Rule 105b-1

Rule 105b-1

A plan in which an investor holding a long position on a security sets forth conditions under which the security will be sold automatically. The selling plan is particularly important if the investor has inside information because Rule 105b-1 of the SEC permits what would otherwise be insider trading as long as the process is set in motion automatically with a selling plan. This construction is controversial, with critics maintaining that selling plans are open to manipulation that allows what amounts to insider trading by stealth.
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Rule 105b-1 allows insiders to adopt written plans for trading securities in a non-discretionary, pre-scheduled manner in order to avoid concerns about initiating stock transactions when the insider may be aware of non-public information.
Bank of Bermuda has announced that Chief Executive Officer Mr Henry Smith has implemented a long- term share trading plan under Rule 105b-1 of the US Securities and Exchange Act of 1934.