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Share Name | Share Symbol | Market | Type |
---|---|---|---|
US Physical Therapy Inc | NYSE:USPH | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 94.48 | 0 | 01:00:00 |
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Preliminary Proxy Statement
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Confidential, for Use of the Commission only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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U.S. Physical Therapy, Inc.
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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Title of each class of securities to which transaction applies:
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Aggregate number of securities to which transaction applies:
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
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4)
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Proposed maximum aggregate value of transaction:
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5)
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Total fee paid:
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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1)
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Amount Previously Paid:
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2)
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Form, Schedule or Registration Statement No.:
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3)
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Filing Party:
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4)
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Date Filed:
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DATE:
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Tuesday, May 18, 2021
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TIME:
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9:00 a.m. (CDT)
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PLACE:
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Online Meeting Only by Remote Communication – No Physical Meeting Location
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1.
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Election of eight directors to serve until the next annual meeting of stockholders.
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2.
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Advisory vote to approve named executive officer compensation.
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3.
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Ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm for the year ending December 31, 2021.
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4.
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Consideration of any other matters that may properly come before the meeting or any adjournments.
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By Order of the Board of Directors,
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Richard Binstein, Secretary
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•
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Election of eight director nominees.
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Advisory vote to approve named executive officer compensation.
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Ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm for the year ending December 31, 2021.
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Nominees:
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Age
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Director
Since
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Position(s) Held
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Edward L. Kuntz
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76
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2014
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Chairman of the Board and Director
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Christopher J. Reading
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57
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2004
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President, Chief Executive Officer and Director
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Mark J. Brookner
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76
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1990
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Director
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Harry S. Chapman
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76
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2010
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Director
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Kathleen A. Gilmartin
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69
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2018
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Director
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Dr. Bernard A. Harris, Jr.
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64
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2005
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Director
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Reginald E. Swanson
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67
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2007
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Director
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Clayton K. Trier
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69
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2005
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Director
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•
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establishing goals and objectives relevant to incentive compensation awards (annual and long-term) for the Chief Executive Officer and other senior executive officers of the Company;
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evaluating the Chief Executive Officer’s and other senior executive officers’ performance and the overall corporate performance in light of these goals and objectives and approve any incentive compensation for such executives;
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determining any periodic adjustments to be made in the Chief Executive Officer’s and other senior executive officers’ base salary level based on the committee’s evaluation thereof;
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reviewing, for officers of the Company other than the senior executives, the proposed salary levels and annual adjustments thereto and the incentive compensation plans formulated by senior executive management and the annual bonus payments to be made thereunder, and providing input and advice to senior executive management with respect to these compensation decisions;
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approving all executive perquisites and any special benefit plans to be made available to senior executive officers;
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advising on compensation of non-employee members of the Board; and
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administering the Company’s equity compensation plans and approving grants to executive officers, employees, directors, and consultants under such plans.
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•
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overseeing our financial reporting processes, including the quarterly reviews and annual audits of our financial statements by the independent auditors;
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the appointment, compensation, retention and oversight of the work of the independent auditors;
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pre-approving audit and permitted non-audit services, and related fees and terms of engagement, provided by the independent auditors;
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reviewing with management and independent auditors issues relating to disclosure controls and procedures and internal control over financial reporting; and
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reviewing the internal audit department responsibilities, budget, staffing and the scope and results of internal audit work.
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Name
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Fees
Earned
or Paid
in Cash(1)
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Stock
Awards(2)
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Option
Awards
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Non-equity
incentive plan
compensation
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Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
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All Other
Compensation(3)
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Total
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Mark J. Brookner
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$ 47,500
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$ 140,896
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$ —
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$ —
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$ —
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$—
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$ 188,396
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Harry S. Chapman
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$ 66,875
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$ 140,896
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$ —
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$ —
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$ —
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$—
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$ 207,771
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Dr. Bernard A. Harris, Jr.
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$ 57,625
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$ 140,896
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$ —
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$ —
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$ —
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$—
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$ 198,521
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Kathleen Gilmartin
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$ 48,125
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$ 140,896
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$ —
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$ —
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$ —
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$—
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$ 189,021
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Edward L. Kuntz
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$ 87,583
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$ 140,896
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$—
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$ —
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$ —
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$—
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$ 228,479
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Jerald L. Pullins(3)
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$ 42,500
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$—
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$ —
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$ —
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$ —
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$—
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$42,500
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Reginald E. Swanson(4)
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$ 36,875
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$ 140,896
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$ —
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$ —
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$ —
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$ 12,656
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$ 190,427
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Clayton K. Trier
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$ 64,792
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$ 140,896
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$ —
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$ —
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$ —
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$—
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$ 205,688
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(1)
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Includes Retainer Fees, Chairman Fees and Meeting Fees.
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(2)
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Stock awards for a total of 1,600 shares of common stock were granted to each director in the table as restricted stock under the terms of the Company’s Amended and Restated 2003 Stock Incentive Plan (the “Stock Incentive Plan”). The restrictions lapsed as to 400 shares on the grant date and on each of October 1, 2020, January 1, 2021 and April 1, 2021. Amounts shown are the grant date fair value of the awards computed in accordance with FASB ASC Topic 718, which amounted to $88.06 per share. Assumptions used in the calculation of these amounts are included in “Note 13 — Equity Based Plans” of the Notes to the Consolidated Financial Statements in the Form 10-K.
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(3)
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Mr. Pullins retired from the Board as of May 18, 2020.
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(4)
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Other compensation represents salary and car allowance received by Mr. Swanson in his role as an employee of STAR Physical Therapy, LP, a subsidiary of the Company. Effective January 31, 2020, Mr. Swanson was no longer an employee of STAR Physical Therapy, LP.
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Name of Beneficial Owner
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Number of Shares
Owned(1)
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Percent of
Common Stock
Outstanding
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Directors:
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Edward L. Kuntz
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5,600
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0.0%
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Chairman of the Board
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Christopher J. Reading
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81,638 (2)
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0.6%
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President, Chief Executive Officer and Director
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Mark J. Brookner
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15,600
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0.1%
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Harry S. Chapman
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34,000
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0.3%
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Kathleen A. Gilmartin
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6,200
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0.0%
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Dr. Bernard A. Harris, Jr
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17,622
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0.1%
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Reginald E. Swanson
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11,796 (3)
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0.1%
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Clayton K. Trier
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10,200
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0.1%
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Non-Director Executive Officers:
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Glenn D. McDowell
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20,069 (4)
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0.2%
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Chief Operating Officer - West
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Graham D. Reeve
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24,440 (5)
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0.2%
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Chief Operating Officer - East
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Carey Hendrickson
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3,688 (6)
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0.0%
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Chief Financial Officer
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Lawrance W. McAfee
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6,582
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0.1%
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Former Executive Vice President, Chief Financial Officer
and Director (Retired on December 9th, 2021)
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All current directors and executive officers as a group (11 persons)
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230,853
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1.8%
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(1)
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There are no outstanding stock options.
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(2)
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Includes 33,134 shares of common stock granted as restricted stock in which the restrictions will lapse as follows:
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1/1/2022
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4,141
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1/1/2023
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2,879
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1/1/2024
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1,610
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4/1/2022
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2,876
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4/1/2023
|
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1,598
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4/1/2024
|
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700
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7/1/2021
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4,141
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7/1/2022
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2,876
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7/1/2023
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1,598
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7/1/2024
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700
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10/1/2021
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4,141
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10/1/2022
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2,876
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10/1/2023
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1,598
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10/1/2024
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700
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1/1/2025
|
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700
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(3)
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6,596 of these shares of our common stock are held by Regg E. Swanson Revocable Trust, of which Mr. Swanson is the trustee and beneficiary.
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(4)
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Includes 15,876 shares of common stock granted as restricted stock in which the restrictions will lapse as follows:
|
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|
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1/1/2022
|
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2,017
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1/1/2023
|
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1,380
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1/1/2024
|
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743
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4/1/2022
|
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1,377
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4/1/2023
|
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729
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4/1/2024
|
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350
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7/1/2021
|
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2,009
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| |
7/1/2022
|
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1,377
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| |
7/1/2023
|
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729
|
| |
7/1/2024
|
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350
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10/1/2021
|
| |
2,009
|
| |
10/1/2022
|
| |
1,377
|
| |
10/1/2023
|
| |
729
|
| |
10/1/2024
|
| |
350
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
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1/1/2025
|
| |
350
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(5)
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Includes 16,035 shares of common stock granted as restricted stock in which the restrictions will lapse as follows:
|
|
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|
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1/1/2022
|
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1,912
|
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1/1/2023
|
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1,448
|
| |
1/1/2024
|
| |
794
|
|
| |
|
| |
4/1/2022
|
| |
1,433
|
| |
4/1/2023
|
| |
788
|
| |
4/1/2024
|
| |
350
|
7/1/2021
|
| |
1,909
|
| |
7/1/2022
|
| |
1,433
|
| |
7/1/2023
|
| |
788
|
| |
7/1/2024
|
| |
350
|
10/1/2021
|
| |
1,909
|
| |
10/1/2022
|
| |
1,433
|
| |
10/1/2023
|
| |
788
|
| |
10/1/2024
|
| |
350
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
1/1/2025
|
| |
350
|
(6)
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Includes 3,228 shares of common stock granted as restricted stock in which the restrictions will lapse as follows:
|
|
| |
|
| |
1/1/2022
|
| |
230
|
| |
1/1/2023
|
| |
230
|
| |
1/1/2024
|
| |
230
|
|
| |
|
| |
4/1/2022
|
| |
230
|
| |
4/1/2023
|
| |
230
|
| |
4/1/2024
|
| |
230
|
7/1/2021
|
| |
230
|
| |
7/1/2022
|
| |
230
|
| |
7/1/2023
|
| |
230
|
| |
7/1/2024
|
| |
230
|
10/1/2021
|
| |
230
|
| |
10/1/2022
|
| |
230
|
| |
10/1/2023
|
| |
230
|
| |
10/1/2024
|
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238
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Name and Address of Beneficial Owner
|
| |
Amount and
Nature of
Beneficial Ownership
|
| |
Percent of
Common Stock
Outstanding
|
BlackRock, Inc
55 East 52nd Street
New York, NY 10055
|
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2,207,762(1)
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17.1%
|
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| |
|
| |
|
T. Rowe Price Associates, Inc
100 East Pratt St.
Baltimore, MD 21202
|
| |
1,314,304(3)
|
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10.2%
|
|
| |
|
| |
|
Kayne Anderson Rudnick Investment Management LLC
1800 Avenue of the Stars, 2nd floor
Los Angeles, CA 90067
|
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1,212,600(2)
|
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9.4%
|
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| |
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The Vanguard Group
100 Vanguard Blvd.
Malvern, PA 19355
|
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891,002(4)
|
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6.9%
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(1)
|
BlackRock, Inc. has sole voting power over 2,151,610 of the shares and sole dispositive power over 2,207,762 of the shares as disclosed in a Schedule 13G/A filed on January 25, 2021. Various persons associated with BlackRock, Inc. have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of the company. The interest of one such person, iShares Core S&P Small-Cap ETF, is more than five percent of the total outstanding common stock.
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(2)
|
T. Rowe Price Associates, Inc. (“Price Associates”) has sole voting power over 310,664 of the shares and sole dispositive power over 1,314,304 of the shares as disclosed in a Schedule 13G/A filed on February 16, 2021 (“T. Rowe Filing”). Price Associates does not serve as custodian of the assets of any of its clients accordingly, in each instance only the client or the client’s custodian or trustee bank has the right to receive dividends paid with respect to, and proceeds from the sale of, such securities. The ultimate power to direct the receipt of dividends paid with respect to, and the proceeds from the sale of, such securities, is vested in the individual and institutional clients which Price Associates serves as investment adviser (“T. Rowe Price Funds”). Except as noted in the T. Rowe Filing with one of the registered investment companies sponsored by Price Associates for which it also serves as investment advisor, not more that 5% of the common stock of the Company is owned by any one client subject to the investment advice of Price Associates. With the respect to the common stock of the Company owned by any one of the T. Rowe Price Funds, only the custodian for each of such Fund, has the right to receive dividends paid with respect to, and proceeds from the sale of, such securities. No other person is known to have such right, except the shareholders of each such Fund participate proportionately in any dividends and distributions so paid.
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(3)
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Kayne Anderson Rudnick Investment Management LLC has sole voting power over 389,810 of the shares, shared voting power over 1,212,600 of the shares (shared with Virtus Investment Advisors), sole dispositive power of 389,810 of the shares and shared dispositive power of 1,212,600 of the shares (shared with Virtus Investment Advisors) as disclosed in a Schedule 13G/A filed on February 12, 2021. Virtus Equity Trust (on behalf of Virtus KAR Small Cap Growth Fund) is deemed to share voting power over 1,125,000 of the shares. Kayne Anderson Rudnick Investment Management, LLC (an investment adviser registered under the Investment Advisers Act of 1940), and Virtus Investment Advisers, Inc. (an investment adviser registered under the Investment Advisers Act of 1940) and Virtus Equity Trust (on behalf of Virtus KAR Small-cap Growth Fund), a Delaware statutory trust, jointly filed the statement on Schedule 13G. With respect to securities owned by Kayne Anderson Rudnick Investment Management LLC and Virtus Investment Advisors, only the custodian for such investment company, has the right to receive dividends paid with respect to, and proceeds from sale of, such securities. No other person is known to have such right, except that the shareholders of such investment companies participate proportionately in any dividends or distributions paid.
|
(4)
|
The Vanguard Group, Inc (“Vanguard”) has sole voting power over none of the shares, shared voting power over 29,474 of the shares, sole dispositive power of 851,444 of the shares and shared dispositive power of 39,558 of the shares as disclosed in a Schedule 13G/A filed on February 10, 2021. Vanguard Fiduciary Trust Company, a wholly-owned subsidiary of Vanguard, is the beneficial owner of 24,894 shares as a result of Vanguard serving as investment manager of collective trust accounts. Vanguard Investments Australia, Ltd, a wholly-owned subsidiary of Vanguard, is the beneficial owner of 4,620 shares as a result of Vanguard serving as investment manager of Australian investment offerings.
|
Name
|
| |
Position
|
Christopher J. Reading
|
| |
President and Chief Executive Officer
|
Carey Hendrickson*
|
| |
Chief Financial Officer
|
Glenn D. McDowell
|
| |
Chief Operating Officer - West
|
Graham D. Reeve
|
| |
Chief Operating Officer - East
|
Lawrance W. McAfee*
|
| |
Former Executive Vice President and Chief Financial Officer
|
*
|
Mr. Hendrickson commenced as the Company’s CFO on November 9, 2020. The former CFO, Lawrance McAfee, retired from his position as CFO effective on November 9, 2020.
|
1.
|
Company Leadership
|
2.
|
Cost Control
|
3.
|
Further Development of Industrial Injury Prevention business
|
4.
|
Compliance
|
5.
|
Acquisition of new partnerships and acquisition performance, revenue and volume growth
|
6.
|
Successful integration and transition involving CFO and COO roles
|
1.
|
Successful and effective integration and management of direct reporting areas
|
2.
|
Further standardization around reporting and controls
|
3.
|
Effective communication to shareholders and Board, including guidance, updates and financial modeling
|
4.
|
Billing office effectiveness and cost control
|
5.
|
Successful completion of Annual audit
|
6.
|
Acquisition modeling, Integration and financial reporting
|
1.
|
Effective transition and integration of certain areas and partnerships
|
2.
|
Cost Control
|
3.
|
Development of Operation’s team leadership
|
4.
|
Development of skills associated with negotiation, due diligence and acquisition integration and assimilation
|
5.
|
Revenue and volume growth
|
6.
|
Compliance
|
1.
|
Effective transition and integration of certain areas and partnerships
|
2.
|
Cost Control
|
3.
|
Development of Operation’s team leadership
|
4.
|
Development of skills associated with negotiation, due diligence and acquisition integration and assimilation
|
5.
|
Revenue and volume growth
|
6.
|
Compliance
|
1.
|
Corporate leadership/Transition of CFO
|
2.
|
Cost control
|
3.
|
Development of the Briotix Health subsidiary business
|
4.
|
Same store growth in revenue and visits
|
5.
|
Compliance
|
6.
|
Acquiring new strategic partnerships
|
1.
|
Briotix success, integration and forward progress
|
2.
|
Cost Control at the clinic level and margin stability at Briotix
|
3.
|
Development of West Team - Succession Planning
|
4.
|
Compliance
|
5.
|
Same Store Growth/ Visit Growth
|
6.
|
Development of additional de novo facilities and tuck-ins
|
1.
|
Management Contract Development
|
2.
|
Compliance
|
3.
|
Development of East Team – Succession Planning
|
4.
|
Same Store Growth/ Visit Growth
|
5.
|
Development of additional de novo facilities and tuck-ins
|
6.
|
Cost Control
|
Name and Principal Position
|
| |
Year
|
| |
Salary
($)
|
| |
Bonus(1)
($)
|
| |
Stock
Awards(2)
($)
|
| |
Option
Awards
($)
|
| |
Non-
Equity
Incentive
Plan
Compen-
sation(3)
($)
|
| |
Change in
Pension
Value and
Non-
Qualified
Deferred
Compen -
sation
Earnings
($)
|
| |
All Other
Compen -
sation
($)
|
| |
Total ($)
|
Christopher J. Reading
Chief Executive Officer
|
| |
2020
|
| |
675,769
|
| |
350,000
|
| |
1,533,056
|
| |
|
| |
400,000
|
| |
|
| |
2,322(4)
|
| |
2,961,147
|
|
2019
|
| |
768,846
|
| |
—
|
| |
1,556,370
|
| |
|
| |
524,397
|
| |
|
| |
2,322(4)
|
| |
2,851,935
|
||
|
2018
|
| |
739,423
|
| |
—
|
| |
2,010,639
|
| |
|
| |
575,000
|
| |
|
| |
2,322(4)
|
| |
3,327,384
|
||
Lawrance W. McAfee.
Former Chief Financial Officer
|
| |
2020
|
| |
425,269
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
1,649,182(5)
|
| |
2,074,451
|
|
2019
|
| |
499,231
|
| |
—
|
| |
736,271
|
| |
|
| |
332,622
|
| |
|
| |
3,564(4)
|
| |
1,571,688
|
||
|
2018
|
| |
479,616
|
| |
—
|
| |
1,021,508
|
| |
|
| |
370,800
|
| |
|
| |
3,564(4)
|
| |
1,875,488
|
||
Glenn D. McDowell
Chief Operating Officer - West
|
| |
2020
|
| |
440,961
|
| |
175,000
|
| |
766,528
|
| |
|
| |
255,000
|
| |
|
| |
3,564(4)
|
| |
1,641,053
|
|
2019
|
| |
499,231
|
| |
—
|
| |
659,890
|
| |
|
| |
301,276
|
| |
|
| |
3,564(4)
|
| |
1,463,961
|
||
|
2018
|
| |
479,616
|
| |
—
|
| |
1,021,508
|
| |
|
| |
370,800
|
| |
|
| |
3,564(4)
|
| |
1,875,488
|
||
Graham D. Reeve(4)
Chief Operating Officer - East
|
| |
2020
|
| |
464,615
|
| |
175,000
|
| |
766,528
|
| |
|
| |
270,000
|
| |
|
| |
2,322(4)
|
| |
1,678,465
|
|
2019
|
| |
469,231
|
| |
—
|
| |
759,462
|
| |
|
| |
321,785
|
| |
|
| |
2,322(4)
|
| |
1,552,800
|
||
|
2018
|
| |
479,616
|
| |
—
|
| |
1,619,404
|
| |
|
| |
347,000
|
| |
|
| |
908(4)
|
| |
2,446,927
|
||
Carey Hendrickson
Chief Financial Officer
|
| |
2020
|
| |
51,923
|
| |
25,000
|
| |
403,430
|
| |
|
| |
—
|
| |
|
| |
—
|
| |
480,353
|
1)
|
The Compensation Committee also considered the award of additional discretionary cash bonus and restricted stock awards to the Messrs. Reading, McDowell and Reeve, based on their performance during 2020 in managing the Company through the challenges arising from the COVID-19 pandemic. The Committee members acknowledged that the objective criteria of the Objective Cash Bonus Plan and the Objective Long-Term Incentive Plan were established prior to any knowledge or awareness of the COVID – 19 pandemic and its resulting impact on the Company performance. The Committee further determined that the Named Executive Officers were successful in implementing difficult operational decisions, keeping patients and employees safe, and managing the business in a manner that enabled the Company to regain its footing and lead the organization back to normalcy by the end of 2020, from both a financial performance and a patient care perspective. The Committee determined that the performance of the Named Executive Officers significantly benefitted patients, employees and stockholders. As a result, in its discretion, the Committee made the following additional awards: Mr. Reading – $350,000 in cash; Mr. McDowell - $175,000 in cash; and Mr. Reeve - $175,000 in cash. These shares of restricted common stock were granted on February 22, 2021, with restrictions on these shares lapsing evenly over 16 quarters starting on April 1, 2021, and the cash awards were paid on March 10, 2021. In addition, the Committee granted Mr. Hendrickson a bonus of $25,000.
|
2)
|
For 2020, stock awards were granted in accordance with the 2020 Executive Incentive Plan as restricted stock under the terms of the Stock Incentive Plan as follows: Mr. Reading was awarded 11,200 shares, (8,800 shares pursuant to the Discretionary Long Term Incentive Plan and an additional 2,400 shares as an additional supplemental discretionary award) Mr. McDowell was awarded 5,600 shares (4,400 shares pursuant to the Discretionary Long Term Incentive Plan and an additional 1,200 shares as an additional supplemental discretionary award) and Mr. Reeve was awarded 5,600 shares (4,400 shares pursuant to the Discretionary Long Term Incentive Plan and an additional 1,200 shares as an additional supplemental discretionary award). Mr. Hendrickson was granted 3,688 shares of restricted stock in November 2020 pursuant to his employment agreement. For 2019, stock awards were granted in accordance with the 2019 Executive Incentive Plan as restricted stock under the terms of the Stock Incentive Plan as follows: Mr. Reading was awarded 14,380 shares, Mr. McAfee was awarded 6,796 shares, Mr. McDowell was awarded 6,078 shares and Mr. Reeve was awarded 7,014 shares. For 2018, stock awards were granted in accordance with the 2018 Executive Incentive Plan as restricted stock under the terms of the Stock Incentive Plan as follows: Mr. Reading was awarded 20,451 shares, Messrs. McAfee and McDowell were awarded 10,371 shares each and Mr. Reeve was awarded 10,335 shares. Amounts shown are the grant date fair value of the awards computed in accordance with FASB ASC Topic 718 which amounted to a weighted average (for each individual) in the range of $109.39 to $136.88 per share for 2020, $108.23 to $108.57 per share for 2019 and in the range of $98.30 to $98.50 per share for 2018. Assumptions used in the calculation of these amounts are included in “Note 13 — Equity Based Plans” of the Notes to the Consolidated Financial Statements in Item 8 of the Form 10-K.
|
3)
|
For 2020, the amounts represent the cash bonuses earned under the 2020 Executive Incentive Plan and paid in March 2021. For 2019, the amounts represent the cash bonuses earned under the 2019 Executive Incentive Plan and paid in March 2020. For 2018, the amounts represent the cash bonuses earned under the 2018 Executive Incentive Plan and paid in March 2019. See “Compensation Discussion and Analysis — Annual Cash Incentive Compensation” herein for further details.
|
4)
|
Represents the value of life insurance premiums for life insurance coverage provided to the Named Executive Officers.
|
5)
|
In connection with his retirement as the Company’s Chief Financial Officer, on December 7, 2020 the Compensation Committee of the Board of Directors, in its discretion, accelerated the vesting on all of Mr. McAfee’s 15,052 shares of unvested restricted stock, effective as of December 7, 2020. The closing price on the day of acceleration was $109.11 per share.
|
Name
|
| |
Grant Date
|
| |
Estimated Possible Payouts
Under Non-Equity
Incentive Plan Awards(1):
|
| |
Estimated Possible Payouts
Under Equity
Incentive Plan Awards(1) :
|
| |
Grant Date
Fair Value
of Stock
Awards(2)
|
||||||||||||
|
Threshold
($)
|
| |
Target
($)
|
| |
Maximum
($)
|
| |
Threshold
(#)
|
| |
Target
(#)
|
| |
Maximum
(#)
|
| |||||||
Christopher J. Reading
|
| |
3/3/2020
|
| |
$—
|
| |
$1,000,000
|
| |
$1,000,000
|
| |
—
|
| |
17,600
|
| |
17,600
|
| |
$1,872,288
|
Lawrance W. McAfee
|
| |
3/3/2020
|
| |
$—
|
| |
$637,500
|
| |
$637,500
|
| |
—
|
| |
8,800
|
| |
8,800
|
| |
$936,144
|
Glenn D. McDowell
|
| |
3/3/2020
|
| |
$—
|
| |
$637,500
|
| |
$637,500
|
| |
—
|
| |
8,800
|
| |
8,800
|
| |
$936,144
|
Graham D. Reeve
|
| |
3/3/2020
|
| |
$—
|
| |
$675,000
|
| |
$675,000
|
| |
—
|
| |
8,800
|
| |
8,800
|
| |
$936,144
|
*
|
Mr. Lawrance W. McAfee was part of the aforementioned plan but was not employed on December 31, 2020 and therefore did not receive any awards pursuant to the 2020 Executive Incentive Plan. Mr. Carey Hendrickson did not participate in the plan above since his employment commenced on November 9, 2020.
|
1.
|
Possible payments and equity grants under the 2020 Executive Incentive Plan. See the Summary Compensation Table above for actual amounts earned for 2020. The cash earned was paid on March 10, 2021 and the shares of restricted stock were granted on February 22, 2021.
|
2.
|
Amounts shown are the grant date fair value of the awards computed in accordance with FASB ASC Topic 718 which amounted to a weighted average of $106.38 per share. See “Note 13 — Equity Based Plans” of the Notes to the Consolidated Financial Statements in Item 8 of the Form 10-K for a description of the valuations and a description of the equity plans.
|
|
| |
Stock Awards
|
|||
Name
|
| |
Number
of Shares
or Units
of Stock
That Have
Not
Vested
(#)
|
| |
Market
Value of
Shares or
Units of
Stock
That Have
Not Vested
($)(1)
|
Christopher J. Reading
|
| |
30,551(2)
|
| |
$3,673,758
|
Glenn D. McDowell
|
| |
14,469(3)
|
| |
$1,739,897
|
Graham D. Reeve
|
| |
13,903(4)
|
| |
$1,671,836
|
Carey Hendrickson
|
| |
3,688(5)
|
| |
$443,482
|
(1)
|
Calculated based on the closing market price of our common stock on December 31, 2020 of $120.25 per share.
|
(2)
|
The restrictions on these shares of common stock granted as restricted stock lapsed or will lapse as follows:
|
1/1/2021
|
| |
4,476
|
| |
1/1/2022
|
| |
3,441
|
| |
1/1/2023
|
| |
2,179
|
4/1/2021
|
| |
3,441
|
| |
4/1/2022
|
| |
2,176
|
| |
4/1/2023
|
| |
898
|
7/1/2021
|
| |
3,441
|
| |
7/1/2022
|
| |
2,176
|
| |
7/1/2023
|
| |
898
|
10/1/2021
|
| |
3,441
|
| |
10/1/2022
|
| |
2,176
|
| |
10/1/2023
|
| |
898
|
|
| |
|
| |
|
| |
|
| |
1/1/2024
|
| |
910
|
(3)
|
The restrictions on these shares of common stock granted as restricted stock lapsed or will lapse as follows:
|
1/1/2021
|
| |
2,184
|
| |
1/1/2022
|
| |
1,667
|
| |
1/1/2023
|
| |
1,030
|
4/1/2021
|
| |
1,659
|
| |
4/1/2022
|
| |
1,027
|
| |
4/1/2023
|
| |
379
|
7/1/2021
|
| |
1,659
|
| |
7/1/2022
|
| |
1,027
|
| |
7/1/2023
|
| |
379
|
10/1/2021
|
| |
1,659
|
| |
10/1/2022
|
| |
1,027
|
| |
10/1/2023
|
| |
379
|
|
| |
|
| |
|
| |
|
| |
1/1/2024
|
| |
393
|
(4)
|
The restrictions on these shares of common stock granted as restricted stock lapsed or will lapse as follows:
|
1/1/2021
|
| |
1,559
|
| |
1/1/2022
|
| |
1,562
|
| |
1/1/2023
|
| |
1,098
|
4/1/2021
|
| |
1,559
|
| |
4/1/2022
|
| |
1,083
|
| |
4/1/2023
|
| |
438
|
7/1/2021
|
| |
1,559
|
| |
7/1/2022
|
| |
1,083
|
| |
7/1/2023
|
| |
438
|
10/1/2021
|
| |
1,559
|
| |
10/1/2022
|
| |
1,083
|
| |
10/1/2023
|
| |
438
|
|
| |
|
| |
|
| |
|
| |
1/1/2024
|
| |
444
|
(5)
|
The restrictions on these shares of common stock granted as restricted stock lapsed or will lapse as follows:
|
1/1/2021
|
| |
230
|
| |
1/1/2022
|
| |
230
|
| |
1/1/2023
|
| |
230
|
| |
1/1/2024
|
| |
230
|
4/1/2021
|
| |
230
|
| |
4/1/2022
|
| |
230
|
| |
4/1/2023
|
| |
230
|
| |
4/1/2024
|
| |
230
|
7/1/2021
|
| |
230
|
| |
7/1/2022
|
| |
230
|
| |
7/1/2023
|
| |
230
|
| |
7/1/2024
|
| |
230
|
10/1/2021
|
| |
230
|
| |
10/1/2022
|
| |
230
|
| |
10/1/2023
|
| |
230
|
| |
10/1/2024
|
| |
238
|
|
| |
Stock Awards
|
|||
Name
|
| |
Number of
shares
acquired
on vesting (#)
|
| |
Value
realized on
Vesting(1)
|
Christopher J. Reading
|
| |
18,370
|
| |
$1,582,348
|
Lawrance W. McAfee*
|
| |
24,194
|
| |
$2,430,555
|
Glenn D. McDowell
|
| |
9,007
|
| |
$778,021
|
Graham Reeve
|
| |
5,798
|
| |
$481,923
|
Carey Hendrickson
|
| |
—
|
| |
—
|
*
|
In connection with his retirement as the Company’s Chief Financial Officer, on December 7, 2020 the Compensation Committee of the Board of Directors, in its discretion, accelerated the vesting on all of Mr. McAfee’s 15,052 shares of unvested restricted stock, effective as of December 7, 2020. The closing price on the day of acceleration was $109.11 per share.
|
Executive Benefits and Payments
Upon Termination(1)
|
| |
Voluntary
Termination
or For
Cause
|
| |
Without
Cause
|
| |
Executive
Resigns
For Good
Reason
|
| |
In
Conjunction
with a
Change In
Control
|
Compensation
|
| |
|
| |
|
| |
|
| |
|
Severance(2)
|
| |
$—
|
| |
$1,600,000
|
| |
$1,600,000
|
| |
$1,600,000
|
Annual Cash Incentive(3)
|
| |
—
|
| |
750,000
|
| |
750,000
|
| |
750,000
|
Change of Control Benefit(4)
|
| |
—
|
| |
—
|
| |
—
|
| |
500,000
|
Restricted Stock (Unvested and (Accelerated)(5)
|
| |
—
|
| |
3,673,758
|
| |
3,673,758
|
| |
3,673,758
|
Benefits and Perquisities
|
| |
|
| |
|
| |
|
| |
|
Health and Dental Coverage(6)
|
| |
—
|
| |
27,596
|
| |
27,596
|
| |
27,596
|
Total
|
| |
$—
|
| |
$6,051,354
|
| |
$6,051,354
|
| |
$6,551,354
|
Executive Benefits and Payments
Upon Termination(1)
|
| |
Voluntary
Termination
or For
Cause
|
| |
Without
Cause
|
| |
Executive
Resigns
For Good
Reason
|
| |
In
Conjunction
with a
Change In
Control
|
Compensation
|
| |
|
| |
|
| |
|
| |
|
Severance(2)
|
| |
$—
|
| |
$900,000
|
| |
$900,000
|
| |
$900,000
|
Annual Cash Incentive(3)
|
| |
—
|
| |
25,000
|
| |
25,000
|
| |
25,000
|
Change of Control Benefit(4)
|
| |
—
|
| |
—
|
| |
—
|
| |
283,333
|
Restricted Stock (Unvested and (Accelerated)(5)
|
| |
—
|
| |
443,482
|
| |
443,482
|
| |
443,482
|
Benefits and Perquisities
|
| |
|
| |
|
| |
|
| |
|
Health and Dental Coverage(6)
|
| |
—
|
| |
14,324
|
| |
14,324
|
| |
14,324
|
Total
|
| |
$—
|
| |
$1,382,806
|
| |
$1,382,806
|
| |
$1,666,139
|
Executive Benefits and Payments
Upon Termination(1)
|
| |
Voluntary
Termination
or For
Cause
|
| |
Without
Cause
|
| |
Executive
Resigns
For Good
Reason
|
| |
In
Conjunction
with a
Change In
Control
|
Compensation
|
| |
|
| |
|
| |
|
| |
|
Severance(2)
|
| |
$—
|
| |
$1,020,000
|
| |
$1,020,000
|
| |
$1,020,000
|
Annual Cash Incentive(3)
|
| |
—
|
| |
430,000
|
| |
430,000
|
| |
430,000
|
Change of Control Benefit(4)
|
| |
—
|
| |
—
|
| |
—
|
| |
283,333
|
Restricted Stock (Unvested and (Accelerated)(5)
|
| |
—
|
| |
1,739,897
|
| |
1,739,897
|
| |
1,739,897
|
Benefits and Perquisities
|
| |
|
| |
|
| |
|
| |
|
Health and Dental Coverage(6)
|
| |
—
|
| |
19,246
|
| |
19,246
|
| |
19,246
|
Total
|
| |
$—
|
| |
$3,209,143
|
| |
$3,209,14344
|
| |
$3,492,476
|
Executive Benefits and Payments
Upon Termination(1)
|
| |
Voluntary
Termination
or For
Cause
|
| |
Without
Cause
|
| |
Executive
Resigns
For Good
Reason
|
| |
In
Conjunction
with a
Change In
Control
|
Compensation
|
| |
|
| |
|
| |
|
| |
|
Severance(2)
|
| |
$—
|
| |
$1,080,000
|
| |
$1,080,000
|
| |
$1,080,000
|
Annual Cash Incentive(3)
|
| |
—
|
| |
445,000
|
| |
445,000
|
| |
445,000
|
Change of Control Benefit(4)
|
| |
—
|
| |
—
|
| |
—
|
| |
283,333
|
Restricted Stock (Unvested and (Accelerated)(5)
|
| |
—
|
| |
1,671,836
|
| |
1,671,836
|
| |
1,671,836
|
Benefits and Perquisities
|
| |
|
| |
|
| |
|
| |
|
Health and Dental Coverage(6)
|
| |
—
|
| |
14,324
|
| |
14,324
|
| |
14,324
|
|
| |
|
| |
|
| |
|
| |
|
Total
|
| |
$—
|
| |
$3,211,160
|
| |
$3,211,160
|
| |
$3,494,493
|
1.
|
For purposes of this analysis, we assumed the price per share of our common stock on the date of termination is $120.25 (the closing price on December 31, 2020) and that the executive’s base salary (as in effect at January 1, 2020) is as follows: Mr. Reading — $800,000; Mr. Hendrickson — $450,000; Mr. McDowell — $510,000; and Graham Reeve — $540,000.
|
2.
|
Severance is calculated using two times the base salary as in effect at January 1, 2020 as noted in Footnote 1 above.
|
3.
|
Annual cash incentive is based on the greater of (i) the bonus paid or payable to the executive with respect to last fiscal year of the Company completed prior to termination or (ii) the average of the bonuses paid to the executive over the three fiscal years of the Company ending with the last fiscal year completed prior to the termination.
|
4.
|
Based on amounts stipulated in the respective employment agreements. To be paid, there must be a Change of Control and Termination Event as described in each respective agreement.
|
5.
|
Pursuant to the Restricted Stock Agreement (entered into prior to January 1, 2020) for each executive, all restrictions and conditions on shares of restricted stock will be deemed satisfied and shares will be fully vested upon a “Change in Control”. With respect to Restricted Stock Agreements for each executive that was entered into during 2020, all restrictions and conditions on shares of restricted stock awarded under such agreements will be deemed satisfied and shares will be fully vested upon a Termination Event in connection with a “Change in Control” (i.e., a “double-trigger” benefit). Shares of restricted stock pursuant to agreements entered into during 2021 are not included as the restricted stock was not outstanding as of December 31, 2020.
|
6.
|
Calculated for the remaining term of the agreement which expires on December 31, 2020 for Messrs. Reading, McAfee and McDowell and on December 31, 2020 for Mr. Reeve. In the event of a “Change in Control”, the remaining term of the agreements is one year from such event.
|
|
| |
Respectfully submitted,
|
|
| |
|
|
| |
The Compensation Committee
|
|
| |
Harry S. Chapman, Chairman
|
|
| |
Edward L. Kuntz
|
|
| |
Kathleen Gilmartin
|
Plan Category
|
| |
Number of Securities
to be Issued Upon
Exercise of
Outstanding Options
and Rights
|
| |
Weighted Average
Exercise Price of
Outstanding
Options and Rights
|
| |
Number of Securities
Remaining Available for
Future Issuance Under Equity
Compensation Plans
Excluding Securities
Reflected in 1st Column
|
Equity Compensation Plans
|
| |
|
| |
|
| |
|
Approved by Stockholders(1)
|
| |
—
|
| |
$ —
|
| |
232,535
|
1.
|
The Stock Incentive Plan permits us to grant stock-based compensation to employees, consultants and outside directors of the Company. The 1999 Stock Option Plan permits us to grant stock-based compensation to employees and non-employee directors. For further descriptions of the Stock Incentive Plan and the 1999 Stock Option Plan, see “Note 13 — Equity Based Plans” of the Notes to the Consolidated Financial Statements in Item 8 of the Form 10-K. All current Equity Compensation Plans have been approved by stockholders.
|
|
| |
2020
|
| |
2019
|
Audit Fees
|
| |
$558,875
|
| |
$600,524
|
Audit-Related Fees
|
| |
—
|
| |
—
|
Tax Fees
|
| |
—
|
| |
—
|
All Other Fees
|
| |
—
|
| |
—
|
|
| |
$558,875
|
| |
$600,524
|
|
| |
Respectfully submitted,
|
|
| ||
|
| |
The Audit Committee
Clayton K. Trier, Chairman
Mark J. Brookner
Dr. Bernard A. Harris
Edward L. Kuntz
|
|
| |
|
| |
By Order of the Board of Directors,
|
|
| |
|
| ||
|
| |
|
| |
|
|
| |
|
| |
Richard Binstein
|
|
| |
|
| |
Secretary
|
Houston, Texas, April 5, 2021
|
| |
|
| |
|
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