Form 4: Aris Water Solutions Executive Chairman William Zartler Reports Changes in Beneficial Ownership

William Zartler, Executive Chairman of Aris Water Solutions, reports transactions involving Class A and Class B common stock, including the surrender of shares for tax withholding and the grant of restricted stock units.

Summary

• On March 1, 2024, William Zartler, the Executive Chairman of Aris Water Solutions, reported changes in his beneficial ownership of the company's stock.
• He surrendered 21,126 shares of Class A Common Stock at a price of $12.04 to cover tax withholding obligations related to the settlement of vested restricted stock units (RSUs).
• Zartler also acquired 122,034 restricted stock units (RSUs) under the company's 2021 Equity Incentive Plan, which will vest in three equal installments on March 1, 2025, March 1, 2026, and March 1, 2027.
• Following these transactions, Zartler directly owns 543,531 shares of Class A Common Stock and 488,474 shares of Class B Common Stock.
• He also indirectly owns 1,064,617 shares of Class B Common Stock through Solaris Energy Capital, LLC, where he is the sole member.
• Zartler has granted a Power of Attorney to Amanda M. Brock, Stephan E. Tompsett, and Robert W. Hunt, Jr. to handle SEC filings on his behalf.

Sentiment

Score: 6

Explanation: The sentiment is neutral. It's a routine disclosure of insider transactions. The granting of RSUs is a positive sign, but the surrender of shares for tax obligations is a neutral event.

Positives

• The granting of RSUs to the Executive Chairman aligns his interests with the long-term performance of the company.
• The vesting schedule of the RSUs (over three years) encourages a long-term commitment from the executive.
• The Power of Attorney ensures timely and accurate SEC filings.

Negatives

• The surrender of shares to cover tax obligations could be perceived negatively, although it's a common practice.

Risks

• The vesting of RSUs is contingent upon continued service, so any departure of the executive could impact the unvested portion.
• Changes in tax laws could affect the attractiveness of equity-based compensation.

Future Outlook

The document does not contain specific forward-looking statements, but the vesting schedule of the RSUs suggests a continued involvement of the executive chairman with the company.

Industry Context

Insider transactions are common and closely monitored in the water solutions industry, as they can provide insights into management's confidence in the company's prospects. This filing is a routine disclosure of such transactions.

Comparison to Industry Standards

• Equity compensation is a standard practice in the industry to align management's interests with shareholders.
• Vesting schedules are typically structured over several years to incentivize long-term commitment.
• Comparable companies like Tetra Technologies and Select Water Solutions also utilize equity-based compensation for their executives.

Stakeholder Impact

• Shareholders may view the granting of RSUs positively as it aligns management's interests with the company's long-term success.
• The transactions have a minimal direct impact on employees, customers, suppliers, or creditors.

Key Dates