Employee Stock Ownership Plan (ESOP) — a type of defined contribution benefit plan in which most or all of the assets
are invested in the employer's stock. Contrary to how it sounds, employees
do not individually buy shares in the company through an ESOP. Rather, the
company contributes shares to the plan, and the plan buys additional stock with
loans to be repaid by the company. (The ability to leverage the plan has
significant tax benefits.) "Vested" employees receive a payout of
benefits when they leave the company.