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Is the ESOP administrative committee the same as the plan fiduciary or the plan trustee?

Q: Does our board have a fiduciary duty to focus only on shareholder value?

Q: We have heard that C corporations must put at least 30% of shares in the ESOP trust to receive tax advantages. Does the same 30% minimum apply for an S corporation even though the tax advantages are different?

Our company is a 100% S ESOP. We have contributed more than the Section 415 limit for our ESOP and 401(k). Are we exempt from excise taxes because we are a 100% S ESOP?

Q: Does Canada have anything like the US ESOP?

Q: We are a 100% S-Corp ESOP and want to provide certain employees with synthetic equity but are having difficulty deciding between phantom stock and stock appreciation rights (SARs). It seems SARs are more common. How do we decide?

Q: Our company is considering two-part financing for an ESOP transaction. It would consist of a bank loan and a seller note. What’s unusual about what we are considering concerns the seller note. We are thinking of repaying the seller note with a life annuity (specifically, the company or the ESOP trust pays the seller a fixed dollar amount per month until the seller dies, at which point payments stop and the note is satisfied). Have you seen examples of this approach? Do you see any problems or concerns with it?

Q: We have just acquired another company. Can we provide their employees with prior service credit toward vesting? Are we required to do that?

Q: Our company was sold two years ago to our ESOP, and the owner deferred taxes on his capital gains by reinvesting in qualified replacement property (a “Section 1042” sale) on the sale. Now we have been approached by a buyer who would pay cash and give us more than two times the current fair market value. I have heard, though, that in a 1042 transaction if the stock held by the ESOP drops below 30% of the total shares within three years of the sale to the ESOP, the company must pay a 10% excise tax on the sale. Does this apply even if the company is sold?

Q. Non-ESOP owners in our S corporation ESOP are considering having the company redeem the shares rather than sell to the ESOP directly. What are the pros and cons of this? Q. Are there ways to transfer Section 1042 qualified replacement property (QRP) without triggering a tax? Q. Can ESOP contributions be used to meet the 401(k) safe harbor test? and more.