Webinar to Educate Business Advisors
on the Benefits of Employee Ownership
The VEOC will be holding a webinar specially designed for attorneys, CPAs, trust officers, and other professional advisors on October 21st at noon. "ESOPs & Succession Planning: A Technical Introduction to Employee Ownership for Business Advisors" offers an efficient way to learn the basics of employee ownership.
At this webinar, attendees will:
- Learn about the two most common forms of employee ownership — ESOPs (Employee Stock Ownership Plans) and worker cooperatives — and how to decide which is best-suited for a particular situation;
- Become versed in the financing techniques suitable for selling a business to employees;
- Gain an understanding about the latest legal issues related to employee ownership;
- Learn about the tax advantages of selling to employees;
- Discover a means of preserving local ownership — and retaining clients;
- Find out what characterizes a good candidate for employee ownership.
There is no cost to participate, but you must register in advance. Click the button below to register.
Loans Available for Employee-Owned Companies
Has your business been affected by the tightening credit market? Are you struggling to find sources of capital to fund your operations? If so, perhaps we can help.
The VEOC offers loans to businesses that are already employee-owned, businesses
that are becoming so through the purchase of stock or business assets, and start-ups that
will be substantially owned by all of the employees.
We can lend up to $50,000, and proceeds may be
used for fixed assets, working capital, financing of
worker shares in cooperatives or the funding of ESOPs. We are happy to participate on a larger loan with other lenders, in a subordinate position if necessary, which can help make a deal more attractive to conventional lenders.
Click here for more information or click here to download an application.
Employee Ownership in the News
• King Arthur Flour Named One of Wall Street Journal’s Top Small Workplaces for 2008. Employee-owned company King Arthur Flour of Norwich, Vt., has been named as one of the 15 Top Small Workplaces in North America by the Wall Street Journal and Winning Workplaces. The Top Small Workplaces list showcases exceptional employers that have built workplace environments that foster teamwork, flexibility, and professional growth while providing an atmosphere and benefits that encourage employee loyalty. Click here for more information.
• Don Mayer, owner of Small Dog Electronics, describes why he plans to sell his company to employees. The October issue of Vermont Business Magazine features a cover story about the history of Small Dog Electronics and why founder Don Mayer believes employee ownership is the right model for his company:
"I want to make this an employee-owned company," Mayer said. "I believe the company stays stronger that way." There are other alternatives, but Mayer does not find them attractive. "We can go public to raise capital," he said. "I can sell my stock and have a big pile of money to retire on. Or I sell the company to somebody. Or give it to my son. The first two have inherent difficulties. If we go public, like Ben & Jerry's, we lose control over the future of the company. Does it make sense for our main distribution center to be in Vermont? Maybe not. So our headquarters and our jobs may move out of the state. I don't want that to happen. I'm committed to the state. Same thing with selling it to someone else. The third alternative, the employee stock ownership plan, makes sense. We use our profits to finance purchase of the company from the owners on the behalf of the employees. There's an incentive to stay in the state. The owners get paid by the success of the company. And we have, on a federal basis, a nontaxable entity." Click here to read the full story on Vermont Business Magazine website.
• Survey Reveals Positive Results for ESOP Companies. Results from the Employee Ownership Foundation’s 17th Annual ESOP Economic Performance Survey prove the decision to become employee-owned means enhanced company performance and greater wealth creation for employee owners. In 2008, 92.4% of survey respondents reported that creating employee ownership through an ESOP (employee stock ownership plan) was “a good business decision that has helped the company.” In the 17 years this survey has been conducted, this is the highest figure ever reported with the average over the last nine years at approximately 88%. In addition, 70.5% indicated the ESOP positively affected the overall productivity of the employees; another record number reported in this category where the average has been 63%. In terms of profitability, 66% of companies responding reported that profitability increased over the prior year and 71% stated that revenue increased. Click here for more information about the study.
• October is Employee Ownership Month. This October, the VEOC along with The ESOP Association and the entire employee ownership community, will be celebrating Employee Ownership Month. Employee Ownership Month is an opportunity for ESOP (employee stock ownership plan) companies across the U.S. to educate employee owners and the public about the tremendous benefits of ESOPs. For more information, visit www.veoc.org.