When the owner of the company chooses to sell the business to an employee stock ownership plan (ESOP), the impending transition can provoke a reaction in some employees.

It would seem counterintuitive for employees to react with unease when they learn they’re about to become eligible for a qualified retirement plan that requires no financial contribution from them. And yet, human resources and corporate leadership can find themselves fielding questions including, “What happens to the ESOP if the company is sold?” and “Where does my ESOP go if the company closes down?”

Because business will always involve a degree of uncertainty, it’s important to make sure employees fully understand how an ESOP works, who the ESOP fiduciaries are, and how your plan rules address these possibilities.

What is the "American Dream" and does it still exist? 

For some, this may seem like a dated term from the 1930s that promises unrealistic expectations in a modern (and expensive) world. Parents and grandparents share stories of when they were young and aspired to own a home, a car, have children and live the “dream.”

This phrase has become our ethos, a guiding belief system that many of us embrace in the United States. Regardless of our name, income level, background, where we live or where we work, we all have the same level of freedom and opportunity to achieve success and prosperity. Oprah Winfrey, Larry Ellison (Oracle Co-Founder) and Elvis Presley are three names that are widely associated with this concept. 

An ESOP is a Business Transition Tool

ESOP stands for Employee Stock Ownership Plan.  An ESOP is qualified retirement plan that can be used as a business transition tool and as an employee ownership instrument. 

An employee stock ownership plan (ESOP) is a business transition tool that establishes an ESOP trust to be an ongoing perpetual owner of the company.

What is an Employee Stock Ownership Plan (ESOP)?

ESOP stands for Employee Stock Ownership Plan.  An ESOP is a qualified retirement plan that can be used as a business transition tool and as an employee ownership vehicle:

An ESOP is a Business Transition Tool

ESOP stands for Employee Stock Ownership Plan.  An ESOP is a qualified retirement plan that can be used as a business transition tool and as an employee ownership vehicle.

An employee stock ownership plan (ESOP) is a business transition tool that establishes an ESOP trust to be an ongoing perpetual owner of the company.

An employee stock ownership plan (ESOP) is an optimal employee ownership vehicle for a company to provide employees with an ownership stake in the company.    

What is an Employee Stock Ownership Plan (ESOP)?

ESOP stands for Employee Stock Ownership Plan.  An ESOP is a qualified retirement plan that can be used as a business transition tool and as an employee ownership vehicle: