THE EMPLOYEE SHARE TRUST

The concept involves the establishment of a special purpose Employee Share Trust (EST). The EST receives contributions and purchases shares in the Employer Company. Those shares are to be held for the benefit of Participating Employees. Employees are in turn issued with units in the trust, the deed and the particular terms of issue of the Share Units govern their entitlements to the share benefits.

Share Units may or may not be issued with vesting conditions, based on time and/or performance measures. These terms of issue should be consistent with the Employer’s particular remuneration strategies, underpinning the offer of participation in the EST.

EMPLOYER TYPE

  • Private Companies.
  • Public Companies.

STRATEGY

  • Retention Strategy.
  • Effective Share acquisition.
  • Deferred Bonus.
  • Succession Planning.

ADVANTAGES

  • Allows controlled access to share benefits to meet incentive/remuneration criteria.
  • Funding is made by the Employer as contributions or loans expensed in its accounts.
  • Allows shares to be bundled and warehoused in the EST.
  • Distributes franked dividend income (if any).
  • Controls Employee downside risk exposure.
  • Provides owner/shareholder full control over who participates, for how much and for how long.
  • Fully outsourced administration.


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