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At work, we had a division meeting with our vice chairman today. Basically, the company is in good shape. During the question and answer session, one individual asked, “If the company makes its goal of 12% ROE (return on equity) this year, what’s in it for us?”
The vice chairman stumbled for a moment, but then described a new stock purchase plan that will be going in effect during the first quarter of 2006. At that point, employees will be able to buy company stock, up to $25,000 worth each year, at a 15% discount off the lowest stock price in the thirty days leading up to the purchase.
It doesn’t sound like a bad deal. My only concerns are the fact that the company’s stock has been doing rather well lately. Perhaps it is overpriced and will head down. Secondly, I don’t want to be overweighted on company stock in which half of our 401(k) company match (so 2% of our salary) is required to stay invested.
It will be interesting to get the details of the new stock purchase plan. I’d like to see how long we are required to hold on to the stock before selling. The 15% discount sounds like a good bargain.
Is this a common benefit?
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