Escoe T. Kenneth 4

What Happened

• Escoe T. Kenneth, Executive Vice President of Illinois Tool Works (ITW), received company stock from performance-based awards and had shares withheld to cover taxes. On Feb 12, 2026, 1,883 performance share units (PSUs) were certified/converted into common shares (derivative conversion). To cover tax withholding, 568 shares were surrendered at an implied price of $298.51 per share, totaling $169,554. On Feb 13, 2026, Kenneth was credited with a 10,120-share award (derivative grant).

Key Details

• Transaction dates: Feb 12, 2026 (PSU settlement and tax withholding); Feb 13, 2026 (award grant).
• Tax withholding: 568 shares withheld at $298.51/share = $169,554.
• Acquisitions: 1,883 shares from PSU conversion (Feb 12) and 10,120 shares from grant/award (Feb 13). The 1,883 conversion also appears in the derivative reporting lines reflecting settlement mechanics.
• Shares owned after the transactions: not specified in the Form 4.
• Relevant footnotes: PSUs were certified and settled on Feb 12 (F1, F5); each PSU represents a contingent right to one share (F2); some shares include dividend reinvestment plan allocations (F3); shares allocated in the company savings plan as of Feb 12 (F4). Grant awards are derivative in nature and typically subject to vesting (F6 notes standard vesting schedule for options).
• Filing timeliness: Form filed Feb 17, 2026 for transactions through Feb 13 — filing appears timely.

Context

• These transactions are award/settlement actions (not open-market buys or discretionary sales). The 568-share disposition is a routine “sell-to-cover”/tax withholding to satisfy payroll tax obligations, not an active market sale for investment purposes.
• Performance share units convert to common stock upon certification of performance metrics; newly granted awards are typically subject to vesting and performance conditions, so the shares may not be immediately transferable.