Executives and other key insiders often face complex decisions when integrating corporate equity awards into their total financial picture. We provide specialized support to help leaders understand their equity compensation, navigate regulatory considerations and connect to broader financial planning resources when appropriate.
10b5-1 Plan Effectiveness
Reviewing plan restrictions, limiting terminations and offering executive training can help enhance the effectiveness of your 10b5-1 plan. Hear insights from Joshua Shek.
Source: Morgan Stanley
Voiceover: 10b5-1 plans are a crucial part of a company’s equity compensation strategy. But with evolving regulations and increasing complexity, how can public companies strengthen plan effectiveness? Here are some strategies to consider:
On Screen: Review Restrictions
Reviewing your policy restrictions can be a good place to start. Plan restrictions can help companies adapt to changing regulations. Common strategies include limiting plan terminations and modifications, restricting trading outside the plan, and using pre-selected brokerage firms, to help reduce risk.
On Screen: Limit Terminations
While many companies allow plan terminations, 79% of survey respondents require them to only occur during open trading windows. To navigate this, some companies are limiting the frequency of terminations and requiring pre-clearance and approvals ahead of a termination, in an effort to maintain the plans affirmative defense, and market confidence.
On Screen: Offer Training
93% of survey respondents share that 10b5-1 plan training and education can enhance plan effectiveness. This can involve providing training on a regular schedule and offering holistic financial planning for executives as a way to provide value to both companies and their employees.
To discover more ways to enhance the effectiveness of your 10b5-1 plan, connect with us with learn more!
When executives need to monetize or diversify, often within tight windows and strict requirements, experienced coordination across transactions and filings can help make the process smoother.
in 10b5-1 market share1
in Rule 144 market share1
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Morgan Stanley has been #1 in Rule 144 sales and the #1 provider of 10b5-1 services for more than 20 years.¹
We help executives approach liquidity needs with guidance and support so they can make informed decisions across planning, timing and execution.
From 10b5-1 trading plans to Rule 144 transactions and restricted or control stock sales, we provide support for executives and other key insiders navigating concentrated equity positions, company policies and regulatory considerations.
Discover why 10b5-1 plans are essential to an integrated equity compensation strategy.
As private companies move toward an IPO, executives and other key insiders may need to prepare for new expectations around equity, liquidity and insider transactions. 10b5-1 plans can be part of a broader public-company readiness toolkit, helping companies establish governance, educate leaders and create a more structured process for future trading activity.
We can help private company leaders prepare early with executive education, plan readiness support and workflows designed to carry forward after an IPO.
Nonqualified Deferred Compensation can help companies tailor an offering that reflects the needs of senior leaders and other highly compensated employees. Explore services designed to support plan design, participant engagement and the evolving needs of your executive population.
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1. Reprinted with the permission of the Washington Service. 301-913-5100, www.washingtonservice.com. The above data is compiled by the Washington Service from Form 144 filings with the Securities and Exchange Commission in the period from 2/1/2005 to 12/31/2025; ranking is based on aggregate data for this period. This data includes transactions from Morgan Stanley & Co. LLC, the Smith Barney division of Citigroup Global Markets Inc. (Through 5/31/2009), and E*TRADE Financial Corporation.
2. The above data is compiled from internal sources for the period from 2/1/2005 to 12/31/2025; it is based on aggregate data for this period and includes the smith barney division of Citigroup Global Markets Inc. (Through 5/31/2009) and E*TRADE Financial Corporation.
Information contained herein was obtained from sources believed reliable, but the accuracy and completeness thereof cannot be guaranteed. Information contained herein is subject to change.
Morgan Stanley Smith Barney LLC, its affiliates and Morgan Stanley Financial Advisors or Private Wealth Advisors do not provide tax or legal advice.
Important considerations for Rule 10b5-1 trading plans:
(1) Plans do not eliminate other applicable requirements, including those relating to company trading policies, restricted stock, stock held by affiliates, Section 16, and Section 13. Plans should be reviewed and approved by the appropriate legal or other designated personnel at the individual’s company. An individual should consult their own legal counsel for legal advice.
(2) Most companies will only allow plans to be adopted, modified and terminated during an open trading window.
(3) A mandatory cooling-off period applies after adopting or modifying a plan and before trading may begin under a new or modified plan.
(4) Early termination of a plan may weaken or eliminate the availability of the Rule 10b5-1 affirmative defense.
(5) Trading under a plan may be suspended in the event of legal, contractual or regulatory restrictions, such as lock-up agreements or, for those selling under Rule 144, the company not being current in its SEC reporting.
(6) Most public companies are required to disclose the adoption and early termination of plans by Section 16 directors and officers.
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