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Houston, TX, United States, 2011/01/18 - With the sale of MRC to an Employee Stock Ownership Plan, the company is poised for an even more successful future.
Doreen James Wise, founder and CEO of Medical Research Consultants, announced today she has sold 100% of company stock to an Employee Stock Ownership Plan (ESOP). Now 300 employees strong, the company is considered a perfect candidate to make the ESOP initiative a success for its clients and its employees. MRC’s long time company accountant best sums it up when he says, “MRC is a poster child example of the perfect culture for an ESOP. The employees are well educated, highly motivated, loyal to clients and each other, and understand how business operates. Several employees through the years have asked how to become owners”.
The sale of the ownership of MRC to an ESOP not only provides a tremendous opportunity to the employees of MRC to share in the future growth of the company, but has transferred the ownership from one woman to many, with 85% of the 2010 participants in the ESOP being women.
As required by IRC 409(p), the third party administrative firm has run compliance testing, which prospectively allocates the shares to the current employees and establishes “deemed-owned shares.” As of 12/31/2010, the test indicated that approximately 87% of the “deemed-owned shares” of MRC stock held by the ESOP will be deemed to be allocated to women.
MRC is a customer-focused and innovation-driven enterprise with a high percentage of long tenured employees. “We value keeping and developing our employees who have longstanding relationships with our clients” Dr. Wise notes. “We want to do all in our power to continue that trend and an ESOP seemed just the right approach to build strength for the future of the company and our clients.”
The ESOP concept was developed in the 1950s by the lawyer and economist Louis Kelso, and became part of the 1974 ERISA federal legislation. ESOPs create trusts to hold the company stock in behalf of employees. As employees retire, their stock is reacquired by the company for cash, affording additional retirement benefits linked to company performance. Legislated tax benefits allow ESOP companies a greater competitive advantage in their markets and offer the opportunity to support clients accordingly.
Research confirms that ESOP companies outperform non-ESOP companies, with higher revenues and lower employee turnover. Fewer ESOPs close their doors than other companies and employee commitment is strong. Currently 11,500 American companies are ESOPs but as baby boomer small business owners debate how to transition into retirement while offering their employees and clients a stable future, the number is expected to grow dramatically in the next ten years. MRC has committed to lead that progression.
Medical Research Consultants is the Houston-based industry leader in medical litigation support and pharmaceutical safety surveillance. Founded in 1983 by Dr. Wise, MRC (mrchouston.com) has served major industry clients, law firms and safety divisions since 1983. Investing heavily through the years in technology and product innovation, MRC counts DuPont, Pfizer and other Fortune 100 companies among its closely held customers.