Form 4: Toast Inc. President Stephen Fredette Executes Stock Sales and Gift Under 10b5-1 Plan

Stephen Fredette, President of Toast Inc., reports sales of Class A Common Stock and a gift of shares, executed under a pre-arranged 10b5-1 trading plan.

Summary

• Stephen Fredette, President of Toast, Inc., filed a Form 4 detailing changes in beneficial ownership.
• On September 20, 2024, Fredette sold 144,238 shares of Class A Common Stock at a weighted average price of $27.341 per share.
• On September 23, 2024, he sold 8,057 shares of Class A Common Stock at a weighted average price of $28.016 per share.
• Also on September 23, 2024, Fredette made a gift of 54,133 shares of Class A Common Stock.
• These transactions were executed under a Rule 10b5-1 trading plan adopted on June 11, 2024.
• Following these transactions, Fredette directly owns 2,098,309 shares of Class A Common Stock.
• Fredette also indirectly owns shares through several trusts: 177,500 shares via the Fredette Family Nominee Trust, 2,303,442 shares via the SHFA 2021 Nominee Trust, and 419,991 shares via the SHFA Family Trust.
• Fredette also owns 25,722,670 shares of Class B common stock, each convertible into one share of Class A common stock.

Sentiment

Score: 5

Explanation: The document primarily reports stock transactions, which are neutral events. The existence of a 10b5-1 plan suggests pre-planned sales, reducing potential negative sentiment.

Industry Context

Executive stock sales are a common occurrence, especially under 10b5-1 plans, which allow insiders to sell shares at predetermined times to avoid accusations of insider trading. The market typically analyzes these sales in the context of the company's performance and future prospects.

Comparison to Industry Standards

• Comparing Fredette's transactions to similar filings by executives at comparable companies like Block (SQ) or Shopify (SHOP) could provide context on the scale and frequency of insider selling.
• Executive compensation packages often include stock options and grants, leading to periodic sales for diversification or liquidity purposes, which is a standard practice across the tech industry.

Stakeholder Impact

• Shareholders may interpret insider sales as a lack of confidence in the company, although sales under 10b5-1 plans are often viewed differently.
• The gift of shares could be seen positively, indicating a philanthropic commitment.

Key Dates