As Chesapeake Energy Corp.’s stock price has tumbled 65 percent over the past nine months, Chesapeake employees are among those most affected, Reuters reported Wednesday.
About 49 percent of Chesapeake’s Saving & Incentive Stock Bonus Plan is in company stock, according to regulatory filings. The plan is the only 401(k) available to most employees.
About 4,000 Chesapeake employees are restricted from selling shares the company uses to match employee contributions to the plan, according to Reuters.
Most companies stopped using company stock as a 401(k) match after Enron Corp.’s 2001 bankruptcy wiped out thousands of employee retirement savings funds. Most investment fund advisors recommend that company stock represent no more than 10 percent of 401(k) balances.
Chesapeake has more than 13,000 employees nationwide. The 4,000 who cannot sell shares in the stock are newer employees and represent only 5 percent of the plan assets, Chesapeake said