Thanks for the reply!
You assumed correctly that they don't like the ESOP (second generation wants majority control of the company) owning 40% of the company. They would like to buy those shares but will have to pay a high premium for those shares unless done thru the repurchase obligation, correct? Considering the termination, that would require 100% vesting and I presume all the unallocated shares would have to be distributed, correct? That's why we considered looking at a merge so we could consolidate 2 plans into one and continue to distribute unallocated shares to the K plan. Is this a violation of anything? We haven't consulted with counsel yet about either of the 2 options and now the KSOP option. This is exploratory at this stage and with the complexity of an ESOP we want to be careful not to violate the rules for the EEs. Pros and cons of both options along with your suggestion to consider a KSOP. If we "reverse" merge the 401k into a converted ESOP to KSOP, what advantages appear? Very curious regarding simplicity as this is always preferred.
