Form 4: Rithm Capital Corp. CEO Michael Nierenberg Reports Changes in Beneficial Ownership

Michael Nierenberg, CEO of Rithm Capital Corp., reports acquisition of common stock and Class B Profits Units due to dividend equivalent rights and grants, along with adjustments to holdings in trusts.

Summary

• On April 30, 2025, Michael Nierenberg, the CEO of Rithm Capital Corp., filed a Form 4 detailing changes in his beneficial ownership of the company's securities.
• Nierenberg acquired 4,168 shares of common stock due to dividend equivalent rights accrued on existing time-based restricted stock units.
• He also acquired Class B Profits Units of Rithm Capital Management LLC (RCM), which are exchangeable into shares of Rithm Capital Corp. common stock on a one-for-one basis.
• These acquisitions include 4,516 units related to dividend equivalent rights, 20,323 units earned based on 2024 return on equity, and 5,662 units granted on February 24, 2025.
• Nierenberg's direct holdings include 1,097,388 shares of common stock, including unvested restricted stock units and shares.
• He also has indirect ownership through various trusts for his children, daughter, and son, as well as a 2019 GRAT and custodian accounts.
• His direct holdings of Class B Profits Units are 306,385, 925,933 and 257,975 respectively.
• The Class B Profits Units vest over time, contingent on continued employment and the allocation of sufficient profits.

Sentiment

Score: 7

Explanation: The sentiment is neutral to positive. The CEO is increasing his stake in the company through dividend equivalents and vesting of performance-based units, which signals confidence. However, it's a routine filing, so the impact is limited.

Positives

• The acquisition of common stock through dividend equivalent rights indicates a return of value to shareholders.
• The vesting of Class B Profits Units based on performance (return on equity) aligns management's interests with those of the shareholders.
• The increase in holdings demonstrates the CEO's continued investment in the company.

Risks

• The vesting of Class B Profits Units is contingent on continued employment, which could be a risk if the CEO were to leave the company.
• The exchange of Class B Profits Units into common stock is dependent on the allocation of sufficient profits, which may not always be guaranteed.

Future Outlook

The document does not contain explicit forward-looking statements, but the vesting schedules of the Class B Profits Units suggest a continued commitment from the CEO.

Industry Context

Form 4 filings are a standard part of regulatory compliance for company insiders and provide transparency into their transactions. This filing indicates the CEO's continued investment in the company, which can be viewed positively by investors.

Comparison to Industry Standards

• Comparing Nierenberg's holdings and transactions to those of CEOs at similar REITs (e.g., Annaly Capital Management, Starwood Property Trust) would provide context on whether his level of ownership and activity is typical.
• The vesting schedules and performance-based criteria for the Class B Profits Units can be compared to industry standards for executive compensation to assess their competitiveness and alignment with shareholder interests.
• Analyzing the dividend equivalent rights in comparison to other REITs dividend policies would provide context.

Stakeholder Impact

• Shareholders may view the CEO's increased stake as a positive sign of confidence in the company's future.
• Employees may be motivated by the performance-based vesting of the Class B Profits Units, aligning their interests with the company's success.

Key Dates

Keywords

Rithm Capital Corp., Michael Nierenberg, beneficial ownership, Form 4, common stock, Class B Profits Units, dividend equivalent rights, Rithm Capital Management LLC, RCM, restricted stock units