Upon the effectiveness of his appointment as interim Chief Executive Officer of the Company, Mr.Adlerz entered into the Company’s standard form of indemnification agreement, a copy of which is filed as Exhibit10.14 to Amendment No.1 to the Company’s Registration Statement on FormS-1 filed on September14, 2015.

Mr.Adlerz is a limited partner of BCPE Seminole Holdings LP (“Seminole”), a Delaware limited partnership, the Company’s controlling stockholder and an affiliate of Bain Capital Private Equity, LP. Except as described herein, there is no arrangement or understanding between Mr.Adlerz and any other persons or entities to which he was appointed as an officer or nominated as a director. There are no family relationships between Mr.Adlerz and any director or executive officer of the Company or any of its subsidiaries. Except as described herein, there are no transactions between the Company or any of its subsidiaries and Mr.Adlerz that require disclosure under Item 404(a)of Regulation S-K.

Separation Agreement with Michael Doyle

On September7, 2017, in connection with Mr.Doyle’s resignation as Chief Executive Officer of the Company, the Company entered into a termination and release agreement (the “Separation Agreement”) with Mr.Doyle. to the Separation Agreement, Mr.Doyle will receive the separation benefits payable to him under his employment agreement with the Company, dated September17, 2015 ( a copy of which was filed as Exhibit10.10 to the Company’s Registration Statement on FormS-1 filed on September21, 2015 and is incorporated herein by reference) (the “Doyle EA”), which consists of the Company’s payment of the following: (i)Mr.Doyle’s base salary through September7, 2017, the effective date of his resignation (the “Resignation Date”), (ii)cash severance in the amount of $550,000, to be paid over a period of twelve (12) months after the Resignation Date in accordance with the Company’s normal payroll practices, (iii)a pro rata portion of the annual bonus Mr.Doyle would have earned in respect of the 2017 performance period (based on actual performance as determined consistent with other senior executives) under the Doyle EA had his employment not been terminated, to be paid on the date the Company pays 2017 bonuses generally, but not later than March15, 2018, (iv)the full amount of Mr.Doyle’s COBRA premiums for continued coverage under the Company’s group health plans, including coverage for Mr.Doyle’s eligible dependents, until the twelve (12) month anniversary of the Resignation Date (or in lieu of payment of such amounts, reimbursement therefor) and (v)$15,000. Such payments are subject to Mr.Doyle’s execution and non-revocation of a general waiver and release of claims and his continued compliance with certain restrictive covenants, further described below.

In addition, the Separation Agreement provides that Mr.Doyle’s outstanding equity-based awards shall be treated in a manner consistent with the Company’s 2015 Omnibus Incentive Plan (a copy of which was filed as Exhibit4.3 to the Company’s Registration Statement on FormS-8 filed on October6, 2015) (the “Incentive Plan”) and the agreements to which such awards were granted, as follows: (i)in accordance with the restricted stock award agreements (the form of which was filed as Exhibit10.1 to the Company’s Current Report on Form8-K filed on March15, 2016), upon the Resignation Date, any shares that are then outstanding and not yet vested will automatically, and without any action on the part of Mr.Doyle, become vested, and as such, 71,928 shares became vested effective September7, 2017 and (ii)in accordance with the performance stock unit award agreements (the form of which was filed as Exhibit10.1 to the Company’s Current Report on Form8-K filed on July5, 2016), upon the Resignation Date, any Earned Shares (as defined in the performance stock unit award agreement) that are then outstanding and not yet vested will automatically, and without any action on the part of Mr.Doyle, become vested and, as such, 22,281 Earned Shares from Mr.Doyle’s August2, 2016 award agreement became vested effective September7, 2017 and any Earned Shares from the March31, 2017 award agreement will be delivered to Mr.Doyle, if applicable, once the Administrator (as defined in the Incentive Plan) certifies the achievement of the applicable performance objectives; provided, however, that if the vesting of any Earned Shares from the March31, 2017 award agreement would make Mr.Doyle’s payments and benefits under the Separation Agreement subject to excise tax under Section4999 of the Internal Revenue Code, then such Earned Shares will be only be delivered to the extent such Earned Shares will not subject Mr.Doyle to excise tax under Section4999 of the Internal Revenue Code. Except for the March31, 2017 award agreement, which will remain outstanding until the Administrator determines whether any performance stock units became Earned Shares in accordance with the terms thereof, all other equity-based awards granted to Mr.Doyle to the Incentive Plan that remain unvested as of the Resignation Date were forfeited and of no further force or effect as September7, 2017.

In consideration for the foregoing, Mr.Doyle agreed to certain restrictions on competition for eighteen (18) months following the Resignation Date and certain restrictions on solicitation of customers, employees and consultants for twenty-four (24) months following the Resignation Date.

The foregoing description of the Separation Agreement does not purport to be complete and is subject to, and qualified in its entirety by the full text of the Separation Agreement, which is incorporated into this Item 5.02 by reference to Exhibit10.2 of this Current Report on Form8-K.

Consulting Agreement with Michael Doyle

Also on September7, 2017, the Company and Mr.Doyle entered into a consulting services agreement (the “Consulting Agreement”), to which Mr.Doyle will provide certain consulting services to the Company and its subsidiaries for a period of six (6)months following the Resignation Date. In exchange, the Company will pay Mr.Doyle an aggregate consulting fee of $275,000, payable in equal monthly installments. The Company may terminate the Consulting Agreement in the event Mr.Doyle repeatedly fails to perform services reasonably requested under the Consulting Agreement. Mr.Doyle may terminate the Consulting Agreement upon two weeks’ advance written notice to the Company, after the first month anniversary of the commencement date of the Consulting Agreement.

The foregoing description of the Consulting Agreement does not purport to be complete and is subject to, and qualified in its entirety by the full text of the Consulting Agreement, which is incorporated into this Item 5.02 by reference to Exhibit10.3 of this Current Report on Form8-K.

TRA Assignment Agreement with Michael Doyle

On September8, 2017, Mr.Doyle entered into a TRA Waiver and Assignment Agreement (the “TRA Assignment Agreement”) with the Company, to which the Company agreed to accept the assignment of 50% of Mr.Doyle’s (and his affiliates’) interest in future payments to which such parties are entitled to the Income Tax Receivable Agreement, dated September30, 2015, by and among the Company, H.I.G. Surgery Centers, LLC (in its capacity as the stockholders representative) and the other parties referred to therein, as amended effective August31, 2017, in exchange for an upfront payment of approximately $5.1 million, in the aggregate, as set forth in the TRA Assignment Agreement. Copies of the Income Tax Receivable Agreement and the amendment thereto were filed as Exhibit10.1 to the Company’s Quarterly Report on Form10-Q filed on November13, 2015 and Exhibit10.3 to the Company’s Current Report on Form8-K filed May11, 2017, respectively.

The foregoing description of the TRA Assignment Agreement does not purport to be complete and is subject to, and qualified in its entirety by the full text of the TRA Assignment Agreement, which is incorporated into this Item 5.02 by reference to Exhibit10.4 of this Current Report on Form8-K.

Approval of Leveraged Performance Incentive Award

On September7, 2017, the Compensation Committee approved a form of leveraged performance unit award agreement (the “FormLPU Award Agreement”) under the existing Incentive Plan, which may be used for future grants of leveraged performance units by the Company to certain employees. The FormLPU Award Agreement is filed as Exhibit10.5 of this Current Report on Form8-K and is incorporated herein by reference.

Item 5.07 Submission of Matters to a Vote of Security Holders.

On September8, 2017, Seminole, as the holder of at least a majority of the combined voting power of the issued and outstanding shares of the Company’s common stock and the issued and outstanding shares of the Company’s 10.00% SeriesA Convertible Perpetual Participating Preferred Stock, acting by written consent in lieu of a meeting of the stockholders of the Company, voted all such shares to approve (x)the expansion of the size of the Board from six (6)directors to seven (7)directors (the “Board Expansion”) in order to effectuate the appointment of Mr.Adlerz to the Board and (y)the Third Amended and Restated Certificate of Incorporation of the Company (collectively, the “Stockholder Approvals”), with such approvals to be effective as of the Stockholder Action Effective Date (as defined below).

The Company’s Second Amended and Restated Certificate of Incorporation, as in effect as of September8, 2017, provides that prior to the date that Seminole ceases to beneficially own 50% or more of the Company’s voting stock (the “Trigger Date”), (i)vacancies on the Board shall be filled by a vote of a majority of the then outstanding voting stock, (ii)the size of the Board shall be determined by a vote of a majority of the then outstanding voting stock and (iii)newly-created directorships shall be filled by a vote of a majority of the directors then on the Board. The Company’s Third Amended and Restated Certificate of Incorporation will provide that, prior to the Trigger Date, the size of the Board shall be determined by, and vacancies and newly created directorships on the Board shall be filled by, either a vote of a majority of the then outstanding voting stock or a vote of a majority of the directors then on the Board.

Seminole’s action by written consent in lieu of a meeting of the stockholders of the Company was the only vote required in respect of the Stockholder Approvals, and as such, there were no votes cast against or withheld, and no abstentions or broker non-votes with respect to the Stockholder Approvals.

The Company will file an Information Statement on Schedule 14C describing these matters and will deliver a copy of the Information Statement to all stockholders of record as of September8, 2017. The Stockholder Approvals will be effective on or immediately after the date that is 20 calendar days after the date on which the Information Statement on Schedule 14C first sent or given to the Company’s stockholders (such effective date, the “Stockholder Action Effective Date”). The Third Amended and Restated Certificate of Incorporation will become effective upon its filing with the Secretary of State of the State of Delaware, which is expected to occur on or promptly following the Stockholder Action Effective Date.

Forward-Looking Statements

This report may contain “forward-looking” statements as defined by the Private Securities Litigation Reform Act of 1995 or by the U.S. Securities and Exchange Commission (the “SEC”) in its rules, regulations and releases. These statements include, but are not limited to, management changes and related actions, the performance of the Company’s business and other non-historical statements. These statements can be identified by the use of words such as “believes,” “anticipates,” “expects,” “intends,” “plans,” “continues,” “estimates,” “predicts,” “projects,” “forecasts,” and similar expressions. All forward looking statements are based on management’s current expectations and beliefs only as of the date of this report and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those discussed in, or implied by, the forward-looking statements, including but not limited to, the risks identified and discussed from time to time in the Company’s reports filed with the SEC, including the Company’s Quarterly Report on Form10-Q for the quarterly period ended June30, 2017, filed on August9, 2017. Readers are strongly encouraged to review carefully the full cautionary statements described in these reports. Except as required by law, the Company undertakes no obligation to revise or update publicly any forward-looking statements to reflect events or circumstances after the date of this report, or to reflect the occurrence of unanticipated events or circumstances.

Item 9.01 Financial Statements and Exhibits.

(d)Exhibits

EXHIBITINDEX

Surgery Partners, Inc. Exhibit
EX-10.1 2 a17-21454_1ex10d1.htm EX-10.1 Exhibit 10.1   Execution Version   EMPLOYMENT AGREEMENT   This EMPLOYMENT AGREEMENT (this “Agreement”) is hereby entered into on September 7,…
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About Surgery Partners,Inc. (NASDAQ:SGRY)

Surgery Partners, Inc. is a healthcare services company. The Company operates in three lines of business across the United States: Surgical Facility Services, Ancillary Services and Optical Services. The Company’s Surgical Facility Services segment consists of the operation of ambulatory surgery centers (ASCs) and surgical hospitals, which include its anesthesia services. The Company’s Ancillary Services segment consists of a diagnostic laboratory, a specialty pharmacy and multi-specialty physician practices. The Company’s physician practices include its owned and operated physician practices pursuant to management service agreements. The Company’s optical services segment consists of an optical laboratory, an optical products group purchasing organization and a marketing business. The Company’s optical laboratory manufactures eyewear, while its optical product purchasing organization negotiates volume buying discounts with optical product manufacturers.

Surgery Partners,Inc. (NASDAQ:SGRY) Recent Trading Information

Surgery Partners,Inc. (NASDAQ:SGRY) closed its last trading session down -0.35 at 9.60 with 590,502 shares trading hands.