Guest Agnes Posted May 15, 2013 Share Posted May 15, 2013 Is a terminated ESOP required to extend diversification rights to terminated employees? Terminated ESOP provided diversification through plan sponsor's 401(k) plan which is also terminated. Link to comment Share on other sites More sharing options...
QDROphile Posted May 15, 2013 Share Posted May 15, 2013 Are you concerned that a particpant is entitled to exercise diversification rights at an earlier date than the expected distribution on termination? Or do you mean that the ESOP has been frozen? Freezing the ESOP will not excuse the plan from providing diversification. Link to comment Share on other sites More sharing options...
Guest Agnes Posted May 15, 2013 Share Posted May 15, 2013 Yes - A Form 5310 has been filed and the plan sponsor planned to make all distributions (except RMDs) once a letter is received. It appears that the sponsor will have to allow the terminated qualified participants (all qualified participants even if they were employed by the acquiror) the ability to diversify out of the terminated ESOP by distributing the shares (since the 401(k) plan was also terminated) Sound right? Link to comment Share on other sites More sharing options...
QDROphile Posted May 15, 2013 Share Posted May 15, 2013 Plan terms may have to be amended to describe the new approach to diversification. Link to comment Share on other sites More sharing options...
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