Employee Stock Ownership Plans: Key Valuation Decisions

Practical Solutions for ESOP Marketability Discounts, Loans and Other Valuation Challenges

Recording of a 110-minute CPE webinar with Q&A

Conducted on Wednesday, February 24, 2010

Recorded event now available

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Course Materials

This course will analyze scenarios that frequently arise in valuing shares held by an Employee Stock Option Plan (ESOP) and outline new approaches for optimal valuation decisions.


Valuation specialists and ESOP administrator clients wrestle with a number of thorny valuation decisions that arise under Internal Revenue Code Sect. 4975, Department of Labor regulations, and FASB guidance — all of which leave room for interpretation. The accounting implications are significant.

What is the proper marketability discount on shares held by an ESOP, compared against pricing in general markets? What are the balance sheet ramifications with dollar-for-dollar reductions in valuations when ESOPs take on loans? How will continuing market struggles impact ESOP valuations?

For these and difficult ESOP valuation issues, practical guidance and experiences from peers are critical to analyzing all alternatives and making a well informed decision.

Listen as our panel of valuation and accounting veterans addresses ongoing and complex valuation challenges involving ESOP shares and other financial statement items.



  1. Sources of relevant guidance on ESOP valuations
    1. IRC Sect. 4975
    2. U.S. Labor Department regs
    3. In some areas, FASB guidance
  2. Practical difficulties in ESOP valuation decisions
    1. Marketability discounts
    2. Loans taken out by ESOPs
    3. Valuation challenges in response to general market downturns and risk levels
    4. Other special challenges with ESOPs
  3. Key inputs into valuation decisions, and alternative approaches


The panel will arm you to make better valuation decisions in these and other relevant areas:

  • Marketability discounts: What valuation discount or discount range is too low or too high, given general market conditions and discounts taken by private companies?
  • ESOP loans: Is there a viable alternative to reducing valuations in the full amount of a loan?
  • Applicable guidance: How are Sect. 4975, Labor Department regs and FASB guidance on-point in making a sound valuation decision — and how are they lacking?


Jeff Faust
Jeff Faust

Director of Business Valuations
Greenstein Rogoff Olsen & Co.

He has more than 19 years of experience in finance and accounting, and 14 years in business valuations. He previously...  |  Read More

David Williams
David Williams

Schiff Hardin

He represents companies and their owners, trustees and lenders on ESOP, other tax-qualified retirement plan, and health...  |  Read More

Adrian Loud
Adrian Loud

Shareholder, Valuation and Litigation Support Services Department
Bennett Thrasher

He works on valuation and advisory services for a variety of engagements covering ESOPs, lost profits/economic damages...  |  Read More

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