Regulatory Alerts2022-01-13
Rule 10b5-1 and Insider Trading
The Securities and Exchange Commission proposes amendments to Rule 10b5-1 that strengthen the affirmative defense against insider trading by imposing mandatory cooling-off periods of 120 days for officers and directors, and 30 days for issuers. The rule also mandates personal certifications that insiders lack material nonpublic information at plan adoption, restricts overlapping trading arrangements, and requires quarterly Inline XBRL disclosures regarding the adoption, termination, and modification of these plans. Additionally, the Commission amends Forms 4 and 5 to require corporate insiders to identify Rule 10b5-1(c)(1) transactions, disclose all securities gifts, and clarify the timing of equity awards relative to material nonpublic information releases.