TZL 1597 (web)

August 11, 2025, Issue 1597 WWW.ZWEIGGROUP.COM

TRENDLINES

Net multiplier

3.3

3.2

3.1

The 2025 Mid-Year Compensation Update highlights key salary shifts and industry trends shaping AEC firm strategy. Inside the latest comp trends

2021 2022 2023 2024 2025

FIRM INDEX Atwell............................................................................. 8 Capital Civil Engineering.................................8 Fentress Architects..............................................2 Populous......................................................................2 SCS Engineers.........................................................4 TRIA................................................................................ 11 MORE ARTICLES n DAN SCHWARTZ: How to achieve a double-win merger Page 3 n MARK ZWEIG: Using LinkedIn for marketing purposes Page 5 n MATT VERDERAMO: The future of construction management Page 7 n CJ LAPORTA: Corporate retirement plans in M&A Page 10 According to Zweig Group’s 2025 Financial Performance Report , the median net multiplier for AEC firms rose to 3.28 in 2025, the highest level in five years. This reflects an improvement in the effective revenue generated for each dollar of direct labor, surpassing target multiplier goals in many cases. Participate in a survey and save on a Zweig Group research publication.

T he AEC industry has seen a range of salary changes in the first half of 2025, reflecting broader economic shifts and industry- specific trends. Understanding how compensation is evolving is crucial for AEC firms, whether you’re planning for mid-year raises, hiring for new positions, or simply assessing your firm’s competitive standing. The 2025 Mid-Year Compensation Update from Zweig Group offers valuable insights into these salary trends, helping firms stay informed and make more strategic decisions regarding compensation. Here’s a deeper dive into the most recent salary shifts and what they mean for your firm: ■ Overall base salaries. Base salaries across AEC firms have increased by 2.22 percent compared to the end of 2024. This rise reflects a consistent yet modest growth in wages, indicating that firms are gradually adjusting to ongoing economic challenges and inflationary pressures. For firms looking to stay competitive, this is an essential indicator of how salaries are evolving in the broader industry. ■ Regional salary differences. Regional variations in salary growth are noteworthy. The East Region saw the highest increase, with a 3.33 percent rise, signaling strong demand for talent. The West Region experienced a 2.08 percent increase, while the Central Region saw a 2.69 percent increase. This diversity highlights the varying demand for talent across regions, influenced by local economic factors. ■ Administrative and non-licensed technical professionals. These positions experienced the largest salary increases, with a combined rise of 5.35 percent. This reflects a broader trend where roles in administration and non-licensed technical fields are becoming increasingly valued. experienced a decline of 4.61 percent, a sharp contrast to the 9.2 percent increase last year. This could signal a reassessment of compensation for leadership positions or changes in firm strategies. ■ Top management salaries. Top management roles

Kyle Ahern

■ Salary increases by firm performance. Firms with stable

See KYLE AHERN, page 2

THE VOICE OF REASON FOR THE AEC INDUSTRY

TRANSACTIONS POPULOUS ACQUIRES

FENTRESS GLOBAL

base to the Populous global aviation and transportation portfolio, as well as synergies across convention center design, will enable us to transform the future of people-centric design and supercharge our global impact in those sectors.” Founded in 1980, Fentress Architects has designed more than $52 billion of architectural landmarks worldwide, including Denver International Airport, Incheon International Airport, Miami Beach Convention Center and the National Museum of the Marine Corps. The firm is known for creating architecture that is sustainable, contextual and deeply connected to the communities it serves. Curt Fentress, Founder and Principal in Charge of Design at Fentress Architects, commented: “Populous shares our values of design excellence and people-centric thinking. Together, we will continue to redefine great architecture and its capacity to ignite social and economic change through inspired design for people.” Fentress Architects will rebrand as Fentress Studios, a Populous Company, with the studios continuing to be based in Denver and Washington D.C. The acquisition further propels Populous’ capabilities in aviation, transportation and public sector design.

ARCHITECTS,

EXPANDING

AVIATION PORTFOLIO Populous, the world-renowned design firm specializing in sport and entertainment venues, announced the acquisition of Denver- based Fentress Architects, a global leader in iconic aviation projects and prominent public buildings, including convention centers, museums, and government facilities. This strategic acquisition unites two of the most respected names in architecture, combining Populous’ unparalleled expertise in designing memorable experiences with Fentress’ award-winning portfolio of aviation, civic, and cultural landmarks. The acquisition broadens the scope and scale of services that Populous can offer clients across the globe. Bruce Miller, Populous global chair and CEO, commented: “We are committed to expanding the breadth of our practice. Fentress Architects has long been known for its visionary aviation and public architecture, exceptional design quality and commitment to innovation. Uniting our aviation team with Fentress to form Fentress Studios, a Populous Company, symbolizes our dedication to design quality. Adding Fentress’ expertise and client

KYLE AHERN, from page 1

growth (unchanged annual growth) and high profits (15 percent to 19.9 percent) saw the highest salary increases. This indicates that firms performing well financially are rewarding their employees accordingly. As the economy continues to shift, staying on top of compensation trends will be vital for long-term success. Knowing where your firm stands in relation to industry standards can help you retain top talent, improve employee satisfaction, and remain competitive in a rapidly changing market. The 2025 Mid-Year Compensation Update provides the data needed to navigate these changes confidently. By accessing the full report, you can better understand how compensation is evolving and ensure your firm stays ahead. For AEC firms seeking to optimize their compensation strategies, this update is an invaluable resource. Access the 2025 Mid-Year Compensation Update today through the Zweig Insights platform and make informed, data-driven decisions for the future. Learn more here. Kyle Ahern is manager of Data and Analytics at Zweig Group. Contact him at kahern@ zweiggroup.com.

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THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

OPINION

Successful M&A communication is achieved through strategy, storytelling, and staying human in the face of complexity. How to achieve a double-win merger

O n a quiet Friday afternoon in January 2022, a “Quick Connect” meeting landed unexpectedly on my calendar for the following Monday. The meeting title was brief and unspecific, which led me to spend the weekend speculating about its purpose. When Monday morning arrived, I learned something that would shape the next six months of my professional life: our firm was entering into a merger with an equal-sized professional services firm, and I was being brought into the inner circle to help lead the communications strategy.

Dan Schwartz

But long before the merger was finalized, the real work had already begun, crafting a communication strategy that could preserve our culture, build trust, and help achieve the business goals of the merger. The stakes were high – not just for revenue or market positioning, but for the people who had built these firms into what they were. That first meeting with my supervisor set the tone for what was to come next. I wasn’t just being informed – I was being invited to help make it successful, and I was thrilled at the opportunity to contribute to such a strategic milestone in our firm’s history. But as the famous saying goes, “With great opportunity comes great responsibility.” I knew I had an obligation not only to the executives leading the merger, but also to honor our people throughout the process – a win-win for both business and our employees. WHAT’S THE DOUBLE-WIN? Mergers are known for triggering a mass of conflicting emotions –

excitement, uncertainty, hope, fear. And for good reason: according to a Harvard Business Review article cited in Forbes , nearly 70 percent of mergers fail to meet their strategic goals, often due to poor cultural integration and communication missteps. The “double win” we aimed for was ambitious:

Retain our top talent

■

Build trust with our people

■

■ Keep our culture intact through high change

■ Support executives in achieving strategic growth through the merger To pull this off, we needed a communication plan that wasn’t just about disseminating information – it had to engage hearts and minds around a strong purpose and a solid “why.”

See DAN SCHWARTZ, page 4

THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

“The merger will be complete in X-to-X months.” Integrations evolve. Communicate in milestones, not hard-stop dates. Pro tip: Using a “Now, Next, Later” approach helps reframe timelines in terms people can absorb. “We’re not changing our brand.” Whether you’re in a merger or not, brands shift in subtle ways even when names don’t. Be transparent about the possibilities. “We’ll announce X news by X date.” This sets up expectations that you may not be able to control. “Our promise to you is that when a decision is made, we’ll communicate clearly and with transparency,” is an example of a better approach. “We won’t be adopting the other firm’s practices or policies.” Mergers are a two-way street. Commit to collaboration and make best-fit decisions, rather than preemptive denials. Each of these phrases may seem reassuring in the moment, but can erode trust when proven inaccurate or oversimplified. 5. Hit the values hard. In the swirl of change, values ground people. Throughout the integration process, we continually tied back updates to our core values – stewardship, transparency, integrity, respect, and excellence. Whether it was celebrating team wins or addressing challenging transitions, every message pointed back to who we are and what we stand for. Culture isn’t preserved by accident. It must be actively reinforced at every stage of a merger. 6. Balance people and business needs. Finally, we reminded ourselves – and our leaders – that our people needed to know they were valued. Even well-run mergers fail if they neglect the human dimension. Yes, we had metrics to meet, synergies to achieve, and growth goals to pursue. But we also had people who needed to feel safe, valued, and seen. When communications strike that balance between business logic and human empathy, they drive the organization forward. THE TAKEAWAY. Six months after that Monday morning meeting, the merger became official. But for those of us in communications, the work didn’t start or end there. It was an ongoing effort to lead with clarity, consistency, and compassion. If you’re guiding your firm through a merger or acquisition, a double-win is possible. But it’s not a result of press releases or buzzwords – it’s built through strategy, storytelling, and staying human in the face of complexity. And it starts, perhaps, with a quiet meeting on a Monday morning, where someone brings you in not just to inform, but to lead. Dan Schwartz is the internal communications manager at SCS Engineers. He can be contacted at dschwartz@scsengineers. com .

DAN SCHWARTZ, from page 3

BEGIN WITH THE END IN MIND. Stephen Covey’s famous principle applies powerfully to mergers: start with the end in mind. If we knew what success looked like – people staying, culture thriving, business goals achieved – we could reverse- engineer the communications process. So that’s what we did. That meant shifting from the typical “announce and defend” model of corporate change to a more empathetic and strategic framework. As Inc . notes, successful merger communication begins by aligning people to the future vision while addressing their real-time emotional and informational needs. That’s how trust is built. Here’s how we did it – and how you can too: 1. Get the announcement right. The first official communication sets the tone for everything that follows. It must strike a balance between transparency and hope, acknowledging what is changing, emphasizing what will remain, and building excitement for a bright future. We prioritized clarity, calm, and credibility. Vague or overly optimistic announcements tend to backfire, creating more anxiety than excitement. Instead, we focused on plain language, real timelines, and visible executive presence across internal channels. 2. Create a continuous forum for Q&A. People don’t just want to be told – they want to be heard. We built recurring opportunities for employees to ask questions directly to leaders through town halls, digital forums, and internal messaging platforms. These moments didn’t just provide answers. They gave people space to process, vent, and find community. The act of asking and being answered reinforced psychological safety, a vital ingredient in retaining talent during change. 3. Develop a resource center. Information overload is a risk in every merger. We built a centralized resource hub – a living library of FAQs, key dates, integration updates, organizational charts, and cultural onboarding materials. People want to explore answers on their own time. A reliable, single searchable source of truth kept rumors at bay and gave teams autonomy in the change journey. 4. Avoid these seven trust-busting phrases. Even well- meaning leaders can say things that unintentionally damage credibility. Throughout the communications process, there were several phrases I advised against at one point or another. I call them “trust-busting” phrases: “No one will lose their job.” Unless it’s a legal guarantee, don’t say it. Be honest about the process and timelines, and set realistic expectations for your people. “We’re doing this for efficiency.” Employees hear this as “we’re eliminating roles” or “layoffs are coming.” Speak in terms of growth, innovation, and vision. “We’re not planning on doing another one of these.” Avoid this phrase altogether – future M&A is always on the table in competitive markets.

THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

FROM THE FOUNDER

I resisted getting on LinkedIn for years. I would constantly get emails from people wanting to connect with me there and thought, “What do I want with another social media platform, especially one where half the people there are looking for jobs and just want to connect with me because they think I might be able to help them with their job search?” LinkedIn is just one tool in your marketing arsenal, but it can be powerful when used consistently and strategically. Using LinkedIn for marketing purposes

Mark Zweig

But about five or six years ago, my friend and the dean of the Walton College of Business at that time, Dr. Matt Waller, told me I really needed to be on there – that I had much knowledge to share and that was the place to do it – so I reluctantly created my profile and started posting. Since then, I have learned LinkedIn can be a tremendous marketing tool IF it is used properly. Here are some things I have learned over the years about how LinkedIn should be used and how it can help people like us: 1. It’s a great place to find names of key people in organizations you want to do business with. IF you know a certain company or organization is a targeted client for your company, why not get on LinkedIn and find out who all of their top people are and try to connect with them? They aren’t always listed on their organization’s website but

most of the time you can find these people on LinkedIn. And add them to your marketing email list if they have their email addresses listed. 2. Do not reach out to these people immediately to try to sell them your services if they do connect with you. It would be much better for those people to see your postings over time and figure out that you are an intelligent person who has insight and experience that could help them. And while you may want to reach out to them at some point (and I will get into that shortly), they may actually reach out to you if your content is compelling enough. 3. The content you put out there needs to be valuable. Refrain from anything political. You don’t want to alienate anyone. Provide helpful information. “Here is a common problem and

See MARK ZWEIG, page 6

THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

7. When there is something specific you are trying to go after in one of these targeted potential client organizations, you can reach out directly to one of your connections – hopefully at a high level in that organization – to see if you can learn more, or who else there you need to be in touch with. And, if they don’t respond, you can move down to connections at the next level in their management hierarchy to see if they can help you. 8. Make connections with your competitors. See what they are doing and what they are saying. Figure out who their top people are and how they will be selling their services to the same clients you are going after. I have gone as far as making predictions about what specific competitors will tell a specific client in presentations I have given (and why that will not be good for the client) to win a project. And when that prediction is accurate, it gains immediate credibility and respect from the client. LinkedIn – like everything else one can do to help market their firms and themselves – is just one tool in your arsenal. But it’s a good tool, and has many potential benefits if used properly over an extended period of time. Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.

MARK ZWEIG, from page 5

here is how we are seeing companies solve it.” “Here is a way you can save money.” “Here are some statistics that will surprise you.” “Here is a story about a client who made a mistake that cost them dearly and what they should have done differently.” Or editorialize on something. “Here is my opinion on something everyone is doing.” “Here are my predictions for where things are heading.” Put this kind of content out there for your network to see. And don’t be afraid to challenge conventional wisdom or create some controversy. Don’t be boring and put out the same kinds of stuff all of your competitors do. 4. You can also create simple polls on LinkedIn that will give you unique information and insight, and get your audience thinking. This data can also be used in other ways including press releases. 5. If and when you do decide to contact any of these people directly after sufficient time has elapsed, I have found that asking them a question about how they do something in their organization can be a great conversation starter. And that gets the interaction started that could be the start of a relationship. 6. If you put out a newsletter or do a podcast, send invitations out to your connections to subscribe to it. I think you are limited to 250 invitations at a time but doing this can be a quick way to build up your reader or listener lists.

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THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

OPINION

Our future depends on bridging generational gaps through mentorship, field experience, and modern leadership development. The future of construction management

W e’re witnessing a massive shift in how construction is managed. Gen X and baby boomers are “the old school.” They primarily make up the VPs, senior superintendents, and owners who are retiring or selling their businesses every day.

In “the new school,” we have millennials, who are the primary generation responsible for overseeing today’s work – as project executives, PMs, superintendents, etc. Then there’s Gen Z, who is graduating from college and joining the front lines of important projects as APMs and project engineers. There are far more new schoolers on your average job site today than there are old schoolers. Thus, the new school of construction management is here, and it’s impossible to ignore. Meanwhile, Gen X and baby boomers are our last generations of truly great builders. Don’t get me wrong – there is some serious building talent in the millennial generation, but it’s so much rarer. Most millennials have spent more time in their career focused on managing the construction rather than building it themselves. And technology and unrealistic schedule expectations from owners have skewed their perception of what is possible to execute in the field.

I know it’s true because I’m a millennial who followed a very common “new school” path: civil engineering degree, two summers interning as a project engineer at a GC, seven years running and estimating work at a trade contractor, VP of preconstruction and sales at 28 years old, and master’s degree in construction management. I am very good at understanding how to use technology, communicating with customers, selling, and managing a project efficiently – which are massively important skills – but I have no real experience in the field. I only know as much as what the people before me have shown me. Running construction companies this way is exciting but also terrifying. It’s good to be more efficient and great communicators, but what happens when we lose this generation of great builders? And what happens when the field realizes their value and gets sick of listening to the office telling them what to do? And how about when high-potential people leave

Matt Verderamo, MS

See MATT VERDERAMO, page 8

THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

TRANSACTIONS ATWELL ACQUIRES

CAPITAL

by Michael McQuillen, the CCE team has decades of experience with regional and national projects. “At CCE, we have a strong reputation of professionalism, high standards of quality, and client satisfaction,” said Kane. “Atwell shares the same values and goals, so we’re looking forward to expanding our capabilities and introducing new opportunities to our clients and employees.” “CCE has an impressive portfolio of work and strong partnerships throughout

North Carolina and beyond,” said Ron Waldrop, senior vice president at Atwell. “Their engineering expertise and client- centered approach mirror Atwell’s commitment to exceptional work and building strong relationships. We’re excited to work with the CCE team to support existing and future clients in reaching their goals.” Atwell, LLC is a national consulting, engineering, and construction services firm with more than 1,700 professionals located across the country.

CIVIL

ENGINEERING,

EXPANDING

ENGINEERING AND EXPERTISE IN THE SOUTHEAST Atwell has acquired the operations of Capital Civil Engineering, an engineering firm located in Apex, North Carolina. This acquisition expands Atwell’s presence in North Carolina and the Southeast. RESOURCES With a 15-year history of engineering excellence, CCE is known for its expertise in engineering, site planning, land planning, and stormwater management. Founded by Michael Kane and co-owned

■ They are using the field as their talent pipeline and creating opportunities for them to cross into the office as PMs, project executives, etc. ■ They are training their senior leadership and middle management on the principles of servant leadership so that they are great at developing and retaining the next generation. And I’m aware that in a lot of ways I’m a hypocrite because I’m one of those people who never learned in the field (and worse, now I’m consulting on the construction industry!), but I’m telling you the tides I’m seeing in the market, and what I feel confident needs to happen for your business to be successful. HOW TO MOVE FORWARD. If you’re worried about the future of your business, I’d recommend asking yourself the following questions: ■ What are we doing to teach the next generation how to build? ■ How are we connecting the different generations in our business?

MATT VERDERAMO, from page 7

because our top leaders were more focused on being macho than helping them grow? I’m not saying this to be negative about the construction industry. I just think it’s time we face the facts. WHAT HAPPENS NEXT? My role as a consultant for some of the top subs and GCs in the country gives me a unique view into how the top contractors are attacking this challenge. I get asked a lot: “What should we do to prepare for the next generation?” My answer is simple. We’ve got to merge the old school and the new school. This means that rather than fighting between the two, we need to take the best elements of both and fuse them together:

Mentor the new school on how to build

■

■ Prioritize field learning experience for all new employees

■ Train senior and middle management on how to lead in today’s age As more Gen X and baby boomers retire, I see the value of real building knowledge increasing. The better you are able to transfer that knowledge from generation to generation, the more likely you are to build a sustainable business. I see mentoring and field experience at the center of this strategy. Plus, to keep your top new school talent, I’m convinced you need great leadership – at the top and in middle management. People are fed up with being treated poorly in return for a paycheck. They just don’t deal with it anymore. Top contractors are making investments in both of these areas. What does this mean for you right now? For our clients, this fusion approach causes a few important shifts: ■ They are finding ways to connect new employees and senior employees. ■ They are making field management – and in some cases field labor – part of the onboarding and early learning process.

■ Do we have plenty of leaders other people want to follow?

■ Are we spending enough time, money, and energy on leadership development? Depending on your answers, you should begin to understand if you are headed in the right direction, or if it may be time for a shift in strategy. STRATEGY MATTERS. This type of long-term thinking and planning is what we help our clients do every day. With clarity of where they want their business to go in the future, it becomes much easier to decide what to prioritize today. Whether you believe in new school or old school methods, I’d bet you want your business to survive for the long-term, which means you need to be thinking ahead. Matt Verderamo, MS is a consultant at Well Built Construction Consulting. Connect with him on LinkedIn .

THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

OPINION

E very year, thousands of business mergers and acquisitions occur, but only a few transactions reach headlines. Several steps go into executing a successful merger or acquisition, but one of the very last or overlooked aspects of M&A are the retirement plans of the two parties. Retirement plans play a critical role in M&A and should not be overlooked during planning or integration. Corporate retirement plans in M&A

CJ LaPorta, CFP, CRPS, AIF

Having a structurally sound and well-performing retirement plan, such as a 401(k), cash balance plan, non-qualified plan, or ESOP is valuable for your company and its employees, but it also plays a critical role when looking to merge with or acquire another company. A well-qualified advisor can assist you in building a solid retirement plan to attract and retain talent, create successful retirement illustrations for business owners and their employees, and provide knowledgeable assistance throughout the M&A process. Outside of the M&A process, attracting and retaining top talent continues to be a hard-fought battle. Offering a competitive retirement plan with great employer contributions, vesting schedules, sound investment options, etc. all work together to attain and retain talent. Attracting key executives and

keeping them with your company is an even harder battle. This is where offering a non-qualified plan comes into play. Non-qualified plans are innovative tools to help your company stand out, but also recruit, retain, reward, and retire your key employees. Now, what happens if you are going through the M&A process? An advisor who specializes in retirement plans can aid you in choosing the best option for your company during the M&A process. Pre- and post-deal, non-qualified plans require special due- diligence to ensure compliance with IRC Section 409A. To focus on 401(k) plans, there are two main options in the M&A process, merge or terminate. When two retirement plans merge, there are several items that need to be taken into consideration. First, is the transaction a stock or asset purchase? More commonly, we will see a stock purchase where the

THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

BUSINESS NEWS TRIA ANNOUNCES STRATEGIC EXPANSION INTO NEW PRACTICE AREAS TRIA, an award-winning architecture firm known for boundary- pushing design and a client-centric approach, has announce its expansion into a diverse range of new practice areas. Under the leadership of president and CEO Sherwood Butler, TRIA is now bringing its signature innovation to the multifamily, interior design, urban design/ master planning, commercial mixed- use, adaptive reuse/repositioning, workplace, retail, and hospitality sectors. With a decade of excellence in holistic design solutions for science and technology, TRIA is building on its deep expertise to transform the built environment across industries. The

firm has recently delivered standout projects in restaurants, workspaces, and repositioning efforts, solidifying its place as a dynamic force in architectural design. “This is a pivotal moment in TRIA’s journey,” said Butler. “Our foundation in science and tech, combined with our growing multidisciplinary experience, has naturally evolved into a bold, integrated practice model. We’re excited to push boundaries, foster innovation across sectors, and create spaces that inspire and transform communities. This evolution enables us to apply insights from one market to another, strengthening outcomes for clients and advancing the quality of the built environment across all sectors we serve.”

TRIA’s portfolio comprises an impressive array of projects, including the full repositioning of office spaces in Portsmouth, New Hampshire, and Cambridge, Massachusetts, an office-to-hotel newly expanded conversion in downtown Boston, a luxury 60-unit condominium and club in the Caribbean, new restaurants, and several ground-up multifamily and urban master plan developments in Massachusetts and New Hampshire. The firm’s cross-sector approach sets the stage for a new era – one where insight from each area informs and elevates the rest. This new era features a TRIA that’s as visionary as it is versatile, poised to make a lasting impact through great and thoughtful design.

post-merger company is assuming all assets, liabilities, and equity. In this scenario, the acquired company will usually merge their plan into the post-merger company’s plan, but the post-merger company will go through a thorough benefit analysis to ensure they offer equal or better benefit options. Part of the benefit analysis is collecting plan documents from the acquired company’s plan, to ensure the plan mergers are compliant with the anti-cutback rule. The anti-cutback rule helps ensure that the employees from the acquired firm do not lose any of their protected benefits from their prior company’s plan. So why would an advisor recommend that the post-merger company should merge the two plans together? Simplicity for the business owner of the post-merger company and less stress for the employees of the acquired company. A plan merger is a less drawn-out process compared to a plan termination. In addition, the employees from the acquired company will be subject to some additional stressors from learning about a new company and its operations, so why not make the transfer of their retirement assets easier with a plan merger through a simple blackout period? A proactive advisor will assist the business owners and employees throughout this process for an efficient and effective outcome. The second option we look at for retirement plans going through M&A is plan termination. There are a couple of ways a plan termination can look. The first way is quite uncommon, but this is where both the acquired company and the post- merger company terminate their current retirement plans and create an entirely new retirement plan. As you can probably imagine, there is a lot of work involved with this option, which is why it is uncommon. The second way is for the acquired company to terminate their retirement plan and join the post- merger company’s retirement plan. This is a far more common approach to plan terminations, and assistance from an advisor is highly recommended. So, what does this process look like? The acquired company needs to file a plan amendment for termination of their current

retirement plan. Participants in this plan will be notified of the plan termination and the intention to join the post-merger company’s retirement plan. In addition to the notices being sent out, final employee and employer contributions need to be deposited into the terminating plan. Upon plan termination, participants must be 100 percent vested in all accrued benefits. These steps do not make the plan termination final, as this process can take several months up to a year to complete. A plan termination is not official until all plan assets are paid out to participants and beneficiaries. What does this mean for the business owner of the acquired company? Until the plan is officially terminated, the plan will be subject to annual testing, 5500 filing, and costly annual plan audits if the plan has more than 100 eligible participants. This is where an advisor can help streamline the termination process, save time, and save money. An advisor will reach out to the participants to review their options with their retirement plan funds, which include rolling over to a current employer’s retirement plan, rolling over to an IRA or Roth IRA, or taking a withdrawal of their retirement funds. An advisor acting as a fiduciary will help participants make the most well-informed decision on what to do with their funds. Plan terminations are very common, but having the correct guidance and assistance is crucial during this process. The M&A process has many moving parts and can become hectic. Retirement plans are likely an afterthought, but overlooking the effects of M&A on your company’s retirement plan is not something to take lightly. Working with an experienced advisor, pre- and post-merger, is highly recommended so business owners can focus on what matters most: the merger. In addition, advisors provide your employees with a less stressful, informative, and beneficial process. CJ LaPorta, CFP, CRPS, AIF is a senior corporate retirement plan advisor at Stonebridge Financial Group, LLC. Connect with him on LinkedIn .

THE ZWEIG LETTER AUGUST 11, 2025, ISSUE 1597

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