401k and Employer stock

[Guest halka]

Following on 8/16 exchange on this topic. Individual account plan has unitized employer stock investment option. Stock is publicly traded but float is very thin. Promptly implementing Plan purchases/sales in public market would create price volatility. Employer typically makes treasury stock available for purchase at price "not less favorable than price paid by a independent person." But employer will not now meet all Plan needs. Any experiences or suggestions on how plan trustee should proceed? Also concerned w/ securities issue of employer's actions indirectly manipulating stock price.

[MoJo]

Always a fun issue. A well crafted plan with an administrative policy regarding stock fund transactions should allow the trustee to suspend trading in the fund when liquidity (both fund, and market) conditions dictate. The employer really needs to take ownership of this - they want their stock in the plan - should should direct how to conduct transactions in it.