An interesting Form 144 came out tonight involving SoFi CEO Anthony Noto. It contains details on the proposed forward sale of 2 million shares worth about $34 million. While Noto is getting cash proceeds over the course of the loan (sort of like a credit revolver), he is not selling these shares today. Instead, shares will be delivered to Goldman Sachs at the end of the loan. It’s important to note that the $34 million (& likely some kind of interest expense) is fixed and based on the current stock price. Meaning? As SoFi’s stock potentially appreciates by the end of the transaction timeline, he will deliver progressively fewer shares than the 2 million base period amount.
The deal represents just 25% of his current stake and a much smaller percentage when including the large performance stock unit (PSU) packages heading his way. He gets those tranches if SoFi sustainably reaches a $25/share average for a 90-day period, then $35 & then $45. His incentives are firmly aligned with ours. It’s also worth reminding everyone that he has purchased a few million shares in the open market over the last couple of years… despite SoFi stock already being a massive proportion of his net worth.