Form 4: Matthews EVP Gackenbach Reports Equity Transactions

Matthews International EVP Steven Gackenbach reported the vesting of restricted share units, a subsequent tax-related stock sale, and a new RSU award with performance-based vesting conditions.

Summary

• Steven D. Gackenbach, EVP, Group President, Memorial at Matthews International Corp (MATW), reported changes in his beneficial ownership of company securities.
• On November 14, 2025, 9,200 time-based restricted share units (RSUs) vested and converted into an equal number of Class A common stock shares.
• Following the vesting, 4,002 shares of Class A common stock were sold back to the registrant at a price of $24.93 per share to cover tax withholding obligations.
• After these transactions, Gackenbach directly beneficially owns 104,144 shares of Class A common stock.
• On November 17, 2025, Gackenbach received an award of 28,500 new restricted share units under the Company's Amended and Restated 2017 Equity Incentive Plan.
• The new RSU award's vesting schedule is structured as follows: 40% vests on November 17, 2028 (time-based), 30% vests based on the Company achieving specific Return on Invested Capital (ROIC) metrics, and 30% vests based on stock price appreciation.
• Vesting for all units is generally subject to continuing employment through November 17, 2028.
• Performance-based units will convert to common stock using a factor ranging from 50% to 200% based on achievement levels, or will be forfeited if performance thresholds are not met.
• Gackenbach's beneficial ownership of derivative securities includes 13,800 restricted share units remaining from previous grants and the newly awarded 28,500 restricted share units.

Sentiment

Score: 5

Explanation: This Form 4 filing reports routine insider equity transactions, including RSU vesting, a tax-related sale, and a new RSU award with performance conditions. It does not contain information that would significantly alter the company's perceived value or outlook, thus maintaining a neutral sentiment.

Positives

• The award of 28,500 new restricted share units aligns executive incentives with company performance metrics such as Return on Invested Capital (ROIC) and stock price appreciation, indicating a commitment to long-term value creation.
• The structure of the new RSU award, with a portion tied to stock price appreciation, suggests management confidence in future share price growth.

Negatives

• The sale of 4,002 shares of Class A common stock, although for tax withholding purposes, represents a reduction in direct beneficial ownership by the executive.

Risks

• A significant portion (60%) of the newly awarded restricted share units are performance-based, meaning they are subject to forfeiture if the Company does not achieve specified Return on Invested Capital (ROIC) or stock price appreciation thresholds by the end of the performance period.
• Vesting of all restricted share units is generally subject to Steven D. Gackenbach's continuing employment through November 17, 2028, posing a risk of forfeiture if employment ceases prior to this date.

Future Outlook

The future outlook for a significant portion of Steven D. Gackenbach's executive compensation is tied to the Company's performance in Return on Invested Capital (ROIC) and stock price appreciation through November 17, 2028. This indicates a strategic focus on these key metrics for long-term value creation.

Industry Context

The reported transactions, particularly the award of performance-based restricted share units, are consistent with common executive compensation practices in publicly traded companies. Equity incentive plans are widely used across industries to align the interests of executives with those of shareholders, promoting long-term performance and retention. The inclusion of ROIC and stock price appreciation as performance metrics reflects a standard approach to incentivizing financial health and market value growth.

Comparison to Industry Standards

• The use of Restricted Share Units (RSUs) with both time-based and performance-based vesting conditions is a common practice in executive compensation across various industries, including manufacturing and industrial services, similar to companies like Dover Corporation or Illinois Tool Works.
• Tying a portion of executive equity awards to Return on Invested Capital (ROIC) is a robust metric often seen in capital-intensive industries, aligning with best practices for efficient capital deployment, comparable to how companies like 3M or Honeywell structure their long-term incentives.
• Including stock price appreciation as a performance metric is a direct way to align executive incentives with shareholder returns, a standard feature in many equity incentive plans across the S&P 500.

Corporate Governance

Related Party Transactions

• Sale of 4,002 shares of Class A common stock to the registrant (Matthews International Corp) at $24.93 per share to cover tax withholding obligations related to the vesting of restricted share units.

Stakeholder Impact

• Shareholders: The new RSU award aligns executive incentives with shareholder interests through performance metrics like ROIC and stock price appreciation, potentially fostering long-term value creation.
• Employees: The vesting conditions tied to continuing employment through November 17, 2028, incentivize executive retention.

Next Steps

• Monitoring the Company's performance against Return on Invested Capital (ROIC) targets and stock price appreciation through November 17, 2028, will be relevant for the vesting of the performance-based restricted share units.
• Steven D. Gackenbach's continued employment through November 17, 2028, is a condition for the vesting of the new RSU award.

Key Dates

Keywords

MATW, Matthews International, Steven Gackenbach, Form 4, Restricted Share Units, RSU, Executive Compensation, Equity Incentive Plan, Insider Transaction, Stock Vesting, Return on Invested Capital, ROIC