In addition, each of the Applicable NEOs will have the opportunity to achieve an additional percentage of his or her base salary for the attainment of specific non-financial performance improvements up to a maximum of an additional 40% for Mr. Hingtgen; 35% for Mr. Hammons; 20% for each of Dr. Simon and Mr. Stockton; and 10% for each of Mr. Medley and Mr. Campbell. Each Applicable NEO will also have the opportunity to achieve an additional percentage of his or her base salary for overachievement of performance goals up to a maximum of an additional 35% for Mr. Hingtgen and an additional 25% for each of Mr. Hammons, Dr. Simon, Mr. Stockton, Mr. Medley and Mr. Campbell.
Long-Term Incentive Compensation – Equity Awards
Pursuant to the Company’s Amended and Restated 2009 Stock Option and Award Plan, the Board approved the following equity grants to the Applicable NEOs, with a grant date of March 1, 2024 (the “Grant Date”):
| | | | | | | | | | | | |
Name and Position | | Non-Qualified
Stock Options | | | Time Vesting
Restricted Stock | | | Performance-Based
Restricted Stock | |
Tim L. Hingtgen, Chief Executive Officer | | | 200,000 | | | | 200,000 | | | | 400,000 | |
Kevin J. Hammons, President and Chief Financial Officer | | | 90,000 | | | | 90,000 | | | | 180,000 | |
Lynn T. Simon, M.D., President, Healthcare Innovation and Chief Medical Officer | | | 40,000 | | | | 40,000 | | | | 80,000 | |
Mark B. Medley, Regional President – Region Operations | | | 25,000 | | | | 25,000 | | | | 50,000 | |
Kevin A. Stockton, Executive Vice President of Operations and Development | | | 40,000 | | | | 40,000 | | | | 80,000 | |
Chad A. Campbell, Regional President – Region Operations | | | 25,000 | | | | 25,000 | | | | 50,000 | |
The number of shares of performance-based restricted stock granted to each Applicable NEO is subject to the attainment of certain performance objectives during the three-year period beginning January 1, 2024 and ending December 31, 2026, with the ultimate number of performance-based restricted shares vesting in respect of such awards after such three-year period ranging from 0% to 200% of the shares set forth above based on the level of achievement with respect to such performance objectives.
Both the non-qualified stock options and the time-vesting restricted stock vest ratably over three years, beginning on the first anniversary of the Grant Date.
Retention Cash Awards
The Board approved the offer of retention cash awards to Mr. Stockton, Mr. Medley and Mr. Campbell in the amount of $1,000,000, $500,000, and $500,000, respectively. Each of these awards will be divided into two installment payments, with 40% of the award payable in the third quarter of 2025 and the remaining 60% payable in the first quarter of 2027, provided that in any such case such individual remains employed by the Company through the payment date. The Board and the Compensation Committee believe these awards would serve as a key long-term retention device for these individuals in light of the requirement for these executives to remain employed with the Company through the applicable payment date in order to receive each such cash payment. These awards have not yet been entered into.
