According to Associated Press stories on July 19 and July 23, new issues have arisen over the use of Employee Stock Option Appreciation Rights Securities (ESOARS) as a means to value employee stock options for company accounting purposes.
The proposed buyout of the Tribune Company by an ESOP and Sam Zell could possibly be derailed if certain credit covenants are not met. A stipulation in the credit agreement requires that the ratio of indebtedness to the trailing four quarters of EBITDA cannot exceed 9 to 1.
According to a Fiduciary Counselors compilation of lawsuits involving employer stock, the 53 cases filed between since the late 1990s have resulted in approximately $1.47 billion in judgments and settlements.
Austrian Finance Minister Wilhelm Molterer wants the percentage of total shares of Austrian companies held by employees to increase from 3% to 6%. He argued that in a globalized economy, wages alone would not suffice; workers need an ownership stake as well.
According to a 2007 Towers Perrin analysis of 89 Fortune 250 companies, 51 now set the exercise price for stock options at not less than the grant date closing price. That is up from 29 before 2007.
Employee-Owned S Corporations of America (ESCA) has put out a short booklet with several first-person stories from employee owners in S ESOP corporations. Copies are available from ESCA by calling 202-466-8700.
The June 2007 issue of the Federal Reserve Bank of Minneapolis's The Region contains an article by Ronald Wirtz titled Employee Ownership: Economic Miracle or ESOPs Fable? Wirtz writes that "research to date s
Many NCEO member companies would be strong candidates for the Great Place to Work Institute's annual "50 Best Small and Medium Companies to Work For in America" list. I am on the board of the Institute, but do not have any role in the selections.
The largest 100 majority employee-owned companies in the U.S. employ approximately 594,144 people, up from 579,000 last year and 506,000 in 2005. Publix Supermarkets again topped the list with 143,000 employees.
Marriott International, Inc. reached a settlement in an investigation of its ESOP by the IRS and Department of Labor. The government alleged that Marriott's leveraged ESOP resulted in unwarranted tax deductions.
An ongoing mantra of the NCEO is that employee involvement does not happen because a company allows it (think of all the "open doors" of management yet to be darkened by an employee with an idea) but because it structures it.
