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When it comes to the new disclosure requirements about insider trading, one provision that we keep reading again & again is Item 408(c). I blogged last month about confusion around the type of “non-Rule 10b5-1 trading arrangement” that is outlined in Item 408(c), which triggers the quarterly Item 408(a) disclosure.

The discussion beginning on page 78 of the adopting release says that basically, a non-Rule 10b5-1 plan is a plan that satisfies the old rules for a 10b5-1 plan, but not the new rules. For example, it may not have a cooling-off period. But still, this is an area where folks are continuing to hope for Staff clarification. Here are a few of the head-scratchers that people are grappling with:

– Purchases of issuer stock pursuant to payroll deduction elections (made when there’s not MNPI) under an employee stock purchase plan.

– Purchases of issuer stock pursuant to elections (made when there’s not MNPI) under a 401(k) plan.

– Default net share issuance provisions (in award agreements or equity plans) for vested restricted stock units (not sell-to-cover).

Do these and similar arrangements trigger Item 408(a) disclosure? With the new quarterly disclosure requirement quickly approaching, these are questions we’ll have to figure out very soon!

Check out the January-February issue of The Corporate Counsel newsletter for even more practical guidance on the ins & outs of these new rules. If you don’t already have access to that essential resource, email sales@ccrcorp.com.

– Liz Dunshee