Form 4: Performant Healthcare CEO Awarded Restricted Stock Units

Simeon Kohl, CEO of Performant Healthcare, received two restricted stock unit awards on May 1, 2025, with vesting conditions tied to service and stock price performance.

Summary

• Simeon Kohl, the CEO of Performant Healthcare Inc., was granted two restricted stock unit (RSU) awards on May 1, 2025.
• The first award consists of 198,320 RSUs that vest in four equal installments annually, contingent on continuous service.
• The second award consists of 198,319 RSUs that vest over four years, based on continuous service and the company's stock price reaching specific targets.
• The stock price targets are increases of +25%, +50%, +75%, and +100% versus an initial stock price based on a 60-day VWAP of $2.61 per share on the grant date.
• Each tranche has a specific vesting percentage and stock price hurdle, with time limits to achieve the hurdles, otherwise the RSUs are forfeited.
• The reporting person's Change in Control and Severance Agreement may accelerate vesting.

Sentiment

Score: 7

Explanation: The document is neutral in tone, simply reporting the grant of stock options. The vesting conditions tied to stock performance are a positive sign, aligning management with shareholder interests.

Positives

• The vesting schedule of the performance-based RSUs is tied to significant increases in the company's stock price, aligning management's interests with those of shareholders.
• The structure of the RSU awards incentivizes long-term value creation, as the CEO must remain in continuous service to vest in the awards.

Negatives

• The forfeiture of RSUs if stock price hurdles are not met could be seen as a potential loss of incentive for the CEO if the company faces unforeseen challenges.

Risks

• The company's stock price may not reach the specified hurdles within the given timeframes, leading to the forfeiture of performance-based RSUs.
• Changes in market conditions or company performance could impact the CEO's ability to meet the vesting requirements.

Future Outlook

The CEO's compensation is now partly tied to the future stock performance of the company, incentivizing growth and value creation.

Industry Context

Granting stock-based compensation to executives is a common practice in the healthcare industry to align management's interests with those of shareholders and incentivize long-term growth.

Comparison to Industry Standards

• Many companies in the healthcare sector use a combination of time-based and performance-based vesting schedules for equity awards.
• The specific stock price hurdles and vesting timelines are tailored to Performant Healthcare's specific circumstances and growth objectives.
• Comparing the total equity compensation package to those of CEOs at similarly sized healthcare companies would provide a more complete picture of its competitiveness.

Stakeholder Impact

• Shareholders may view the performance-based vesting as a positive, aligning the CEO's incentives with stock price appreciation.
• Employees may see the CEO's compensation as a reflection of the company's commitment to growth and success.

Key Dates

Keywords

Restricted Stock Units, RSU, Vesting, Stock Price Hurdle, Incentive Compensation, CEO, Simeon Kohl, Performant Healthcare, PHLT