOP lending.

Professional Liaison

ESI will coordinate the ESOP related activities of professional advisors, including the corporate attorney and accountant, as well as work with the company’s personnel department to fully implement the ESOP.

Employee Communications Program

A communication program will be prepared and presented to your employees that will explain the concept of Employee Stock Ownership and the particulars of your ESOP in further detail, as well as answer questions concerning the ESOP. This service will include the preparation and delivery of the Summary Plan Description and an audio-visual program in order to introduce the ESOP. ESI will also provide follow-up employee communications material and a press release for your use.

Plan Qualification

Upon adoption of the ESOP Plan and Trust an application will be filed with the IRS requesting a Favorable Determination Letter to ensure that the Plan and Trust qualify under Sections 40l(a) and 4975(e)(7) of the Internal Revenue Code, will be filed.

“1042” Investment Consulting

Access to and selection of investment specialists providing investment management consulting in conjunction with the complexities of the Section 1042 “tax-free” rollover of ESOP sale proceeds.