Form 4: Femasys CEO Acquires $50K in Convertible Notes, Warrants

Femasys CEO Kathy Lee-Sepsick acquired $50,000 worth of convertible notes and warrants, signaling a long-term investment in the company.

Summary

• Kathy Lee-Sepsick, the Chief Executive Officer and a Director of Femasys Inc. (FEMY), acquired Senior Secured Convertible Notes and three series of Warrants (A-1, B-1, C-1).
• The total aggregate purchase amount for these derivative securities was $50,000.
• The transaction occurred on November 7, 2025, and was reported on November 19, 2025.
• The Senior Secured Convertible Notes have an initial conversion price of $0.73 per share and expire on November 7, 2035.
• The Series A-1 Warrants have an initial exercise price of $0.81 per share, Series B-1 Warrants at $0.92 per share, and Series C-1 Warrants at $1.10 per share, all expiring on November 7, 2035.
• Each derivative security (Convertible Notes, A-1, B-1, C-1 Warrants) is associated with 68,244 shares of common stock upon conversion or exercise, subject to adjustments and Nasdaq limitations.
• The acquisition was made pursuant to a Rule 10b5-1(c) plan, indicating a pre-arranged transaction.

Sentiment

Score: 7

Explanation: The CEO's direct investment of $50,000 in convertible notes and warrants, especially under a 10b5-1 plan and with long-term maturities, indicates strong management confidence in the company's future. While the amount is not massive, the nature of the investment is positive.

Positives

• CEO Kathy Lee-Sepsick's direct investment of $50,000 in the company's convertible notes and warrants demonstrates strong confidence in Femasys's future prospects.
• The acquisition of long-term derivative securities (expiring in 2035) suggests a long-term commitment from the CEO, aligning her interests with shareholders.
• The transaction was made under a Rule 10b5-1(c) plan, indicating a pre-arranged, non-discretionary purchase, which can be viewed favorably by investors.

Risks

• The conversion and exercise of the derivative securities are subject to certain limitations in accordance with Nasdaq Capital Market rules, which could affect the number of shares ultimately received.
• The value of the underlying common stock could fluctuate, impacting the profitability of converting or exercising the notes and warrants.

Future Outlook

The acquisition of long-term convertible notes and warrants by the CEO suggests an optimistic long-term outlook for Femasys Inc., with potential for significant upside if the stock price appreciates above the conversion/exercise prices.

Management Comments

• The reported securities were purchased by the reporting person for an aggregate amount of $50,000.

Industry Context

Insider purchases, especially by a CEO, are generally seen as a positive signal, indicating management's belief in the company's intrinsic value and future growth prospects. This type of transaction is common in the biotech/medtech industry where Femasys operates, often signaling confidence in upcoming product developments or market expansion.

Comparison to Industry Standards

• Insider buying, particularly by a CEO, is generally viewed as a strong positive signal across all industries, often outperforming general market sentiment.
• The acquisition of derivative securities with long maturities (10 years) is common for long-term strategic investments by insiders, similar to practices seen in companies where executives often hold stock options or convertible debt.
• The specific conversion/exercise prices ($0.73 to $1.10) provide benchmarks for future stock performance relative to the CEO's entry points, which can be compared to similar insider transactions in development-stage companies where executives often invest at various stages of growth.

Stakeholder Impact

• Shareholders: Potential for future dilution if the convertible notes and warrants are converted/exercised, but also a positive signal of management confidence which could boost investor sentiment.
• Creditors: The Senior Secured Convertible Notes represent a debt instrument, which impacts the company's capital structure and obligations to creditors.

Next Steps

• Monitor Femasys Inc.'s stock performance relative to the conversion and exercise prices of the acquired derivatives.
• Observe any future conversions of the notes or exercises of the warrants by Kathy Lee-Sepsick.
• Track Femasys Inc.'s operational and financial results to assess the underlying value supporting the CEO's investment.

Key Dates

Recommendation

The CEO's insider purchase is a positive signal, indicating confidence in the company's long-term prospects. However, without additional financial or operational context beyond this Form 4, a 'buy' recommendation would be premature. The investment is relatively small ($50,000) for a CEO, and the transaction, while positive, is a single event. Investors should hold and monitor for further developments and financial performance before making a more aggressive move.

Keywords

Femasys Inc., FEMY, SEC Form 4, Insider Trading, Beneficial Ownership, Convertible Notes, Warrants, CEO Investment, Kathy Lee-Sepsick, Corporate Governance