Building ESOPs. Securing Legacies.

What if you could capitalize on the wealth you’ve created, ensure the future of your family and employees, and maintain a meaningful role in the business you’ve worked hard to build? It’s possible with an ESOP.

The ESOP Specialists

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Since 2000, CSG Partners has helped middle-market companies realize the unique benefits of employee stock ownership plans (ESOPs).  Private business owners and shareholders of family businesses who seek liquidity, diversification, and tax relief turn to our nationally-recognized team of advisors.  We’ve guided hundreds of clients through the ESOP formation process, from analysis, through capital raising, to closing.

What is an ESOP?

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Employee stock ownership plans (ESOPs) enable privately-held companies to sell shares to an employee trust.  Owners receive fair market value for their equity and can gain significant tax benefits for themselves and their companies.  Employees gain a valued retirement benefit (company stock).  This is not a stock option plan.  Instead, it’s an ERISA-authorized, defined contribution plan that invests in employer securities.

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Who’s the buyer?

A trust representing at least 10 employees.

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Who sets the price?

The price is negotiated with an institutional trustee, based on an independent valuation.

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How is it funded?

Commercial and/or seller financing, paid-off with pre-tax corporate cashflow.

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Who gets shares?

Full-time employees are allocated shares proportional to their annual compensation.

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How is stock earned?

A portion of all shares is allocated annually; the shares vest within 3-6 years.

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How do employees cash out?

Vested stock is sold back to the company, at a current valuation, when employees depart or retire.

Who can Benefit from an ESOP?

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Owners

  • Paid fair market value for their business
  • Can defer capital gains taxes on proceeds
  • Maintain upside potential & a role in the company

Companies

  • Receive tax deductions on sale amount
  • Can become income tax-free entities
  • Get a tool to retain & attract talent

Employees

  • Secure a unique retirement benefit
  • Earn a real stake in their companies
  • Gain workplace stability & peace of mind 

Could an ESOP be Right for you?

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If you’ve thought about selling your business, or if you've considered other opportunities to take money off the table and still secure your legacy, a leveraged ESOP may be an attractive option.  Answer a few simple questions to see if it’s worth exploring an ESOP plan for your business.

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CSG does not offer and does not purport to offer tax, investment, regulatory, accounting or legal advice, and this information should not and cannot be relied upon as such. Securities, mezzanine debt and equity are offered by Synergy Capital I LLC, a wholly owned subsidiary of CSG Partners. Synergy Capital I LLC is a member of FINRA and SIPC.

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