Loren Rodgers
The election for the NCEO’s board of directors opens on January 3 for three-year terms that begin on April 1, 2024. NCEO members in good standing will receive an email on January 3 with the subject line "Invitation to the ballot for the NCEO board elections," which will include a link to a confidential electronic ballot. Directors will be selected through this election and by appointment by the existing board. Balloting will end on January 19.
Corey Rosen
In a potentially important ruling, a district court has dismissed a case against the defendants at Inland Fresh Seafood Company because the plaintiffs did not first exhaust the administrative remedies for complaints provided by the plan. In Bolton v. Inland Fresh Seafood Employee Stock Ownership Plan, No. 1:22-cv-04602-AT (N.D. Ga. Dec. 5, 2023), the plaintiffs contended that a 2016 $92 million sale to the ESOP was overpriced. The plaintiffs alleged that the defendants (including the independent trustee) and sellers to the ESOP (all of whom were executives of the company) and the executives each were acting as fiduciaries. The suit alleged the executives had already received multiple bids for the company at lower prices. The plaintiffs alleged that management provided the appraiser with highly unrealistic projections about significant increases in revenues and profits, which they alleged were accepted to provide a higher than fair value. The plaintiffs said the defendants sought multiple valuations for the stock and accepted the highest one.
Evelyn Castro
We're thrilled to announce our highly anticipated 1.5-day seminar Is an ESOP Right for You? in Dallas, TX, from February 5-6, 2024. This event will provide entrepreneurs, business owners, and HR professionals with comprehensive insights into ESOP transaction structures, plan design, financing, and more in response to the expanding ESOP landscape.
Corey Rosen
Kerry Siggins, the CEO of Durango, Colorado-based StoneAge, was named CEO of the year by Colorado Biz. Siggins was the co-keynote speaker at our Kansas City annual conference this year. StoneAge is a 100% ESOP-owned water-blasting tool manufacturer in Durango, Colorado. Siggins became the CEO three years after being hired as director of operations when she was just 28 years old. She has led the company through significant growth, including two recent acquisitions. The company now has 200 employees. Siggins is the author of the recently published The Ownership Mindset: A Handbook for Transforming Your Life and Leadership, which covers her journey from substance abuse to recovery to getting an engineering degree and becoming a CEO. She also serves on Colorado Governor Jared Polis’s Employee Ownership Commission.
Loren Rodgers
When it comes to replacing the chief executive, every company knows it needs to make a plan, even if it doesn't have one yet. But what about succession planning for other key leaders and roles? More than one cohort of the NCEO’s CEO network dug into this topic last month. Rather than try to cover succession planning comprehensively, this blog post shares some of the thought-provoking ideas from those discussions.
Timothy Garbinsky
Retailer and department chain the John Lewis Partnership is mulling a reduction of its employee ownership percentage. The company, currently 100% employee-owned via a perpetual trust (the UK's version of an employee ownership trust, or EOT), is considering the reduction to raise between 1 and 2 million pounds of investment capital. The plan, as it stands, would sell a minority stake, allowing the company to retain its status as the UK's largest majority employee-owned company.
Corey Rosen
The Department of Labor (DOL) announced that it now expects to release its proposed regulations on ESOP valuation in March 2024. The DOL previously stated that it expected to issue the proposed regulations by the end of 2023. The WORK Act, part of the SECURE 2.0 Act of 2022, requires the DOL to issue valuation regulations for ESOPs. The announcement does not specify a date in March, and it is not binding -- the proposed rules could be released before or after March.
Timothy Garbinsky
It’s that time of year again! This December, you can support employee-owned businesses while crossing items off your wish list by shopping with our NCEO Gift Guide. Every year, we refresh this guide to bring you the latest in consumer goods and products created and/or sold by employee-owned businesses.
Corey Rosen
In its 2023 Fall Economic Statement released on November 21, the Canadian government (the ruling party in Parliament) “introduce[d] a series of new measures to advance the government's economic plan by continuing to build a stronger economy, and provide[d] important updates on key pillars of the government's plan to fight climate change and create great careers for Canadians from coast to coast to coast.” The new measures include a tax exclusion on up to the first $10 million in capital gains from the sale of a business to a qualifying employee ownership trust (EOT) (p. 62 of the PDF version of the Fall Economic Statement). A similar law in the UK has spurred rapid development of EOTs, which are growing at a rate three times that of ESOPs in the U.S., even though the UK is much smaller.
