SCHEDULE: Intuitive Machines Insider Sells Shares for Diversification

Ghaffarian Enterprises, LLC, an entity linked to Intuitive Machines' founder, has established a 10b5-1 trading plan to sell nearly 2 million Class A common shares for investment diversification and liquidity.

Summary

• Ghaffarian Enterprises, LLC, an entity associated with Kamal Seyed Ghaffarian, has adopted a Rule 10b5-1 trading plan.
• The plan aims to sell a total of 1,986,732 Class A common shares of Intuitive Machines, Inc.
• The shares to be sold represent less than 2% of the total outstanding Class A Common Stock.
• The primary objectives of the sales plan are to achieve broader diversification of investments and reduce over-concentration risk, while generating liquidity for Ghaffarian Enterprises, LLC.
• J.P. Morgan Securities LLC (JPMS) will execute the sales on a "best efforts" basis, with discretion to minimize market impact and maximize prices.
• The plan outlines procedures for share delivery, including the redemption of Class C shares and exchange of Intuitive Machines, LLC units if necessary.
• The plan is designed to comply with Rule 10b5-1(c)(1) under the Exchange Act, ensuring sales are made without the seller having material non-public information.
• Kamal Seyed Ghaffarian, through various entities, beneficially owns 39,711,374 shares (25.6%) of Intuitive Machines' Class A Common Stock as of November 10, 2025.

Sentiment

Score: 5

Explanation: The filing describes a routine insider selling plan for diversification and liquidity, which is neutral in nature. While insider selling can sometimes be viewed negatively, the explicit purpose and the relatively small percentage of shares being sold (less than 2%) suggest it's a standard wealth management activity rather than a signal of company-specific issues. The robust compliance framework of the 10b5-1 plan also adds a layer of neutrality.

Positives

• The stated purpose of the sales plan is for broader diversification of investments and reducing over-concentration risk, which is a prudent financial strategy for large shareholders.
• The plan is structured to comply with Rule 10b5-1, indicating an intent to conduct sales in a pre-arranged, legal manner, mitigating concerns about insider trading.
• The amount of shares to be sold (1,986,732) represents less than 2% of the total outstanding Class A Common Stock, suggesting a controlled and potentially less disruptive divestment.

Negatives

• A significant insider selling shares, even for diversification, can sometimes be perceived negatively by the market, potentially signaling a lack of confidence, although the filing explicitly states the purpose is diversification and liquidity.
• The "best efforts" basis for sales execution means there is no assurance that all orders will be executed in whole or in part, or at desired prices.

Risks

• Market Disruptions: JPMS may not be able to effect a sale due to market disruptions, which could impact the timing and execution of sales.
• Legal, Regulatory, or Contractual Restrictions: Sales may be hindered by legal, regulatory, or contractual restrictions applicable to JPMS or the Seller.
• Issuer Non-compliance: If Intuitive Machines, Inc. does not comply with reporting requirements of Section 13 or 15(d) of the Exchange Act, sales under Rule 144 or 145 could be delayed or prevented.
• Volume Limitations: Sales may be restricted by applicable volume limitations under Rule 144 or 145, leading to carryover of unsold shares.
• Insufficient Shares: If the Seller's account has insufficient shares and deficiencies cannot be met by redeeming Tender Shares or Units, the Seller must deposit shares, or JPMS may need to borrow shares, incurring potential expenses or losses for the Seller.
• State or Foreign Regulation: Sales may be subject to further restrictions or limitations imposed by U.S. states or non-U.S. jurisdictions (e.g., EU Market Abuse Regulation), for which JPMS has no duty to determine compliance.
• Blackout Periods: The plan cannot be amended or modified during an Issuer blackout period or if the Seller is aware of any material non-public information.

Future Outlook

The filing primarily details a pre-arranged stock sale plan for diversification and liquidity, rather than providing a future outlook for the company's operations or financial performance. The plan's duration is tied to a "Sales End Date" (not specified in the provided text) or until all shares are sold.

Management Comments

• "The purpose of this Sales Plan is to achieve the investment objectives of broader diversification of investments, while reducing the risk of over concentration in a particular investment."
• "The 10b5-1 Trading Plan is being entered into solely to generate liquidity for Ghaffarian Enterprises, LLC."

Industry Context

Insider selling through 10b5-1 plans is a common practice for executives and large shareholders to manage their personal wealth, diversify holdings, and generate liquidity in a manner compliant with insider trading regulations. This particular filing indicates a significant shareholder of Intuitive Machines, Inc. is taking such a step, which is a routine event in the broader market for publicly traded companies, especially for founders or early investors with concentrated positions.

Comparison to Industry Standards

• The establishment of a Rule 10b5-1 trading plan is a standard and widely accepted practice for insiders to sell company stock while mitigating potential accusations of insider trading. This aligns with best practices for corporate governance and transparency in the financial industry.
• The stated reasons for the sale—diversification and liquidity—are common and legitimate motivations for large shareholders, consistent with financial planning strategies observed across various industries.
• The disclosure of the plan via a Schedule 13D amendment is standard regulatory compliance for significant shareholders.

Corporate Governance

Related Party Transactions

• The filing details a trading plan by Ghaffarian Enterprises, LLC, an entity controlled by Kamal Seyed Ghaffarian, who is a significant beneficial owner of Intuitive Machines, Inc. This constitutes a transaction involving a related party (a major shareholder and likely founder/executive).

Stakeholder Impact

• Shareholders: The sale of nearly 2 million shares by a significant insider could introduce selling pressure on the stock, potentially impacting its price. However, the stated purpose of diversification and liquidity, and the relatively small percentage of outstanding shares, might mitigate negative sentiment.
• Company (Intuitive Machines, Inc.): The company acknowledges the plan, which is a standard procedure for large shareholders. The plan's structure aims to avoid market disruption.
• Regulatory Bodies: The filing ensures compliance with SEC regulations, particularly Rule 10b5-1 and Schedule 13D, promoting transparency.

Next Steps

• JPMS will commence sales under the plan on the "Sales Commencement Date" (not specified in the filing).
• JPMS will notify the Issuer and Seller of each transaction within one trading day.
• The Seller will continue to monitor and comply with Sections 13(d), 13(g), and 16 of the Exchange Act.
• The plan will terminate on the earlier of the Sales End Date, when all shares are sold, or other specified conditions.

Key Dates

Recommendation

The filing details a pre-arranged insider selling plan for diversification and liquidity, not due to any negative company-specific news. While insider selling can sometimes create downward pressure, the stated rationale and the relatively small percentage of shares being sold (less than 2% of outstanding) suggest it's a routine wealth management event rather than a red flag. Investors should monitor the execution of the plan and broader company performance, but this specific filing does not present a strong case for a "buy" or "sell" action based solely on its content. A "hold" recommendation is appropriate as it's a neutral event.

Keywords

Intuitive Machines, 10b5-1 trading plan, insider selling, stock diversification, liquidity, Class A Common Stock, SEC filing, Ghaffarian Enterprises, J.P. Morgan Securities, Rule 144, Rule 145