Form 4: Passage Bio CFO Converts RSUs, Sells Shares for Tax

Passage Bio's CFO, Kathleen Borthwick, converted 5,000 restricted stock units into common stock and subsequently sold 2,062 shares to cover tax obligations.

Summary

• Kathleen Borthwick, CFO of Passage BIO, Inc. (PASG), converted 5,000 restricted stock units (RSUs) into common stock on January 8, 2026.
• Following the RSU conversion, Borthwick beneficially owned 7,464 shares of common stock, which included 200 shares acquired on May 15, 2025, and 200 shares acquired on November 15, 2025, through the 2020 Employee Stock Purchase Plan.
• On the same date, Borthwick sold 2,062 shares of common stock at a weighted average price of $18.4394 per share to satisfy tax withholding obligations related to the RSU vesting.
• The reported sale price ranged from $18.13 to $19.3061 per share.
• After these transactions, Borthwick directly owned 5,402 shares of Passage BIO common stock.
• An additional 5,000 restricted stock units are scheduled to vest on January 8, 2027, subject to continued service.

Sentiment

Score: 6

Explanation: The filing reports routine insider transactions involving RSU vesting and a tax-mandated stock sale. While a sale reduces direct holdings, it is not a discretionary trade and the vesting itself is a positive for executive compensation. The overall sentiment is neutral to slightly positive due to the vesting and continued equity participation.

Positives

• CFO Kathleen Borthwick's vesting of 5,000 restricted stock units demonstrates continued equity participation and alignment with shareholder interests.
• Acquisition of 400 shares (200 on May 15, 2025, and 200 on November 15, 2025) through the Employee Stock Purchase Plan indicates ongoing investment by the CFO.

Negatives

• The sale of 2,062 shares, although mandated for tax withholding, reduces the CFO's direct common stock holdings.

Future Outlook

The filing indicates that 50% of the total restricted stock units (5,000 RSUs) are scheduled to vest on January 8, 2027, contingent upon the CFO's continued service to the Issuer.

Industry Context

This Form 4 filing details an insider transaction, specifically the vesting of restricted stock units and a subsequent "sell to cover" transaction for tax purposes. Such transactions are common for executives in publicly traded companies as part of their compensation structure and do not inherently reflect broader industry trends or specific company performance beyond the individual's equity compensation.

Comparison to Industry Standards

• The "sell to cover" mechanism for tax withholding is a standard practice in equity compensation plans across various industries, including biotechnology, to manage tax liabilities upon RSU vesting.
• The acquisition of shares through an Employee Stock Purchase Plan (ESPP) is also a common benefit offered by companies to encourage employee ownership, aligning employee interests with shareholder value.

Related Party Transactions

• The vesting of restricted stock units and the subsequent "sell to cover" transaction are related party dealings as they involve an executive (Kathleen Borthwick) and the company (Passage BIO, Inc.) as part of her compensation.

Stakeholder Impact

• Shareholders: The CFO's continued equity participation through RSU vesting and ESPP acquisitions aligns her interests with shareholders. The tax-mandated sale is a routine event and not indicative of a lack of confidence.
• Employees: The existence of an Employee Stock Purchase Plan (ESPP) and Restricted Stock Units (RSUs) indicates a compensation structure designed to incentivize employees and align their interests with company performance.

Next Steps

• The remaining 50% of the restricted stock units are scheduled to vest on January 8, 2027, subject to continued service.

Key Dates

Recommendation

This Form 4 filing details routine insider transactions, specifically the vesting of restricted stock units and a mandatory "sell to cover" sale for tax purposes. These events are part of standard executive compensation and do not reflect a discretionary investment decision by the CFO. While the sale reduces direct holdings, it is not indicative of a change in the company's fundamental outlook or the CFO's confidence. Therefore, the filing itself does not provide new information that would warrant a change in an existing investment thesis, leading to a "hold" recommendation.

Keywords

Passage BIO, PASG, Form 4, Insider Trading, Restricted Stock Units, RSU Conversion, Stock Sale, CFO, Kathleen Borthwick, Employee Stock Purchase Plan, Tax Withholding