Form 4: Knowles Corp Executive Exercises Options and Sells Shares

Robert J. Perna, SVP, General Counsel & Secretary of Knowles Corp, reported exercising stock options and subsequently selling the acquired shares, alongside a gift of shares to a trust.

Summary

• Robert J. Perna, SVP, General Counsel & Secretary of Knowles Corp, engaged in several transactions involving company common stock.
• On March 20, 2025, 9,221 shares of common stock were gifted from direct ownership to an indirect ownership via a trust.
• On July 28, 2025, Perna exercised non-qualified stock options to acquire 26,718 shares at an exercise price of $17.39 per share.
• Immediately following the exercise on July 28, 2025, 26,718 shares were sold at a price of $20.4724 per share.
• Also on July 28, 2025, Perna exercised additional non-qualified stock options to acquire 29,412 shares at an exercise price of $16.77 per share.
• Concurrently, 29,412 shares acquired from this second option exercise were sold at a price of $20.4724 per share.
• Following these reported transactions, Perna's direct beneficial ownership stands at 66,552 shares, with an additional 9,221 shares held indirectly by a trust, totaling 75,773 shares.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative due to the executive selling all shares acquired from option exercises and gifting shares to a trust, indicating a reduction in direct ownership and a preference for cash realization over increased equity stake.

Positives

• Executive exercised stock options, indicating a realization of value from previously granted equity compensation.
• The sale price of $20.4724 per share was higher than both exercise prices ($17.39 and $16.77), resulting in a profit for the executive.

Negatives

• The executive sold all shares acquired through option exercises, indicating a lack of intent to increase direct ownership in the company at this time.
• A portion of direct beneficial ownership (9,221 shares) was transferred to a trust, reducing direct holdings.

Future Outlook

NA

Industry Context

NA

Related Party Transactions

• Transfer of 9,221 common shares from direct ownership to an indirect ownership by a trust on March 20, 2025.

Stakeholder Impact

• Shareholders: The sale of shares by a senior executive might be perceived negatively, potentially signaling a lack of confidence or a desire to diversify personal holdings, which could put downward pressure on the stock price.

Key Dates

Recommendation

The filing indicates an executive exercising stock options and immediately selling the acquired shares, a common practice for liquidity and diversification rather than a direct bearish signal. While the executive did not increase their direct stake, the transactions do not suggest a fundamental deterioration of the company's prospects. The gift to a trust also represents a change in ownership form rather than a complete divestment. Therefore, a 'hold' recommendation is appropriate, advising investors to maintain their current position while monitoring future company performance and insider activity.

Keywords

Knowles Corp, KN, SEC Form 4, Insider Trading, Stock Options, Beneficial Ownership, Equity Compensation, Share Sale, Trust Transfer