Form 4: Marpai COO Dallas Scrip Granted 300,000 Restricted Stock Units with Performance Vesting

Marpai, Inc.'s Chief Operating Officer, Dallas Scrip, has been granted 300,000 Class A Common Stock Restricted Stock Units (RSUs) under a Rule 10b5-1 plan, with vesting tied to time and a $5 million EBITDA performance target.

Summary

• Dallas Scrip, Chief Operating Officer of Marpai, Inc. (MRAI), was granted 300,000 Restricted Stock Units (RSUs) of Class A Common Stock.
• The transaction occurred on June 9, 2025, and was made pursuant to a Rule 10b5-1(c) plan.
• The RSUs have an acquisition price of $0, which is typical for a grant.
• The vesting schedule for the RSUs is as follows: 100,000 RSUs vest on the first anniversary of the grant, 100,000 RSUs vest on the second anniversary of the grant, and the remaining 100,000 RSUs vest immediately upon Marpai Inc. achieving $5 million in unadjusted EBITDA for a full fiscal year while Mr. Scrip is employed by the company.
• Following this reported transaction, Mr. Scrip beneficially owns 300,000 Class A Common Stock units directly.

Sentiment

Score: 6

Explanation: The RSU grant is a positive for executive retention and aligns management incentives with company performance, particularly through the EBITDA target. However, it also represents potential future dilution. Overall, it's a standard and generally neutral-to-positive event in the context of corporate governance and compensation.

Positives

• The grant of 300,000 RSUs to the Chief Operating Officer aligns management's interests with shareholder value creation.
• A significant portion of the RSU vesting is tied to a specific financial performance metric ($5 million unadjusted EBITDA), incentivizing the COO to achieve company profitability goals.
• The use of a Rule 10b5-1 plan indicates a pre-arranged transaction, promoting transparency and mitigating concerns about insider trading.

Negatives

• The RSU grant represents potential future dilution for existing shareholders upon vesting.

Risks

• The vesting of 100,000 RSUs is contingent on Marpai Inc. achieving $5 million in unadjusted EBITDA for a full fiscal year, meaning this portion of the compensation is at risk if the target is not met.

Future Outlook

The document indicates a future performance target for Marpai Inc. to achieve $5 million in unadjusted EBITDA for a full fiscal year, which is a key condition for the vesting of a portion of the Chief Operating Officer's Restricted Stock Units. This suggests a strategic focus on profitability.

Management Comments

• "The RSUs vest according to the following schedule: 100,000 RSUs vest on the first anniversary of the grant, 100,000 RSU vest on the second anniversary of the grant, and 100,000 RSUS vest immediately upon the Marpai Inc. reaching $5 million in unadjusted EBITDA for a full fiscal year in which Mr. Scrip is employed by the Company."

Industry Context

The grant of Restricted Stock Units (RSUs) with both time-based and performance-based vesting conditions is a common practice in executive compensation across various industries, particularly in technology and healthcare services, to attract, retain, and incentivize key leadership. The use of an EBITDA target is a standard financial metric for performance-based awards.

Comparison to Industry Standards

• The structure of the RSU grant, combining time-based vesting with a performance-based component (EBITDA target), aligns with best practices in executive compensation designed to balance retention with performance incentives.
• While specific comparable companies or projects are not detailed in this Form 4, similar compensation structures are observed at companies like HealthEquity (HQY) or Castlight Health (CSLT) in the healthcare technology space, where executive compensation often includes equity awards tied to financial metrics or strategic milestones.
• The $5 million unadjusted EBITDA target is specific to Marpai's current financial context and would need to be evaluated against its peer group's financial performance and growth stages to assess its relative ambition.

Corporate Governance

Related Party Transactions

• The grant of 300,000 Restricted Stock Units to Dallas Scrip, the Chief Operating Officer, constitutes a related party transaction as it involves compensation from the company to a key management personnel.

Stakeholder Impact

• Shareholders: Potential future dilution from RSU vesting; improved alignment of executive interests with shareholder value creation due to performance-based vesting.
• Employees: Retention of a key executive (COO) through long-term incentive compensation.

Next Steps

• Vesting of 100,000 RSUs on the first anniversary of the grant (June 9, 2026).
• Vesting of 100,000 RSUs on the second anniversary of the grant (June 9, 2027).
• Vesting of 100,000 RSUs upon Marpai Inc. achieving $5 million in unadjusted EBITDA for a full fiscal year while Mr. Scrip is employed.

Key Dates

Keywords

Marpai Inc., MRAI, Dallas Scrip, Chief Operating Officer, COO, Restricted Stock Units, RSUs, Executive Compensation, SEC Form 4, Insider Ownership, 10b5-1 Plan, EBITDA Target, Stock Grant