History of ESOPs
Who is was the inventor of ESOPs?
Louis Kelso
How many ESOPs are there nationwide?
6,243
Which trusted advisor approves the share value each year?
Plan Trustee
What determines the number of shares an eligible participant will receive?
Eligible Compensation
When does a newly eligible participant enter the ESOP?
January 1st or July 1st after completion of the two (2) requirements for eligibility.
Which year was the ERISA established?
1974
How many ESOPs are 100% employee-owned?
Approximately 2,500
Which trusted advisor prepares the individual participant statements?
Third-Party Administrator
What must an employee do to earn a year of vested service?
Work 1,000 hours
What is the age and participation within the ESOP Plan requirement for normal diversification?
Age 55 with 10 years of participation in the ESOP Plan.
What was the name of the first employee-owned company?
Peninsula Newspapers in Northern California
Which region of the country has the highest percentage of ESOPs? (East, Southeast, Midwest, Southwest, or West)
Midwest
Which trusted advisors is hired by the Plan Trustee?
Independent Appraiser
What are the two requires that must be completed by all eligible employee-owners in order to receive an allocation of shares each year?
1. Be actively employed on the final day of the year (12/31). 2. Work at least 1,000 hours per plan year.
How many ESOP companies in Iowa?
Iowa - 137 ESOP Companies.
What is the maximum deductible contribution level an employer can make towards an ESOP? (percentage)
25%
Which industry has the highest percentage of ESOPs?
Manufacturing
Which trusted advisors drafts and finalizes all the legal documents?
ERISA Attorney
What are the three (3) requirements for eligibility?
1). Age 21 and, 2). Completion of One (1) Year of Service and 3). Work 1,000 hours
According to a Rutgers University study released on April 30th, what is the median ESOP balance for low to middle-class employee-owners?
$165,000
Name the senator that introduced the Employee Retirement Income Security Act (ERISA).
Russell Long
How many times greater is the retirement wealth for participants (ages 60-64) in an ESOP compared to participants at non-ESOP companies according to a study by Rutgers University?
10 times greater
Which group of individuals appoints a Plan Trustee?
The Board of Directors
What are the five triggers to a distribution?
1). Death, 2). Disability, 3). Termination, 4). Retirement, and 5). Diversification
How much less likely are ESOP companies to lay off employee-owners during the recent recession?
4 times less likely