Glossary

A 10b5-1 plan is a prearranged trading arrangement that can provide an affirmative defense under Rule 10b5-1 when trades are executed according to specified conditions and disclosures.

An acquisition is a transaction that increases a reporting person’s beneficial ownership of a security and must be disclosed under SEC Section 16 on Form 4 when it results in a reportable change in ownership.

An affiliate is a person or entity that controls, is controlled by, or is under common control with another person, as defined under SEC Rule 12b-2, with implications across U.S. securities disclosure and reporting frameworks.

Beneficial owner is a person or entity that directly or indirectly has voting power or investment power over a security or the opportunity to profit from it, determining who must file SEC insider and beneficial ownership reports under Section 16 of the Exchange Act and Schedules 13D/13G.

Beneficial ownership describes when a person or entity has an economic interest in or control over a security, determining who must disclose holdings and transactions under SEC rules, including insider reporting under Section 16.

A corporate officer is an executive of an issuer with a registered class of equity securities who meets the SEC’s functional definition under Rule 16a-1(f) and is subject to insider reporting obligations under Section 16.

Derivative security refers to an equity-linked instrument whose value is derived from an underlying asset; under Section 16, certain derivatives are defined and reported separately in insider filings.

Direct ownership describes securities held in a reporting person’s own name and account; under Section 16, directly owned securities are disclosed separately from indirect holdings in insider filings.

A director is a member of an issuer’s board of directors who, for issuers with registered equity securities, is subject to insider reporting obligations under SEC Section 16, including filing Forms 3, 4, and 5.

A disposition is a transaction that reduces a reporting person’s beneficial ownership of a security and must be disclosed under SEC Section 16 on Form 4 when it results in a reportable change in ownership.

EDGAR is the SEC’s electronic system for submitting and accessing public financial and regulatory filings, providing real-time access to company disclosures including insider reports, periodic reports, and registration statements.

Equity compensation refers to arrangements in which an issuer provides rights to acquire or receive equity securities as compensation, with reporting under SEC Section 16 determined by the structure, vesting, and settlement of those rights.

Form 3 is the initial SEC insider ownership disclosure that officers, directors, and 10% beneficial owners must file under Section 16(a) to establish their baseline beneficial equity holdings; beginning March 18, 2026, officers and directors of foreign private issuers will also be required to file Form 3.

Form 4 (Statement of Changes in Beneficial Ownership) is an SEC insider trading disclosure form reporting changes in an insider’s equity holdings. Learn who must file, when it’s due, and what information is reported.

Form 5 is the SEC’s annual insider disclosure for reporters to file within 45 days after fiscal year end, reporting previously unreported or deferred beneficial ownership changes; beginning March 18, 2026, directors and officers of foreign private issuers will also be required to file Form 5 where applicable.

A gift is a transfer of securities without consideration that reduces a reporting person’s beneficial ownership and must be disclosed under SEC Section 16 on Form 4 using transaction code “G” when reportable.

A grant is the award of an equity-related right or instrument by an issuer—such as a stock option or restricted stock unit—that may result in a reportable transaction under SEC Section 16 and is disclosed on Form 4 using transaction code “A”.

Indirect ownership describes securities held through another person or entity; under Section 16, indirectly owned securities are disclosed separately from direct holdings in insider filings.

An insider is a person or entity—such as an officer, director, or ten percent beneficial owner—subject to SEC disclosure obligations under Section 16 of the Securities Exchange Act for holdings and transactions in an issuer’s equity securities.

An issuer is a person or entity that issues or proposes to issue securities; under U.S. securities law, issuer obligations depend on the regulatory context, including Section 16 insider reporting.

An open market transaction is a purchase or sale of securities executed through ordinary trading channels; under Section 16, such transactions are reported using specific codes on insider filings.

An option exercise is the use of a stock option to acquire or dispose of an issuer’s underlying equity security at a specified exercise price, resulting in a reportable change in beneficial ownership under SEC Section 16 and disclosed on Form 4 using transaction code “M”.

A private transaction is a securities purchase or sale executed outside public trading venues; under Section 16, such transactions are reported based on how and where they are executed.

Reporting person refers to an insider required under SEC Section 16(a) to disclose beneficial equity ownership and transactions through Forms 3, 4, and 5; this includes officers, directors, and >10% beneficial owners for domestic issuers, and effective March 18, 2026, officers and directors of foreign private issuers

An RSU (restricted stock unit) is a right to receive an issuer’s equity securities at a future date subject to vesting conditions and is treated as a derivative security for SEC insider reporting under Section 16.

Section 16 of the Securities Exchange Act sets disclosure rules requiring officers, directors, and 10% shareholders of U.S. public companies to file Forms 3, 4, and 5 with the SEC and provides for disgorgement of short-swing profits under Section 16(b)

A stock option is a contractual right to acquire an issuer’s equity securities at a specified exercise price and is treated as a derivative security for SEC insider reporting under Section 16.

The strike price is the fixed price at which a derivative security, such as a stock option, may be exercised to acquire or dispose of an issuer’s equity securities and is disclosed for SEC insider reporting under Section 16.

A ten percent owner is a person or entity that beneficially owns more than ten percent of a registered class of an issuer’s equity securities and is subject to insider reporting obligations under SEC Section 16, including filing Forms 3, 4, and 5.

Vesting is the process by which rights to equity securities or equity-based awards become non-forfeitable, determining when ownership interests are fixed and how related changes are reported under SEC rules.