Chen Paul Y 4

What Happened

• Paul Y. Chen, a director of Karat Packaging Inc. (KRT), had restricted stock units (RSUs) convert into common stock on May 7, 2026. The Form 4 shows 1,000 shares acquired upon conversion/vesting (derivative transaction code M).
• The filing also shows 1,000 shares disposed on the same date at $0.00 (no cash proceeds). Dispositions at $0 are commonly how companies report shares withheld or net-settled to satisfy tax withholding, though the filing does not explicitly label this as tax withholding.

Key Details

• Transaction date: May 7, 2026; Form 4 filed May 11, 2026 (timely — within two business days).
• Acquired: 1,000 shares upon RSU vesting (price N/A).
• Disposed: 1,000 shares at $0.00 (proceeds $0).
• Footnotes: F1–F3 indicate these shares came from RSUs (each RSU = 1 share); 2,000 RSUs were granted on May 7, 2024 and vest in two equal annual installments beginning May 7, 2025 — this appears to be the second installment vesting.
• Shares owned after the transaction are not specified in the provided excerpt of the filing.

Context

• This is a routine compensation-related event (RSU vesting and likely net settlement/withholding), not an open-market buy or sale for investment purposes.
• Transaction code M denotes conversion/exercise of a derivative (here, RSUs converting to common shares). A reported disposal at $0 often reflects shares withheld to cover taxes and should not be read as a cash sale signaling sentiment.