Pre-adoption workflow

10b5-1 plan checklist: what to settle before you sign.

The best time to fix a 10b5-1 plan is before adoption. After adoption, changes can create cooling-off, disclosure, or affirmative-defense issues. Use this checklist to get the financial assumptions ready for counsel, broker, and company review.

1. Confirm eligibility and timing

• Confirm you are in an open trading window under company policy.
• Confirm you are not aware of material nonpublic information.
• Identify whether you are a director, officer, Section 16 insider, or other covered person — your Form 4 filing and Section 16(b) obligations differ based on this.
• Map the applicable cooling-off period before selecting a first-trade date.

2. Inventory the stock position

• Separate vested shares, RSUs, PSUs, ISO shares, NSO shares, ESPP lots, founder shares, and restricted stock.
• Tag short-term and long-term lots and identify large unrealized gains or losses.
• Estimate future vesting that will add to concentration during the plan term.
• List transfer restrictions, lockup dates, Rule 144 issues, pledge arrangements, and margin loans. If you are approaching a post-IPO lockup expiration, read the IPO lockup expiration planning guide before this checklist — the timing steps there must be complete before the pre-adoption checklist below makes sense.

3. Pick the sale objective

• Reduce employer stock from a target percent of net worth to a lower target.
• Raise cash for taxes, diversification, charitable giving, home purchase, or estate planning.
• Sell enough future vests to prevent concentration from rebuilding.
• Decide whether non-execution is acceptable if price conditions are included.

4. Coordinate the professional team

5. Decide what not to do

Do not adopt a plan you expect to terminate early. Do not build a sale schedule that solves optics but fails the portfolio. Do not ignore future RSU or PSU vesting. Do not rely on a downloaded template without issuer, counsel, and broker approval.

Before using this checklist, confirm the trading window and blackout period timing for your planned adoption date — the window must be open and the issuer's event-driven blackout check must clear. Next steps: compare plan examples, check cost components, and understand rule requirements. If you are planning a multi-year diversification program across successive plans, read the guide to multiple and staggered 10b5-1 plans before finalizing the adoption calendar. If you are approaching retirement or a planned departure, also read the resignation and retirement planning guide — the pre-departure steps are distinct from the pre-adoption checklist above. If your company is in an industry where acquisitions are common, review the acquisition and merger planning guide to understand what happens to an existing plan if a deal is announced.