DEF 14A of Option Care Health, Inc.
Filed Apr 2, 2025 · FY20240001140361-25-011852
2024 Director Nominees
2024 Director Nominees
2024 Director Nominees
| Name | Age | Years on the Board | Independent | # of Other U.S. Public Company Boards | Audit Committee | Compensation Committee | Finance and Investment Committee | Nominating and Corporate Governance Committee | Quality and Compliance Committee | | Elizabeth Q. Betten | 44 | 6 | Yes | 0 | | | Chair | | Member | | Elizabeth D. Bierbower | 66 | 3 | Yes | 0 | Member | | | | Member | | Barbara W. Bodem | 57 | 1 | Yes | 2 | Member | | | Member | | | Eric K. Brandt | 62 | 1 | Yes | 3 | | Member | Member | | | | Natasha Deckmann, M.D. | 48 | 3 | Yes | 0 | | | Member | Member | Chair | | David W. Golding | 63 | 10 | Yes | 0 | | Member | | | | | Harry M. Jansen Kramer, Jr. | 70 | 6 | Yes | 1 | Member | | | Chair | | | R. Carter Pate | 70 | 10 | Yes | 1 | Chair | | Member | | | | John C. Rademacher | 58 | 6 | No | 0 | | | | | | | Timothy P. Sullivan | 67 | 6 | Yes | 0 | | Member | | | | | Norman L. Wright | 60 | 1 | Yes | 1 | | Chair | | Member | |
Compensation Best Practices
| What We Do | | | | Tie approximately 88% of target CEO compensation to corporate performance and creation of long-term stockholder value | | | The Compensation Committee has discretion to adjust any performance-based equity award payouts for certain events to reflect original intent of the awards | | | Maintain robust stock ownership requirements, including stock retention provisions | | | Dodd-Frank clawback policy plus a policy that allows recovery of compensation in the event of certain acts of misconduct by NEOs and senior management | | | Independent compensation consultant | | | Annual compensation risk assessment | | | Maintain “double-trigger” provisions for all change in control scenarios for the NEOs |
Compensation Best Practices
| What We Don't Do | | | | No short sales, hedging or pledging of our securities by any NEO | | | No excise tax gross-ups in our Executive Severance Plan or for perquisites | | | No dividends or dividend equivalents on any equity awards other than restricted stock | | | No guaranteed annual salary increases | | | No pension or supplemental executive retirement, health or insurance benefits | | | No significant perquisites |
Stockholder Engagement and Response
| Feedback We Heard | How We Responded | | • Stockholders showed support for the changes in our governance practices as we transitioned into a non-controlled public company. However, they expressed a desire for us to keep progressing and improving our governance framework to better align with best practices. This includes addressing concerns about the lack of a stockholder right to call a special meeting. | • We are proposing to amend our Certificate of Incorporation to provide stockholders holding at least 25% of our voting power the right to request special meetings. | | • Stockholders asked us to continue to make progress on providing further information about our governance practices, including with respect to how the Board oversees strategy and risk management, board refreshment practices, the mix of director skills and effectiveness, and executive compensation decision-making. | • We continue to enhance the disclosure and readability related to a number of key topics in this Proxy Statement, including those related to Board effectiveness (including our Board orientation and ongoing education programs), the qualifications and skills of our director nominees and the Board’s self-evaluation. | | • Stockholders encouraged us to continue to enhance our sustainability-related disclosure practices and continue to tie our key sustainability-related priorities to issues specifically impacting our business. | • We intend to enhance our data collection and monitoring capabilities, with a focus on increased reporting of key sustainability-related metrics where practicable. | | • Stockholders expressed concerns with respect to one-time supplemental equity grants given to certain NEOs in 2023, along with one-time cash awards made to certain NEOs in 2023 related to a proposed strategic transaction that was terminated by the counterparty. | • The Compensation Committee agrees that our regular, ongoing executive compensation program should be the primary way we incentivize and retain our executives. • We did not offer any one-time awards to NEOs or other executive officers in 2024. The Compensation Committee agrees that one-time awards should only be made in extraordinary circumstances and accompanied by clear disclosure of the Board’s rationale. | | • Stockholders expressed additional concerns with respect to the performance period under certain performance-based equity awards and certain other features in our incentive programs. | • For performance-based equity awards granted in 2024, we extended the performance period from two years to three years. • For more information about stockholder feedback with respect to our executive compensation program and practices and what we did in response, see “Compensation Discussion and Analysis — Response to Stockholder Engagement on Compensation” below. |
Election of Directors
Election of Directors The Board has nominated Elizabeth Q. Betten, Elizabeth D. Bierbower, Barbara W. Bodem, Eric K. Brandt, Natasha Deckmann, M.D., David W. Golding, Harry M. Jansen Kraemer, Jr., R. Carter Pate, John C. Rademacher, Timothy P. Sullivan and Norman L. Wright to be elected to the Board until our next annual meeting of stockholders and until their successors are duly elected and qualified. All of the nominees currently serve as directors. Each of the eleven director nominees has consented to serving as a nominee, being named in this Proxy Statement and serving on the Board if elected. There are no family relationships among our executive officers and directors. Holders of proxies solicited by this Proxy Statement will vote the proxies received by them as directed on the proxy card or, if no direction is given, for the election of the Board’s eleven nominees. In the event that any nominee is unable or unwilling to serve at the time of the Annual Meeting, the proxy holders may vote for any nominee designated by the current Board to fill the vacancy. The Board believes that each nominee possesses extensive business experience, education and personal skills that qualify them to serve as effective Board members. The specific experience, qualifications and skills of each nominee are detailed below.
Director Nominee Biographies
Director Nominee Biographies Presented below is information regarding the eleven director nominees. The details for each nominee include their specific experience, qualifications, attributes and skills that led the Board to conclude they should serve on the Board. The provided information, including the age, principal occupation, public directorships held, and other details about each nominee, is as of March 18, 2025.
Director Nominee Biographies
| Harry M. Jansen Kraemer, Jr. | | | Independent Board Chair Independent Director Since: 2019 Age: 70 | Committees • Audit • Nominating and Corporate Governance (Chair) | | Experience • Clinical Professor of Management and Strategy at the Kellogg School of Management at Northwestern University (2005-Present) • Executive Partner of MDP, a private equity firm (2005-Present) • Chairman (2000-2004), President (1997-2004) and Chief Executive Officer (1999-2004) of Baxter International Inc., a global, publicly-traded manufacturer of diagnostic and other health care-related products (“Baxter”) • Certified Public Accountant | Key Skills and Qualifications • Over 30 years of executive leadership experience, including through his service as chairman, president and chief executive officer of a large international public company • Extensive financial expertise and significant experience with boards of directors of private and public companies, investment decisions, capital allocation activities and complex transactions acquired through executive roles in large companies as well as through his role at a leading private equity firm • Through his experience at biotechnology and pharmaceutical companies, he brings significant expertise in the healthcare industry and with technology and innovation | | Other U.S. Public Company Boards • Leidos Holdings, Inc. (1997-Present) | Former U.S. Public Company Boards (within last five years) • DENTSPLY Sirona Inc. |
Director Nominee Biographies
| 2025 Proxy Statement | 22 |
Director Nominee Biographies
| Elizabeth Q. Betten | | | Independent Director Since: 2019 Age: 44 | Committees • Finance and Investment (Chair) • Quality and Compliance | | Experience • Partner and Co-Head of the Healthcare Team at MDP, a private equity firm (2023-Present); various other positions from 2008-2022, including Managing Director (2017-2022) • Investment Banking Analyst, Health Care Group, J.P. Morgan (2002-2004) • Director of Stanley Manne Children’s Research Institute (2018-Present) and Advanced Personnel Management (2020-Present) | Key Skills and Qualifications • Strong financial acumen and expertise in global capital markets and investment banking, which provides valuable insight in connection with strategic growth opportunities and overseeing our capital allocation practices • Deep health care industry experience obtained through 20 years of focus in the health care sector as well as her current leadership role in the health care group of a leading private equity firm • Completed numerous acquisitions, divestitures and other transactions designed to create stockholder value through her service on the boards of numerous portfolio companies | | Other U.S. Public Company Boards • None | |
Director Nominee Biographies
| Elizabeth D. Bierbower | | | Independent Director Since: 2022 Age: 66 | Committees • Audit • Quality and Compliance | | Experience • Chairman and Chief Executive Officer of Friday Health Plans, a health insurance company (2022-2023); Ms. Bierbower worked with the insurance department of each applicable state to transition the operations of Friday Health Plans into receivership • Various leadership roles at Humana, a leading health insurance company, including as Segment President (2018-2020), President of Employer Group Segment (2012-2018); Chief Operating Officer of Specialty Benefits (2008-2012); and Vice President of Product Innovation (2001-2008) | Key Skills and Qualifications • Strategic leadership, operational experience and financial expertise through her more than 30 years of proven executive-level experience in the healthcare industry • Served as segment president of a national health insurance company, chief executive officer of a regional health plan and chief operating officer of the specialty division of a large health insurance company as well as serves on several boards of directors of privately-held companies | | Other U.S. Public Company Boards • None | |
Director Nominee Biographies
| 2025 Proxy Statement | 23 |
Director Nominee Biographies
| Barbara W. Bodem | | | Independent Director Since: 2024 Age: 57 | Committees • Audit • Nominating and Corporate Governance | | Experience • Interim Chief Financial Officer of DENTSPLY Sirona Inc., a publicly-traded manufacturer of professional dental products and technologies (May 2022-October 2022) • Senior Vice President and Chief Financial Officer of Hill-Rom Holdings, Inc., a medical device and technology provider (2018-2021) • Senior Vice President, Finance, of Mallinckrodt plc, a global specialty pharmaceutical company (2015-2018) • Vice President, Global Commercial Finance of Hospira, a global pharmaceutical and medical device company (2013-2015) • Positions of increasing responsibility at Eli Lilly & Company, a global pharmaceutical company (1997-2013) | Key Skills and Qualifications • Extensive finance, accounting and risk management experience, including through her service as a public company chief financial officer • Significant healthcare industry experience gained through her service at numerous large, complex healthcare organizations • Her service on numerous public company boards of directors, including as an audit committee member and chair, provides experience with corporate governance matters, risk management and management oversight | | Other U.S. Public Company Boards • BioMarin Pharmaceutical Inc. (2023-Present) • Enovis Corporation (2022-Present) | Former U.S. Public Company Boards (within last five years) • Syneos Health, Inc. • Turning Point Therapeutics, Inc. |
Director Nominee Biographies
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Director Nominee Biographies
| Eric K. Brandt | | | Independent Director Since: 2024 Age: 62 | Committees • Compensation • Finance and Investment | | Experience • Chief Financial Officer of Broadcom Inc., a Fortune 500 technology company (2007-2016) • President and Chief Executive Officer of Avanir Pharmaceuticals, Inc., a pharmaceutical manufacturing company (2005-2007) • Positions of increasing responsibility at Allergan Inc, a publicly-traded pharmaceutical manufacturing company, including as its Chief Financial Officer (1999-2005) • Vice President and Partner, The Boston Consulting Group, Inc. (1989-1999) | Key Skills and Qualifications • Significant business development and corporate strategy experience gained through executive leadership roles, including serving as chief executive officer and chief financial officer at multiple companies in the healthcare industry • Digital and technology experience gained through his leadership of the information technology department at a Fortune 500 technology company • Served in leadership roles on several public company boards, gaining valuable public company governance experience | | Other U.S. Public Company Boards • Gen Digital Inc. (2020-Present) • The Macerich Company (2018-Present)(1) • Lam Research Corporation (2010-Present) | Former U.S. Public Company Boards (within last five years) • Altaba Inc.((2)) • DENTSPLY Sirona Inc. |
Director Nominee Biographies
| (1) On March 12, 2025, Mr. Brandt notified the board of directors of The Macerich Company that he would not be standing for re-election at its 2025 annual meeting of stockholders. |
Director Nominee Biographies
| (2) As discussed in “—Director Nomination Process—Directors’ Other Board Commitments” above, Altaba Inc. was delisted in October 2019 and is currently in the process of a stockholder-approved plan of dissolution and liquidation. In light of these circumstances, the Board and the Nominating and Corporate Governance Committee do not believe this constitutes service on a public company board for the purpose of the limit on the number of commitments directors can have to other public company boards contained in our Corporate Governance Guidelines. |
Director Nominee Biographies
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Director Nominee Biographies
| Natasha Deckmann, M.D. | | | Independent Director Since: 2022 Age: 48 | Committees • Finance and Investment • Nominating and Corporate Governance • Quality and Compliance (Chair) | | Experience • President (2024-Present) and Chief Transformation Officer (2024) of Tivity Health, a national provider of health improvement, fitness and social engagement solutions • Chief Operating Officer, Chief Clinical Officer, and Board Member of SecureSeniorConnections, a health care technology and services business (2020-2023) • Chief Executive Officer of CarePoint Health System, a three hospital and two medical group system in New Jersey (2018-2020) • Senior Vice President, Population Health Solutions and Chief Operating Officer, Consumer Solutions Group, Optum, a UnitedHealth Group company (2013-2018) • Positions of increasing responsibility at Marsh Inc., a global insurance broker and risk advisor (2006-2012), including as Chief Operating Officer of Marsh International | Key Skills and Qualifications • Extensive executive leadership and operational expertise as well as experience in healthcare technology through her service in executive roles at several healthcare organizations • Payer and provider expertise, clinical oversight and human capital management skills gained during her tenure at a leading insurance and health service company and at a hospital system • Comprehensive M&A and business development experience through her operational and P&L roles in acquiring and integrating service businesses • Experience in risk management oversight and governance practices through her service on various boards of directors as well as her tenure at a global risk management and insurance broker business | | Former U.S. Public Company Boards (within last five years) • Senior Connect Acquisition Corp. I | |
Director Nominee Biographies
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Director Nominee Biographies
| David W. Golding | | | Independent Director Since: 2015 Age: 63 | Committees • Compensation | | Experience • Director and advisor to several private health care companies (2013-2022) • Company Advisor to Twistle, a provider of automated patient communication software (2017-2022) • Positions of increasing responsibility at CVS Health, a leading diversified health solutions company (1987-2011), including as Executive Vice President of Specialty Pharmacy (2005-2011) | Key Skills and Qualifications • Over 35 years of experience in the healthcare industry, particularly in home infusion and specialty pharmacy, and the hospital and retail sectors, as well as executive leadership skills and P&L responsibility through his role as executive vice president within the pharmacy benefit management division of an industry-leading retail pharmacy chain • Early innovator in development of the specialty pharmacy segment while driving significant growth through organic, acquisition and client contract strategies • As a clinical pharmacist, brings unique perspectives on patient care | | Other U.S. Public Company Boards • None | |
Director Nominee Biographies
| R. Carter Pate | | | Independent Director Since: 2015 Age: 70 | Committees • Audit (Chair) • Finance and Investment | | Experience • Chief Executive Officer, Modivcare Inc., a global holding company whose subsidiaries provide technology-enabled healthcare logistics and other services (2017-2020) • Chief Executive Officer, MV Transportation, Inc., a passenger transportation company (2011-2014) • Global and U.S. Managing Partner, Health Care and Government Services Practice, PricewaterhouseCoopers (1996-2012) | Key Skills and Qualifications • Extensive executive leadership and public company corporate governance experience through his service as chief executive officer of several large public companies • Financial expertise as a former managing partner of an international accounting firm and as a member of public company audit committees • Experience with government relations, public policy and risk management from his tenure at global companies and his service on other boards of directors • Understanding of the home and alternate site infusion industry, including through his service on the board of directors of our predecessor company, BioScrip, Inc. | | Other U.S. Public Company Boards • Purple Innovation, Inc. (2023-Present) | Former U.S. Public Company Boards (within last five years) • Advanced Emissions Solutions, Inc. • Red Lion Hotels • Teligent, Inc. |
Director Nominee Biographies
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Director Nominee Biographies
| John C. Rademacher | | | President and Chief Executive Officer, Option Care Health Director Since: 2019 Age: 58 | | | Experience • President and Chief Executive Officer, Option Care Health (2018-Present) • Chief Operating Officer, Option Care Health (2015-2018) • President, Ambulatory Care (2012-2014) and President, Nuclear & Pharmacy Services (2007-2012) of Cardinal Health, Inc., a publicly-traded multinational health care services company • Senior Vice President of Cigna, a publicly-traded health services company (2001-2007) | Key Skills and Qualifications • As our President and Chief Executive Officer, possesses a wide range of business and leadership skills and a deep experience and familiarity with Option Care Health • Over 20 years of executive leadership experience in the healthcare industry, including the management of nationwide operations, sales, service and support related to the provision of home and alternate site infusion services | | Other U.S. Public Company Boards • None | |
Director Nominee Biographies
| Timothy P. Sullivan | | | Independent Director Since: 2015 Age: 67 | Committees • Compensation | | Experience • Vice Chair (2024 – Present), Co-Chief Executive Officer (2023-2024), Co-President (2022–2023) and Co-Founder, Managing Director, and Co-Head of Health Care (1992 –2022) of MDP | Key Skills and Qualifications • Significant executive and human capital management experience obtained through his creation and leadership of one of the world’s leading private equity firms • Created significant stockholder value through acquisitions, divestitures and other transactions involving numerous portfolio companies in the healthcare industry • Extensive governance expertise gained through his current and prior service on the boards of several healthcare companies and leading non-profit organizations | | Other U.S. Public Company Boards • None | |
Director Nominee Biographies
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Director Nominee Biographies
| Norman L. Wright | | | Independent Director Since: 2024 Age: 60 | Committees • Compensation (Chair) • Nominating and Corporate Governance | | Experience • Positions of increasing responsibility at UnitedHealth, including as EVP, Health Equity Strategy (2022-2023); EVP and Chief Customer Experience Officer (2021-2022); EVP, Chief Marketing and Customer Experience Officer, Optum (2019-2021); and SVP and Chief, Operations (2013-2016) • Served in executive roles at Citigroup Inc., Accenture plc, Home Shopping Network, Inc., Fidelity Investments, and The General Electric Company | Key Skills and Qualifications • Brings more than 35 years of experience as an executive in sales and customer service, operations, marketing, digital and business consulting supporting a number of industries, including the healthcare industry • Significant experience in human capital management and risk management through his leadership of large, complex organizations, including leading a team of 55,000 team members across five global regions focused on improving quality and service experiences across customer experiences and channels • Has led large equity and community engagement strategies and has developed numerous global strategic plans, which bring value to our ESG and sustainability initiatives and our broader strategic planning efforts | | Other U.S. Public Company Boards • First Solar, Inc. (2022-Present) | |
Non-Employee Director Compensation
Non-Employee Director Compensation Members of the Board who are not our employees (“Non-Employee Directors”) are compensated for their service on the Board. Mr. Rademacher, our President and Chief Executive Officer, does not receive compensation for his service on the Board. The Compensation Committee conducts an annual review of the total compensation of our Non-Employee Directors, examining each component of the program. During this process, the Compensation Committee assesses market data provided by its independent compensation consultant, Pearl Meyer, and presents a recommendation to the Board. After reviewing this recommendation, the Board determines the form and amount of compensation for Non-Employee Directors. For 2024, the Compensation Committee recommended, and the Board approved, the following increases in the Non-Employee Director compensation program. The Compensation Committee, based on the advice of its independent compensation consultant, Pearl Meyer, believes that these increases more closely align our Non-Employee Director compensation program with our peer group median.
Non-Employee Director Compensation
| • | The annual cash retainer for Board service paid to each Non-Employee Director increased from $80,000 to $100,000. |
Non-Employee Director Compensation
| • | The annual grant of time-based restricted stock units (“RSUs”) to each Non-Employee Director for Board service increased from $150,000 to $160,000. |
Non-Employee Director Compensation
| • | The annual cash retainer paid to the Board Chair increased from $100,000 to $125,000. |
Non-Employee Director Compensation
| • | The annual cash retainers paid to the Chairs of the standing committees of the Board increased as follows: $22,000 to $30,000 for the Audit Committee Chair, $15,000 to $20,000 for the Compensation Committee Chair, $10,000 to $15,000 for the Finance and Investment Committee Chair, $15,000 to $20,000 for the Nominating and Corporate Governance Committee Chair and $15,000 to $20,000 for the Quality and Compliance Committee Chair. |
Non-Employee Director Compensation
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2024 Non-Employee Director Compensation Program
2024 Non-Employee Director Compensation Program All Non-Employee Directors receive both an annual cash retainer and an annual grant of RSUs for their service on the Board. The below table sets forth the Non-Employee Director compensation program for 2024:
2024 Non-Employee Director Compensation Program
| Name | Cash ($) | Value of RSUs ($) | | All Non-Employee Directors | 100,000 | 160,000 | | Board Chair | 125,000 | — | | Audit Committee Chair | 30,000 | — | | Finance and Investment Committee Chair | 15,000 | — | | All Other Board Committee Chairs | 20,000 | — | | Audit Committee Member | 11,000 | — | | Finance and Investment Committee Member | 5,000 | — | | All Other Board Committee Members | 7,500 | — |
Equity-Based Awards
Equity-Based Awards A significant portion of the compensation for each Non-Employee Director is provided through equity awards. In May 2024, each Non-Employee Director received an RSU award. The number of shares underlying the award was determined by dividing $160,000 by the per-share closing price of our common stock on the grant date, rounded up to the nearest factor of three for equal pro-rata vesting. These equity awards were granted pursuant to our 2018 Equity Incentive Plan (the “EIP”) and vest in equal amounts on each of the first three anniversaries of the grant date. Vesting accelerates in the event of a change in control or termination of service for any reason other than for cause.
2024 Non-Employee Director Compensation
2024 Non-Employee Director Compensation The table below provides information about the compensation earned in 2024 by Non-Employee Directors who served on the Board during the year. Please see the “2024 Summary Compensation Table” below for the compensation received by Mr. Rademacher as our President and Chief Executive Officer with respect to 2024.
2024 Non-Employee Director Compensation
| Name | Fees Earned or Paid in Cash(1) ($) | Stock Awards(2) ($) | Total ($) | | John J. Arlotta(3) | 115,000 | 160,000 | 275,000 | | Elizabeth Q. Betten | 122,500 | 160,000 | 282,500 | | Elizabeth D. Bierbower | 118,500 | 160,000 | 278,500 | | Barbara W. Bodem(4) | 154,861 | 215,372 | 370,233 | | Eric K. Brandt | 112,500 | 160,000 | 272,500 | | Natasha Deckmann, M.D. | 132,500 | 160,000 | 292,500 | | David W. Golding | 107,500 | 160,000 | 267,500 | | Harry M. Jansen Kraemer, Jr. | 256,000 | 160,000 | 416,000 | | R. Carter Pate | 135,000 | 160,000 | 295,000 | | Nitin Sahney(3) | — | — | — | | Timothy P. Sullivan | 107,500 | 160,000 | 267,500 | | Norman L. Wright(4) | 162,569 | 215,372 | 377,941 |
2024 Non-Employee Director Compensation
| (1) Each of the following directors elected to receive his or her annual cash retainers for service on the Board in RSUs in the following amounts: Mr. Arlotta: 9,150 RSUs; Ms. Betten: 5,325 RSUs; Ms. Bierbower: 5,325 RSUs; Ms. Bodem: 7,056 RSUs; Mr. Brandt: 5,325 RSUs; Dr. Deckmann: 5,983 RSUs; Mr. Golding: 6,219 RSUs; Mr. Kraemer: 13,806 RSUs; Mr. Pate: 5,325 RSUs; Mr. Sullivan: 5,325 RSUs; and Mr. Wright: 7,056 RSUs. |
2024 Non-Employee Director Compensation
| (2) As discussed above, on May 15, 2024, each then-serving Non-Employee Director received an RSU award. In accordance with SEC rules, the amounts shown reflect the aggregate grant date fair value of such award ($160,000), computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation-Stock Compensation (“ASC 718”). The grant date fair value of these RSUs is measured based on the closing price of our common stock on the date of grant ($30.06, or $32.79 with respect to the RSUs granted to Ms. Bodem and Mr. Wright on April 1, 2024 in respect of their prorated director compensation). See Note 15—Stock-Based Incentive Compensation found in Part II, Item 8, “Financial Statements and Supplementary Data” in the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”) for more information. |
2024 Non-Employee Director Compensation
| The following stock awards were outstanding as of December 31, 2024: Mr. Arlotta: 0 RSUs; Ms. Betten: 13,059 RSUs; Ms. Bierbower: 10,605 RSUs; Ms. Bodem: 7,056 RSUs; Mr. Brandt: 5,325 RSUs; Dr. Deckmann: 11,265 RSUs; Mr. Golding: 14,578 RSUs; Mr. Kraemer: 30,034 RSUs; Mr. Pate: 14,370 RSUs; Mr. Sahney: 0 RSUs; Mr. Sullivan: 12,825 RSUs; and Mr. Wright: 7,056 RSUs. These numbers include, where applicable, the annual equity award described in “—Equity-Based Awards” above as well as RSUs earned by directors who have elected to receive their cash compensation in the form of RSUs. |
2024 Non-Employee Director Compensation
| (3) Mr. Arlotta and Mr. Sahney resigned from the Board effective September 6, 2024 and January 1, 2024, respectively. Mr. Sahney did not receive any compensation for his services on the Board during 2024. |
2024 Non-Employee Director Compensation
| (4) Ms. Bodem and Mr. Wright were appointed to the Board effective January 2, 2024. In addition to their compensation for service from and after the 2024 Annual Meeting, in April 2024, Ms. Bodem and Mr. Wright received prorated director compensation for their partial year of service prior to the 2024 Annual Meeting. For this partial year of service, Ms. Bodem received a prorated cash retainer of $36,361 and a prorated equity grant of 1,731 RSUs, and Mr. Wright received a prorated cash retainer of $35,069 and a prorated equity grant of 1,731 RSUs. |
2024 Non-Employee Director Compensation
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2024 Compensation Program Enhancements
| • | We increased the performance period for PSU awards from two years to three years, a structure the Compensation Committee expects to maintain. |
2024 Compensation Program Enhancements
| • | We refined our annual cash incentive program by reducing the weight of the individual performance goals from 30% to 20% of the total target incentive, with ongoing assessment based on business conditions, market practices and stockholder feedback. |
2024 Compensation Program Enhancements
| • | We eliminated stock options from our long-term incentive program, increasing the portion of our long-term incentive awards with performance-based vesting conditions from 50% to 60% and reducing the portion with time-based vesting conditions from 50% to 40%, which we believe helps reinforce our pay-for-performance philosophy and improves alignment with evolving market practices. |
2024 Compensation Highlights
2024 Compensation Highlights Our 2024 executive compensation program had three components: annual base salary, an annual cash incentive award and long-term equity incentive awards. Each of these components serves a specific purpose in our compensation strategy. We believe base salary is an essential component to any market-competitive compensation program. We also believe annual cash incentives reward the achievement of short-term goals, while long-term incentives drive our NEOs to focus on long-term, sustainable stockholder value creation. Below are key highlights of the executive compensation decisions the Compensation Committee made for 2024 related to the NEOs:
2024 Compensation Highlights
| Base Salaries | • Did not increase Mr. Rademacher’s base salary • Increased Mr. Grashoff’s base salary to recognize his promotion to Chief Growth Officer in December 2023 • Increased Mr. Whitworth’s and Mr. Smyser’s base salaries to bring their base salary closer to peer group median for similar roles as well as to reflect their increased tenure and performance in role | | Annual Cash Incentives (paid pursuant to our Management Incentive Plan (the “MIP”) | • Kept NEO MIP targets unchanged from the end of 2023 • Approved actual annual incentive awards—based on performance—ranging from 89% to 100% of MIP target | | Long-Term Equity Incentive Awards | • Granted 2024 awards using a mix of 60% PSUs and 40% RSUs • Increased the total target grant date value of annual equity grants for all NEOs to ensure total direct compensation remains competitive within the market for executives in similar roles • Certified the final performance of each metric for 2023 PSU grants, which resulted in the PSUs vesting at 166% of target |
Executive Compensation Governance and Best Practices
| What We Do | | What We Do Not Do | | | | Tie more than 85% of target CEO compensation to corporate performance and creation of long-term stockholder value | | No short sales, hedging or pledging of our securities by any NEO | | | The Compensation Committee has discretion to adjust any performance-based equity award payouts for certain events to reflect original intent of the awards | | No excise tax gross-ups in our Executive Severance Plan or for perquisites | | | Maintain robust stock ownership requirements, including stock retention provisions | | No dividends or dividend equivalents on any equity awards other than RSUs | | | Dodd-Frank clawback policy plus a supplemental clawback policy that allows recovery of compensation in the event of certain acts of misconduct by NEOs and senior management | | No guaranteed annual salary increases | | | Independent compensation consultant | | No pension or supplemental executive retirement, health or insurance benefits | | | Annual compensation risk assessment | | No significant perquisites | | | Maintain “double-trigger” provisions for all change in control scenarios for the NEOs | | |
Compensation Philosophy and Strategy
| • | To align our executives’ interests with those of our stockholders, thereby ensuring a focus on long-term value creation; |
Compensation Philosophy and Strategy
| • | To encourage our successful executives to remain with us for the long-term; and |
Components of Compensation
| Base Salary | Customary, fixed element of compensation intended to attract and retain executives | | Annual Cash Incentives (paid pursuant to the MIP) | Performance-based, at-risk component of our NEOs’ compensation. Variable payouts are designed to motivate our NEOs to deliver strong annual financial results while also advancing their individual performance goals. Additional details regarding the 2024 annual cash incentives can be found in “—Annual Cash Incentive Program” below. | | Long-Term Equity Incentive Awards | A significant component of our NEOs’ annual compensation is provided in the form of long-term equity incentive awards that emphasize long-term stockholder value creation and the retention of a strong executive leadership team. This is accomplished through a mix of PSU awards and RSUs. PSU awards are at-risk and performance-based as they only have value if the pre-established performance goals are met during the performance period, while RSUs are viewed as at-risk, variable compensation because the value of the awards fluctuates based on changes in our underlying stock price. To further strengthen the alignment between pay and performance by increasing the percentage of long-term equity incentive awards with vesting tied to the achievement of pre-established performance goals, the Compensation Committee approved an update to the mix of long-term equity incentive awards to eliminate non-qualified stock option awards and to increase the weighting of PSUs from 50% to 60% of the long-term equity incentive award mix. Details regarding these awards and the PSUs that vested in 2024 can be found in “—Long-Term Equity Incentive Awards” below. |
Independent Compensation Consultant
Independent Compensation Consultant The Compensation Committee has the exclusive authority to hire external advisors, such as compensation consultants, to help assess both current and proposed compensation for our executives. The committee also takes into account the independence of its compensation consultant under SEC and Nasdaq rules. Pearl Meyer was engaged by the Compensation Committee to serve as its independent compensation consultant with respect to setting executive compensation in 2024. As part of its engagement, Pearl Meyer conducted a review of our executive compensation peer group and performed a competitive analysis of compensation for our NEOs. Pearl Meyer also assisted the Compensation Committee in
Independent Compensation Consultant
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Independent Compensation Consultant
various areas, including developing recommendations for the compensation for our Chief Executive Officer and our other NEOs, evaluating performance metrics under our variable incentive plans and conducting a compensation risk analysis. Furthermore, Pearl Meyer delivered presentations to the Compensation Committee on trends and regulatory developments in executive compensation. At the Compensation Committee’s request, representatives of Pearl Meyer attend Compensation Committee meetings and engage in private sessions with committee members. Pearl Meyer reports directly to the Chair of the Compensation Committee and collaborates with our management team as directed by the Compensation Committee. During 2024, Pearl Meyer did not provide any additional advice or services to us or our executive officers. The Compensation Committee has evaluated Pearl Meyer’s independence in accordance with SEC and Nasdaq rules and determined that Pearl Meyer’s work did not raise any conflict of interest.
Compensation Peer Group
Compensation Peer Group In consultation with Pearl Meyer, the Compensation Committee annually reviews the pay levels and practices of peer companies in order to assess the competitive positioning of our pay levels and plan designs. For 2024 compensation decisions, the peer group consisted of:
Compensation Peer Group
| Acadia Healthcare Company, Inc. (ACHC) | The Ensign Group, Inc. (ENSG) | | Amedisys, Inc. (AMED) | Owens & Minor, Inc. (OMI) | | AMN Healthcare Services, Inc. (AMN) | Patterson Companies, Inc. (PDCO) | | Brookdale Senior Living Inc. (BKD) | Quest Diagnostics Incorporated (DGX) | | Chemed Corporation (CHE) | Select Medical Holdings Corporation (SEM) | | DaVita Inc. (DVA) | Surgery Partners, Inc. (SGRY) | | Encompass Health Corporation (EHC) | |
Compensation Peer Group
The Compensation Committee chose the companies in our peer group based on certain criteria, including market capitalization and revenue that are broadly similar to ours, ranging from 0.25x to 4.0x and 0.4x to 2.5x, respectively. The committee also considered companies that exhibit year-over-year consistency, particularly key competitors, and aimed to maintain a robust sample size within the peer group. Our peer group does not include companies exclusively in the home and alternate site infusion industry because we believe there are no publicly-traded companies in our specific industry that match our size and complexity. However, the Compensation Committee works to identify companies that share important characteristics with us, such as being direct competitors in certain services, operating under a similar business model or employing people with the unique skills required in our industry. The committee believes these companies are likely to have executive positions comparable to ours in complexity and scope of responsibility. Annually, the Compensation Committee, along with its independent compensation consultant, reviews our peer group. In 2023, for purposes of 2024 executive compensation benchmarking, the Compensation Committee removed LHC Group, Inc. (acquired) and added Owens & Minor, Inc. In 2024, for purposes of 2025 executive compensation benchmarking, Brookdale Senior Living Inc. was removed, and Addus HomeCare Corporation, AdaptHealth Corporation, agilon health, inc., BrightSpring Health Services, Inc., Enhabit Inc., and Labcorp Holdings Inc. were added. These changes were made in order to include companies with market capitalization and revenues that fall within the specified ranges, maintain a robust sample size, align the peer group with the appropriate sector, industry, size, and business characteristics, and to incorporate key competitors.
Compensation Peer Group
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Target Setting
| • | Annual budgets and long-term operating plans; |
Target Setting
| • | Input from its independent compensation consultant and management; and |
Determinations of Total Direct Compensation
Determinations of Total Direct Compensation In making decisions regarding the compensation of our NEOs, the Compensation Committee (and the full Board, excluding Mr. Rademacher, with respect to Mr. Rademacher) takes into account the peer group and other data and perspectives mentioned earlier, along with our financial and operating performance. The Compensation Committee’s consideration of financial and operating performance was evaluated in two ways: (a) overall performance in the previous year using various metrics, which was a factor in establishing target compensation; and (b) the rigor of performance goals for the upcoming year, including in relation to our peer group. The Compensation Committee also assessed each NEO’s individual performance over the prior year, including how they demonstrated our values and leadership behaviors.
Final Determinations for Compensation Program
Final Determinations for Compensation Program After evaluating our financial and operating performance, the Compensation Committee sets the total direct compensation levels for the NEOs based on the compensation philosophy described in “—Compensation Philosophy and Strategy” above. The Compensation Committee also decides on the performance metrics used to determine our results for the annual cash incentives paid pursuant to our MIP and the long-term PSUs issued under the EIP. For more details on our annual cash incentive plan metrics, targets and performance, see “2024 NEO Compensation—Annual Cash Incentive Program” below, and for a discussion of our long-term equity incentive metrics, targets and performance for 2024, see “2024 NEO Compensation—Long-Term Equity Incentive Awards” below. Finally, the Compensation Committee sets the annual compensation and future target pay levels for all of the NEOs other than Mr. Rademacher. Regarding Mr. Rademacher’s compensation, the Compensation Committee makes a recommendation to the full Board (other than Mr. Rademacher). The Compensation Committee serves as the final
Base Salary
Base Salary The Compensation Committee sets annual base salaries at levels intended to attract, retain, motivate and reward a leadership team that will sustain long-term growth for our stockholders while maintaining affordability within our business plan. When setting these base salaries, the Compensation Committee generally considers the range of compensation paid to similarly-situated executive officers in our compensation peer group. The Compensation Committee may set salaries relative to this range based on considerations such as the expertise, performance or advancement potential of each NEO. The base salaries of our NEOs are typically considered annually as part of the performance review period as well as upon an NEO’s promotion or other change in job responsibilities. In 2024, Mr. Grashoff’s base salary was increased due to his promotion to Chief Growth Officer. Mr. Whitworth’s and Mr. Smyser’s base salaries were also adjusted to bring their base salaries closer to peer group median for similar roles as well as to reflect their increased tenure and performance in their respective roles. The following table sets forth the 2023 and 2024 base salaries for each of the NEOs.
Annual Cash Incentive Program
Annual Cash Incentive Program
Award Targets and Performance Metrics
Award Targets and Performance Metrics Our NEOs are eligible to earn annual cash incentives under the MIP. The MIP is a variable, at-risk, performance-based program designed to reward the achievement of our company-wide financial goals for the year. In doing so, it provides a direct link between the individuals’ short-term incentive payouts and our annual financial results.
Award Targets and Performance Metrics
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Award Targets and Performance Metrics
The target award opportunity is set for each NEO as an approximate percentage of the NEO’s base salary, and is designed to reflect our compensation philosophy and generally align with median benchmarking data provided by Pearl Meyer. For Mr. Rademacher, our President and Chief Executive Officer, his target award opportunity was 130% of his base salary for 2024. For our other NEOs, the target award opportunities ranged from 75% to 90% of annual base salary. The following table sets forth the 2023 and 2024 MIP targets for each of the NEOs.
Award Targets and Performance Metrics
| Name | 2023 MIP Target | 2024 MIP Target(1) | Year-Over- Year Change | | John C. Rademacher | 130% | 130% | — | | Michael Shapiro | 90% | 90% | — | | Luke Whitworth | 90% | 90% | — | | Collin G. Smyser | 75% | 75% | — | | Christopher L. Grashoff | 90%(2) | 90% | — |
Award Targets and Performance Metrics
| (1) Effective date of 2024 MIP Target was January 1, 2024. |
Award Targets and Performance Metrics
| (2) Mr. Grashoff’s target bonus was increased from 50% to 90% of base salary during 2023 as a result of promotions during the year, and his actual bonus payout was based on the pro-rated target bonus rates in effect throughout the year. |
Award Targets and Performance Metrics
In 2024, actual awards under the MIP for corporate-level management team members, including the NEOs, were based on overall company results and individual performance goals. For 2024, payouts under the MIP were subject to a threshold achievement goal (the “OPCH Funding Threshold”) tied to overall company performance as measured by a specific EBITDA metric (“Incentive EBITDA”). For these purposes, we defined Incentive EBITDA as net income before net interest expense, income tax expense, depreciation and amortization, stock-based compensation expenses, loss on extinguishment of debt, and restructuring, acquisition, integration and bonus expenses. This metric was selected because the Compensation Committee believes that we should generate sufficient earnings before paying out annual cash incentive awards. If the OPCH Funding Threshold was not achieved, no amounts would have been paid under the MIP for 2024. For 2024, the Compensation Committee established an OPCH Funding Threshold as measured by Incentive EBITDA of $452 million, and we achieved actual Incentive EBITDA of $470 million for 2024. As a result, the OPCH Funding Threshold was achieved and the MIP payouts were determined based on achievement of the financial and individual performance goals described below. For 2024, 50% of each NEO’s annual cash incentive award was subject to overall company results as measured by Adjusted EBITDA. For these purposes, we defined Adjusted EBITDA as net income before net interest expense, income tax expense, depreciation and amortization, stock-based compensation expense, loss on extinguishment of debt, and restructuring, acquisition, integration and other expenses, which is consistent with how we report Adjusted EBITDA in our annual and quarterly financial results. This metric was selected because the Compensation Committee believes it reflects a commonly-recognized measure of our overall performance and is a key driver of long-term stockholder value creation. In setting target Adjusted EBITDA achievement level for 2024, the Compensation Committee established a threshold goal of $435.5 million, a target goal of $450.0 million, and a maximum goal of $495.0 million. The Compensation Committee believed that these goals were set at levels designed to be challenging yet achievable and that represented solid financial results for the year, with the 2024 target representing an approximately 6% increase over our 2023 actual performance. The Compensation Committee set the payout curve such that if the threshold Adjusted EBITDA performance level was reached, the total payout opportunity for the 50% component related to the Adjusted EBITDA metric would be 50% of the target payout opportunity. If the maximum payout level was reached, the total payout opportunity would be capped at 200% of the target payout opportunity for the 50% component related to the Adjusted EBITDA metric. If the threshold goal was not achieved, there is no payout for the 50% component related to the Adjusted EBITDA metric.
Award Targets and Performance Metrics
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Award Targets and Performance Metrics
Another 30% of each NEO’s annual cash incentive award for 2024 was tied to overall company revenue (together with Adjusted EBITDA, the “OPCH Performance Targets”). This 30% component would payout from 0% of target to a maximum of 200% of target for this component. In setting the revenue achievement goals for 2024, the Compensation Committee established a threshold goal of $4.636 billion, a target goal of $4.791 billion, and a maximum goal of $5.266 billion. The Compensation Committee believes that these goals were set at levels designed to be challenging yet achievable and that represented solid financial results for the year, with the 2024 target representing an approximately 11% increase over our 2023 actual performance. The Compensation Committee included revenue as an additional component in our 2024 annual cash incentive program because it believed we needed to continue to emphasize revenue growth, while still maintaining solid profitability growth, to help drive long-term stockholder value and help ensure continued success and growth of our company. The remaining 20% of each NEO’s annual cash incentive payment for 2024 was tied to the achievement by each individual of their leadership and non-financial goals. This 20% component would payout from 0% of target to a maximum of 200% of target for this component. This individual performance multiplier does not apply to the portion of the annual cash incentive target tied to the OPCH Performance Target. The Compensation Committee believes that the inclusion of the individual performance multiplier is consistent with market practice and helps drive performance in the area where each individual is deemed to have the most influence and further aligns their interests with those of our stockholders. Taking together the 80% component related to the OPCH Performance Targets and the 20% component related to the achievement of individual performance goals, actual total payouts can range from 0% to 200% of target payout opportunities.
Annual Cash Incentive Award Payouts
Annual Cash Incentive Award Payouts In February 2025, the Compensation Committee reviewed actual results for 2024 with respect to achievement of the OPCH Performance Targets. For 2024, as reported in our financial statements, we achieved Adjusted EBITDA of $443.8 million, which represented 4.4% year-over-year growth, and achieved revenue of $4.998 billion, which represented 16.2% year-over-year growth. Therefore, for the MIP components related to the OPCH Performance Targets accounting for 80% of the total MIP, our performance resulted in a formulaic payout percentage of 89% of target for the NEOs. As described above, 20% of each NEO’s annual cash incentive is tied to individual performance goals, which can pay out from 0% to 200% of target. These individual performance goals are defined early in the fiscal year and generally relate to achieving key financial and growth objectives, supporting strategic transactions, strengthening talent and leadership and otherwise achieving specific goals of their team. The Compensation Committee believes that including individual performance goals drives more rigor in our MIP program, while also building accountability for non-financial objectives. The Compensation Committee designed the individual goals to be challenging but achievable with strong performance, aligned with our strategic initiatives. The Compensation Committee and the independent members of the Board evaluated our Chief Executive Officer’s performance against his individual performance goals, and our Chief Executive Officer evaluated each of the other
Annual Cash Incentive Award Payouts
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Annual Cash Incentive Award Payouts
NEOs performance against their individual performance goals and made a recommendation to the Compensation Committee for its consideration. After considering the recommendation of the Compensation Committee based on the committee’s evaluation of the Chief Executive Officer’s performance and the committee’s consideration of the Chief Executive Officer’s recommendations for the other NEOs, the Compensation Committee determined for each of the NEOs other than Mr. Rademacher, and the full Board (other than Mr. Rademacher) determined for Mr. Rademacher (upon the recommendation of the Compensation Committee), that each of the NEOs would receive a payout between 89% and 100% of target for their individual performance goals component. Their individual accomplishments are summarized below:
Annual Cash Incentive Award Payouts
| Mr. Rademacher | • Successfully achieved key financial milestones • Led transition of executive leadership team with new Chief Medical Officer and Chief Growth Officer • Supported strategic plan development and achievement of key strategic milestones | | Mr. Shapiro | • Successfully achieved key financial milestones and continued to enhance reporting and risk management processes • Oversaw key corporate development activities, including successfully-completed acquisition of Intramed Plus, Inc., a home and alternate site infusion services provider in South Carolina • Managed disciplined capital allocation process | | Mr. Whitworth | • Completed key value creation initiatives and improved core operational metrics • Successfully managed response and recovery efforts related to major global and industry-specific events | | Mr. Smyser | • Enhanced stockholder engagement and corporate governance practices • Strengthened government relations program and federal public policy advocacy efforts • Oversaw continued expansion of infusion clinic footprint and development of other strategic initiatives | | Mr. Grashoff | • Successfully achieved top-line growth metrics • Strengthened and realigned commercial team to help maximize growth |
Annual Cash Incentive Award Payouts
Accordingly, the Board approved for Mr. Rademacher, and the Compensation Committee approved for the other NEOs, the following awards under the MIP.
Annual Cash Incentive Award Payouts
| Name | Target Award | Actual Award | Actual Award as a % of Target Award | | John C. Rademacher | $1,300,000 | $1,209,000 | 93.0% | | Michael Shapiro | $550,439 | $489,890 | 89.0% | | Luke Whitworth | $547,193 | $547,193 | 100.0% | | Collin G. Smyser | $366,496 | $353,334 | 97.5% | | Christopher L. Grashoff | $360,000 | $320,400 | 89.0% |
Long-Term Equity Incentive Awards
Long-Term Equity Incentive Awards The Compensation Committee believes that annual long-term incentive awards provide our NEOs with a strong link to our long-term performance, help create an ownership culture and help align the interests of our NEOs with those of our stockholders. This component is also designed to align a substantial amount of our NEOs’ compensation with our key financial incentives and focus those leaders on achieving certain pre-determined company performance objectives that our Compensation Committee believes support the creation of long-term stockholder value. In February 2024, the Compensation Committee granted long-term incentive awards to our executive officers, including the NEOs. The target long-term incentive grants included PSUs constituting approximately 60% of the target opportunity and RSUs constituting approximately 40% of the target opportunity (increased from 50% and 25% of the
Long-Term Equity Incentive Awards
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Long-Term Equity Incentive Awards
target opportunity in 2023, respectively). The Compensation Committee did not grant stock options as part of the 2024 target long-term incentive grants (which previously represented 25% of the target opportunity in 2023), which it believes is consistent with the market practice for similarly situated companies. The eliminations of stock options resulted in an increase in the percentage of long-term incentive mix with vesting tied to pre-established performance goals.
2024 Target Grant Values
| Name | 2023 Annual Equity Grant | 2024 Annual Equity Grant | Year-Over- Year Change | | John C. Rademacher | $5,500,000 | $6,000,000 | 9.1% | | Michael Shapiro | $2,000,000 | $3,000,000 | 50.0% | | Luke Whitworth | $1,425,000 | $2,250,000 | 57.9% | | Collin G. Smyser | $825,000 | $1,050,000 | 27.3% | | Christopher L. Grashoff | $250,000 | $1,000,000 | 400.0% |
Performance Stock Units
Performance Stock Units In February 2024, each NEO received PSUs under the EIP. PSUs represent a substantial, at-risk component of our eligible NEOs’ compensation that is directly tied to our long-term financial performance. In 2024, these awards had the following characteristics:
Performance Stock Units
| • | The payout is based on our consolidated results over a three-year performance cycle (increased from two-year performance cycle in 2023), beginning on the first calendar day of the fiscal year in which the awards were granted. |
Performance Stock Units
| • | Financial performance is measured 50% on the three-year average cash flow from operations growth rate over the performance period and 50% on the combined three-year average revenue growth rate and Adjusted EBITDA growth rate over the performance period. In recognition of our use of Adjusted EBITDA in both the MIP and the long-term equity incentive program, the Compensation Committee continued its historical practice of supplementing the primary performance measures under these programs with additional performance measures in order to strike an appropriate balance with respect to incentivizing top-line growth, profitability, non-financial business imperatives, and stockholder returns over both the short-term and long-term horizons. |
Performance Stock Units
| • | The payout based on financial performance can range from 50% to 200% based on actual results. |
Performance Stock Units
| • | Earned PSUs vest three years from the date of grant and are conditioned upon the recipients’ continued employment with us until the vesting date. |
Performance Stock Units
As noted in “—Response to Stockholder Engagement on Compensation” above, beginning with the 2024 PSU grants, the Compensation Committee increased the performance period from two years to three years. The Compensation Committee made this decision based in part on stockholder feedback and market practice as well as to further incentivize performance against our long-term operating plan. The Compensation Committee selected the financial metrics above due to the belief that performance underlying these metrics would help drive our financial performance and align the recipients’ interests with those of our stockholders. The specific targets used for each of the metrics for the 2024 to 2026 performance period, and the range of awards related to the achievement of such metrics, are based on internal forecasts and strategic goals that are not publicly disclosed. These targets are inherently tied to our confidential business plan, which includes market expansion strategies, operational efficiencies, and financial assumptions that we believe, if disclosed, could give competitors an undue advantage by providing insights into our growth expectations and competitive positioning. To ensure that PSUs drive meaningful results, the Compensation Committee established target levels that are designed to be challenging but achievable with strong performance and the successful execution of our business plan.
Performance Stock Units
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Performance Stock Units
The target number of PSUs granted to an eligible NEO was determined by dividing 60% of the target equity grant value applicable to each NEO by the closing stock price at the date of grant. The grant date fair values of these awards are as follows:
Performance Stock Units
| Name | Vesting Date | Target Grant Date Value | | John C. Rademacher | February 2027 | $3,600,000 | | Michael Shapiro | February 2027 | $1,800,000 | | Luke Whitworth | February 2027 | $1,350,000 | | Collin G. Smyser | February 2027 | $630,000 | | Christopher L. Grashoff | February 2027 | $600,000 |
Restricted Stock Units
Restricted Stock Units In February 2024, each NEO also received RSUs under the EIP. These service-based awards are designed to align the interests of our NEOs with those of our stockholders by promoting the retention of the executive team over the longer term. In addition, these awards are variable and at-risk as the value of the RSUs fluctuates based on our stock price performance. The number of RSUs granted to an NEO was determined by dividing 40% of the target equity grant value applicable to such individual by the closing stock price at the grant date. Roughly one-third of these RSUs vest on each of the first three anniversaries of the grant date, subject to continuous service through each vesting date. The grant date fair values for these awards are as follows:
Restricted Stock Units
| Name | Final Vesting Date | Grant Date Fair Market Value | | John C. Rademacher | February 2027 | $2,400,000 | | Michael Shapiro | February 2027 | $1,200,000 | | Luke Whitworth | February 2027 | $900,000 | | Collin G. Smyser | February 2027 | $420,000 | | Christopher L. Grashoff | February 2027 | $400,000 |
Payout of Long-Term Equity Incentive Awards for 2023-2024 Performance Period
Payout of Long-Term Equity Incentive Awards for 2023-2024 Performance Period The performance period for the PSUs issued to the NEOs in early 2023 ended on December 31, 2024. These 2023 PSU awards provided for a payout ranging from 50% to 200% of target based on the actual achievement of (i) our two-year average cash flow from operations growth rate (50% weighting) and (ii) our combined two-year average revenue growth rate and Adjusted EBITDA growth rate (50% weighting) over the performance period.
Payout of Long-Term Equity Incentive Awards for 2023-2024 Performance Period
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Payout of Long-Term Equity Incentive Awards for 2023-2024 Performance Period
The final performance of each metric exceeded the target goal and resulted in the 2023 PSUs vesting at 166% of target. In addition to the performance measures, the 2023 PSUs are subject to an additional one-year service-based vesting schedule that requires continuous employment for a total of three years from the applicable grant date, subjecting each NEO to three years of stock price fluctuations. The performance measures and actual results for the 2023 PSUs are summarized below:
Payout of Long-Term Equity Incentive Awards for 2023-2024 Performance Period
| Measure (2-year averages for 2023 and 2024) | Threshold (% growth) | Target (% growth) | Maximum (% growth) | Actual (% growth) | Payout (% of target) | | Adjusted EBITDA + Revenue growth (50%) | 22.0% | 24.0% | 33.0% | 26.8% | 131.3% | | Cash Flow from Operations growth (50%) | 7.5% | 10.0% | 15.0% | 18.0% | 200.0% |
Practices Related to the Grant of Certain Equity Awards
Practices Related to the Grant of Certain Equity Awards Our policy with respect to the regular long-term incentive awards for all eligible employees, including eligible NEOs, is to determine the target grant value and grant the award at the Compensation Committee’s regularly scheduled meeting during the first quarter of each year. The Compensation Committee believes that this allows for careful consideration of the prior year’s financial performance when determining the awards and is consistent with market practice. The Compensation Committee and senior management monitor our equity grant practices to evaluate whether such practices comply with governing regulations and are consistent with good corporate practices. When making regular annual equity grants, the Compensation Committee’s practice is to approve them at its meeting in February as part of the annual compensation review and after results for the preceding fiscal year become available. In addition, the Compensation Committee may occasionally make grants during the year as it deems appropriate, including with respect to new hires or promotions. We do not schedule equity grants in anticipation of the release of material non-public information (“MNPI”) nor do we time the release of MNPI based on equity grant dates. We did not grant any stock options in 2024.
Executive Severance Plan
Executive Severance Plan We maintain the Option Care Health Amended and Restated Executive Severance Plan (the “Executive Severance Plan”), which helps support our compensation objective of providing a market competitive compensation program that allows us to attract and retain key talent. The Executive Severance Plan provides severance benefits to certain of our key management personnel, including our President and Chief Executive Officer, our Chief Financial Officer, and such other employees designated for participation by the Compensation Committee (which includes each NEO) in the event that their employment is terminated by us for any reason other than for cause, death or disability, or if they resign for good reason. The terms of the Executive Severance Plan were determined after considering the competitive market and input from Pearl Meyer. Please see “Executive Compensation Tables—Payments Upon Termination or Change of Control (As of December 31, 2024)” below for a description of the severance benefits provided under the Executive Severance Plan.
NEO Employment Agreements
NEO Employment Agreements We are a party to an employment agreement with each of Mr. Rademacher and Mr. Shapiro. These employment agreements were entered into prior to the consummation of the BioScrip Merger in 2019 and were believed at the time to be reasonably necessary to secure their continued employment. In February 2024, each of Mr. Rademacher and Mr. Shapiro entered into a letter agreement with us to terminate the severance benefits provisions of their employment agreements (all other provisions of the employment agreements are still in effect) and now each is subject to the terms of the Executive Severance Plan. We do not expect to enter into employment agreements with our executive officers in the future; however, we customarily enter into offer letters setting forth the initial terms of hire for executive officers, but which have no further ongoing contractual obligations for us.
2024 Summary Compensation Table
2024 Summary Compensation Table The following table, footnotes, and related narrative disclosure show information regarding the total compensation of each of our NEOs for 2024 and, to the extent required by SEC disclosure rules, 2023 and 2022.
2024 Summary Compensation Table
| Name and Principal Position | Year | Salary(1) ($) | Bonus ($) | Stock Awards(2) ($) | Option Awards(2) ($) | Non-Equity Incentive Plan Compensation(3) ($) | All Other Compensation(4) ($) | Total Compensation ($) | | John C. Rademacher President and Chief Executive Officer | 2024 | 1,000,000 | — | 6,000,000 | — | 1,209,000 | 13,800 | 8,222,800 | | | 2023 | 1,000,000 | — | 7,875,000 | 5,125,000 | 2,600,000 | 13,200 | 16,613,200 | | | 2022 | 953,846 | — | 3,187,500 | 1,062,500 | 1,539,593 | 11,200 | 6,754,639 | | Michael Shapiro Chief Financial Officer | 2024 | 611,598 | — | 3,000,000 | — | 489,890 | 13,800 | 4,115,289 | | | 2023 | 599,306 | 125,000 | 3,750,000 | 2,750,000 | 1,080,000 | 13,200 | 8,317,506 | | | 2022 | 579,342 | — | 1,050,000 | 350,000 | 700,000 | 11,200 | 2,690,542 | | Luke Whitworth Chief Operating Officer | 2024 | 607,992 | — | 2,250,000 | — | 547,193 | 13,800 | 3,418,984 | | | 2023 | 542,446 | — | 1,356,250 | 643,750 | 965,250 | 13,200 | 3,520,896 | | Collin G. Smyser General Counsel and Corporate Secretary | 2024 | 488,661 | — | 1,050,000 | — | 357,334 | 13,800 | 1,908,996 | | | 2023 | 448,077 | 100,000 | 868,750 | 456,250 | 675,000 | — | 2,548,077 | | | 2022 | 269,231 | 220,000 | 581,250 | 93,750 | 317,200 | — | 1,481,431 | | Christopher L. Grashoff Chief Growth Officer | 2024 | 400,000 | — | 1,000,000 | — | 320,400 | 13,800 | 1,735,120 |
2024 Summary Compensation Table
| (1) Amounts reflect base salary earned in the year, including any amounts voluntarily deferred under the 401(k) Plan and the Deferred Compensation Plan. |
2024 Summary Compensation Table
| (2) Amounts reflect the aggregate grant date fair value of stock awards and stock option awards, as applicable, granted in the year computed in accordance with ASC 718 and, in the case of PSUs, calculated based on the probable outcome of the applicable performance conditions on the grant date. Assuming the highest level of performance is achieved for the 2024 PSU awards, the maximum value of these awards at the grant date would be as follows: Mr. Rademacher: $7,200,000; Mr. Shapiro: $3,600,000; Mr. Whitworth: $2,700,000; Mr. Smyser: $1,260,000; and Mr. Grashoff: $1,200,000. A discussion of the assumptions used in computing the grant date fair values may be found in Note 15 – Stock-Based Incentive Compensation found in Part II, Item 8, “Financial Statements and Supplementary Data” in the Notes to Consolidated Financial Statements in the 2024 Annual Report. |
2024 Summary Compensation Table
| (3) Amounts reflect payments under the MIP for performance in 2024, 2023 and 2022. See “Compensation Discussion and Analysis—2024 NEO Compensation—Annual Cash Incentive Program” above for details on 2024 payments to the NEOs under the MIP. |
2024 Summary Compensation Table
| (4) Amounts consist solely of our matching contributions to the 401(k) Plan and the Deferred Compensation Plan, which were consistent with the benefits available to our similarly-situated employees. There were no other reportable perquisites, personal benefits, tax reimbursements or gross-ups paid to any NEO in 2024. |
2024 Summary Compensation Table
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2024 Grants of Plan-Based Awards
2024 Grants of Plan-Based Awards The following table shows information regarding the incentive awards granted to our NEOs in 2024. Annual cash incentive awards are made pursuant to the MIP and equity awards are made pursuant to the EIP. To receive a payout under the PSUs and RSUs, a participant must remain actively employed by us through the end of the relevant performance period or vesting date (except in the case of a qualifying termination of employment, as described in “—Payments Upon Termination or Change of Control (As of December 31, 2024)” below). No dividends, if any were to be declared and paid, would accrue on any of the PSUs or RSUs prior to payout or vesting, as applicable.
2024 Grants of Plan-Based Awards
| Name | Award Type(1) | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(2) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(4) | | | All Other Stock Awards: Number of Shares of Stock or Units (#)(5) | Target Grant Date Fair Value of Stock Awards ($)(3) | | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | John C. Rademacher | MIP | | 650,000 | 1,300,000 | 2,600,000 | | | | | | | | PSU | 2/20/2024 | | | | 53,812 | 107,624 | 215,248 | | 3,600,023 | | | RSU | 2/20/2024 | | | | | | | 71,751 | 2,400,071 | | Michael Shapiro | MIP | | 275,219 | 550,439 | 1,100,877 | | | | | | | | PSU | 2/20/2024 | | | | 26,906 | 53,812 | 107,624 | | 1,800,011 | | | RSU | 2/20/2024 | | | | | | | 35,877 | 1,200,086 | | Luke Whitworth | MIP | | 273,596 | 547,193 | 1,094,385 | | | | | | | | PSU | 2/20/2024 | | | | 20,180 | 40,359 | 80,718 | | 1,350,009 | | | RSU | 2/20/2024 | | | | | | | 26,907 | 900,039 | | Collin G. Smyser | MIP | | 183,248 | 366,496 | 732,992 | | | | | | | | PSU | 2/20/2024 | | | | 9,418 | 18,835 | 37,670 | | 630,031 | | | RSU | 2/20/2024 | | | | | | | 12,558 | 420,065 | | Christopher L. Grashoff | MIP | | 180,000 | 360,000 | 720,000 | | | | | | | | PSU | 2/20/2024 | | | | 8,969 | 17,938 | 35,876 | | 600,026 | | | RSU | 2/20/2024 | | | | | | | 11,961 | 400,095 |
2024 Grants of Plan-Based Awards
| (1) “MIP” refers to annual cash incentive awards made pursuant to the MIP. |
2024 Grants of Plan-Based Awards
| (2) These columns represent the range of possible annual cash incentive awards under the MIP. Actual awards are dependent on actual results measured against pre-established performance goals, as described in “Compensation Discussion and Analysis—2024 NEO Compensation—Annual Cash Incentive Program” above. Payouts range from 50% to 200% of target. The actual amounts paid to NEOs under the MIP for 2024 are included in the “Non-Equity Incentive Plan Compensation” column of the “2024 Summary Compensation Table” above. |
2024 Grants of Plan-Based Awards
| (3) A discussion of the assumptions used in computing the grant date fair values may be found in Note 15 – Stock-Based Incentive Compensation found in Part II, Item 8, “Financial Statements and Supplementary Data” in the Notes to Consolidated Financial Statements in the 2024 Annual Report. |
2024 Grants of Plan-Based Awards
| (4) These columns show the range of payouts for the PSUs. These PSUs are scheduled to vest in February 2027, with payouts ranging from 0% to 200% of target based on performance over a three-year performance period ended December 31, 2026. The grant date fair value of the PSUs is based on the probable payout outcome at the time of grant. |
2024 Grants of Plan-Based Awards
| (5) This column shows the number of shares underlying the RSUs. One-quarter of these RSUs are scheduled to vest on each anniversary of the grant date. |
2024 Grants of Plan-Based Awards
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Outstanding Equity Awards as of December 31, 2024
Outstanding Equity Awards as of December 31, 2024 The following table shows information regarding the outstanding equity awards held by each of our NEOs as of December 31, 2024.
Outstanding Equity Awards as of December 31, 2024
| | Option Awards(1) | | | | Stock Awards | | | | | Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | John C. Rademacher | 77,388(3) | 25,796(3) | 18.97 | 02/23/2031 | — | — | — | — | | | 90,918(8) | — | 26.91 | 10/26/2031 | — | — | — | — | | | 43,046(4) | 43,046(4) | 23.65 | 02/21/2032 | — | — | — | — | | | — | 238,596(9) | 28.86 | 02/22/2033 | — | — | — | — | | | 21,872(10) | 65,616(10) | 28.86 | 02/22/2033 | — | — | — | — | | | — | — | — | — | 22,174(13) | 514,437 | — | — | | | — | — | — | — | 35,733(15) | 829,006 | — | — | | | — | — | — | — | 129,940(14) | 3,014,608 | — | — | | | — | — | — | — | 71,751(24) | 1,664,623 | — | — | | | — | — | — | — | 177,380(19) | 4,115,216 | — | — | | | — | — | — | — | — | — | 154,830(20) | 3,661,656 | | | — | — | — | — | — | — | 107,624(23) | 2,496,877 | | Michael Shapiro | — | 7,739(3) | 18.97 | 02/23/2031 | — | — | — | — | | | 49,357(11) | — | 25.75 | 10/21/2031 | — | — | — | — | | | 14,180(5) | 14,180(5) | 23.96 | 02/17/2032 | — | — | — | — | | | 7,954(10) | 23,862(10) | 28.86 | 02/22/2033 | — | — | — | — | | | — | 143,156(9) | 28.86 | 02/22/2033 | — | — | — | — | | | — | — | — | — | 3,954(12) | 91,733 | — | — | | | — | — | — | — | 7,304(16) | 169,453 | — | — | | | — | — | — | — | 12,996(15) | 301,507 | — | — | | | — | — | — | — | 77,963(14) | 1,808,742 | — | — | | | — | — | — | — | 35,877(24) | 832,346 | — | — | | | — | — | — | — | 58,432(19) | 1,355,622 | — | — | | | — | — | — | — | — | — | 56,135(20) | 1,302,323 | | | — | — | — | — | — | — | 53,812(23) | 1,248,438 |
Outstanding Equity Awards as of December 31, 2024
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Outstanding Equity Awards as of December 31, 2024
| | Option Awards(1) | | | | Stock Awards | | | | | Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Luke Whitworth | 36,092(6) | — | 13.34 | 03/09/2030 | — | — | — | — | | | 9,675(3) | 3,225(3) | 18.97 | 02/23/2031 | — | — | — | — | | | 24,679(11) | — | 25.75 | 10/21/2031 | — | — | — | — | | | 4,052(5) | 4,052(5) | 23.96 | 02/17/2032 | — | — | — | — | | | 5,667(10) | 17,001(10) | 28.86 | 02/22/2033 | — | — | — | — | | | — | 18,293(9) | 28.86 | 02/22/2033 | — | — | — | — | | | — | — | — | — | 1,648(12) | 38,234 | — | — | | | — | — | — | — | 2,088(16) | 48,442 | — | — | | | — | — | — | — | 9,261(15) | 214,855 | — | — | | | — | — | — | — | 9,962(14) | 231,118 | — | — | | | — | — | — | — | 26,907(24) | 624,242 | — | — | | | — | — | — | — | 16,696(21) | 387,347 | — | — | | | — | — | — | — | — | — | 40,893(20) | 948,718 | | | — | — | — | — | — | — | 40,359(23) | 936,329 | | Collin G. Smyser | 3,052(7) | 3,052(7) | 28.89 | 05/19/2032 | — | — | — | — | | | 3,281(10) | 9,843(10) | 28.86 | 02/22/2033 | — | — | — | — | | | — | 15,907(9) | 28.86 | 02/22/2033 | — | — | — | — | | | — | — | — | — | 1,624(18) | 37,677 | — | — | | | — | — | — | — | 10,384(17) | 240,909 | — | — | | | — | — | — | — | 5,361(15) | 124,375 | — | — | | | — | — | — | — | 8,663(14) | 200,982 | — | — | | | — | — | — | — | 12,558(24) | 291,346 | — | — | | | — | — | — | — | 12,984(22) | 301,229 | — | — | | | — | — | — | — | — | — | 23,676(22) | 549,283 | | | — | — | — | — | — | — | 18,835(23) | 436,972 |
Outstanding Equity Awards as of December 31, 2024
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Outstanding Equity Awards as of December 31, 2024
| | Option Awards(1) | | | | Stock Awards | | | | | Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Christoper L. Grashoff | | | | | | | | | | | 3,678(3) | 1,226(3) | 18.97 | 02/23/2031 | — | — | — | — | | | 8,974(3) | — | 25.75 | 10/21/2031 | — | — | — | — | | | 2,026(5) | 2,026(5) | 23.96 | 02/17/2032 | — | — | — | — | | | 1,989(10) | 5,967(10) | 28.86 | 02/22/2033 | — | — | — | — | | | — | — | — | — | 626(12) | 14,523 | — | — | | | — | — | — | — | 1,044(16) | 24,221 | — | — | | | — | — | — | — | 3,249(15) | 75,377 | — | — | | | — | — | — | — | 11,961(24) | 277,495 | — | — | | | — | — | — | — | — | — | 17,938(23) | 416,162 |
Outstanding Equity Awards as of December 31, 2024
| (1) Our non-qualified stock option awards typically vest over a four-year period and, in certain instances, may fully vest upon a change in control of Option Care Health. These awards also have an exercise price that may not be less than 100% of its fair market value on the date of grant and are typically exercisable within ten years after the date of grant, subject to earlier termination in certain circumstances. |
Outstanding Equity Awards as of December 31, 2024
| (2) The value of the unvested RSUs is based on our closing stock price as of December 31, 2024 (the last trading day of 2024) of $23.20. Outstanding RSUs typically vest in four equal annual installments on each of the first four anniversaries of the grant date, subject to continued service with us. |
Outstanding Equity Awards as of December 31, 2024
| (3) Represents non-qualified stock options granted under the EIP that vested 50% on February 23, 2023, 25% on February 23, 2024, and 25% on February 23, 2025. |
Outstanding Equity Awards as of December 31, 2024
| (4) Represents non-qualified stock options granted under the EIP that vested 25% on February 21, 2022, 25% on February 21, 2023, 25% on February 21, 2024, and 25% on February 21, 2025. |
Outstanding Equity Awards as of December 31, 2024
| (5) Represents non-qualified stock options granted under the EIP that vested 25% on February 17, 2023, 25% on February 17, 2024, 25% on February 17, 2025, and will vest 25% on February 17, 2026. |
Outstanding Equity Awards as of December 31, 2024
| (6) Represents non-qualified stock options granted under the EIP that vested 50% on March 9, 2022, 25% on March 9, 2023, and 25% on March 9, 2024. |
Outstanding Equity Awards as of December 31, 2024
| (7) Represents non-qualified stock options granted under the EIP that vested 25% on May 19, 2023, and 25% on May 19, 2024, 25% on May 19, 2025, and 25% on May 19, 2026. |
Outstanding Equity Awards as of December 31, 2024
| (8) Represents non-qualified stock options granted under the EIP that vested 100% on October 26, 2024. |
Outstanding Equity Awards as of December 31, 2024
| (9) Represents non-qualified stock options granted under the EIP that are scheduled to vest 100% on February 22, 2026. |
Outstanding Equity Awards as of December 31, 2024
| (10) Represents non-qualified stock options granted under the EIP that vested 25% on February 22, 2024, 25% on February 22, 2025, and which are scheduled to vest 25% on February 22, 2026, and 25% on February 22, 2027. |
Outstanding Equity Awards as of December 31, 2024
| (11) Represents non-qualified stock options granted under the EIP that vested 100% on October 21, 2024. |
Outstanding Equity Awards as of December 31, 2024
| (12) Represents RSUs granted under the EIP that vested 25% on February 23, 2025. |
Outstanding Equity Awards as of December 31, 2024
| (13) Represents RSUs granted under the EIP that vested 25% on February 21, 2025 and which are scheduled to vest 25% on February 21, 2026. |
Outstanding Equity Awards as of December 31, 2024
| (14) Represents RSUs granted under the EIP that are scheduled to vest 100% on February 22, 2026. |
Outstanding Equity Awards as of December 31, 2024
| (15) Represents RSUs granted under the EIP that vested 25% on February 22, 2025, and which are scheduled to vest 25% on February 22, 2026, and 25% on February 22, 2027. |
Outstanding Equity Awards as of December 31, 2024
| (16) Represents RSUs granted under the EIP that vested 25% on February 17, 2025, and which are scheduled to vest 25% on February 17, 2026. |
Outstanding Equity Awards as of December 31, 2024
| (17) Represents RSUs granted under the EIP that are scheduled to vest 100% on May 19, 2025. |
Outstanding Equity Awards as of December 31, 2024
| (18) Represents RSUs granted under the EIP that are scheduled to vest 25% on May 19, 2025 and 25% on May 19, 2026. |
Outstanding Equity Awards as of December 31, 2024
| (19) Represents PSUs that were earned as to 200% of the target shares and vested on February 21, 2025. |
Outstanding Equity Awards as of December 31, 2024
| 2025 Proxy Statement | 63 |
Outstanding Equity Awards as of December 31, 2024
| (20) Represents PSUs granted under the EIP that are scheduled to vest on February 22, 2026, disclosed at maximum level. |
Outstanding Equity Awards as of December 31, 2024
| (21) Represents PSUs that were earned as to 200% of the target shares and vested on February 17, 2025. |
Outstanding Equity Awards as of December 31, 2024
| (22) Represents PSUs that were earned as to 166% of the target shares and scheduled to vest on May 19, 2025. |
Outstanding Equity Awards as of December 31, 2024
| (23) Represents PSUs granted under the EIP that are scheduled to vest on February 20, 2027, disclosed at maximum level. |
Outstanding Equity Awards as of December 31, 2024
| (24) Represents RSUs granted under the EIP that vested 33% on February 20, 2025, and which are scheduled to vest 33% on February 20, 2026, and 34% on February 20, 2027. |
Options Exercised and Stock Vested During 2024
Options Exercised and Stock Vested During 2024 The following table shows information regarding the stock options exercised and the vesting of stock awards previously granted to our NEOs during 2024.
Options Exercised and Stock Vested During 2024
| | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#)(1) | Value Realized on Exercise ($)(2) | Number of Shares Acquired on Vesting (#)(3) | Value Realized on Vesting ($)(4) | | John C. Rademacher | — | — | 278,257 | 8,900,023 | | Michael Shapiro | 23,217 | 278,075 | 92,290 | 2,953,382 | | Luke Whitworth | — | — | 45,369 | 1,451,105 | | Collin G. Smyser | — | — | 2,599 | 82,348 | | Christopher L. Grashoff | — | — | 10,531 | 322,587 |
Options Exercised and Stock Vested During 2024
| (1) Reflects the aggregate gross number of options exercised and includes any shares used to exercise such options and satisfy applicable taxes. |
Options Exercised and Stock Vested During 2024
| (2) The value equals our stock price on the exercise date, minus the per share exercise price of the non-qualified stock option, multiplied by the number of shares acquired on exercise. |
Options Exercised and Stock Vested During 2024
| (3) Reflects the aggregate gross number of RSUs that vested during 2024. |
Options Exercised and Stock Vested During 2024
| (4) The value equals our stock price on the vesting date multiplied by the number of shares acquired on vesting. |
Non-qualified Deferred Compensation
Non-qualified Deferred Compensation Our NEOs are eligible to participate in the Deferred Compensation Plan. Deferred Compensation Plan participants may elect to defer up to 75% of their annual base salary and up to 100% of their eligible cash bonus by timely completing a deferral election form. Amounts deferred under the Deferred Compensation Plan, as adjusted for applicable earnings gains and losses and fees, are credited to an account in the participant’s name and remain fully vested at all times. Participants may select at any time from a diversified menu of investment options, which align with the investment options available under our qualified 401(k) plan, and the value of their Deferred Compensation Plan account balance may increase or decrease based on the performance of their selected investment options. In 2024, annual returns on the investment options available for the Deferred Compensation Plan generally ranged from 1.8% to 33.0%. Deferred Compensation Plan participants may elect to receive distributions of their deferred amounts upon separation from service, death or another payment date. Distributions will be made in a lump sum payment unless the Participant elected to receive their account balance in a designated number of annual installments not to exceed fifteen (15) installment payments. A Deferred Compensation Plan participant also may request to receive a hardship distribution on account of an eligible unforeseeable emergency. If a Deferred Compensation Plan participant dies before receiving a complete distribution of their account, the remaining account will be paid to their beneficiaries in a lump sum by December 31 of the year following the participant’s death. The following table shows information regarding the participation of our NEOs in the Deferred Compensation Plan as of December 31, 2024.
Non-qualified Deferred Compensation
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Non-qualified Deferred Compensation
| Name | Executive Contributions ($)(1) | Company Contributions ($) | Aggregate Earnings ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance as of December 31, 2024 ($) | | John C. Rademacher | 0 | 0 | 0 | 0 | 0 | | Collin G. Smyser | 243,269 | 0 | (799) | 0 | 242,470 | | Christopher L. Grashoff | 19,904 | 0 | 920 | 0 | 20,824 |
Non-qualified Deferred Compensation
| (1) Mr. Whitworth and Mr. Shapiro did not participate in the Deferred Compensation Plan. Mr. Rademacher participated in the Deferred Compensation Plan with an election to defer a portion of his 2024 MIP bonus that was not contributed until March 14, 2025. |
Payments Upon Termination or Change of Control (As of December 31, 2024)
Payments Upon Termination or Change of Control (As of December 31, 2024)
Potential Payments Table
Potential Payments Table The following table discloses the potential payments and benefits, other than those available generally on a nondiscriminatory basis to all U.S. salaried employees, provided upon a change of control or termination of employment for each of the NEOs, calculated as if the change of control or termination of employment had occurred on December 31, 2024:
Potential Payments Table
| Name | Severance ($)(1) | Accelerated Vesting of Equity ($)(2) | Total ($) | | John C. Rademacher | | | | | Termination without cause | 3,346,622 | 13,127,163 | 16,473,785 | | Termination due to death or disability | 4,800,000 | 13,127,163 | 17,927,163 | | Termination without cause or resignation for “good reason”within two years following a change in control | 5,646,622 | 16,711,292 | 22,357,914 | | Michael Shapiro | | | | | Termination without cause | 1,514,852 | 5,499,244 | 7,014,096 | | Termination due to death or disability | 2,976,000 | 5,499,244 | 8,475,244 | | Termination without cause or resignation for “good reason”within two years following a change in control | 2,683,352 | 7,172,118 | 9,855,470 | | Luke Whitworth | | | | | Termination without cause | 1,374,832 | 2,235,111 | 3,609,943 | | Termination due to death or disability | 2,843,750 | 2,235,111 | 5,078,861 | | Termination without cause or resignation for “good reason” within two years following a change in control | 2,562,332 | 3,442,927 | 6,005,259 | | Collin G. Smyser | | | | | Termination without cause | 1,010,368 | 1,595,472 | 2,605,840 | | Termination due to death or disability | 2,250,000 | 1,595,472 | 3,845,472 | | Termination without cause or resignation for “good reason” within two years following a change in control | 1,885,368 | 2,182,772 | 4,068,140 | | Christopher L. Grashoff | | | | | Termination without cause | 891,763 | 288,164 | 1,179,927 | | Termination due to death or disability | 1,860,000 | 288,164 | 2,148,164 | | Termination without cause or resignation for “good reason” within two years following a change in control | 1,651,763 | 812,964 | 2,464,727 |
Potential Payments Table
| (1) As of December 31, 2024, all NEOs were entitled to severance under the Executive Severance Plan. |
Potential Payments Table
| (2) Represents the value of accelerated vesting of option, PSU and RSU awards. Please see “—Payments Upon Termination or Change of Control (As of December 31, 2024)” above for information regarding vesting upon a change in control of Option Care Health and upon employment termination. |
Potential Payments Table
| 2025 Proxy Statement | 67 |
CEO Pay Ratio
CEO Pay Ratio In accordance with SEC rules, we are providing the ratio of the annual total compensation of our President and Chief Executive Officer, John C. Rademacher, to the annual total compensation of our median employee. The 2024 annual total compensation of Mr. Rademacher is $8,222,800, the 2024 annual total compensation of our median employee is $53,369, and the ratio of these amounts is 154 to 1. We believe this pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our information systems and the methodology described below. Because SEC rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a wide variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and types of workforces and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios. For 2024, we used the same median employee that was identified in 2023 since there has been no change in our employee population or employee compensation that we reasonably believe would result in a significant change in the pay ratio disclosure. We identified the median employee for 2023 as of December 31, 2023, taking into account all of our 7,713 full-time, part-time, and per diem hourly employees, excluding Mr. Rademacher. We utilized actual earned wages reported for tax purposes for 2023 as the consistently applied compensation measure as of December 31, 2023 to identify the median employee. We calculated the total compensation of this new median employee for 2024 using the same methodology that was used for our NEOs as set forth in “2024 Summary Compensation Table” above.
CEO Pay Ratio
| 2025 Proxy Statement | 68 |
Pay-Versus-Performance Table
| Year(1) | Summary Compensation for Table Total for PEO ($) | Compensation Actually Paid to PEO ($)(2)(3) | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs ($)(2)(3) | Value of Initial Fixed $100 Investment Based On | | Net Income ($M) | Adjusted EBITDA ($M)(5) | | | | | | | Total Shareholder Return ($)(4) | Peer Group Total Shareholder Return ($)(4) | | | | 2024 | 8,222,800 | (1,867,673) | 2,794,597 | 831,127 | 155.50 | 123.45 | 211.8 | 443.8 | | 2023 | 16,613,200 | 22,231,884 | 3,647,608 | 4,661,216 | 225.80 | 121.70 | 267.1 | 425.2 | | 2022 | 6,754,639 | 10,072,293 | 1,943,041 | 286,518 | 201.68 | 116.36 | 150.6 | 342.9 | | 2021 | 8,148,659 | 13,139,273 | 3,292,294 | 4,992,770 | 190.62 | 145.57 | 139.9 | 289.8 | | 2020 | 1,137,554 | 1,137,554 | 1,118,132 | 1,085,922 | 104.83 | 133.00 | (8.1) | 221.7 |
Pay-Versus-Performance Table
| (2) The dollar amounts reported represent the amount of “compensation actually paid” as calculated in accordance with SEC rules. “Compensation actually paid” represents a new required calculation of compensation that differs significantly from the “Summary Compensation Table” calculation of compensation, each NEO’s realized or earned compensation, as well as from the way in which the Compensation Committee views annual compensation decisions, as discussed in “Compensation Discussion and Analysis” above. The amounts in the table above are calculated in accordance with SEC rules and do not represent amounts actually earned or realized by NEOs, including with respect to equity awards that remain subject to forfeiture if the vesting conditions are not satisfied. For purposes of calculating “compensation actually paid,” the fair value of equity awards is calculated in a manner consistent with the fair value methodology used for financial reporting purposes. |
Pay-Versus-Performance Table
| (5) Adjusted EBITDA is the financial measure that was determined to be the most important financial performance measure linking “compensation actually paid” to our NEOs to company performance for 2024, and therefore was selected as the 2024 “Company-Selected Measure” as defined in Item 402(v) of Regulation S-K under the Exchange Act. Adjusted EBITDA is a non-GAAP financial measure. Please refer to the reconciliation of this non-GAAP financial measure to the comparable GAAP financial measure in Appendix A of this Proxy Statement. |
Relationship Between “Compensation Actually Paid” and Performance Measures
Relationship Between “Compensation Actually Paid” and Performance Measures In accordance with SEC rules, the charts below illustrate how “compensation actually paid” to our NEOs aligns with our financial performance as measured by our total stockholder return, our peer group total stockholder return, our net income, and our Adjusted EBITDA.
Relationship Between “Compensation Actually Paid” and Performance Measures
| 2025 Proxy Statement | 71 |