Form 4: Quest Diagnostics Director Lassiter Wright III Reports Acquisition of Phantom Stock Units

Director Lassiter Wright III reports acquiring phantom stock units through elective deferrals under Quest Diagnostics' deferred compensation plan.

Summary

• On January 2, 2025, Wright L. Lassiter, III, a director of Quest Diagnostics Inc., acquired 190 phantom stock units.
• These units resulted from elective deferrals of his cash compensation under the company's Amended and Restated Deferred Compensation Plan for Directors.
• The phantom stock units are payable in cash upon Lassiter's termination of service as a director.
• Following the transaction, Lassiter directly owns 190 phantom stock units.

Sentiment

Score: 7

Explanation: The sentiment is neutral to slightly positive. The filing indicates standard compensation practices and alignment of director interests with the company's performance. There are no indications of negative events or concerns.

Positives

• The acquisition of phantom stock units aligns the director's interests with the long-term performance of the company.
• The deferred compensation plan allows directors to defer income, potentially optimizing their tax situation.

Future Outlook

The phantom stock units will be payable in cash upon the reporting person's termination of service as a director.

Industry Context

Director compensation through equity-based awards and deferred compensation plans is a common practice in publicly traded companies to align management's interests with shareholder value. Phantom stock units are often used as a cash-settled alternative to traditional stock options or restricted stock.

Comparison to Industry Standards

• Many companies, including those in the diagnostics and healthcare sectors like Laboratory Corporation of America (Labcorp) and Bio-Rad Laboratories, utilize deferred compensation plans for their directors.
• The specific terms and conditions of these plans, such as vesting schedules and payout triggers, can vary significantly across companies.
• The use of phantom stock units is a fairly standard practice, offering a cash-based incentive tied to the company's stock performance without diluting existing shareholders.

Stakeholder Impact

• Shareholders are indirectly impacted as the director's compensation is tied to the company's performance.
• The compensation structure aims to align the director's interests with those of the shareholders.

Key Dates