Form 4: Director Sells Paramount Group Units in Merger

Paramount Group Director Paula Sutter disposed of 90,789 operating partnership units for $6.60 per unit following a merger-related conversion of LTIP units.

Summary

• Paula Sutter, a Director of Paramount Group, Inc. (PGRE), reported transactions related to her beneficial ownership on December 19, 2025.
• A total of 63,139 LTIP Units automatically converted into an equivalent number of Common OP Units due to the Partnership Merger Effective Time and their Book-Up Target becoming zero.
• Specifically, 12,769 vested LTIP Units (granted 12/15/2023), 25,000 vested LTIP Units (granted 05/16/2024), and 25,370 time-vested LTIP Units (granted 05/15/2025) converted into OP Units.
• Immediately following these conversions, Sutter disposed of all 90,789 Common OP Units she beneficially owned.
• The disposition occurred as part of a merger agreement with Rithm Capital Corp., where each outstanding OP Unit was exchanged for $6.60 in cash.
• The reported 90,789 OP Units included 27,650 LTIP Units granted on May 18, 2023, which had previously converted to OP Units but were not reported on a prior Form 4.

Sentiment

Score: 6

Explanation: Neutral to slightly positive. The transaction is a routine insider sale due to a merger, allowing the director to monetize holdings. The prior unreported conversion is a minor negative, but the overall event is a standard part of a corporate transaction.

Positives

• Director Paula Sutter realized cash proceeds totaling $599,207.40 from her equity holdings as part of a merger transaction.
• The conversion of LTIP units to OP units and subsequent cash exchange indicates a successful vesting and monetization event for the director.

Negatives

• The disposition of all OP Units by a director could be interpreted as a reduction in insider exposure to the company's future performance, post-merger.
• A prior conversion of 27,650 LTIP Units into OP Units was not reported on a Form 4, indicating a potential past reporting oversight, though it is now being accounted for in the current disposition.

Risks

• The merger transaction itself carries inherent risks related to integration, synergy realization, and potential changes in strategic direction under new ownership (Rithm Capital Corp.).
• The complete disposition of OP Units by a director removes their direct financial alignment with the operating partnership's future performance.

Future Outlook

The filing primarily reports a past transaction related to a merger and does not provide explicit forward-looking statements or guidance from the company. The disposition of units by a director is a consequence of the merger, which implies a change in the company's ownership structure.

Management Comments

• No direct quotes or paraphrased statements from company management are provided in this Form 4 filing, which is typical for this document type.

Industry Context

This transaction is a direct result of a merger involving Paramount Group, Inc. and Rithm Capital Corp. Such insider transactions are common during corporate acquisition events, as equity awards and partnership units are typically converted or cashed out according to merger agreements. The real estate investment trust (REIT) sector frequently sees such consolidation activities.

Comparison to Industry Standards

• The conversion of LTIP units to OP units and subsequent cash-out at a fixed price per unit is a standard mechanism in REIT mergers and acquisitions for compensating holders of partnership interests and equity awards.
• The $6.60 per unit consideration would need to be compared to the pre-merger trading price of PGRE common stock and the valuation multiples of comparable REIT transactions to assess its fairness, but this filing does not provide enough information for such a detailed comparison.
• For example, comparing the per-unit price to recent REIT acquisitions like Blackstone's acquisition of Tricon Residential or Prologis's acquisition of Duke Realty would provide context on market valuations, but specific details are not available here.

Stakeholder Impact

• Shareholders: The merger consideration of $6.60 per OP unit provides a clear exit value for holders of these units. The overall merger with Rithm Capital Corp. would have broader implications for common stock shareholders, but this filing focuses on OP units.
• Employees (specifically Paula Sutter as a director): The transaction represents the monetization of equity-based compensation (LTIP Units) as part of a corporate event.

Next Steps

• No specific future actions or milestones are mentioned for the company or the reporting person in this filing, beyond the completion of the merger transaction.

Key Dates

Keywords

Paramount Group, PGRE, Paula Sutter, Form 4, Insider Trading, SEC Filing, LTIP Units, OP Units, Merger, Rithm Capital Corp., Director Transaction, Equity Disposition