Form 4: Butterfly Network Director Sells Shares for Estate Planning

Jonathan M. Rothberg, a Director and 10% owner of Butterfly Network, Inc., sold 132,570 shares of Class A Common Stock for estate planning purposes.

Summary

• Jonathan M. Rothberg, a Director and 10% Owner of Butterfly Network, Inc. (BFLY), disposed of 132,570 shares of Class A Common Stock.
• The transaction occurred on November 28, 2025, at a weighted average sales price of $3.079 per share.
• The shares were sold pursuant to a Rule 10b5-1 trading plan adopted by Dr. Rothberg on March 5, 2025, for estate planning purposes.
• Following the transaction, Dr. Rothberg directly holds 2,880,252 shares of Class A Common Stock.
• Dr. Rothberg also indirectly holds a significant number of Class A and Class B Common Stock through various LLCs (JNR TR, LLC, EJR TR, LLC, GBR TR, LLC, NVR TR, LLC, JAR TR, LLC, 4C Holdings I-V, LLC) and his spouse, Bonnie E Gould Rothberg MD.
• The sales prices ranged from $3.07 to $3.105 per share.

Sentiment

Score: 4

Explanation: The sentiment is moderately negative due to a significant insider sale by a director and 10% owner. While the sale is attributed to estate planning and executed via a 10b5-1 plan, which mitigates some concerns, insider selling is generally viewed cautiously by investors.

Positives

• The transaction was executed under a pre-arranged Rule 10b5-1 trading plan, adopted on March 5, 2025, indicating a scheduled sale rather than a reactive one.
• The stated reason for the sale is estate planning, which suggests a personal financial management decision rather than a reflection of company performance or outlook.

Negatives

• A significant sale of 132,570 shares by a Director and 10% owner, even if planned, can be perceived by the market as a negative signal regarding the insider's confidence in the company's future stock price.
• The sale reduces the direct beneficial ownership of a key insider, which might be interpreted as a decrease in alignment with shareholder interests.

Risks

• Insider selling, even for personal reasons, can sometimes lead to negative market sentiment and downward pressure on the stock price.
• The market might interpret the sale as a signal that the insider believes the stock is currently fairly valued or potentially overvalued, despite the stated estate planning purpose.

Future Outlook

The filing does not contain any forward-looking statements or guidance regarding the company's future performance or strategic direction. It solely reports an insider transaction.

Management Comments

• The transactions reported were effected pursuant to a Rule 10b5-1 trading plan adopted by the reporting person on March 5, 2025, for estate planning purposes.
• Dr. Rothberg disclaims beneficial ownership of the securities held by various entities and his spouse except to the extent of his pecuniary interest therein.

Industry Context

This filing is an insider transaction report and does not provide information directly related to broader industry trends or competitive landscape. It reflects an individual's personal financial planning within the context of their holdings in Butterfly Network, Inc.

Comparison to Industry Standards

• Insider selling, particularly by founders or significant shareholders, is a common occurrence across industries, often for diversification or estate planning, as seen with Dr. Rothberg's transaction.
• The use of a Rule 10b5-1 plan is a standard practice for insiders to sell shares in a pre-arranged, compliant manner, mitigating concerns about trading on material non-public information. Many executives at companies like Apple (AAPL), Microsoft (MSFT), and Tesla (TSLA) utilize similar plans for their stock sales.

Related Party Transactions

• Dr. Rothberg indirectly holds shares through various LLCs (JNR TR, LLC, EJR TR, LLC, GBR TR, LLC, NVR TR, LLC, JAR TR, LLC, 4C Holdings I, LLC, 4C Holdings II, LLC, 4C Holdings III, LLC, 4C Holdings IV, LLC, 4C Holdings V, LLC) and his spouse, Bonnie E Gould Rothberg MD, for which he disclaims beneficial ownership except to the extent of his pecuniary interest.

Stakeholder Impact

• Shareholders may interpret the insider sale as a signal of reduced confidence, potentially leading to negative sentiment or downward pressure on the stock price.
• Employees and other stakeholders might monitor such transactions for insights into management's view of the company's prospects, though the estate planning reason aims to mitigate this.

Next Steps

• No specific future actions or events are mentioned in this Form 4 filing beyond the reported transaction.

Key Dates

Recommendation

While the sale by a director and 10% owner is generally a negative signal, the fact that it was pre-planned under a Rule 10b5-1 plan for estate planning purposes suggests it's not a reactive sale based on new negative information. This mitigates the immediate alarm. However, it still represents a reduction in insider ownership. Investors should hold and monitor future company performance and other insider activity rather than immediately selling based solely on this planned transaction.

Keywords

Butterfly Network, BFLY, Jonathan Rothberg, Insider Trading, Form 4, Stock Sale, 10b5-1 Plan, Director Transaction, Estate Planning