Form 4: Centene Counsel Koster Reports Tax-Related Stock Disposition

Centene's Secretary and General Counsel, Christopher Koster, reported a disposition of 9,087 common shares for tax withholding purposes related to restricted stock unit vesting.

Summary

• Christopher Koster, Secretary & General Counsel of Centene Corp (CNC), reported a transaction on March 15, 2026.
• The transaction involved the disposition of 9,087 shares of common stock.
• These shares were withheld for taxes upon the vesting of previously-reported grants of restricted stock units.
• The price per share for the disposition was $34.45.
• Following this transaction, Mr. Koster directly beneficially owns 352,835.617 shares of common stock.
• This direct ownership includes 229,874 shares of previously-granted restricted stock units and performance stock units subject to vesting requirements.
• Additionally, 100 shares are indirectly beneficially owned by his spouse.
• Mr. Koster also holds 15,690 common stock options with an exercise price of $81.85, granted on December 15, 2021, and expiring on December 15, 2031. These options may become exercisable on or after the third anniversary of the grant date if CNC's common stock closing price equals or exceeds $100 per share for 20 consecutive trading days.
• He also holds 3,015.544 shares of phantom stock, which represent the right to receive the fair market value of one share of Centene common stock, settled in cash or other non-Company securities upon termination or election.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a neutral to slightly positive event. While shares were disposed of, it was for tax purposes related to vesting, indicating successful compensation and continued executive alignment through significant remaining holdings and future-oriented options.

Positives

• The underlying event is the vesting of restricted stock units, which indicates compensation and retention of a key executive.
• The executive continues to hold a significant number of shares and derivative securities, aligning his interests with shareholders.

Negatives

• A disposition of shares, even for tax purposes, reduces the executive's direct equity stake.

Risks

• The performance stock option's exercisability is contingent on the stock price reaching $100 for 20 consecutive trading days, introducing market performance risk for the executive's potential gain.

Future Outlook

The performance stock option highlights a future potential for the stock price to reach $100 per share for 20 consecutive trading days, which would enable the executive to exercise the option. The phantom stock will be settled upon Mr. Koster's termination or election.

Industry Context

StockSavvy.ai notes that Form 4 filings are routine disclosures for insider transactions, providing transparency into executive stock ownership and compensation activities. This specific filing reflects a common practice of shares being withheld to cover tax obligations upon the vesting of equity awards, which is standard across many industries for executive compensation.

Comparison to Industry Standards

• StockSavvy.ai observes that the practice of withholding shares for tax purposes upon the vesting of restricted stock units is a standard mechanism for managing executive equity compensation across publicly traded companies, including peers in the healthcare services sector like UnitedHealth Group (UNH) or Anthem (ELV, now Elevance Health).
• The structure of performance-based options, contingent on specific stock price targets (e.g., $100 per share for 20 consecutive trading days), is also a common incentive mechanism designed to align executive interests with long-term shareholder value creation, similar to those seen in other large-cap companies.

Stakeholder Impact

• Shareholders: Provides transparency into executive compensation and ownership, showing continued alignment of a key executive's interests with the company's performance.
• Employees: Reflects standard executive compensation practices, which can influence broader compensation strategies.

Next Steps

• The performance stock option may become exercisable on or after December 15, 2024 (third anniversary of grant date) if the stock price condition is met.
• The phantom stock will be settled upon Mr. Koster's termination with the Company or on such other date he may elect.

Key Dates

Recommendation

This Form 4 filing details a routine insider transaction related to executive compensation and tax obligations. It does not provide new information about the company's operational performance, financial health, or strategic direction that would warrant a change in investment recommendation. The executive's continued significant holdings and performance-based incentives suggest ongoing alignment with shareholder interests, supporting a 'hold' stance for existing investors.

Keywords

Centene, CNC, Form 4, Insider Transaction, Stock Disposition, Restricted Stock Units, Performance Stock Options, Executive Compensation, Christopher Koster, Tax Withholding