According to the company’s filing with the US Securities and Exchange Commission (SEC), Girish Mathrubootham, founder and executive chairman of Freshworks, has sold his shares worth about $39 million.
The filing discloses that Mathrubootham sold a combined total of more than 2.5 million shares of Class A common stock through multiple transactions on December 18 and 19 at a weighted average price of between $15.33 and $16.50 per share. The stocks were sold under SEC Rule 10b5-1.
Rule 10b5-1 is a rule established by the SEC that allows corporate insiders, such as executives and directors, to set up a default trading plan for buying or selling shares of their company.
This rule provides an affirmative defense against insider trading charges. Under this rule, insiders may engage in transactions even if they possess material non-public information (MNPI) at the time of the trade, as long as the trades are executed according to a pre-established plan. The plan must be created in good faith when the insider is not aware of any material nonpublic information, and it must specify the amount, price, and date of trades or provide a formula for determining these details.
Mathrubootham, who was moved from CEO to executive chairman earlier this year, retains about 4% ownership in the company, becoming the largest individual shareholder with significant voting power.
Freshworks Inc. Currently trading at $15.33 per share. Over the past 52 weeks, the stock has fluctuated between a low of $10.81 and a high of $24.34. Despite these movements, the stock has seen a decline of about 20.48% in the past year, down from $19.68 on December 12, 2023.
The software-as-a-service major reported a 22% increase in revenue, climbing to $186.6 million for the third quarter ended September 30, 2024, up from $153.6 million in the same period last year.
The Nasdaq-listed company narrowed its loss by 3.55% to $29.9 million during the quarter under review, from $31 million a year earlier.