That's true even if you sell the shares the day after the distribution from your plan, since the rule requiring you to hold the stockmore than one year to qualify for long-term capital gain rates does not apply to NUA stock withdrawn as part of an LSD.
Investors are more likely to hold onto a stock when they know that a stable or rising dividend is going to be paid every few months and they see either the cash flow or additional shares of the security (if they dividend reinvest) in their accounts.
We carefully analyze the company and if our analysis indicates that the stock price has more than fully discounted the problem, we hold our nose and may purchase the stock.
Google (GOOG) announced last night that it would create a triple class structure, to ensure the founders and Eric Schmidt hold on to full control of the company forever even as they use morestock for employee compensation.