Form 4: Reddit CLO Sells Shares After Option Exercise

Reddit's Chief Legal Officer, Benjamin Seong Lee, exercised stock options and subsequently sold a significant number of Class A Common Stock shares in December 2025.

Summary

• Benjamin Seong Lee, Chief Legal Officer of Reddit, Inc., reported transactions involving Class A Common Stock on December 16 and December 18, 2025.
• On December 16, 2025, Lee exercised options to acquire 50,000 shares of Class A Common Stock at an exercise price of $7.92 per share.
• Immediately following the option exercise on December 16, 2025, Lee sold 50,000 shares of Class A Common Stock at weighted average prices ranging from $216.43 to $223.93.
• On December 18, 2025, Lee exercised options to acquire 18,750 shares of Class A Common Stock at an exercise price of $7.92 per share.
• Immediately following the option exercise on December 18, 2025, Lee sold 18,750 shares of Class A Common Stock at a weighted average price of $240 per share.
• All reported sales were executed pursuant to a Rule 10b5-1 trading plan adopted by Lee on September 11, 2025.
• Following these transactions, Lee directly beneficially owns 62,608 shares of Class A Common Stock and 180,750 stock options.

Sentiment

Score: 5

Explanation: The filing reports routine insider transactions (option exercise and subsequent sale) executed under a pre-arranged 10b5-1 plan. While insider selling can sometimes be viewed negatively, the pre-planned nature mitigates immediate concerns about new negative information.

Positives

• The executive exercised stock options at a low price of $7.92 per share, indicating a significant unrealized gain prior to the sales.
• Shares were sold at high prices, ranging from $216.43 to $240, demonstrating a substantial profit from the option exercises.
• The transactions were conducted under a Rule 10b5-1 trading plan, indicating pre-planned sales not based on immediate material non-public information.

Negatives

• Significant insider selling by a key executive (Chief Legal Officer) reduces their direct beneficial ownership in the company.
• The total number of shares sold (68,750 shares) represents a notable reduction in the executive's direct holdings.

Future Outlook

NA

Management Comments

• The sales reported were effected pursuant to a Rule 10b5-1 trading plan adopted by the Reporting Person on September 11, 2025.
• The stock option is fully vested and currently exercisable.

Industry Context

NA

Stakeholder Impact

• Shareholders: May interpret the significant insider selling as a signal, though the 10b5-1 plan suggests it is not based on new material non-public information.

Key Dates

Recommendation

The filing details a pre-planned insider sale by a key executive following the exercise of stock options. While the sale is substantial, its execution under a Rule 10b5-1 plan suggests it is not based on new material non-public information, but rather a scheduled liquidity event. Investors should monitor future filings and company performance, but this specific transaction alone does not warrant a strong buy or sell recommendation, suggesting a 'hold' position.

Keywords

Reddit, RDDT, Insider Trading, Form 4, Stock Option Exercise, Share Sale, Chief Legal Officer, Benjamin Seong Lee, 10b5-1 Plan, Equity Compensation