Form 4: Kewaunee Scientific CFO Converts Restricted Stock Units and Sells Shares for Tax Obligations

Kewaunee Scientific's Chief Financial Officer, Donald T. Gardner III, converted various restricted stock units into common stock and subsequently sold a portion of these shares to cover tax liabilities.

Summary

• Donald T. Gardner III, Chief Financial Officer of Kewaunee Scientific Corp (KEQU), reported transactions involving the conversion of restricted stock units (RSUs) into common stock and the subsequent sale of shares to cover tax obligations.
• On June 30, 2025, Mr. Gardner converted 5,697 restricted stock units into common stock at a price of $0.
• This conversion included 3,035 units from the FY23 RSU grant, 1,628 units from the FY24 RSU grant, and 1,034 units from the FY25 RSU grant.
• Following these conversions, Mr. Gardner's direct beneficial ownership of common stock increased to 20,055 shares.
• On July 1, 2025, Mr. Gardner disposed of 2,491 shares of common stock at a price of $58.34 per share. This transaction was marked as a payment of exercise price or tax liability by delivering or withholding securities.
• After the disposition, Mr. Gardner's direct beneficial ownership of common stock was 17,564 shares.
• Remaining unvested derivative securities include 13,025 Restricted Stock Units from the FY24 grant and 6,727 Restricted Stock Units from the FY25 grant.

Sentiment

Score: 5

Explanation: The document is a routine Form 4 filing detailing the vesting of equity compensation and a subsequent sale to cover tax liabilities. It reflects standard executive compensation practices and pre-planned transactions, thus having a neutral sentiment.

Positives

• The conversion of restricted stock units indicates the vesting of previously granted equity compensation, reflecting continued employment and, for performance-based units, achievement of performance goals.
• The transactions were made pursuant to a Rule 10b5-1(c) plan, indicating a pre-arranged and automated transaction, which can reduce concerns about opportunistic insider trading.

Negatives

• The sale of 2,491 shares, while for tax purposes, reduces the CFO's direct equity stake in the company.

Future Outlook

The document details future vesting schedules for Restricted Stock Units, indicating that a portion of the FY24 and FY25 grants are performance-based and will vest only if specific performance goals are achieved over a three-year period, subject to continued employment.

Management Comments

• Restricted stock units convert to common stock on a one-for-one basis.
• On June 29, 2022, the reporting person was granted restricted stock units that vest as follows: (a) 100% of the number of restricted stock units subject to the award consist of service-based restricted stock units that vest in three equal annual installments beginning on June 30, 2023, subject to the reporting person's continued employment with the Company.
• On June 28, 2023, the reporting person was granted restricted stock units that vest as follows: (a) 30% of the number of restricted stock units subject to the award consist of service-based restricted stock units that vest in three equal annual installments beginning on June 30, 2024, subject to the reporting person's continued employment with the Company, and (b) 70% of the number of restricted stock units subject to the award consist of performance-based restricted stock units that vest only if performance goals are achieved over a three-year period. The actual number of units (if any) received under this award will depend on continued employment and actual performance over the three-year performance period.
• On June 28, 2024, the reporting person was granted restricted stock units that vest as follows: (a) 40% of the number of restricted stock units subject to the award consist of service-based restricted stock units that vest in three equal annual installments beginning on June 30, 2025, subject to the reporting person's continued employment with the Company, and (b) 60% of the number of restricted stock units subject to the award consist of performance-based restricted stock units that vest only if performance goals are achieved over a three-year period. The actual number of units (if any) received under this award will depend on continued employment and actual performance over the three-year performance period.

Industry Context

The conversion of restricted stock units and subsequent sale for tax purposes is a common practice for executives receiving equity compensation across various industries. This filing reflects standard executive compensation practices within publicly traded companies.

Comparison to Industry Standards

• The use of restricted stock units (RSUs) as a form of equity compensation, with a mix of service-based and performance-based vesting, aligns with common executive compensation structures observed in publicly traded companies, including those in the manufacturing or scientific equipment sectors like Kewaunee Scientific.
• The "sell to cover" transaction for tax obligations is a standard and widely accepted method for executives to manage the tax implications of equity vesting, seen across companies like Thermo Fisher Scientific (TMO) or Agilent Technologies (A) which also utilize RSU programs for their executives.
• The filing under Rule 10b5-1(c) indicates a pre-planned transaction, which is a best practice for insiders to avoid accusations of trading on material non-public information, a standard adopted by many corporate executives to ensure compliance and transparency.

Related Party Transactions

• The reported transactions involve an executive (Donald T. Gardner III, CFO) and the company (Kewaunee Scientific Corp), which are inherently related party transactions in the context of insider trading disclosures.

Stakeholder Impact

• Shareholders: The conversion of RSUs increases the number of outstanding shares, potentially leading to minor dilution, though this is typically factored into equity compensation plans. The sale of shares by the CFO, while for tax purposes, slightly reduces insider ownership.
• Employees: The vesting of RSUs demonstrates the company's commitment to its equity compensation programs, which can be a positive for employee retention and motivation, particularly for those with similar equity grants.

Next Steps

• Future vesting of remaining FY24 and FY25 Restricted Stock Units will occur based on service and achievement of performance goals over a three-year period.

Key Dates

Keywords

Kewaunee Scientific Corp, KEQU, Donald T. Gardner III, Chief Financial Officer, CFO, SEC Form 4, Insider Trading, Restricted Stock Units, RSU conversion, Equity compensation, Stock sale, Tax liability, Rule 10b5-1