Rule 10b5-1 trading plans, and those using them, are making
headlines. A Rule 10b5-1 trading plan is a written plan for buying
or selling securities meeting the requirements of Exchange Act Rule
10b5-1(c). A properly adopted and implemented Rule 10b5-1 trading
plan provides an affirmative defense against accusations of insider
trading and allows the purchases and sales of securities even when
the person using the plan is aware of material nonpublic
information.
Rule 10b5-1(c) requires, among other things, that the (i)
written trading plan be established in good faith and at a time
when the person establishing the plan is not aware of any material
nonpublic information, (ii) the written trading plan specify the
amount, price and date of the transaction(s) (or include a written
formula, algorithm, or computer program for determining the amount,
price and date), and (iii) the person establishing the plan not
exercise any subsequent influence over how, when, or whether
