Form 4: UL Solutions Director James Shannon Receives Equity Grant

Director James M. Shannon was awarded 2,206 deferred restricted stock units as part of UL Solutions Inc. non-employee director compensation plan.

Summary

• James M. Shannon, a member of the Board of Directors, received a grant of 2,206 Deferred Restricted Stock Units (DRSUs) on May 20, 2026.
• Each DRSU represents a contingent right to receive one share of Class A Common Stock.
• The units are scheduled to vest on the earlier of the one-year anniversary of the grant or the date of the next annual meeting.
• Following this transaction, the reporting person directly owns a total of 2,206 derivative securities in the form of DRSUs.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a neutral to slightly positive governance event, reflecting standard director compensation and alignment with shareholder interests.

Positives

• Aligns director interests with those of shareholders through equity-based compensation.
• Indicates a commitment to long-term value creation as the units have a one-year vesting period.
• The use of a Deferred Compensation Plan suggests structured and transparent governance regarding director pay.

Negatives

• Represents a potential, albeit minor, dilution of existing Class A Common Stock upon settlement.
• The grant is a fixed award regardless of short-term market performance fluctuations.

Risks

• The ultimate value of the award is subject to the market price of Class A Common Stock at the time of settlement.
• Vesting is contingent upon the director remaining in service until the one-year anniversary or the next annual meeting.

Future Outlook

The grant ensures the director remains incentivized through at least May 2027, aligning board oversight with the company's annual performance cycle.

Management Comments

• Each deferred restricted stock unit represents a contingent right to receive one share of the Issuer's Class A Common Stock.
• The DRSUs will vest on the earlier of the one-year anniversary of the grant date or the date of the annual meeting following the grant date.

Industry Context

StockSavvy.ai notes that equity-based compensation for non-employee directors is a standard practice among publicly traded companies in the testing, inspection, and certification industry to ensure board members have skin in the game.

Comparison to Industry Standards

• The grant size is consistent with mid-to-large cap industrial services companies providing annual equity retainers to independent directors.
• The one-year cliff vesting schedule is a common benchmark for director equity awards to ensure stability between annual general meetings.

Corporate Governance

Related Party Transactions

• The issuance of equity to a director is considered a related party transaction under standard compensation agreements.

Stakeholder Impact

• Shareholders may see minor dilution upon the eventual conversion of these units into common stock.
• The director is incentivized to maintain oversight that supports the company's stock price.

Next Steps

• Vesting of the 2,206 DRSUs on or around May 20, 2027.
• Settlement of shares into Class A Common Stock according to the director's election under the Deferred Compensation Plan.

Key Dates

Recommendation

This is a routine administrative filing regarding director compensation and does not signal a change in company fundamentals or strategic direction.

Keywords

UL Solutions Inc., ULS, Insider Trading, Director Compensation, Deferred Restricted Stock Units, Equity Grant, Class A Common Stock, Corporate Governance