Michigan Amended and Restated Employee Stock Purchase Plan

• Category: Corporations - Public - Employees
• State: Multi-State
• Control #: US-CC-19-179
• Format: Word; Rich Text

Description

19-179 19-179 . . . Employee Stock Purchase Plan under which each employee of corporation and its wholly-owned direct or indirect, domestic and foreign subsidiaries that have authorized participation in Plan (Participating Company) can contribute up to 15% of earnings through payroll deductions and Participating Company contributes a cash amount equal to 5% of participant's payroll deductions for first year of participation, additional 7% for second year, additional 10% for third year, additional 13% for fourth year and additional 15% for fifth year. Custodian of plan purchases shares of common stock on open market or from corporation at current market prices, using payroll deductions and applicable matching Company contributions

Michigan Amended and Restated Employee Stock Purchase Plan (ESPN) is a comprehensive program designed to provide eligible employees with the opportunity to purchase company shares at a discounted price. This plan is established and governed in accordance with Michigan state laws and regulations. The primary objective of the Michigan Amended and Restated Employee Stock Purchase Plan is to motivate and retain employees by offering them a convenient and financially beneficial way to become shareholders of the company they work for. By participating in this plan, employees are able to share in the company's success and potentially benefit from any future increase in stock value. Under this plan, eligible employees can contribute a certain percentage of their eligible compensation towards the purchase of company stock. These contributions are made through payroll deductions, which can be adjusted or halted during specific enrollment periods. The deducted funds are then used to purchase shares of company stock at a predetermined discounted price. It is important to note that the Michigan Amended and Restated Employee Stock Purchase Plan may comprise different types or variations, depending on the specific terms and conditions outlined within the plan documents. Some potential variations of this plan include: 1. Standard ESPN: This is the traditional form of the plan, offering eligible employees the ability to purchase company stock at a specified discount. The discount is usually calculated based on the lowest of the stock's fair market value at the beginning or end of the offering period. 2. Look back ESPN: In this type of plan, the purchase price is set at a percentage, typically 85%, of the lowest of the stock's fair market value at the beginning or end of the offering period. This allows employees to benefit from any decline in stock price during the offering period. 3. Qualified ESPN: This is a type of plan that meets specific requirements outlined by the Internal Revenue Code (IRC) Section 423. Qualified ESPN offer certain tax advantages to employees, such as favorable tax treatment on the purchase and sale of shares. 4. Non-Qualified ESPN: Unlike the qualified ESPN, non-qualified ESPN are not subject to the specific requirements of the IRC Section 423. They offer more flexibility in terms of design and eligibility requirements, but do not provide the same tax benefits. Employees participating in the Michigan Amended and Restated Employee Stock Purchase Plan should carefully review the plan documents, including the enrollment periods, contribution limits, purchase dates, and any specific rules or restrictions that apply. It is advisable for employees to consult with a qualified financial advisor or tax professional to fully understand the potential benefits and implications of participating in this plan.