Form 4: Rapid7 Director Benjamin Nye Granted Over 10,000 Restricted Stock Units

Rapid7, Inc. Director Benjamin Nye was granted a total of 10,148 Restricted Stock Units (RSUs) through two separate awards, increasing his direct beneficial ownership to 80,294 shares.

Summary

• Benjamin Nye, a Director of Rapid7, Inc. (RPD), was granted 8,420 Restricted Stock Units (RSUs) on June 11, 2025.
• This RSU grant vests in full on the earlier of the Issuer's next annual meeting of stockholders held after the grant date or the first anniversary of the grant date, subject to continued service.
• Additionally, Mr. Nye was granted 1,728 Restricted Stock Units (RSUs) on June 11, 2025, as an election to receive equity in lieu of cash compensation under the Issuer's Non-Employee Director Compensation Policy.
• This second RSU grant vests in four quarterly installments, with the first installment vesting on September 30, 2025, and vesting in full on the earlier of the Issuer's next annual meeting of stockholders held after the grant date or the first anniversary of the grant date, subject to continued service.
• Following these transactions, Benjamin Nye's direct beneficial ownership of Rapid7 common stock, including RSUs, increased to 80,294 shares.
• The transactions were made pursuant to a contract, instruction, or written plan for the purchase or sale of equity securities of the issuer that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c).

Sentiment

Score: 6

Explanation: The document reports a standard compensation event for a director, which is generally a neutral to slightly positive signal as it aligns director interests with shareholders. The election to take equity over cash is a positive sign of confidence.

Positives

• The grant of Restricted Stock Units to a director aligns management's interests with those of shareholders, as the value of the compensation is tied to the company's stock performance.
• The election by the director to receive equity in lieu of cash compensation demonstrates confidence in the company's future prospects and conserves cash for the company.

Future Outlook

The vesting schedules for the RSU grants indicate future equity awards will convert to common stock, contingent on the director's continued service with Rapid7, Inc. The first quarterly vesting for a portion of the RSUs is set for September 30, 2025.

Industry Context

This Form 4 filing reflects standard practice for compensating non-employee directors in publicly traded technology companies, often involving a mix of cash and equity to align their interests with long-term shareholder value. The use of RSUs with vesting conditions is a common mechanism to retain directors and incentivize performance within the cybersecurity and IT operations industry.

Comparison to Industry Standards

• The grant of Restricted Stock Units (RSUs) as part of director compensation is a common practice across the technology sector, including companies like CrowdStrike Holdings, Inc. (CRWD) and Zscaler, Inc. (ZS), which also utilize equity awards to incentivize and retain their board members.
• The option for directors to elect equity in lieu of cash compensation, as seen with Benjamin Nye, is also a prevalent feature in director compensation policies, aligning with best practices for corporate governance and demonstrating director confidence in the company's stock performance, similar to policies at Palo Alto Networks (PANW) or Fortinet (FTNT).

Corporate Governance

Related Party Transactions

• The RSU grants to Benjamin Nye, a director, represent compensation transactions between the company and a related party (a member of its board of directors).

Stakeholder Impact

• Shareholders: The grants align the director's financial interests with the long-term performance of the company's stock, potentially benefiting shareholders if the stock price increases.
• Employees: No direct impact on employees is indicated by this filing.
• Customers: No direct impact on customers is indicated by this filing.
• Suppliers: No direct impact on suppliers is indicated by this filing.
• Creditors: No direct impact on creditors is indicated by this filing.

Next Steps

• The 8,420 RSU grant will vest in full on the earlier of Rapid7's next annual meeting of stockholders or June 11, 2026.
• The 1,728 RSU grant will have its first quarterly vesting installment on September 30, 2025, and will vest in full on the earlier of Rapid7's next annual meeting of stockholders or June 11, 2026.

Key Dates

Recommendation

Keywords

Rapid7, RPD, Restricted Stock Units, RSU, SEC Form 4, Insider Trading, Director Compensation, Equity Compensation, Corporate Governance, Stock Ownership, Rule 10b5-1