The PRC ESOP

For any closely held company, business succession is a concern. The traditional approach to business succession is to find the buyer with the highest offer. However, this raises various questions. How will the nature of the business change with ownership? Will customer interests continue to have the same high priority that we have given them? Will new owners be more interested in generating profits and shareholder return than in the mission we have had for nearly four decades?

Over the many years of PRC history, our products and services have touched the lives of many tens of thousands of people with disabilities, their families and friends, and the professionals and others who serve them. Our impact on these people has never been greater than it is now. Our success to this point leads to a responsibility to continue to be available with the products and services that our customers need for their own success. Therefore, we have taken a non-traditional approach to business succession.

The ESOP (employee stock ownership plan) appears to be by far the best fit for PRC, when compared to the more traditional approaches to business ownership. Through an ESOP, a portion of company profits and tax savings will be used to purchase PRC stock from current owners. The stock will be owned by a trust that is operated for the retirement benefits of PRC employees. The portion allocated to each employee is a function of compensation and years of service.

PRC employees have always been dedicated to the mission of the company. This move rewards their past and future contributions and gives them every incentive to continue the success of PRC. The ESOP program allows transfer of ownership to employees without their having to purchase it. Everyone wins.

Additional information on ESOPs can be found at the web site of The ESOP Association: www.esopassociation.org.

Principal PRC shareholder Barry Romich intends to continue his active involvement in PRC as well as in the AAC Institute (a not-for-profit charitable organization) and other organizations that share the PRC mission.

Akron Beacon Journal article

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