ESOP benefits to stockholders include providing a ready market for some or all of the shares owned by shareholders in a closely held company. With an ESOP in place, a majority or controlling shareholder has an exit strategy when he or she is ready to retire. Likewise an ESOP is often the only market for a minority shareholder in a closely held company.
The ESOP benefit rollover permits a shareholder to sell stock to an ESOP and defer capital gains taxes. This option can also be used to obtain estate planning benefits.
With ESOPs, a majority shareholder has the option of selling all or only a portion of his or her stock to increase personal liquidity while maintaining control of the company.