HealthStream announced that its Chief Executive Officer, Robert A. Frist, Jr., has contributed approximately $2.25 million of his personally owned shares of HealthStream common stock for the benefit of HealthStream employees. To accomplish this, Mr. Frist has contributed 86,494 of his shares to HealthStream, and HealthStream has approved the grant of that same number of shares under its 2016 Omnibus Incentive Plan to eligible employees, as noted below. These shares will not be subject to any vesting conditions and are being issued effective immediately.
“Since its founding as a two-person, tech start-up over 30 years ago, HealthStream has grown into an industry-leading, innovative public company that is improving the quality of healthcare by developing the people who deliver care—and our employees have made this happen”
Over 1,000 HealthStream employees will receive shares of stock from this contribution, none of whom are executives, vice presidents, or associate vice presidents who periodically receive equity grants in the Company’s stock incentive plan.
“Since its founding as a two-person, tech start-up over 30 years ago, HealthStream has grown into an industry-leading, innovative public company that is improving the quality of healthcare by developing the people who deliver care—and our employees have made this happen,” said Robert A. Frist, Jr., Chief Executive Officer, HealthStream. “I am excited to make this contribution to allow our employees, many of whom have not previously participated in our equity programs, to become owners in the Company that they helped to build and join all of our stakeholders in the future success of HealthStream.”
The grant of HealthStream common stock for employees will result in no dilution of shares to any existing shareholders other than Mr. Frist. In addition, Mr. Frist has contributed an additional 7,113 shares (valued at approximately $185,000) to HealthStream, without consideration paid to Mr. Frist, which amount is equivalent to the estimated Company costs associated with the equity grants, such as administrative expenses and employer payroll taxes which will be associated with the grants. The Company will record a compensation expense of approximately $2.25 million, along with approximately $185,000 for such administrative expenses and employer payroll taxes, in connection with this transaction in the fourth quarter of 2021. The only impact on adjusted EDITDA in connection with this transaction will be approximately $185,000 of such payroll tax and administrative expenses.
“I am humbled by our employees’ visionary drive and hard work to make a difference in healthcare, particularly during the last 21 months in their relentless support of the healthcare workforce through the extraordinary challenges brought on by COVID-19,” said Mr. Frist. “For those that have been on this journey with me over the months and years, I want to recognize their service with this expression of my appreciation.”
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