Fulgent Genetics President and COO Xie Jian Sells Shares in Transaction Tied to Equity Award Vesting

Executive Share Sale to Satisfy Tax Withholding Requirements

Xie Jian, serving as President and Chief Operating Officer of Fulgent Genetics, executed a share transaction on July 26, 2026, involving the disposition of 4,361 common shares at a price of $19.67 per share. The filing indicates that this sale was not a voluntary market transaction but rather a mandatory share withholding mechanism designed to satisfy tax obligations. Specifically, the shares were withheld from the reporting person to fulfill tax withholding obligations that arose upon the vesting of certain restricted stock units.

This type of transaction is a standard corporate practice where companies automatically withhold shares from equity awards to cover the employee's tax liability upon vesting. The mechanism allows executives to satisfy their tax obligations without requiring them to conduct separate market transactions. By withholding shares at the time of vesting, the company facilitates compliance with tax requirements while providing executives with the net economic benefit of their equity awards after tax satisfaction.

Restricted Stock Units Originated from Fulgent Pharma Merger

The restricted stock units that vested to trigger this withholding transaction were originally assumed by Fulgent Genetics pursuant to the Agreement and Plan of Merger dated November 7, 2022. This merger agreement involved Fulgent Genetics, Inc., FG Merger Sub, Inc., Fulgent Pharma Holdings, Inc., and various stockholders. The awards were originally reported on a Form 4 filing submitted to the Securities and Exchange Commission on November 9, 2022, establishing a clear record of their assumption in the merger transaction.

The continuation of equity awards through merger transactions is a standard practice in corporate combinations, ensuring that employees of acquired companies retain appropriate equity incentives. By assuming these awards rather than canceling them, Fulgent Genetics maintained continuity of Xie's equity compensation arrangement. The delayed vesting and recent withholding transaction demonstrate the multi-year vesting schedules typically associated with restricted stock units granted during merger transactions.

Direct and Indirect Beneficial Ownership Structure

Following the share withholding transaction, Xie maintained direct beneficial ownership of 363,244 shares of Fulgent Genetics common stock. This direct ownership represents shares held in the executive's own name and subject to his sole control. The filing indicates that Xie continues to hold a substantial direct stake in the company, reflecting his long-term investment in the organization he leads operationally.

In addition to his direct holdings, Xie beneficially owns 220,816 shares indirectly through The Hsieh Family Dynasty Trust, dated January 27, 2010. According to the filing, Xie serves on the investment committee of this trust and has disclaimed beneficial interest in the trust's holdings except with respect to any pecuniary interest therein. This structure is common among executives and wealthy individuals seeking to manage family wealth through formal trust arrangements. The combined direct and indirect shareholdings provide insight into Xie's overall economic interest in the company's performance.

Beneficial Ownership Calculations and Total Holdings

The aggregate beneficial ownership position disclosed in the filing reflects both direct and indirect holdings totaling 584,060 shares of Fulgent Genetics common stock. This combined total provides investors with a comprehensive view of the executive's economic interest in the company. The distinction between direct and indirect ownership is important for regulatory clarity and disclosure purposes, allowing investors and analysts to understand the various mechanisms through which executives hold company shares.

The filing's disclosure of beneficial ownership following the reported transaction demonstrates compliance with Section 16 reporting requirements under the Securities Exchange Act of 1934. These requirements mandate that officers, directors, and significant shareholders file reports detailing changes in their beneficial ownership. By disclosing both the transaction itself and the resulting beneficial ownership position, the filing provides complete transparency regarding changes in Xie's stake in Fulgent Genetics.

Tax Withholding as a Standard Corporate Practice

Share withholding to satisfy tax obligations represents a well-established mechanism in executive compensation administration. When restricted stock units vest, employees face immediate tax liability on the value of the vested shares, even though they have not received cash proceeds from the sale. Companies typically allow employees to authorize the withholding of a portion of their vested shares to satisfy this tax liability, with the company selling the withheld shares and remitting the proceeds to tax authorities on behalf of the employee.

In Xie's case, the withholding of 4,361 shares at $19.67 per share generated approximately $85,831 in gross proceeds (before commissions and fees) to satisfy his tax withholding obligations on the vesting event. This approach provides executives with a convenient method to satisfy tax requirements without requiring them to execute separate sell orders in the open market. The mechanism also eliminates timing risk and execution uncertainty that might otherwise arise if executives were required to sell shares independently.

Filing Timing and Regulatory Compliance

The Form 4 filing was submitted to the Securities and Exchange Commission on July 28, 2026, two days following the July 26, 2026 transaction date. This filing timing aligns with regulatory requirements, which mandate that officers, directors, and ten percent shareholders report changes in beneficial ownership. The filing's submission by Paul Kim as attorney-in-fact indicates that the reporting was executed through authorized legal representation, a common practice for corporate insiders managing compliance obligations.

The detailed explanations provided in the filing regarding the restricted stock unit assumption and the trust arrangement demonstrate the company's commitment to transparent disclosure. By clearly identifying the source of the vesting units (the November 2022 merger) and specifying the nature of indirect ownership (through a named trust with specified dates), the filing provides investors and regulators with complete context for understanding the transaction and ownership structure.

Significance of Leadership Equity Ownership for Investors

The substantial beneficial ownership position maintained by Xie as President and COO—representing over 584,000 shares directly and indirectly—reflects significant personal investment in Fulgent Genetics' long-term success. Leadership executives with meaningful equity stakes are generally viewed positively by investors, as their personal financial interests are substantially aligned with shareholder returns. The continued direct ownership of more than 363,000 shares following the tax withholding transaction indicates Xie's ongoing confidence in the company's prospects.

Share ownership by executives can serve as a signal of management confidence in the company's strategy and financial performance. However, the specific transaction reported in this filing—a mandatory tax withholding—should not be interpreted as a voluntary market decision or a commentary on Xie's outlook for the company. Investors analyzing executive share transactions should distinguish between voluntary dispositions, which may reflect personal views about valuation or cash needs, and mandatory withholdings, which are driven by tax considerations rather than discretionary choices.

Context for Fulgent Genetics Shareholders

Fulgent Genetics, a NASDAQ-listed company trading under the ticker FLGT, provides comprehensive genetic testing and laboratory services. The company's leadership structure includes Xie Jian in the dual capacity of President and Chief Operating Officer, positioning him as responsible for operational execution of the company's strategy. Executive officers typically receive equity compensation tied to vesting schedules and performance conditions, ensuring alignment with shareholder interests and long-term value creation.

The Form 4 filing represents routine disclosure regarding changes in insider beneficial ownership and provides no indication of material corporate developments or strategic changes. Investors should note that this transaction reflects administrative tax withholding mechanics rather than executive commentary on business conditions, market outlook, or company performance. The filing contributes to the body of publicly available information regarding insider equity positions at Fulgent Genetics.