Form 4: Latham Group CEO Granted 907,591 Stock Appreciation Rights

Latham Group, Inc. President and CEO, Sean Gadd, was granted 907,591 Stock Appreciation Rights with a $6.44 exercise price, vesting over three years.

Summary

• Sean Gadd, President and CEO, and a Director of Latham Group, Inc. (SWIM), was granted 907,591 Stock Appreciation Rights (SARs).
• The grant was effective on January 5, 2026, with an exercise price of $6.44 per SAR.
• The SARs will vest in a staggered schedule: 25% on the first anniversary of the grant date, 25% on the second anniversary, and the remaining 50% on the third anniversary.
• The expiration date for these SARs is January 5, 2036.
• The transaction was made pursuant to a contract, instruction, or written plan for the purchase or sale of equity securities, intended to satisfy Rule 10b5-1(c).

Sentiment

Score: 6

Explanation: The grant of Stock Appreciation Rights to a key executive is generally viewed as a positive for aligning management incentives with shareholder interests and for executive retention, contributing to a slightly positive sentiment.

Positives

• The grant of Stock Appreciation Rights aligns the interests of the President and CEO with those of shareholders, as the value of the SARs increases with the company's stock price.
• This compensation structure serves as a retention mechanism for key executive talent, encouraging long-term commitment to the company's performance.
• The vesting schedule over three years promotes sustained focus on strategic goals and shareholder value creation.

Risks

• The value of the Stock Appreciation Rights is dependent on the future performance of Latham Group, Inc.'s common stock, meaning there is no guaranteed payout if the stock price does not appreciate above the exercise price.

Future Outlook

The grant of Stock Appreciation Rights represents a forward-looking compensation incentive, tying executive remuneration to the future appreciation of Latham Group, Inc.'s common stock over the next decade, with vesting scheduled over the next three years.

Industry Context

The grant of Stock Appreciation Rights is a common form of executive compensation in publicly traded companies across various industries, designed to incentivize leadership to drive long-term shareholder value. This practice is consistent with typical compensation strategies aimed at attracting and retaining high-caliber executives.

Comparison to Industry Standards

• Not applicable as this filing reports an individual executive compensation grant, not company performance or project results that can be directly compared to industry benchmarks or specific competitor projects.

Corporate Governance

Related Party Transactions

• The grant of Stock Appreciation Rights to President and CEO Sean Gadd constitutes an executive compensation arrangement, which is a form of related party transaction between the company and its executive management.

Stakeholder Impact

• Shareholders: Potential positive impact through enhanced alignment of executive incentives with long-term stock performance and value creation.
• Employees (Sean Gadd): Direct financial incentive tied to the company's stock appreciation, contributing to personal wealth accumulation if performance targets are met.

Next Steps

• The SARs will vest according to the specified schedule: 25% on January 5, 2027, 25% on January 5, 2028, and 50% on January 5, 2029.
• Sean Gadd will be able to exercise the vested SARs at any point before their expiration on January 5, 2036, provided the stock price is above the exercise price of $6.44.

Key Dates

Keywords

Latham Group, SWIM, Stock Appreciation Rights, SARs, Executive Compensation, Insider Transaction, Sean Gadd, Corporate Governance, Equity Grant