Form 4: Okta COO Sells Over 16,000 Shares Under Pre-Arranged Trading Plan

Okta's President and Chief Operating Officer, Eric Robert Kelleher, sold 16,018 shares of Class A Common Stock for approximately $1.47 million on July 15, 2025, as part of a Rule 10b5-1 trading plan.

Summary

• Eric Robert Kelleher, Okta's President and Chief Operating Officer, executed several stock transactions on July 15, 2025.
• Kelleher converted 2,410 shares of Class B Common Stock into Class A Common Stock.
• He also exercised an employee stock option for 2,410 shares of Class B Common Stock at an exercise price of $8.97, which were subsequently converted to Class A Common Stock.
• A total of 16,018 shares of Class A Common Stock were sold in two separate transactions.
• The first sale involved 12,546 shares at a weighted average price of $91.6646 per share, with individual prices ranging from $91.09 to $92.08.
• The second sale involved 3,472 shares at a weighted average price of $92.3302 per share, with individual prices ranging from $92.09 to $92.65.
• These sales were conducted pursuant to a Rule 10b5-1 trading plan adopted on April 15, 2025.
• Following these transactions, Kelleher directly beneficially owns 7,044 shares of Class A Common Stock.
• The reported Class A Common Stock holdings include 172 shares acquired under a Section 423 Employee Stock Purchase Plan.
• Remaining derivative holdings include various employee stock options and Restricted Stock Units (RSUs) with different vesting schedules, representing a significant number of potential Class A shares.

Sentiment

Score: 6

Explanation: The sentiment is neutral to slightly positive. While there are significant insider sales, they were conducted under a pre-arranged 10b5-1 plan, which mitigates the negative signal often associated with insider selling. The executive also continues to hold substantial equity and derivative interests in the company, indicating continued alignment with shareholder value.

Positives

• The sales were conducted under a pre-arranged Rule 10b5-1 trading plan, indicating a planned liquidity event rather than a reaction to new negative information.
• The reporting person continues to hold a substantial number of unexercised options and unvested Restricted Stock Units, aligning their interests with long-term shareholder value.

Negatives

• The President and Chief Operating Officer sold a significant number of shares (16,018 shares), which could be perceived as a reduction in direct equity exposure.

Risks

• Insider selling, even if pre-planned, can sometimes be interpreted negatively by the market, potentially leading to short-term downward pressure on the stock price.

Future Outlook

The document does not provide any forward-looking statements or guidance regarding the company's future performance or strategic direction.

Management Comments

• The reported price in Column 4 is a weighted average price. These shares were sold in multiple transactions at prices ranging from $91.09 to $92.08 per share, inclusive.
• The reported price in Column 4 is a weighted average price. These shares were sold in multiple transactions at prices ranging from $92.09 to $92.65 per share, inclusive.
• The Reporting Person undertakes to provide to the Issuer, any security holder of the Issuer, or to the staff of the U.S. Securities and Exchange Commission (the 'SEC'), upon request, full information regarding the number of shares sold at each separate price within the range set forth in this footnote.

Industry Context

This Form 4 filing details routine insider transactions for an executive at a publicly traded software company. Such filings are common and reflect individual liquidity management or compensation strategies, often pre-planned through Rule 10b5-1 plans. They do not inherently indicate broader industry trends unless a pattern of similar insider activity emerges across multiple companies in the sector.

Stakeholder Impact

• Shareholders: The sale of shares by a key executive, even if pre-planned, could be viewed with caution by some shareholders, though the 10b5-1 plan mitigates concerns about negative sentiment. The executive's continued significant equity holdings suggest ongoing alignment.
• Employees: The vesting schedules for options and RSUs indicate ongoing equity compensation for the executive, which is a common practice in the tech industry to retain talent.

Next Steps

• Remaining shares subject to an employee stock option shall vest in 36 equal monthly installments after September 15, 2022.
• Remaining shares underlying certain Restricted Stock Units (RSUs) shall vest in 12 equal quarterly installments after September 15, 2022.
• Remaining shares underlying certain Restricted Stock Units (RSUs) shall vest in 15 equal quarterly installments after June 15, 2022.
• Remaining shares underlying certain Restricted Stock Units (RSUs) shall vest in 11 equal quarterly installments after June 15, 2023.
• Remaining shares underlying certain Restricted Stock Units (RSUs) shall vest in 11 equal quarterly installments after June 15, 2024.
• Remaining shares underlying certain Restricted Stock Units (RSUs) shall vest in 11 equal quarterly installments after June 15, 2025.

Key Dates

Keywords

Okta, OKTA, SEC Form 4, Insider Trading, Stock Sale, Rule 10b5-1, Executive Compensation, Equity Sales, Employee Stock Option, Restricted Stock Units, Class A Common Stock, Class B Common Stock