SEC Filings

8-K
ENVISION HEALTHCARE CORP filed this Form 8-K on 09/19/2017
Entire Document
 
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 19, 2017 (September 13, 2017)

http://api.tenkwizard.com/cgi/image?quest=1&rid=23&ipage=11802857&doc=4

ENVISION HEALTHCARE CORPORATION
(Exact Name of Registrant as Specified in its Charter)

Delaware
001-37955
62-1493316
(State or Other Jurisdiction of Incorporation)
(Commission
 File Number)
(I.R.S. Employer
 Identification No.)
 
 
 
1A Burton Hills Boulevard
 
 
Nashville, Tennessee
 
37215
(Address of Principal
Executive Offices)
 
(Zip Code)

(615) 665-1283
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]






Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

Departure of Certain Officers

On September 13, 2017, Claire M. Gulmi, the Executive Vice President and Chief Financial Officer of Envision Healthcare Corporation (the “Company”), notified the Company of her intention to retire from her position, effective October 2, 2017. Ms. Gulmi will be employed as an advisor to the Company for a period of one year following the date of her retirement to assist with the transition of her responsibilities to the new Executive Vice President and Chief Financial Officer. In connection with the Company’s retirement policies, for one year following her retirement, Ms. Gulmi will continue to receive base salary and benefits at her current level.

Separately, on September 13, 2017, Robert J. Coward, the Company’s Executive Vice President and President-Physician Services Group, notified the Company of his intention to resign, effective October 2, 2017, and will be available to assist with transition efforts until mid-November 2017. Mr. Coward’s decision to resign is related to his desire to pursue new opportunities and not the result of any disagreement with the Company on any matter relating to the Company’s operation, policies or practices.

Appointment of Certain Officers

On September 18, 2017, in connection with the announcement of certain organizational changes, the Company announced the appointment of the following executive officers:

Name
Title
Effective Date of Appointment
Karey L. Witty
Executive Vice President and Chief Operating Officer
October 2, 2017
Kevin D. Eastridge
Executive Vice President and Chief Financial Officer
October 2, 2017
Kenneth E. Zongor
Senior Vice President and Chief Accounting Officer
October 2, 2017

Mr. Witty, 53, is a veteran healthcare executive with more than 25 years of experience in various executive, financial, and operational leadership positions and most recently served as President and Chief Executive Officer of Corizon Health, Inc. (“Corizon”), a leading provider of correctional healthcare services in the United States, a role he held from November 2015 until September 2017. Prior to joining Corizon, Mr. Witty served as Chief Financial Officer for Nashville-based naviHealth, Inc., a provider of healthcare services across the post-acute care continuum, from January 2014 through October 2015. Mr. Witty also served as Chief Financial Officer of HealthSpring, Inc. from July 2009 until its acquisition by Cigna in January 2012, a time of significant change in its managed care offerings. He was with Centene Corporation for eight years, including six years as Chief Financial Officer and one year as Chief Executive Officer of its Health Plan Business unit.

Mr. Eastridge, 52, currently serves as the Company’s Senior Vice President and Chief Accounting Officer. Prior to the merger (the “Merger”) of the Company with AMSURG Corp. (“AMSURG”), Mr. Eastridge served as Senior Vice President of Finance at AMSURG from July 2008 through November 2016 and as Chief Accounting Officer from July 2004 through November 2016. Mr. Eastridge served in various capacities with AMSURG from March 1997 through July 2004, including Vice President of Finance and Controller. During his time with the Company, Mr. Eastridge has been a key executive in its strategic transformation into a diversified healthcare services organization, including several transactions that include the Merger.

Mr. Zongor, 42, currently serves as Senior Vice President Financial Reporting, a position he has held since July 2017. Previously, Mr. Zongor served as Vice President of Financial Reporting of the Company and, prior to the Merger, as Vice President of Financial Reporting of AMSURG since September 2010. Prior to joining AMSURG, Mr. Zongor worked in the assurance and advisory department for multiple public accounting firms for over 13 years.

A copy of the press release issued by the Company on September 18, 2017 announcing the foregoing management changes is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

Compensatory Arrangements of Appointed Officers

In connection with his appointment, Mr. Witty will receive a base salary of $700,000 and will be eligible to receive a target bonus payment equal to 100% of his base salary under the Company’s short-term incentive plan. In addition, Mr. Witty will receive a one-time restricted stock unit award with a value equal to $500,000 upon the commencement of his employment, and





will be eligible to receive a long-term incentive plan (“LTIP”) award equal to 200% of his base salary during the Company’s regular 2018 executive compensation process. The Company and Mr. Witty intend to enter into an employment agreement with an initial term expiring December 31, 2018, which will provide for severance benefits upon the termination of Mr. Witty’s employment by the Company “without cause” or by Mr. Witty for “good reason,” as defined therein. Under such circumstances, Mr. Witty will receive a cash payment equal to two times his annual salary, acceleration of his unvested equity awards, and continuing health and life insurance benefits for at least six-months following his termination.

In connection with Mr. Eastridge’s appointment, he will receive a base salary of $575,000 and will be eligible to receive a target bonus payment equal to 100% of his base salary. He will also be eligible to receive a LTIP award with a target value of $1.1 million during the regular 2018 executive compensation process. The Company and Mr. Eastridge intend to enter into an employment agreement with an initial term expiring December 31, 2018, which will provide for severance benefits upon the termination of Mr. Eastridge’s employment by the Company “without cause” or by Mr. Eastridge for “good reason,” as defined therein. Under such circumstances, Mr. Eastridge will receive a cash payment equal to two times his annual salary, acceleration of his unvested equity awards, and continuing health and life insurance benefits for at least six-months following his termination.

Mr. Zongor will receive a base salary of $370,000 and will be eligible to receive a target bonus payment equal to 50% of his base salary. He will be eligible to receive a LTIP award with a target value of $300,000 during the regular 2018 executive compensation process. The Company and Mr. Zongor intend to enter into an employment agreement with an initial term expiring December 31, 2018, which will provide for severance benefits upon the termination of Mr. Zongor’s employment by the Company “without cause” or by Mr. Zongor for “good reason,” as defined therein. Under such circumstances, Mr. Zongor will receive a cash payment equal to two times his annual salary, acceleration of his unvested equity awards, and continuing health and life insurance benefits for at least six-months following his termination.

Other than as set forth above, there are no arrangements or understandings between each of Messrs. Witty, Eastridge and Zongor (collectively, the “Appointed Officers”), and any other persons pursuant to their appointments. There are no family relationships between any of the Appointed Officers, on the one hand, and any director or other executive officer of the Company. Mr. Eastridge's brother-in-law, John Clark, is employed by the Company as a Vice-President-Development and, consistent with the Company's compensation policies applicable to other employees of similar title and responsibility, is paid aggregate annual compensation in excess of $120,000. Other than Mr. Eastridge's family relationship, none of the Appointed Officers has any direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.

Item 8.01. Other Events.

On September 18, 2017, the Company issued a press release announcing the approval by the Company’s Board of Directors of the repurchase of up to $250 million of the Company’s common stock, representing approximately 4% of the Company’s then current market capitalization. The timing and amount of any shares repurchased will be determined based on the Company’s evaluation of market conditions and other factors. Repurchases will be made in accordance with the rules and regulations promulgated by the Securities and Exchange Commission and certain other legal requirements to which the Company may be subject. The program may be suspended or discontinued at any time and has no mandatory expiration date.

A copy of the foregoing press release is furnished as Exhibit 99.2 hereto and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.
Exhibit No.
 
Description of Exhibit
99.1
 
Press Release of Envision Healthcare Corporation, dated September 18, 2017, announcing Organizational Changes.
99.2
 
Press Release of Envision Healthcare Corporation, dated September 18, 2017, announcing $250 million Stock Repurchase.






SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
Envision Healthcare Corporation
 
 
 
 
 
 
 
By:
/s/ Claire M. Gulmi
 
 
Claire M. Gulmi
 
 
 
 
 
Executive Vice President and Chief Financial Officer
 
 
(Principal Financial and Duly Authorized Officer)

Date:    September 19, 2017





EXHIBIT INDEX



Exhibit

Exhibit 99.1

http://api.tenkwizard.com/cgi/image?quest=1&rid=23&ipage=11802857&doc=4
Contact:
Bob Kneeley
 
Vice President, Investor Relations
 
(303) 495-1245
 
Bob.kneeley@evhc.net

ENVISION HEALTHCARE ANNOUNCES ORGANIZATIONAL CHANGES TO ALIGN
SENIOR LEADERSHIP STRUCTURE WITH PHYSICIAN-CENTRIC STRATEGY

Karey Witty, Former CEO of Corizon Health, Joins in New Role of Chief Operating Officer

Kevin Eastridge Appointed CFO on Retirement of Claire Gulmi

Brian Jackson to Succeed Robert Coward as President of Physician Services

NASHVILLE, Tenn. & GREENWOOD VILLAGE, Colo. - (September 18, 2017) - Envision Healthcare Corporation (“Envision” or the “Company”) (NYSE: EVHC) today announced organizational changes, including a realignment of the senior leadership structure under Christopher A. Holden, Envision’s President and Chief Executive Officer, to reflect the Company’s focus on its physician-centric strategic plan.

As part of its ongoing efforts to enhance its scale, physician-centric strategy and operational excellence, Envision has created the new role of Executive Vice President and Chief Operating Officer. The Executive Vice President and Chief Operating Officer will report directly to Mr. Holden, with responsibility for Envision’s Physician Services and Ambulatory Surgery service lines. In addition, Envision announced the implementation of succession plans for its current Chief Financial Officer, Claire Gulmi, and President of Physician Services, Robert Coward.

As a result of these changes:

Karey Witty, a veteran healthcare executive with more than 25 years of experience in various executive, financial, and operational leadership positions, has been appointed to the new role of Executive Vice President and Chief Operating Officer, effective October 2, 2017.
Kevin Eastridge, currently Chief Accounting Officer, will succeed Ms. Gulmi as Chief Financial Officer, also effective October 2, 2017. Thereafter, Ms. Gulmi will be employed as an advisor to the Company for one year to assist with the transition of her responsibilities to Mr. Eastridge. Kenneth Zongor, currently Senior Vice President - Financial Reporting, will succeed Mr. Eastridge as Chief Accounting Officer, effective October 2, 2017.
Brian Jackson, currently Chief Operating Officer for the Physician Services Group, will succeed Mr. Coward as President of Physician Services, effective October 2, 2017. Mr. Coward’s decision to resign is related to his desire to pursue new opportunities and not the result of a disagreement with the Company on any matter relating to the Company’s operation, policies or practices. Mr. Coward has agreed to be available for a period of 60 days to assist with transition efforts.

“We are excited about the progress we’ve made since closing the transformational combination of Envision and AMSURG, a merger that has advanced our physician-centric strategy,” said Christopher A. Holden, President and CEO of Envision. “Today’s announcement reflects a comprehensive evaluation of options to select the most effective management structure for our business, as well as the results of a robust search process. I am grateful for the contributions made by our leaders and team members at every level of our organization. These leadership appointments will advance the strategic evolution of the Company and ensure timely continuity of leadership. I am pleased that, as we implement this new organizational structure, we are able to draw on a deep bench of talented leaders and attract the experiences and perspectives of seasoned healthcare executives.


-MORE-

Envision Healtthcare Announces Organizational Change to Align Senior Leadership Structure With Physician-Centric Strategy
Page 2
 
 
September 18, 2017
 
 


“On behalf of the entire Envision team, I would like to thank Claire for her tireless efforts and strong financial leadership through a period of significant growth and transformation from an operator of ambulatory surgery services to a leading diversified healthcare services organization. We wish Claire the best in her well-earned retirement, and are thankful for her continued guidance during the transition period. I would also like to thank Bob for his work to position Physician Services for continued growth and success.”

Karey Witty
Mr. Witty, 53, brings more than 25 years of healthcare expertise and leadership, and most recently served as Chief Executive Officer of Corizon Health, Inc., the leading provider of correctional healthcare services in the United States. At Corizon, Mr. Witty engineered an organizational turnaround that focused on achieving operational excellence. Prior to joining Corizon, Mr. Witty served as CFO for Nashville‐based naviHealth, Inc., which provides services to approximately two million patients across the post‐acute continuum. Mr. Witty also served as CFO of HealthSpring from 2009 until its acquisition by CIGNA in 2012, a time of significant change in its managed care offerings. He was with Centene Corporation for eight years, including six years as CFO and one year as Chief Executive Officer of its Health Plan Business unit.

Mr. Holden commented, “We look forward to leveraging Karey’s extensive leadership and management experience developed during his time as CEO of Corizon and, previously, as CFO of naviHealth. We have no doubt we will benefit immediately from his fresh perspective and extensive knowledge of payor and provider dynamics. I look forward to working with Karey and the rest of our team to enhance operational excellence, execute our unique strategy and drive value for shareholders.”

Kevin Eastridge
Mr. Eastridge, 52, currently serves as Senior Vice President and Chief Accounting Officer for Envision. Prior to the merger creating today’s Envision, Mr. Eastridge served as Senior Vice President of Finance at AMSURG Corp. from July 2008 through November 2016 and as Chief Accounting Officer from July 2004 through November 2016. Mr. Eastridge served in various capacities with AMSURG from March 1997 through July 2004, including Vice President of Finance and Controller. During his time with the Company, Mr. Eastridge has been a key executive in its strategic transformation into a diversified healthcare services organization, including several transactions that include the merger creating today’s Envision.

Mr. Holden commented, “Kevin is a proven leader who has been instrumental in helping develop and implement our vision of the new Envision, including important capital structure allocation to create value for our shareholders. He has been a trusted and highly effective leader throughout his 20-year tenure with the Company. He is the ideal person to step into the CFO role, as his deep experience and intimate knowledge of our company will be critical as we continue to execute on the strategic initiatives underway to solidify our position as the trusted partner for payors, providers, health systems, and their communities.”

Brian Jackson
Mr. Jackson, 54, currently serves as Chief Operating Officer for Physician Services, and served as Chief Operating Officer for AMSURG’s Sheridan division prior to the merger with Envision. Prior to joining Sheridan in 2014, Mr. Jackson served as Division Vice President at DaVita Healthcare Partners, Inc. and as Senior Vice President of National Markets for Cardinal Health, Inc. Mr. Jackson also had a distinguished career as a US Army attack helicopter pilot in Germany and Saudi Arabia.

Mr. Holden commented, “Brian’s balance of development and operations experience makes him ideally suited for this role as President of Physician Services. Drawing on his significant experience in developing and managing teams to drive margins and growth at DaVita and Cardinal Health, Brian has contributed to improved operational execution of the Company’s largest business line during the past three years as COO of Physician Services. As COO, Brian worked closely with the executive leadership team to help drive our growth strategy and has shown a readiness and ability to successfully lead key initiatives at Envision. His expertise and insight into our business will enable us to continue our momentum in Physician Services and capitalize on the many opportunities that lie ahead.”


-MORE-

Envision Healtthcare Announces Organizational Change to Align Senior Leadership Structure With Physician-Centric Strategy
Page 3
 
 
September 18, 2017
 
 


About Envision Healthcare Corporation
Envision Healthcare Corporation is a leading provider of physician-led services and post-acute care, and ambulatory surgery services. At June 30, 2017, we delivered physician services, primarily in the areas of emergency department and hospitalist services, anesthesiology services, radiology/tele-radiology services, and children’s services to more than 1,800 clinical departments in healthcare facilities in 47 states and the District of Columbia. Post-acute care is delivered through an array of clinical professionals and integrated technologies which, when combined, contribute to efficient and effective population health management strategies. As a market leader in ambulatory surgical care, the Company owns and operates 263 surgery centers and one surgical hospital in 35 states and the District of Columbia, with medical specialties ranging from gastroenterology to ophthalmology and orthopedics. In total, the Company offers a differentiated suite of clinical solutions on a national scale, creating value for health systems, payors, providers and patients. For additional information, visit www.evhc.net.

Forward-Looking Statements
Certain statements and information in this communication may be deemed to be “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to the Company’s financial and operating objectives, plans and strategies, industry trends, and all statements (other than statements of historical fact) that address activities, events or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future. These statements are often characterized by terminology such as “believe,” “hope,” “may,” “anticipate,” “should,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy” and similar expressions, and are based on assumptions and assessments made by the Company’s management in light of their experience and their perception of historical trends, current conditions, expected future developments, and other factors they believe to be appropriate. Any forward-looking statements in this communication are made as of the date hereof, and the Company undertakes no duty to update or revise any such statements, whether as a result of new information, future events or otherwise. Forward-looking statements are not guarantees of future performance. Whether actual results will conform to expectations and predictions is subject to known and unknown risks and uncertainties, including: (i) risks and uncertainties discussed in the reports and other documents that the Company files with the Securities and Exchange Commission; (ii) general economic, market, or business conditions; (iii) the impact of legislative or regulatory changes, such as changes to the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010; (iv) changes in governmental reimbursement programs; (v) decreases in revenue and profit margin under fee-for-service contracts due to changes in volume, payor mix and reimbursement rates; (vi) the loss of existing contracts; (vii) risks associated with the ability to successfully integrate the Company’s operations and employees following the completion of its merger with AMSURG; (viii) the ability to realize anticipated benefits and synergies of the business combination; (ix) the potential impact of the consummation of the transaction on the Company’s relationships, including with employees, customers and competitors; and (x) other circumstances beyond the Company’s control.

-END-


Exhibit

Exhibit 99.2

http://api.tenkwizard.com/cgi/image?quest=1&rid=23&ipage=11802857&doc=4
Contact:
Bob Kneeley
 
Vice President, Investor Relations
 
(303) 495-1245
 
Bob.kneeley@evhc.net

ENVISION HEALTHCARE ANNOUNCES
$250 MILLION STOCK REPURCHASE

NASHVILLE, Tenn. & GREENWOOD VILLAGE, Colo. - (September 18, 2017) - Envision Healthcare Corporation (“Envision” or the “Company”) (NYSE: EVHC) today announced the authorization of a program to repurchase up to $250 million of its common stock. The decision to return capital to shareholders is a reflection of the Company’s successful efforts to rationalize its service offerings around a physician-centric strategy and confidence in its ability to differentiate Envision through its stated plan to drive operational excellence and long-term growth.

Envision’s Board of Directors has decided to return capital to shareholders in a manner that will not affect Envision’s strategy to reduce its leverage, drive execution across its combined platform, or pursue potential strategic, accretive acquisitions and investments that will drive growth and substantial value. Envision’s 2017 acquisition spend through early August has totaled $620 million.

“In the 10 months since we completed our transformational combination, the Board and management team of Envision have been focused on reshaping the business to advance our physician-centric strategy,” said Christopher A. Holden, President and CEO of Envision. “The execution of this strategy will be enhanced by the new organization structure and executive leadership, which we also announced today. Our capital allocation priorities reflect Envision’s view of the long-term potential of our organization and our commitment to creating value for shareholders. We will maintain financial flexibility to deliver on our strategic plan, invest in our infrastructure to achieve sustained operational excellence, continue our disciplined approach to acquisitions, and reduce leverage.”

The share repurchase program authorized by the Company’s Board of Directors permits Envision to acquire up to $250 million of its common stock, which represents approximately four percent of the Company’s current market capitalization. The timing and amount of any shares repurchased will be determined based on the Company’s evaluation of market conditions and other factors. Repurchases will be made in accordance with the rules and regulations promulgated by the Securities and Exchange Commission and certain other legal requirements to which the Company may be subject. The program may be suspended or discontinued at any time, and has no time limit.


-MORE-

Envision Healthcare Announces $250 Million Stock Repurchase
 
Page 2
 
 
September 18, 2017
 
 

About Envision Healthcare Corporation
Envision Healthcare Corporation is a leading provider of physician-led services and post-acute care, and ambulatory surgery services. At June 30, 2017, we delivered physician services, primarily in the areas of emergency department and hospitalist services, anesthesiology services, radiology/tele-radiology services, and children’s services to more than 1,800 clinical departments in healthcare facilities in 47 states and the District of Columbia. Post-acute care is delivered through an array of clinical professionals and integrated technologies which, when combined, contribute to efficient and effective population health management strategies. As a market leader in ambulatory surgical care, the Company owns and operates 263 surgery centers and one surgical hospital in 35 states and the District of Columbia, with medical specialties ranging from gastroenterology to ophthalmology and orthopedics. In total, the Company offers a differentiated suite of clinical solutions on a national scale, creating value for health systems, payors, providers and patients. For additional information, visit www.evhc.net.

Forward-Looking Statements
Certain statements and information in this communication may be deemed to be “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to the Company’s financial and operating objectives, plans and strategies, including capital allocation, industry trends, and all statements (other than statements of historical fact) that address activities, events or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future. These statements are often characterized by terminology such as “believe,” “hope,” “may,” “anticipate,” “should,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy” and similar expressions, and are based on assumptions and assessments made by the Company’s management in light of their experience and their perception of historical trends, current conditions, expected future developments, and other factors they believe to be appropriate. Any forward-looking statements in this communication are made as of the date hereof, and the Company undertakes no duty to update or revise any such statements, whether as a result of new information, future events or otherwise. Forward-looking statements are not guarantees of future performance. Whether actual results will conform to expectations and predictions is subject to known and unknown risks and uncertainties, including: (i) risks and uncertainties discussed in the reports and other documents that the Company files with the Securities and Exchange Commission; (ii) general economic, market, or business conditions; (iii) the impact of legislative or regulatory changes, such as changes to the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010; (iv) changes in governmental reimbursement programs; (v) decreases in revenue and profit margin under fee-for-service contracts due to changes in volume, payor mix and reimbursement rates; (vi) the loss of existing contracts; (vii) risks associated with the ability to successfully integrate the Company’s operations and employees following the completion of its merger with AMSURG; (viii) the ability to realize anticipated benefits and synergies of the business combination; (ix) the potential impact of the consummation of the transaction on the Company’s relationships, including with employees, customers and competitors; and (x) other circumstances beyond the Company’s control.

-END-