Form 4: FMCB CEO Sells Shares for Tax Liquidity

FARMERS & MERCHANTS BANCORP's President and CEO, Kent A. Steinwert, disposed of 9,425 shares of common stock to cover tax liabilities related to terminated retirement plans.

Summary

• Kent A. Steinwert, President/CEO and Director of FARMERS & MERCHANTS BANCORP (FMCB), reported a transaction on December 5, 2025.
• He disposed of 9,425 shares of FMCB common stock at a price of $1,041.24 per share.
• The share price was determined using the 30-day volume weighted average price after the close of market on December 4, 2025.
• This disposition was made in connection with the anticipated liquidation and distribution of the Company's Non-Qualified Executive Retirement and Senior Management Retirement Plans, which were terminated effective November 29, 2024.
• The Trustees of the grantor trust funding these plans elected to exchange shares for cash to provide liquidity for related tax liabilities.
• Following this transaction, Mr. Steinwert directly owns 11,203 shares of common stock.
• He indirectly owns 20,300 shares held in a grantor trust established for the company's Non-Qualified Retirement Plan.
• The transaction was made pursuant to a Rule 10b5-1(c) plan.

Sentiment

Score: 5

Explanation: The insider sale is for tax liabilities related to the termination of non-qualified retirement plans, not a discretionary sale based on a change in company outlook. This context makes the transaction largely neutral in terms of sentiment, as it's a pre-planned event.

Positives

• The sale was for tax liabilities related to the termination of non-qualified retirement plans, not a discretionary sale based on a negative outlook for the company.
• The transaction was executed under a Rule 10b5-1 plan, indicating a pre-planned sale rather than an immediate reaction to market conditions.

Negatives

• Insider selling, even for tax purposes, can sometimes be perceived negatively by the market, potentially leading to short-term investor uncertainty.
• A significant number of shares (9,425) were disposed of by a key executive, representing a notable reduction in their direct beneficial ownership.

Future Outlook

NA

Industry Context

NA

Corporate Governance

Stakeholder Impact

• Shareholders: May observe insider selling, but the explanation mitigates concerns about management's confidence in the company.
• Executives (specifically Kent A. Steinwert): Impacted by the liquidation of retirement plans and associated tax liabilities, leading to a change in their personal investment portfolio.

Next Steps

• Continued vesting of previously granted restricted stock awards (7,260 shares over two years and 2,130 shares over three years from February 3, 2025).
• Anticipated liquidation and distribution of the Company's Non-Qualified Executive Retirement and Senior Management Retirement Plans.

Key Dates

Recommendation

The reported insider sale by the President/CEO is a non-discretionary transaction for tax liabilities arising from the termination of non-qualified retirement plans, executed under a Rule 10b5-1 plan. This context suggests the sale is not indicative of a change in management's outlook on the company's fundamentals. Therefore, the filing itself does not provide a strong basis for a 'buy' or 'sell' recommendation, leading to a 'hold' stance based solely on this information.

Keywords

FMCB, Kent A. Steinwert, Insider Trading, Form 4, Stock Sale, Executive Compensation, Retirement Plan, Rule 10b5-1