In the cannabis industry’s evolving legal and financial landscape, company owners may need innovative liquidity solutions to achieve their business continuity or succession goals. Stevens & Lee and its affiliated ESOP advisory firm SES ESOP Strategies are uniquely positioned to offer cannabis businesses liquidity opportunities, tax efficiencies, competitive employee benefits and other long-term advantages through an employee stock ownership plan (ESOP).
By pursuing an ESOP, equity owners of cannabis businesses, from cultivators and manufacturers to distributors and retailers, can generate liquidity by selling their company shares to their employees through an ESOP transaction. Once implemented, an ESOP also allows the new employee owners to retain the businesses’ cash flow by shielding the company from cannabis-related tax burdens that prevent business expense deductions to be claimed. Additionally, company contributions to the ESOP may qualify for tax benefits that further improve the company’s bottom line.
We also help cannabis clients maximize the many employee benefits that derive from a company’s ESOP culture and values. In addition to increasing workforce motivation, productivity and retention through company ownership, an ESOP can be positioned as an attractive advantage for cannabis businesses that operate in highly competitive labor markets with skilled employees.
