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Adequate Consideration Status Update (Part II)

For purposes of valuing an ESOP, the question of what is “adequate consideration” has vexed the author and other BV practitioners. In this article, the author shares an update on the DOL’s response to earlier inquiries. Her two previous articles published in QuickRead detailed the earlier efforts to clarify what constituted “adequate consideration” for the valuation of entities held in ESOPs. On October 25, 2024, the OMB received a proposal on the topic from the DOL intended to clarify how shares in ESOPs are valued via adequate consideration.

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