Item 1.01 Entry into a Material Definitive Agreement
On January 11, 2021, Evolent Health, LLC ("EVH LLC"), EH Holding Company, Inc.
("EH Holdings") and True Health New Mexico, Inc. ("THNM"), each wholly owned
subsidiaries of Evolent Health, Inc. (the "Company"), entered into a Stock
Purchase Agreement (the "SPA" and the transactions contemplated by the SPA are
referred to herein as the "Transactions") with Bright Health Management, Inc.
("Bright HealthCare"), pursuant to which EH Holdings will sell all of its equity
interest in THNM to Bright HealthCare for a purchase price (the "Purchase
Price") of $22 million, plus excess risk based capital. The Purchase Price is
subject to a customary purchase price adjustment following the closing of the
Transactions (the "Closing") based in part on actual medical claims experience.
In the SPA, EH Holdings, THNM and Bright HealthCare have made customary
representations and warranties and have agreed to customary covenants,
indemnification and termination rights relating to the Transactions. Among other
things, THNM will be subject to certain business conduct restrictions with
respect to its operations prior to the Closing. EVH LLC has guaranteed the
obligations of EH Holdings under the SPA.
The Closing is conditioned on customary conditions, including, among others, (i)
the accuracy of the representations and warranties of the parties at Closing
(generally, subject to a material adverse effect standard), (ii) material
compliance with the covenants and the agreements made by the parties in the SPA,
(iii) approval of the Transactions by the New Mexico Office of Superintendent of
Insurance, (iv) the absence of any legal restraints prohibiting the Transactions
and (v) the entry into a transition services agreement. The Closing is expected
to occur on or after the end of the first quarter of 2021.
Item 2.02 Results of Operations and Financial Condition
On January 13, 2021, the Company posted investor presentation materials that the
Company will be presenting at the 39th Annual J.P. Morgan Healthcare Conference
on the investor relations section of the Company's website. In these materials,
the Company stated that it anticipates meeting or exceeding previously issued
Adjusted Revenue and Adjusted EBITDA guidance for the year ended December 31,
2020. A copy of the investor presentation materials is furnished as Exhibit 99.1
and is incorporated herein by reference.
The information furnished under this Item 2.02, including Exhibit 99.1 hereto,
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to
the liabilities of that section, nor shall it be deemed incorporated by
reference into any filing made by the Company under the Exchange Act or the
Securities Act of 1933, as amended, except as shall be expressly set forth by
specific reference in such a filing.
Item 5.02 - Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On January 7, 2021, Mr. Bruce Felt notified the Company of his decision to
resign from the Company's Board of Directors (the "Board"), effective January
11, 2021. Mr. Felt's decision to resign was not the result of any disagreement
between the Company and Mr. Felt on any matter relating to the Company's
operations, policies, or practices.
On January 11, 2021, the Board (1) appointed Ms. Kim Keck to the Board as a
Class III director with a term expiring at the 2021 Annual Meeting and (2)
appointed Ms. Keck to the Audit Committee of the Board and the Nominating and
Governance Committee of the Board.
--------------------------------------------------------------------------------
The Board has determined that Ms. Keck is an independent director in accordance
with applicable New York Stock Exchange and Securities and Exchange Commission
rules and regulations. Ms. Keck will be eligible to participate in the
compensation arrangements and programs that are established for the Company's
non-employee directors.
Item 7.01 Regulation FD Disclosure
The disclosure contained in Item 2.02 of this Current Report on Form 8-K is
incorporated herein by reference.
On January 13, 2021, the Company issued a press release announcing the execution
of the SPA. A copy of the press release is furnished as Exhibit 99.2 hereto and
is incorporated herein by reference.
On January 13, 2021, the Company issued a press release announcing Ms. Keck's
appointment to the Board. A copy of the press release is furnished as Exhibit
99.3 hereto and is incorporated herein by reference.
The information, including Exhibits 99.2 and 99.3 hereto, furnished under this
Item 7.01 shall not be deemed "filed" for purposes of Section 18 of the Exchange
Act, or otherwise subject the Company or any other person to liability under
that Section, to the liabilities of that section, nor shall it be deemed
incorporated by reference into any filing made by the Company under the Exchange
Act or the Securities Act of 1933, as amended, except as shall be expressly set
forth by specific reference in such a filing.
Forward Looking Statements
In addition to the discussion regarding forward-looking statements in the press
release attached as Exhibit 99.2 hereto and incorporated herein by reference,
this Current Report on Form 8-K contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995, as
amended (the "PSLRA"), including, but not limited to statements regarding the
consummation of the transactions contemplated by the SPA and the expected
Closing and timing with respect thereto. The Company claims the protection
afforded by the safe harbor for forward-looking statements provided by the
PSLRA. Actual events or results may differ materially from those contained in
these forward-looking statements. The factors that could cause future events or
results to vary from the forward-looking statements contained herein include,
without limitation, (a) the possibility that the Closing may be delayed or may
not occur and (b) receipt of required governmental approvals and the
satisfaction of other conditions to Closing. In addition, please refer to the
periodic reports that the Company has filed with the Securities and Exchange
Commission, including its Annual Report on Form 10-K, Quarterly Reports on Form
10-Q and Current Reports on Form 8-K and the risk factors noted therein. Such
periodic filings by the Company identify and address other important factors
that could cause future events or results to vary from the forward-looking
statements set forth in this Current Report on Form 8-K. In addition, the
Company disclaims any obligation to update any forward-looking statements
contained herein to reflect events or circumstances that occur after the date
hereof.
--------------------------------------------------------------------------------
Item 9.01. Financial Statements and Exhibits.
Exhibit No. Description
99.1 Investor Presentation
99.2 Press Release Announcing Agreement for Bright HealthCare to Acquire True
Health New Mexico, dated January 13, 2021
99.3 Press Release Naming Kim Keck to Board of Directors, dated January 13,
2021
104 The cover page from this Current Report on Form 8-K, formatted as Inline
XBRL
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses