10b5-1 Planning

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The Scenario

As an executive employee incented with shares of company stock, there may be restrictions and risks associated with how you can trade these shares. The 10b5-1 plan permits officers and directors of publicly traded companies to adopt a predetermined written plan for selling or purchasing specified amounts of stock. By establishing a predefined trading plan, shares can be bought/sold in accordance with the plan regardless of blackout periods. More importantly, a 10b5-1 plan mitigates the risk of insider trading.

Key Considerations

  • Are you doing everything you can to reduce your legal liability from trading in your company stock?
  • Could you be doing more to meet your retirement goals and limit the risk of having too much of your retirement resources tied up in company stock?
  • Are feeling restricted by your company’s blackout periods and looking for more options?

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How we help

The first part of our initial engagement is to understand your retirement goals, which allows us to outline an investment and tax plan. Once we know the overarching structure, we can explore the components that go into it, such as a 10b5-1 plan. If trading in your company’s stock is necessary and prudent, we will setup a plan that makes the most sense for your situation while meeting regulatory compliance requirements. Our goal is to take full advantage of the incentives available to you while limiting the financial risks in holding company stock.  We aim to balance these trade-offs and deliver an outcome that focuses on tax and investment efficiency.

Our process includes:

  • Find the right balance of stability and growth while holding company stock
  • Establish a trading plan to mitigate risks associated with being in possession of material, nonpublic information
  • Carefully assess the tax impact of your trading strategy

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