Well before the Enron controversy, Ikon participants had charged that their employer imprudently encouraged company stock investments in its defined contribution plan via educational materials distributed to employees. The suit, Whetman, et al. v. IKON Office Solutions, Inc., contended that the company as well as certain of its present and former officers, directors and employees breached fiduciary duties owed to participants in the Company’s 401(k) plan during the period October 1995 through August 1998.
Ikon says the settlement won’t require a monetary payment and doesn’t reflect an admission of liability.
Under the settlement, employees who have been with the Company for at least two years will be allowed to transfer company matching funds in investment options other than IKON stock, subject to vesting schedules.
Ikon’s employer match was made in company stock, and participants were barred from transferring the stock to other investment options until the employee attains the age of 55.
In announcing the settlement, Ikon Chairman and CEO James J. Forese noted “?In the past year, there has been a great deal of public discussion about high concentrations of employees’ investment of retirement assets in employers’ stock. The changes to our plan are in keeping with the growing trend to lift restrictions on investment of the employer match to allow greater diversification. The settlement allows the Company to address those legitimate concerns and, at the same time, put the expense and distraction of the litigation behind us.”