Technical Associates was founded in 1980 by two visionary engineers who recognized then that a market was rapidly growing for companies who could supply superior engineering and technical services to large industrial customers who were themselves facing shrinking in-house technical talent pools but ever increasing capital investments by their organizations. The demand for outside resources from large manufacturers as their capital project needs continued to grow became increasingly evident to our founders. TA capitalized quickly on this demand and steadily prospered under its original ownership for 26 years.
As the company grew and as the years passed, TA’s ownership recognized what all owners recognize in due time. That a succession plan to carry the company forward into the future had to be put in place to secure the company, its clients, and most of all, its employees. As our owners prepared for this eventual transition, several options were considered including the sale of the company entirely. The major concern regarding an outright sale was a deterioration of the culture of excellence that had been well sustained for such a long period of time.
With a strong management team in place and the company on solid financial footing, the owners decided to explore the option of an employee purchase. Those initial discussions led to the formation of our ESOP (Employee Stock Ownership Plan) in 2006. Since that time, our employees have been earning shares of stock in our organization as part of a tax-qualified retirement program. This kind of program is particularly powerful as it truly instills an owner’s interest in every employee who owns a share of stock. We are proud of this model and have seen its positive effects in the daily work of our associates and we all feel a sense of pride that the company we work for is indeed, our company.
What is Employee Ownership?
An employee stock ownership plan (ESOP) is a tax-qualified benefit plan that establishes the employees of a company as the beneficial owners of stock in that company.
Through our ESOP, our associates receive shares of stock automatically at no cost to them whatsoever. At year end, stock is released to our employees based on their compensation and the value of that stock is determined by an independent valuation firm that specializes in performing such valuations.
The company is annually valued and that value is divided by the amount of company shares. Each year every associate receives a statement that clearly states the amount of shares in their account, any cash value in the account, and the value of the shares in the account.
As an employee continues their employment with TA, their ESOP account grows with annual contributions, stock appreciation, and possible dividend payments. Our employee owners vest after 3 years of service. When an employee owner retires or leaves the company, their stock is repurchased by the company and they receive the proceeds from the sale of their stock through annual payments to be no more than 5 years.
This program could be a very powerful addition to one’s retirement and we maintain a great appreciation for the vision of our original ownership that the future of the company they founded would be better served by the employees and leaders who had worked so hard to build it.