Form 4: Coastal Financial Director Sells Shares for Tax Obligations

Coastal Financial Corp. director and President of CCBX, Brian T. Hamilton, reported the disposition of common stock to satisfy tax withholding obligations related to equity awards.

Summary

• Brian T. Hamilton, a Director and President of CCBX at Coastal Financial Corp. (CCB), reported two dispositions of common stock.
• On November 28, 2025, 232 shares were disposed of at a price of $111.35 per share.
• On December 1, 2025, 6,232 shares were disposed of at a price of $113.81 per share.
• These dispositions were marked with transaction code 'F', indicating they were made to satisfy tax withholding obligations.
• Following these transactions, Hamilton directly beneficially owns 77,780 shares of common stock.
• The remaining beneficial ownership includes 16,861 restricted stock units (RSUs) vesting monthly in approximately equal amounts through April 30, 2028.
• It also includes 7,387 performance-based RSUs which are eligible to vest on the first day of each month beginning October 1, 2024, until April 30, 2028, contingent on continuous employment and achievement of certain stock price conditions.
• Additionally, 15,000 performance-based RSUs are eligible to vest on April 30, 2028, subject to continuous employment and achievement of return on equity that is at least 80% of the company's comparator peer group.
• An additional 669 RSUs vest in four approximately equal remaining installments, with each RSU representing the right to receive one share of common stock upon vesting.

Sentiment

Score: 5

Explanation: The filing is a routine disclosure of insider transactions for tax purposes, which is a neutral event. The continued significant RSU holdings, including performance-based units, maintain a degree of positive alignment, balancing the minor reduction in direct stock ownership.

Positives

• Significant remaining beneficial ownership (77,780 shares plus substantial RSUs) indicates continued alignment of executive interests with shareholders.
• The existence of performance-based RSUs (7,387 and 15,000 units) ties a portion of executive compensation directly to company performance metrics like stock price and return on equity.

Negatives

• The disposition of shares, even for tax purposes, reduces the direct common stock holdings of a key insider.

Risks

• Vesting of performance-based RSUs (7,387 units) is subject to achieving certain stock price conditions, which may not be met.
• Vesting of performance-based RSUs (15,000 units) is contingent on achieving return on equity that is at least 80% of the company's comparator peer group, which introduces performance risk.
• All RSU vesting is subject to continuous employment, posing a risk to the executive if employment ceases.

Future Outlook

The executive's compensation structure, particularly the performance-based restricted stock units, indicates a long-term incentive alignment with the company's stock price appreciation and return on equity performance through April 2028.

Industry Context

Form 4 filings are standard disclosures for insider transactions, and the disposition of shares to cover tax obligations upon the vesting of equity awards is a common practice in executive compensation across industries. The use of performance-based restricted stock units is also a prevalent mechanism to align executive incentives with shareholder value creation and company financial performance.

Comparison to Industry Standards

• The structure of executive compensation, including restricted stock units (RSUs) and performance-based RSUs, aligns with common practices observed in the financial services industry for publicly traded companies.
• Many companies, such as JPMorgan Chase & Co. (JPM) or Bank of America Corp. (BAC), utilize similar equity-based incentive plans to retain key executives and link their compensation to long-term company performance.
• The specific vesting conditions tied to stock price and return on equity are standard performance metrics used in comparable plans to ensure executive accountability and drive shareholder value.

Corporate Governance

Stakeholder Impact

• Shareholders: The disposition is a routine tax-related event and is unlikely to have a significant impact. The remaining substantial equity holdings, including performance-based RSUs, suggest continued alignment of executive interests with shareholder value.
• Employees: No direct impact on general employees.
• Management: The executive's compensation structure remains tied to long-term company performance through various RSU grants.

Next Steps

• Continued vesting of 16,861 restricted stock units monthly through April 30, 2028.
• Continued vesting eligibility for 7,387 performance-based RSUs monthly from October 1, 2024, until April 30, 2028, subject to conditions.
• Vesting of 15,000 performance-based RSUs on April 30, 2028, subject to conditions.
• Continued vesting of 669 restricted stock units in four approximately equal remaining installments.

Key Dates

Keywords

Coastal Financial Corp, CCB, Brian T. Hamilton, Form 4, insider transaction, stock disposition, restricted stock units, RSU, executive compensation, tax withholding, beneficial ownership