Changing or ending your plan

10b5-1 plan modification and early termination: what restarts the clock.

You adopted a 10b5-1 plan, the cooling-off period ran, and trades began. Now circumstances have changed — the stock price has moved, your tax situation looks different, or you're leaving the company sooner than expected. The question is whether you can adjust the plan, terminate it, or need to wait through another cooling-off period before any change takes effect.

The core rule: Under the December 2022 SEC amendments (effective February 27, 2023), any modification or change to the amount, price, or timing of planned trades is treated as a termination of the original plan and adoption of a new one — which means a new cooling-off period before trading can resume.¹

What counts as a modification

The amended rule draws a hard line. Changes to these three parameters restart the clock:

AmountChanging the number of shares per trade, the total shares to be sold, or the percentage-of-position target.

PriceAdding, removing, or changing a price floor, price ceiling, or limit-order condition.

TimingChanging trade dates, sale frequency, the start date, or the overall plan duration.

Administrative changes that do not affect those three parameters — correcting a typo in account numbers, updating broker contact information, or transferring a plan to a successor broker with identical terms — are generally not treated as plan modifications. Any substantive change to what will be sold, when, or at what price is a new plan.

What termination triggers

If you terminate a plan before it runs its natural course, the consequences depend on what you do next:

If you terminate and do not re-adopt: No trades can occur under the terminated plan. You are back to the open-window / Rule 144 regime with no plan protection.
If you terminate and re-adopt: The new plan is subject to the full cooling-off period — 90 days / next quarterly earnings / 120-day cap for officers and directors; 30 days for other covered persons.
If you have a second plan already in place: The SEC's "effective cooling-off period" rule applies. If the first plan is terminated before its scheduled end, the second plan cannot begin trading immediately — it must wait through its own effective cooling-off period.¹

Common modification scenarios and their risk profile

Adding or lowering a price floor

Risk level: high — restarts the clock. Even a modest change from "sell at any price" to "sell only above $X" is a price modification. If you are a director or officer, you will wait another 90 days to 120 days before the first trade on the revised terms.

Skipping or pausing a scheduled sale

Risk level: high if discretionary. Using later influence to skip a specific sale or pause trades can be treated as a modification — and potentially as evidence that the plan was not adopted or operated in good faith. Pauses should be built into the original plan terms, not decided after adoption.

Adjusting for a stock split

Risk level: generally low if mechanical. Adjustments that preserve the economic terms of the plan (e.g., doubling share count after a 2-for-1 split) are typically treated as administrative rather than substantive modifications. Confirm the treatment with your broker and counsel before assuming it is safe.

Early termination before departure

Risk level: compliance sensitive. Terminating a plan shortly before a resignation, acquisition announcement, or other event that would have been MNPI at the termination date raises scrutiny. The good-faith requirement applies to termination, not just adoption.

Reducing the plan duration

Risk level: high — restarts the clock. Shortening the plan from 24 months to 12 months changes timing. This is a new plan with a new cooling-off period.

The good-faith requirement applies to termination

The amended rule requires that a plan be entered into and operated in good faith — and that requirement extends through termination. An early termination timed to stop losses immediately before bad news, or structured to allow open-market sales during a window that would otherwise be closed, can undermine the affirmative-defense protection the plan was designed to provide.

Termination for legitimate reasons — departure from the company, a change in cash-flow needs that were not foreseeable at adoption, or a material change in personal circumstances — is generally treated differently than termination driven by market intelligence. Document the reason for any early termination.

Disclosure of plan adoption, modification, and termination

The 2022 SEC amendments added quarterly disclosure requirements. Issuers must disclose in their Form 10-Q and 10-K filings whether any director or officer adopted, modified, or terminated a 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter, including the material terms. Individual filers should also confirm their Form 4 obligations with their company's legal team, since trades executed under a 10b5-1 plan still require timely reporting.

What to do before making any change

Check with your issuer's legal or compliance team — most large issuers have a pre-clearance step for plan changes as well as for plan adoption.
Talk to your securities counsel — whether a specific change counts as a modification under the amended rule depends on how the plan was written and what the change does to amount, price, or timing.
Model the cooling-off calendar — if a change requires a new cooling-off period, work out what the new first-sale date would be and whether it still meets your liquidity, tax, or diversification goal.
Coordinate with your financial advisor — a modification that resets the clock can change your entire tax-year modeling, especially if you were counting on a specific sale for estimated tax payments or year-end charitable giving.

Read the full 10b5-1 plan rules guide, understand how cooling-off period timing works from a clean adoption, and use the pre-adoption checklist when re-adopting after a termination.

Need to rework your plan without losing your window?

We match executives with advisors who can model the new cooling-off calendar, re-run sale-schedule scenarios, and coordinate with your counsel before any modification goes to the broker.

Sources

SEC Final Rule Release 33-11138: Insider Trading Arrangements and Related Disclosures — December 14, 2022. Effective February 27, 2023. Establishes cooling-off periods, modification/termination treatment, good-faith requirement, and overlapping-plan limits.
SEC Press Release: SEC Adopts Amendments to Modernize Rule 10b5-1 Insider Trading Plans — December 14, 2022. Summary of the final rule changes.
SEC Compliance Guide: Insider Trading Arrangements and Related Disclosures — SEC small-business compliance guide covering the amended requirements.
Cooley: Filling the Gaps — SEC Adopts Final Rules on 10b5-1 Trading Plans — Detailed law-firm analysis of the December 2022 amendments, including modification and termination treatment.

Rule text and SEC guidance verified as of June 2026. SEC rules can be amended; confirm current requirements with your issuer, securities counsel, and broker before acting on any plan change.