Form 4: Rithm CLO converts units, sells 19,285 shares

Rithm Capital’s Chief Legal Officer exchanged 19,285 Class B Profits Units for common stock at $0 and sold the shares at $11.105 on November 14, 2025.

Summary

• Chief Legal Officer David Zeiden exchanged 19,285 Class B Profits Units for an equal number of Rithm Capital common shares at an exercise price of $0 on 2025-11-14 (code M).
• Immediately sold 19,285 common shares at $11.105 per share on 2025-11-14 (code S).
• Common stock beneficially owned after the transactions: 0 shares (Direct).
• Derivative securities (Class B Profits Units) beneficially owned after the transactions: 21,025 units (Direct).
• The exchanged units derive from a profits interest award granted on 2024-05-01, vesting 50% on 2025-01-01 and 50% on 2026-01-01, contingent on continued employment.
• Class B Profits Units are exchangeable into common stock on a one-for-one basis after vesting and sufficient profit allocation to the holder.

Sentiment

Score: 4

Explanation: Net insider sale of shares immediately after exchange can be viewed as mildly negative, though the executive retains 21,025 derivative units and the transaction appears routine.

Positives

• Clear disclosure of insider transaction details including dates, amounts, and prices.
• Retention of 21,025 Class B Profits Units suggests continued long-term equity alignment.
• Vesting schedule through 2026 supports retention incentives for a key executive.

Negatives

• Sale of all 19,285 shares acquired the same day may be perceived as insider selling pressure.
• Zero common shares held directly after the transaction.

Risks

• Future exchangeability of remaining Class B Profits Units is contingent on vesting and sufficient profits allocation.
• Vesting of the May 1, 2024 award requires continued employment through the vesting dates (2025-01-01 and 2026-01-01).

Future Outlook

Remaining Class B Profits Units from the May 1, 2024 award are scheduled to vest on January 1, 2026 and may be exchangeable into common stock thereafter, subject to sufficient profit allocation and continued employment conditions.

Industry Context

This is a routine insider liquidity event featuring a same-day exchange and sale of equity-based awards, common across financial services and asset management firms. Such transactions generally have minimal operational implications and limited market impact given the modest size.

Comparison to Industry Standards

• Same-day option/unit exercise and sale is standard practice for executives across asset managers and REITs, similar to patterns seen at peers like Blackstone (BX) and KKR (KKR).
• Use of profits interest (or similar) awards that vest over multiple years aligns with common long-term incentive structures in the sector.
• Transaction size (19,285 shares) is immaterial relative to typical daily trading volumes for large-cap financials, implying low market impact.

Related Party Transactions

• Exchange of Class B Profits Units in Rithm Capital Management LLC into Rithm Capital Corp. common stock as part of an equity compensation program.

Stakeholder Impact

• Minimal impact on shareholders given the small transaction size relative to total shares outstanding.
• Provides transparency to investors regarding executive equity activity and alignment.
• No operational impact on employees, customers, suppliers, or creditors indicated.

Next Steps

• Second tranche of the May 1, 2024 award expected to vest on 2026-01-01, subject to continued employment.
• Potential future exchanges of vested Class B Profits Units into common stock, contingent on sufficient profit allocation.

Key Dates

Keywords

Rithm Capital, RITM, Form 4, insider transaction, insider sale, Class B Profits Units, equity compensation, beneficial ownership, executive compensation