What Does Employee Stock Ownership Plan Mean?

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What does Employee Stock Ownership Plan mean? Read on to discover the definition & meaning of the term Employee Stock Ownership Plan - to help you better understand the language used in insurance policies.

Employee Stock Ownership Plan

Employee Stock Ownership Plan

An employee stock ownership plan (ESOP) allows employees to acquire the stock of the company employing them. The company allocates the stocks among the employees according to a criteria (such as seniority or salary). Once employees resign or retire, employees sell their stocks to the company at fair market value.

We hope the you have a better understanding of the meaning of Employee Stock Ownership Plan.

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