5. Employer Contributions & Valuation

You’re eligible for the Employee Stock Ownership Plan (ESOP) and your account is growing year after year. But how do you gain more shares of stock and how do those shares increase (or decrease) in value? This week, we will learn more about how Tanimura & Antle makes an annual contribution to our ESOP and how our share value is calculated during an annual valuation.

How do I gain stocks of the company? 

Each year the Company makes a contribution to the ESOP in appreciation of our hard-working employees.  The contribution is allocated and shared based on your efforts and time worked during that year.  The more time you work in a year, the more stock you are allocated. 

Marissa, from our previous examples, lives in Madera and is a seasonal employee that worked 1,350 hours during the 2020 Salinas season.  In 2021, she received her 2020 Annual Statement which showed she received 171 shares of the company stock. 

How could Marissa have received a larger number of stocks? 

Tanimura & Antle is a year-round shipper of fresh produce by utilizing a rotation of seasons. Each fall, we have up to 5 weeks after the Salinas season for additional work in the San Joaquin Valley of California. Transportation is available from some locations to assist our employees with working this additional season. Some employees also choose to work the Yuma, Arizona, season and/or again in the spring in the San Joaquin Valley for up to five weeks before returning for the Salinas season. For those willing to travel, there is plenty of opportunity. Opportunities to work and earn more hours towards our ESOP include (this varies by commodity):

• Yuma, AZ – November 20th through March 27th
• San Joaquin Valley, CA (Huron) – March 27th through April 24th
• Salinas, CA – April 24th through October 30th
• San Joaquin Valley, CA (Huron) – October 30th through November 20th
• Oxnard, CA – November 6th through June 16th of the next year

If Marissa worked both the San Joaquin Valley (Huron) spring and fall seasons, she could have earned up to another 450 hours to her plan year, which would approximately provide her with a 25% increase to her ESOP stock received for that year.  Domestic Yuma employees who may worry about meeting the 1,000-hour requirement for the year can also utilize working in our other seasons to ensure they qualify and make the most of each year.

What is a valuation?

A valuation is the process which determines how much our company stock is worth. Each year, the company hires an independent appraiser to research our business, industry and financial position to determine our stock value.  There are many factors that can affect the value of our stock, just like the value of stocks traded on the stock market such as Apple, IBM or Netflix.  Market pricing, growth, new product offerings and innovating on how we operate all contribute to the value of our company.  The stock value goes up when the company does well and down when the company does not.  The valuation amount is then divided by the number of shares owned to determine the value of the stock. 

How can I help the stock value increase?

The stock value is dependent on the success of the company, and the success of the company is dependent on our hard work, innovation and years of service.  The longer you work for the company the greater the amount you earn.  Likewise, the longer you work for the company, the more knowledgeable and skilled you become at your job, which helps the company succeed.  We both benefit in the success together as partners. 

How do I know how the number of shares of stocks I have and the value? 

Employees participating in the ESOP will receive an ESOP statement once a year after the annual contribution and valuation is complete—typically midway through the following year. You can also log onto Principal.com at any time to see your current account value; however, keep in mind that your account will only change once a year after the contribution and valuation is completed.  

Coming Up Next Week

Next week, we will be reviewing our annual statement. To prepare for next week, have your annual statement handy. If you’ve misplaced it, you can log into Principal.com to view your current account data.