|
|
|
|
|
|
|
|
|
|
Title of Class
|
|
Beneficial Owner
|
|
Number of
Shares
Beneficially
Owned
|
|
Percentage of
Class
Beneficially
Owned
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
Beneficial owners of 5% or more of our Common Stock:
|
|
|
|
|
|
|
|
|
|
BCPE Seminole Holdings LP
(1)(2)
|
|
|
42,811,671
|
|
|
65.7
|
%
|
|
|
Directors and Executive Officers:
|
|
|
|
|
|
|
|
|
|
Clifford G. Adlerz
(3)
|
|
|
|
|
|
*
|
|
|
|
Teresa F. Sparks
|
|
|
193,376
|
|
|
*
|
|
|
|
John Crysel
|
|
|
113,939
|
|
|
*
|
|
|
|
Jennifer Baldock
|
|
|
77,739
|
|
|
*
|
|
|
|
Dennis Dean
|
|
|
113,895
|
|
|
*
|
|
|
|
Benjamin F. Jacobs
|
|
|
|
|
|
*
|
|
|
|
Bryan S. Fisher
|
|
|
20,000
|
|
|
*
|
|
|
|
Michael T. Doyle
(4)
|
|
|
3,161,760
|
|
|
6.5
|
%
|
|
|
Adam Feinstein
(5)
|
|
|
11,877
|
|
|
*
|
|
|
|
Brent Turner
(6)
|
|
|
8,828
|
|
|
*
|
|
|
|
Teresa DeLuca
(7)
|
|
|
4,676
|
|
|
*
|
|
|
|
Christopher R. Gordon
(8)
|
|
|
|
|
|
*
|
|
|
|
T. Devin O'Reilly
(8)
|
|
|
|
|
|
*
|
|
|
|
All Directors and Executive Officers as a Group (13 persons)
|
|
|
3,706,090
|
|
|
7.6
|
%
|
Preferred Stock
|
|
|
|
|
|
|
|
|
|
Beneficial owners of 5% or more of our Preferred Stock:
|
|
|
|
|
|
|
|
|
|
BCPE Seminole Holdings LP
(2)
|
|
|
310,000
|
|
|
100
|
%
|
|
|
Directors and Executive Officers:
|
|
|
|
|
|
|
|
|
|
Clifford G. Adlerz
(3)
|
|
|
|
|
|
*
|
|
|
|
Teresa F. Sparks
|
|
|
|
|
|
*
|
|
|
|
John Crysel
|
|
|
|
|
|
*
|
|
|
|
Jennifer Baldock
|
|
|
|
|
|
*
|
|
|
|
Dennis Dean
|
|
|
|
|
|
*
|
|
|
|
Benjamin F. Jacobs
|
|
|
|
|
|
*
|
|
|
|
Bryan S. Fisher
|
|
|
|
|
|
*
|
|
|
|
Michael T. Doyle
|
|
|
|
|
|
*
|
|
|
|
Adam Feinstein
|
|
|
|
|
|
*
|
|
|
|
Brent Turner
|
|
|
|
|
|
*
|
|
|
|
Teresa DeLuca
|
|
|
|
|
|
*
|
|
|
|
Christopher R. Gordon
(8)
|
|
|
|
|
|
*
|
|
|
|
T. Devin O'Reilly
(8)
|
|
|
|
|
|
*
|
|
|
|
All Directors and Executive Officers as a Group (13 persons)
|
|
|
|
|
|
*
|
|
-
*
-
Less
than one percent.
-
(1)
-
BCPE
Seminole Holdings LP directly holds (i) 26,455,651 shares of Common Stock and (ii) 310,000 shares of Preferred Stock, which,
on an as-converted basis (as explained below), represented 16,356,020 shares of Common Stock as of September 8, 2017. Each share of Preferred Stock is convertible at any time, at the election
of the holder, into the number of shares of Common Stock equal to the quotient obtained by dividing (a) the accrued value of such share of Preferred Stock plus any accrued but uncompounded
dividends on such share by (b) the conversion price ($19.00 per share as of the Record Date). Dividends accrue daily at a rate of 10%
13
Table of Contents
per
annum on the accrued value (initially, $1,000 as of August 31, 2017) and are compound quarterly on March 31, June 30, September 30 and December 31 of each year.
At least a portion of such dividends are added to the accrued value of a share and, therefore, the number of shares of Common Stock into which each share of Preferred Stock may be converted will
increase over time. As of September 8, 2017, each share of Preferred Stock was convertible into approximately 52.76 shares of Common Stock.
-
(2)
-
Bain
Capital Investors, LLC ("
BCI
") is the sole member of BCPE Seminole GP LLC
("
BCPE GP
"), which is the general partner of BCPE Seminole Holdings LP. The governance, investment strategy and decision-making process
with respect to investments held by BCPE Seminole Holdings LP is directed by the Global Private Equity Board of BCI. By virtue of the relationships described in this footnote, BCI and
BCPE GP may be deemed to share voting and dispositive power with respect to the securities held by BCPE Seminole Holdings LP.
The
principal business address of each of BCI, BCPE GP and BCPE Seminole Holdings LP is c/o Bain Capital Private Equity, LP, 200 Clarendon Street, Boston, MA 02116.
-
(3)
-
Mr. Adlerz,
our interim Chief Executive Officer, is a limited partner of BCPE Seminole Holdings LP. Mr. Adlerz does not exercise
control over the general partner of BCPE Seminole Holdings LP or otherwise exercise investment control over the portfolio transactions of BCPE Seminole Holdings LP, and thus does not
beneficially own any Common Stock or Preferred Stock held by BCPE Seminole Holdings LP.
-
(4)
-
A
portion of Mr. Doyle's shares of Common Stock is held in trust for the benefit of his immediate family.
-
(5)
-
Mr. Feinstein's
beneficially owned shares include 2,982 shares of Common Stock underlying stock options exercisable within 60 days of
September 8, 2017.
-
(6)
-
Mr. Turner's
beneficially owned shares include 1,338 shares of Common Stock underlying stock options exercisable within 60 days of
September 8, 2017.
-
(7)
-
Dr. DeLuca's
beneficially owned shares include 1,399 shares of Common Stock underlying stock options exercisable within 60 days of
September 8, 2017.
-
(8)
-
The
shares beneficially owned by each of Mr. O'Reilly and Mr. Gordon do not include shares held by BCPE Seminole Holdings LP. Each
of Mr. O'Reilly and Mr. Gordon is a Managing Director of BCI and as a result, by virtue of the relationships described footnote (2) above, may each be deemed to share beneficial
ownership of the shares of Common Stock and Preferred Stock held by BCPE Seminole Holdings LP. The address of each of Mr. O'Reilly and Mr. Gordon is c/o Bain Capital Private
Equity, LP, 200 Clarendon Street, Boston, MA 02116.
14
Table of Contents
INTEREST OF CERTAIN PERSONS IN THE MATTERS TO BE ACTED UPON
T. Devin O'Reilly and Christopher R. Gordon, each a current member of our Board, are Managing Directors of Bain Capital Investors, LLC
("
BCI
"), which is the sole member of BCPE Seminole GP LLC, the general partner of Seminole, the Consenting Stockholder. The governance,
investment strategy and decision-making process with respect to investments held by Seminole is directed by the Global Private Equity Board of BCI. By virtue of these relationships,
Mr. O'Reilly or Mr. Gordon may be deemed to share beneficial ownership of the shares held by Seminole. Each of Mr. O'Reilly and Mr. Gordon disclaims beneficial ownership of
such securities except to the extent of his pecuniary interest therein.
Clifford
G. Adlerz, our interim Chief Executive Officer, is a limited partner of Seminole. Mr. Adlerz does not exercise control over the general partner of Seminole or otherwise
exercise investment control over the portfolio transactions of Seminole, and thus does not beneficially own any Common Stock or Preferred Stock held by Seminole.
No
other officer, director or director nominee has any substantial interest in the matter acted upon by the Board and the Consenting Stockholder, other than in their roles as an officer,
director or director nominee.
As
of the Record Date, the Consenting Stockholder held 26,455,651 shares of our Common Stock, or approximately 54.2% of the Company's outstanding Common Stock, and 310,000 shares of our
Preferred Stock, or 100% of the Company's outstanding Preferred Stock, equating to approximately 65.7% of the Company's Voting Stock.
15
Table of Contents
HOUSEHOLDING
Regulations regarding the delivery of copies of information statements to stockholders permit us, banks, brokerage firms and other nominees to
send one information statement to multiple stockholders who share the same address under certain circumstances. This practice is known as "householding." Stockholders who hold their shares through a
bank, broker or other nominee may have consented to reducing the number of copies of materials delivered to their address. In the event that a stockholder wishes to revoke a "householding" consent
previously provided to a bank, broker or other nominee, the stockholder must contact the bank, broker or other nominee, as applicable, to revoke such consent. If a stockholder wishes to receive a
separate information statement, we will promptly deliver a separate copy to such stockholder that contacts us by mail at Surgery Partners, Inc., 40 Burton Hills Boulevard, Suite 500,
Nashville, Tennessee, 37215, (615) 234-5900. Any stockholders of record sharing an address who now receive multiple copies of our annual reports, proxy statements and information statements,
and who wish to receive only one copy of these materials per household in the future should also contact Investor Relations by mail or telephone as instructed above. Any stockholders sharing an
address whose shares of Common Stock are held by a bank, broker or other nominee who now receive multiple copies of our annual reports, proxy statements and information statements, and who wish to
receive only one copy of these materials per household, should contact the bank, broker or other nominee to request that only one set of these materials be delivered in the future.
16
Table of Contents
WHERE YOU CAN OBTAIN ADDITIONAL INFORMATION
We are required to file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any
document we file at the SEC's public reference rooms at 100 F Street, N.E, Washington, D.C. 20549. You may also obtain copies of the documents at prescribed rates by writing to the Public
Reference Section of the SEC at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for more information on the operation of the public reference rooms. Copies of
our SEC filings are also available to the public from the SEC's web site at www.sec.gov.
We
will provide, upon request and without charge, to each stockholder receiving this Information Statement a copy of our Annual Report on Form 10-K for the fiscal year ended
December 31, 2016 (the "
Annual Report
") and our Quarterly Report on Form 10-Q for the period ended June 30, 2017 (the
"
Quarterly Report
"), in each case, including the financial statements and financial statement schedule information included therein, as filed with the
SEC and any other documents filed with the SEC. You
are encouraged to review the Annual Report and Quarterly Report together with any subsequent information we filed or will file with the SEC and other publicly available information. A copy of any
public filing is also available, at no charge, by contacting Surgery Partners, Inc., 40 Burton Hills Boulevard, Suite 500, Nashville, Tennessee, 37215, (615) 234-5900.
17
Table of Contents
FORWARD-LOOKING STATEMENTS
This Information Statement includes "forward-looking" statements as defined by the Private Securities Litigation Reform Act of 1995 or by the
SEC in its rules, regulations and releases. These statements include, but are not limited to, statements regarding 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 Information Statement 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 most recent Quarterly Report on Form 10-Q. 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 Information Statement, or to reflect the occurrence of unanticipated events or circumstances.
18
Table of Contents
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
Statements contained in this Information Statement or in any document incorporated by reference into this Information Statement as to the
contents of any contract referred to within this Information Statement or other documents that are incorporated herein by reference are not necessarily complete and, in each instance, reference is
made to the copy of the applicable contract or other document filed as an annex to this Information Statement or otherwise filed with the SEC. Each statement in this Information Statement regarding an
agreement or other document is qualified in all respects by such agreement or other document.
The
SEC allows us to "incorporate by reference" the information we file with it, which means that we can disclose important information to you by referring you to those documents. The
information incorporated by reference is deemed to be part of this Information Statement, except for any information superseded or modified by information contained directly in this Information
Statement. The information we incorporate by reference is an important part of this Information Statement. The documents we incorporate by reference are:
-
-
Current Reports on Form 8-K, filed with the SEC on May 11, 2017, June 5, 2017, September 1, 2017 and
September 8, 2017;
-
-
Proxy Statement on Schedule 14A, filed with the SEC on April 17, 2017;
-
-
Definitive Information Statement on Schedule 14C, filed with the SEC on July 3, 2017; and
-
-
Quarterly Report on Form 10-Q for the period ended June 30, 2017, filed with the SEC on August 9, 2017.
We
will provide to each person, including any beneficial owner, to whom this Information Statement is delivered, a copy of any or all of the reports or documents that have been
incorporated by reference into this Information Statement but not delivered with this Information Statement. We will provide these reports upon written or oral request at no cost to the requester.
Please direct your request, either in writing or by telephone, to the Corporate Secretary, Surgery Partners, Inc., 40 Burton Hills Boulevard, Suite 500, Nashville, Tennessee, 37215,
(615) 234-5900. We maintain a website at http://www.surgerypartners.com. You may access our annual proxy statement on Schedule 14A, our annual reports on Form 10-K, quarterly
reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the SEC free of
charge at our website as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. The information contained in, or that can be accessed through, our
website is not incorporated by reference in, and is not part of, this Information Statement.
19
Table of Contents
|
|
|
|
|
|
|
Surgery Partners, Inc.
|
|
|
By Order of the Board of Directors
|
Date: October 10, 2017
|
|
By:
|
|
/s/ T. DEVIN O'REILLY
T. Devin O'Reilly
Chairman of the Board of Directors
|
Annex A
FORM OF SURGERY PARTNERS, INC.
Amended and Restated Certificate of Incorporation
Pursuant to Sections 242 and 245 of the General Corporation Law of the State of Delaware, Surgery Partners, Inc. has adopted this
Amended and Restated Certificate of Incorporation restating, integrating and amending its Certificate of Incorporation (originally filed April 2, 2015 and amended and restated on
September 21, 2015), which Amended and Restated Certificate of Incorporation has been duly proposed by the directors and adopted by the stockholders of this corporation (by written consent
pursuant to Section 228 of the General Corporation Law of the State of Delaware) in accordance with the provisions of Sections 242 and 245 of the General Corporation Law of the State of
Delaware.
ARTICLE INAME
The
name of the corporation is Surgery Partners, Inc. (the "
Corporation
").
ARTICLE IIREGISTERED OFFICE AND AGENT
The
address of the Corporation's registered office in the State of Delaware is 1209 Orange Street, in the City of Wilmington, County of New Castle, 19801. The name of
the Corporation's registered agent at such address is The Corporation Trust Company.
ARTICLE IIIPURPOSE
The
purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of
Delaware (the "
DGCL
").
ARTICLE IVCAPITALIZATION
(a)
Authorized Shares.
The total number of shares of stock that the Corporation shall have authority to issue is
320,310,000, consisting of 300,000,000 shares of Common Stock, par value $0.01 per share ("
Common Stock
"), and 20,310,000 shares of Preferred Stock, par
value $0.01 per share ("
Preferred Stock
"). Such stock may be issued from time to time by the Corporation for such consideration as may be fixed by the
board of directors of the Corporation (the "
Board of Directors
").
(b)
Common Stock.
Subject to the powers, preferences and rights of any Preferred Stock, including any series
thereof, having any preference or priority over, or rights superior to, the Common Stock and
except as otherwise provided by law and this Article IV, the holders of the Common Stock shall have and possess all powers and voting and other rights pertaining to the stock of the
Corporation.
(i)
Voting.
Each holder of Common Stock, as such, shall be entitled to one vote for each share of Common Stock
held of record by such holder on all matters on which stockholders generally are entitled to vote; provided, however, that to the fullest extent permitted by law, holders of Common Stock, as such,
shall have no voting power with respect to, and shall not be entitled to vote on, any amendment to this Amended and Restated Certificate of Incorporation (including any certificate of designations
relating to any series of Preferred Stock) that relates solely to the terms of one or more outstanding series of Preferred Stock if only the holders of such affected series are entitled, either
separately or together with the holders of one or more other such series, to vote thereon pursuant to this Amended and Restated Certificate of Incorporation (including any certificate of designations
relating to any series of Preferred Stock) or pursuant to the DGCL. There shall be no cumulative voting.
A-1
(ii)
Dividends.
Dividends may be declared and paid on the Common Stock from funds lawfully available therefor as
and when determined by the Board of Directors and subject to any preferential dividend rights of any then outstanding Preferred Stock. Except as otherwise provided by the DGCL or this Amended and
Restated Certificate of Incorporation, the holders of record of shares of Common Stock shall share ratably in all dividends payable in cash, stock or otherwise and other distributions, whether in
respect of liquidation or dissolution (voluntary or involuntary) or otherwise.
(iii)
No Preemptive Rights.
The holders of the Common Stock shall have no preemptive rights to subscribe for any
shares of any class of stock of the Corporation whether now or hereafter authorized.
(iv)
No Conversion Rights.
The Common Stock shall not be convertible into, or exchangeable for, shares of any
other class or classes or of any other series of the same class of the Corporation's capital stock.
(v)
Liquidation Rights.
In the event of any voluntary or involuntary liquidation, dissolution or winding up of
the affairs of the Corporation, after payment or provision for payment of the debts and other liabilities of the Corporation and of the preferential and other amounts, if any, to which the holders of
Preferred Stock shall be entitled, the holders of all outstanding shares of Common Stock shall be entitled to receive the remaining assets of the Corporation available for distribution ratably in
proportion to the number of shares held by each such stockholder. A merger or consolidation of the Corporation with or into any other corporation or other entity or a sale or conveyance of all or any
part of the assets of the Corporation, in any such case which shall not in fact result in the liquidation
of the Corporation and the distribution of assets to its stockholders, shall not be deemed to be a voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation.
(c)
Preferred Stock.
Shares of Preferred Stock may be issued in one or more series, from time to time, with each
such series to consist of such number of shares and to have such voting powers relative to other classes or series of Preferred Stock, if any, or Common Stock, full or limited or no voting powers, and
such designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof, as shall be stated in the resolution or
resolutions providing for the issuance of such series adopted by the Board of Directors, and the Board of Directors is hereby expressly vested with the authority, to the full extent now or hereafter
provided by applicable law, to adopt any such resolution or resolutions. Except as otherwise provided in this Amended and Restated Certificate of Incorporation or any certificate of designations
relating to any series of Preferred Stock, no vote of the holders of the Preferred Stock or Common Stock shall be a prerequisite to the designation or issuance of any shares of any series of the
Preferred Stock authorized by and complying with the conditions of this Amended and Restated Certificate of Incorporation and any certificate of designations relating to any series of Preferred Stock,
the right to have such vote being expressly waived by all present and future holders of the capital stock of the Corporation. Any shares of Preferred Stock that are redeemed, purchased or acquired by
the Corporation may be reissued except as otherwise provided by law, this Amended and Restated Certificate of Incorporation or any certificate of designations relating to any series of Preferred
Stock. Different series of Preferred Stock shall not be construed to constitute different classes of shares for the purposes of voting by classes unless expressly provided in any certificate of
designations or any resolution or resolutions providing for the issue of such series adopted by the Board of Directors.
(d)
No Class Vote on Changes in Authorized Number of Shares of Preferred Stock.
Subject to the rights of the
holders of any series of Preferred Stock pursuant to the terms of this Amended and Restated Certificate of Incorporation, any certificate of designations or any resolution providing for the issuance
of such series of stock adopted by the Board of Directors, the number of authorized shares of
A-2
Preferred
Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of the outstanding
shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, irrespective of the provisions of Section 242(b)(2) of the
DGCL.
ARTICLE VBOARD OF DIRECTORS
(a)
Number of Directors; Vacancies and Newly Created Directorships.
The number of directors constituting the
Board of Directors shall be not fewer than three and not more than 15, each of whom shall be a natural person. Subject to the special rights of the holders of any series of Preferred Stock to elect
directors, the precise number of directors shall be fixed from time to time (i) if prior to the date (the "
Trigger Date
") that the Sponsor
Entities (as defined below) cease collectively to beneficially own (directly or indirectly) fifty percent (50%) or more of the then outstanding capital stock of the Corporation entitled to vote
generally in the election of directors ("
Voting Stock
"), by either (A) a majority vote of the Board of Directors or (B) the affirmative
vote of at least a majority of the Corporation's then outstanding Voting Stock and (ii) if on or after the Trigger Date, exclusively by a majority vote of the Board of Directors. Vacancies and
newly-created directorships shall be filled (1) if prior to the Trigger Date, by either (X) a vote of a majority of the directors then in office, even if less than a quorum, or by a sole
remaining director or (Y) a vote of a majority of the then outstanding Voting Stock and (2) if on or after the Trigger Date, exclusively by a vote of a majority of the directors then in
office, even if less than a quorum, or by a sole remaining director, except in each case, that any vacancy created by the removal of a director by the stockholders for cause shall only be filled, in
addition to any other vote otherwise required by law, by vote of a majority of the then outstanding Voting Stock. No decrease in the number of directors constituting the Board of Directors shall
shorten the term of any incumbent director. A director elected to fill a vacancy shall be elected for the unexpired term of his or her predecessor in office, and a director chosen to fill a position
resulting from an increase in the number of directors shall hold office until the next election of the class for which such director shall have been chosen, subject to the election and qualification
of his or her successor and to his or her earlier death, resignation or removal. "
Affiliate
" means, with respect to any Person, any other Person that
controls, is controlled by, or is under common control with such Person; the term "
control
," as used in this definition, means the power to direct or
cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and
"
controlled
" and "
controls
" have meanings correlative to the foregoing.
"
Person
" means an individual, any general partnership, limited partnership, limited liability company, corporation, trust, business trust, joint stock
company, joint venture, unincorporated association, cooperative or association or any other legal entity or organization of whatever nature, and shall include any successor (by merger or otherwise) of
such entity. "
Sponsor Entities
" means, collectively, investment funds affiliated with Bain Capital Private Equity, LP and its successors,
Transferees and Affiliates. "
Transferee
" means, any Person who becomes a beneficial owner of Voting Stock upon having purchased such shares from the
investment funds affiliated with the Sponsor Entities or their respective Affiliates, provided, however, that a purchaser of Voting Stock in an registered public offering shall not be a "Transferee."
For the purpose of this Amended and Restated Certificate of Incorporation, "
beneficial ownership
" shall be determined in accordance with
Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the "
Exchange Act
").
(b)
Classified Board of Directors.
Subject to the special rights of the holders of any series of Preferred Stock
to elect directors, the Board of Directors (other than those directors elected by the holders of any series of Preferred Stock) shall be classified into three classes: Class I; Class II;
and Class III. Each class shall consist, as nearly as practicable, of one-third of the total number of directors constituting the
entire Board of Directors and the allocation of directors among the three classes shall be determined by the Board of Directors. The term of office of the Class I Directors shall expire at the
2019 annual meeting of stockholders, the term of office of the Class II Directors shall expire at the
A-3
2020
annual meeting of stockholders and the term of office of the Class III Directors shall expire at the 2018 annual meeting of stockholders. Each director in each class shall hold office
until his or her successor is duly elected and qualified or until his or her earlier death, resignation or removal. At each annual meeting of stockholders beginning with the first annual meeting of
stockholders following the filing of this Amended and Restated Certificate of Incorporation, the successors of the class of directors whose term expires at that meeting shall be elected to hold office
for a term expiring at the annual meeting of stockholders to be held in the third year following the year of their election, with each director in each such class to hold office until his or her
successor is duly elected and qualified or until his or her earlier death, resignation or removal. If the number of directors is changed, any increase or decrease shall be apportioned among the
classes so as to maintain the number of directors in each class as nearly equal as possible and such apportionment shall be determined by the Board of Directors.
(c)
Removal.
Subject to the special rights of the holders of any series of Preferred Stock to elect directors,
the directors of the Corporation may be removed only for cause by the affirmative vote of the holders of at least seventy-five percent (75%) of the voting power of the outstanding shares of
capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, at a meeting of the stockholders called for that purpose.
ARTICLE VILIMITATION OF DIRECTOR LIABILITY
To
the fullest extent that the DGCL or any other law of the State of Delaware (as they exist on the date hereof or as they may hereafter be amended) permits the
limitation or elimination of the liability of directors, no director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a
director. No amendment to, or modification or repeal of, this Article VI shall adversely affect any right or protection of a director of the Corporation existing hereunder with respect to any
state of facts existing or act or omission occurring, or any cause of action, suit or claim that, but for this Article VI, would accrue or arise, prior to such amendment, modification or
repeal. If the DGCL is amended after the Effective Time to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the
Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended.
ARTICLE VIIMEETINGS OF STOCKHOLDERS
(a)
No Action by Written Consent.
From and after the Trigger Date, any action required or permitted to be taken
by the stockholders of the Corporation may be effected only at a duly called annual or special meeting of stockholders of the Corporation and may not be effected by any consent in writing by such
stockholders.
(b)
Special Meetings of Stockholders.
Subject to any special rights of the holders of any series of Preferred
Stock, and to the requirements of applicable law, special meetings of stockholders of the Corporation may be called only (i) by or at the direction of the Board of Directors pursuant to a
written resolution adopted by a majority of the total number of directors which the Corporation would have if there were no vacancies, or (ii) prior to the Trigger Date, by the Secretary of the
Corporation at the request of the holders of fifty percent (50%) or more of the then outstanding Voting Stock. Any business transacted at any special meeting of stockholders shall be limited to
matters relating to the purpose or purposes stated in the notice of meeting.
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(c)
Election of Directors by Written Ballot.
Election of directors need not be by written ballot.
ARTICLE VIIIAMENDMENTS TO THE
CERTIFICATE OF INCORPORATION AND BYLAWS
(a)
Bylaws.
In furtherance and not in limitation of the powers conferred by law, the Board of Directors is
expressly authorized to make, alter, amend or repeal the bylaws of the Corporation subject to the power of the stockholders of the Corporation entitled to vote with respect thereto to make, alter,
amend or repeal the bylaws both before and after the Trigger Date;
provided
, that with respect to the powers of stockholders entitled to vote with
respect thereto to make, alter, amend or repeal the bylaws, from and after the Trigger Date, in addition to any other vote otherwise required by law, the affirmative vote of the holders of at least
seventy-five percent (75%) of the voting power of the outstanding shares of capital stock of the Corporation entitled to vote with respect thereto, voting together as a single class, shall be
required to make, alter, amend or repeal the bylaws of the Corporation.
(b)
Amendments to the Certificate of Incorporation.
Subject to any certificate of designations relating to any
series of Preferred Stock, the Corporation reserves the right to amend, alter, change or repeal any provision contained in this Amended and Restated Certificate of Incorporation, in the manner now or
hereafter prescribed by the DGCL, and all rights conferred upon stockholders herein are granted
subject to this reservation. Notwithstanding anything to the contrary contained in this Amended and Restated Certificate of Incorporation, and notwithstanding that a lesser percentage may be permitted
from time to time by applicable law, no provision of Article V, Article VI, paragraphs (a) and (b) of Article VII, Article VIII, Article IX,
Article X and Article XI may be altered, amended or repealed in any respect, nor may any provision or bylaw inconsistent therewith be adopted, unless, in addition to any other vote
required by this Amended and Restated Certificate of Incorporation or otherwise required by law, (i) prior to the Trigger Date, such alteration, amendment, repeal or adoption is approved by, in
addition to any other vote otherwise required by law, the affirmative vote of the holders of a majority of the voting power of the outstanding shares of capital stock of the Corporation entitled to
vote generally in the election of directors, voting together as a single class, and (ii) from and after the Trigger Date, such alteration, amendment, repeal or adoption is approved by, in
addition to any other vote otherwise required by law, the affirmative vote of the holders of at least seventy-five percent (75%) of the voting power of the outstanding shares of capital stock
of the Corporation entitled to vote generally in the election of directors, voting together as a single class, at a meeting of the stockholders called for that purpose.
ARTICLE IXBUSINESS COMBINATIONS
(a)
Opt Out of DGCL 203.
The Corporation shall not be governed by Section 203 of the DGCL.
(b)
Limitations on Business Combinations.
Notwithstanding the foregoing, the Corporation shall not engage in any
business combination (as defined below), at any point in time at which the Corporation's Common Stock is registered under Sections 12(b) or 12(g) of the Exchange Act, with any interested
stockholder (as defined below) for a period of three (3) years following the time that such stockholder became an interested stockholder, unless:
(i) prior
to such time, the Board of Directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested
stockholder, or
(ii) upon
consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting
stock (as defined below) of the Corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock
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owned
by the interested stockholder) those shares owned by (i) persons who are directors and also officers or (ii) employee stock plans in which employee participants do not have the
right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer, or
(iii) at
or subsequent to such time, the business combination is approved by the Board of Directors and authorized at an annual or special meeting of stockholders, and not
by written consent, by the affirmative vote of at least two thirds of the outstanding voting stock of the Corporation which is not owned by the interested stockholder.
(c)
Definitions.
For purposes of this Article IX, references to:
(i) "
affiliate
" means a person that directly, or indirectly through one or more intermediaries, controls, or is controlled
by, or is under common control with, another person.
(ii) "
associate
," when used to indicate a relationship with any person, means: (i) any corporation, partnership,
unincorporated association or other entity of which such person is a director, officer or partner or is, directly or indirectly, the owner of 20% or more of any class of voting stock; (ii) any
trust or other estate in which such person has at least a 20% beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; and (iii) any relative or
spouse of such person, or any relative of such spouse, who has the same residence as such person.
(iii) "
business combination
," when used in reference to the Corporation and any interested stockholder of the Corporation,
means:
(1) any
merger or consolidation of the Corporation or any direct or indirect majority-owned subsidiary of the Corporation (a) with the interested stockholder, or
(b) with any other corporation, partnership, unincorporated association or other entity if the merger or consolidation is caused by the interested stockholder and as a result of such merger or
consolidation paragraph (b) of this Article IX is not applicable to the surviving entity;
(2) any
sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), except proportionately as a stockholder of
the Corporation, to or with the interested stockholder, whether as part of a dissolution or otherwise, of assets of the Corporation or of any direct or indirect majority-owned subsidiary of the
Corporation which assets have an aggregate market value equal to 10% or more of either the aggregate market value of all the assets of the Corporation determined on a consolidated basis or the
aggregate market value of all the outstanding stock of the Corporation;
(3) any
transaction which results in the issuance or transfer by the Corporation or by any direct or indirect majority-owned subsidiary of the Corporation of any stock of
the Corporation or of such subsidiary to the interested stockholder, except: (a) pursuant to the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible
into stock of the Corporation or any such subsidiary which securities were outstanding prior to the time that the interested stockholder became such; (b) pursuant to a merger under
Section 251(g) of the DGCL; (c) pursuant to a dividend or distribution paid or made, or the exercise, exchange or conversion of securities exercisable for, exchangeable for or
convertible into stock of the Corporation or any such subsidiary which security is distributed, pro rata to all holders of a class or series of stock of the Corporation subsequent to the time the
interested stockholder became such; (d) pursuant to an exchange offer by the Corporation to purchase stock made on the same terms to all holders of said stock; or (e) any issuance or
transfer of stock by the Corporation;
provided, however
, that in no case under items (c)-(e) of this subsection (3) shall there be an
increase in the interested stockholder's proportionate
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share
of the stock of any class or series of the Corporation or of the voting stock of the Corporation (except as a result of immaterial changes due to fractional share adjustments);
(4) any
transaction involving the Corporation or any direct or indirect majority-owned subsidiary of the Corporation which has the effect, directly or indirectly, of
increasing the proportionate share of the stock of any class or series, or securities convertible into the stock of any class or series, of the Corporation or of any such subsidiary which is owned by
the interested stockholder, except as a result of immaterial changes due to fractional share adjustments or as a result of any purchase or redemption of any shares of stock not caused, directly or
indirectly, by the interested stockholder; or
(5) any
receipt by the interested stockholder of the benefit, directly or indirectly (except proportionately as a stockholder of the Corporation), of any loans, advances,
guarantees, pledges, or other financial benefits (other than those expressly permitted in subsections (1)-(4) above) provided by or through the Corporation or any direct or indirect
majority-owned subsidiary.
(iv) "
control
," including the terms "
controlling
,"
"
controlled by
" and "
under common control with
," means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting stock, by contract, or otherwise. A person who is the owner of 20% or more of
the outstanding voting stock of the Corporation, partnership, unincorporated association or other entity shall be presumed to have control of such entity, in the absence of proof by a preponderance of
the evidence to the contrary. Notwithstanding the foregoing, a presumption of control shall not apply where such person holds voting stock, in good faith and not for the purpose of circumventing this
Article IX, as an agent, bank, broker, nominee, custodian or trustee for one or more owners who do not individually or as a group have control of such entity.
(v) "
interested stockholder
" means any person (other than the Corporation or any direct or indirect majority-owned subsidiary
of the Corporation) that (i) is the owner of 15% or more of the outstanding voting stock of the Corporation, or (ii) is an affiliate or associate of the Corporation and was the owner of
15% or more of the outstanding voting stock of the Corporation at any time within the three (3) year period immediately prior to the date on which it is sought to be determined whether such
person is an interested stockholder, and the affiliates and associates of such person; provided, however, that the term "interested stockholder" shall not include (a) the Sponsor Entities, or
(b) any person whose ownership of shares in excess of the 15% limitation set forth herein is the result of any action taken solely by the Corporation; provided that such person specified in
this clause (b) shall be an interested stockholder if thereafter such person acquires additional shares of voting stock of the Corporation, except as a result of further corporate action not
caused, directly or indirectly, by such person. For the purpose of determining whether a person is an interested stockholder, the voting stock of the Corporation deemed to be outstanding shall include
stock deemed to be owned by the person through application of the definition of "owner" below but shall not include any other unissued stock of the Corporation which may be issuable pursuant to any
agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise.
(i) "
owner
," including the terms "
own
" and
"
owned
," when used with respect to any stock, means a person that individually or with or through any of its affiliates or associates:
(1) beneficially
owns such stock, directly or indirectly; or
(2) has
(a) the right to acquire such stock (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement
or understanding, or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise;
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provided, however
, that a person shall not be deemed the owner of stock tendered pursuant to a tender or exchange offer made by such person or any of such person's affiliates
or associates until such tendered stock is accepted for purchase or exchange; or (b) the right to vote such stock pursuant to any agreement, arrangement or understanding;
provided, however
, that a
person shall not be deemed the owner of any stock because of such person's right to vote such stock if the agreement,
arrangement or understanding to vote such stock arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made to ten (10) or more persons; or
(3) has
any agreement, arrangement or understanding for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent as described in
item (b) of subsection (2) above), or disposing of such stock with any other person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly,
such stock.
(ii) "
person
" means any individual, corporation, partnership, unincorporated association or other entity.
(iii) "
stock
" means, with respect to any corporation, capital stock and, with respect to any other entity, any equity
interest.
(iv) "
voting stock
" means stock of any class or series entitled to vote generally in the election of directors.
ARTICLE XRENOUNCEMENT OF CORPORATE OPPORTUNITY
(a)
Scope.
The provisions of this Article X are set forth to define, to the extent permitted by
applicable law, the duties of Exempted Persons (as defined below) to the Corporation with respect to certain classes or categories of business opportunities. "
Exempted
Persons
" means the Sponsor Entities and all
of their respective partners, principals, directors, officers, members, managers and/or employees, including any of the foregoing who serve as officers or directors of the Corporation.
(b)
Competition and Allocation of Corporate Opportunities.
The Exempted Persons shall not have any fiduciary
duty to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as the Corporation or any of its subsidiaries. To the fullest extent permitted by
applicable law, the Corporation, on behalf of itself and its subsidiaries, renounces any interest or expectancy of the Corporation and its subsidiaries in, or in being offered an opportunity to
participate in, business opportunities that are from time to time presented to the Exempted Persons, even if the opportunity is one that the Corporation or its subsidiaries might reasonably be deemed
to have pursued or had the ability or desire to pursue if granted the opportunity to do so, and each such Exempted Person shall have no duty to communicate or offer such business opportunity to the
Corporation and, to the fullest extent permitted by applicable law, shall not be liable to the Corporation or any of its subsidiaries for breach of any fiduciary or other duty, as a director or
officer or otherwise, by reason of the fact that such Exempted Person pursues or acquires such business opportunity, directs such business opportunity to another person or fails to present such
business opportunity, or information regarding such business opportunity, to the Corporation or its subsidiaries.
(c)
Certain Matters Deemed Not Corporate Opportunities.
In addition to and notwithstanding the foregoing
provisions of this Article X, a corporate opportunity shall not be deemed to belong to the Corporation if it is a business opportunity that the Corporation is not financially able or
contractually permitted or legally able to undertake, or that is, from its nature, not in the line of the Corporation's business or is of no practical advantage to it or that is one in which the
Corporation has no interest or reasonable expectancy.
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(d)
Amendment of this Article.
No amendment or repeal of this Article X in accordance with the provisions
of paragraph (b) of Article VIII shall apply to or have any effect on the liability or alleged liability of any Exempted Person for or with respect to any activities or opportunities of
which such Exempted Person becomes aware prior to such amendment or repeal. This Article X shall not limit any protections or defenses available to, or indemnification or advancement rights of,
any director or officer of the Corporation under this Amended and Restated Certificate of Incorporation, the Corporation's bylaws or applicable law.
ARTICLE XIEXCLUSIVE JURISDICTION FOR CERTAIN ACTIONS
The
Court of Chancery of the State of Delaware shall, to the fullest extent permitted by applicable law, be the sole and exclusive forum for (i) any derivative
action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to
the Corporation or the Corporation's stockholders, (iii) any action asserting a claim against the Corporation arising pursuant to any provision of the DGCL or the Corporation's Amended and
Restated Certificate of Incorporation or bylaws or (iv) any action asserting a claim against the Corporation governed by the internal affairs doctrine, in each case excluding actions in which
the Court of Chancery of the State of Delaware concludes that an indispensable party is not subject to the jurisdiction of the Delaware courts and can be subject to the jurisdiction of another court
within the United States. Any person or entity purchasing or otherwise acquiring any interest in the shares of capital stock of the Corporation shall be deemed to have notice of and consented to the
provisions of this Article XI.
ARTICLE XIISEVERABILITY
If
any provision or provisions of this Amended and Restated Certificate of Incorporation shall be held to be invalid, illegal or unenforceable as applied to any
circumstance for any reason whatsoever: (i) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Amended and Restated
Certificate of Incorporation (including, without limitation, each portion of any paragraph of this Amended and Restated Certificate of Incorporation containing any such provision held to be invalid,
illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and (ii) to the fullest extent possible, the
provisions of this Amended and Restated Certificate of Incorporation (including, without limitation, each such portion of any paragraph of this Amended and Restated Certificate of Incorporation
containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to permit the Corporation to protect its directors, officers, employees and agents from personal
liability in respect of their good faith service to or for the benefit of the Corporation to the fullest extent permitted by law.
*
* * * *
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IN
WITNESS WHEREOF, the undersigned has caused this Amended and Restated Certificate of Incorporation to be executed by the officer below this day
of ,
2017.
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SURGERY PARTNERS, INC.
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By:
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Name:
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Title:
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[Signature Page to Amended and Restated Certificate of Incorporation]