Form 4: Fathom CEO Gifts Shares, Details Future Holdings

Fathom Holdings Inc. CEO Marco Fregenal reported a planned gift of 33,024 common shares and disclosed his future beneficial ownership, including restricted stock and performance rights.

Summary

• CEO Marco Fregenal reported a planned gift of 33,024 shares of Fathom Holdings Inc. common stock.
• The transaction date for this gift is 12/23/2025, with a price of $0 per share, and was made pursuant to a Rule 10b5-1(c) plan.
• Following this planned transaction, Mr. Fregenal will directly own 1,514,940 shares of common stock, of which 133,337 are restricted and vest on the second and third anniversary of November 15, 2024.
• He will indirectly own 5,056 shares through his wife and 150,000 shares through the Fregenal 2020 Irrevocable Trust for his children, disclaiming beneficial ownership of the trust's shares.
• Mr. Fregenal also holds 250,000 performance rights, contingent on Fathom's common stock achieving specified prices, with vesting dates of August 20, 2028 (200,000 rights) and November 15, 2034 (50,000 rights).

Sentiment

Score: 6

Explanation: The filing is a routine disclosure of an insider transaction (a gift) and beneficial ownership. While a disposition, it's a gift and part of a pre-arranged plan, not a sale for cash, and the CEO retains significant holdings and performance incentives. The future transaction date is notable but explained by the 10b5-1 plan.

Positives

• The existence of performance rights tied to specific stock price achievements indicates management's incentive to drive share value.
• The gift of shares to a trust for children can be seen as a long-term commitment to the company's future, aligning family interests with company performance.

Negatives

• A disposition of shares, even as a gift, reduces the CEO's direct equity stake, though the amount is relatively small compared to total holdings.

Future Outlook

The performance rights vesting upon Fathom's common stock achieving a specified price per share for a specified time indicates a forward-looking incentive structure for the CEO, aligning his compensation with future stock performance.

Industry Context

NA

Related Party Transactions

• The indirect ownership of 150,000 shares by the Fregenal 2020 Irrevocable Trust for the reporting person's children, with the spouse as trustee, constitutes a related party dealing.

Stakeholder Impact

• Shareholders: The gift slightly reduces the CEO's direct ownership but is a planned transaction under a 10b5-1 plan, which can provide transparency. The CEO retains substantial direct and indirect holdings, including performance-based incentives, aligning his interests with shareholder value creation.
• Management/Employees: The CEO's continued significant equity stake and performance-based compensation reinforce leadership's commitment to long-term company success.

Next Steps

• The planned gift of 33,024 common shares is expected to occur on 12/23/2025.
• The 133,337 restricted shares will vest on the second and third anniversary of November 15, 2024.
• The 200,000 performance rights will vest upon Fathom's common stock achieving a specified price per share for a specified time, with an expiration date of August 20, 2028.
• The 50,000 performance rights will vest upon Fathom's common stock achieving a specified price per share for a specified time, with an expiration date of November 15, 2034.

Key Dates

Recommendation

This Form 4 filing primarily details a planned gift of shares by the CEO and updates on his beneficial ownership, including restricted stock and performance rights. It does not contain new operational or financial information that would warrant a change in investment thesis. The CEO maintains a substantial equity stake and performance incentives, which is generally positive for alignment with shareholder interests. Therefore, a 'hold' recommendation is appropriate as this filing provides routine transparency without altering the fundamental outlook for the company.

Keywords

Fathom Holdings, FTHM, Marco Fregenal, CEO, Insider Trading, Beneficial Ownership, Stock Gift, Performance Rights, SEC Form 4, Equity Compensation, Rule 10b5-1