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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 and 15(d) of The Securities Exchange Act of 1934
DATE OF REPORT
(Date of earliest event reported): June 26, 1996
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HORIZON/CMS HEALTHCARE CORPORATION
(Exact name of Registrant as specified in its charter)
DELAWARE 1-9369 91-1346899
(State or other jurisdiction (Commission File No.) (I.R.S. Employer
or incorporation or organization) Identification No.)
6001 INDIAN SCHOOL ROAD, N.E.
SUITE 350
ALBUQUERQUE, NEW MEXICO
(Address of principal
executive offices)
87110
(Zip Code)
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ITEM 5.
On July 2, 1996, Horizon/CMS Healthcare Corporation announced the
resignations of Barry Portnoy, Gerard Martin, LeRoy Zimmerman and Robert
Ortenzio from its Board of Directors. The Company said that a search for
highly qualified independent candidates is now underway, and that it expects
to name new Directors to its Board in the near future.
Both Mr. Portnoy and Mr. Martin joined the Board of Horizon/CMS
following its 1994 acquisition of Greenery Rehabilitation Group, Inc., where
Mr. Portnoy served as a Director and Mr. Martin served as Chairman and Chief
Executive Officer. Mr. Ortenzio and Mr. Zimmerman joined the Board of
Horizon/CMS following its 1995 acquisition of Continental Medical Systems,
Inc. ("CMS"), where Mr. Zimmerman served as a Director and Mr. Ortenzio
served as President. Mr. Ortenzio will relinquish his position as Executive
Vice President of Horizon/CMS but will continue to serve as President and
Chief Executive Officer of Horizon's wholly-owned subsidiary, CMS.
Mr. Martin will continue to serve under an existing arrangement as a consultant
to Horizon/CMS.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Current Report to be signed on its behalf by
the undersigned, thereunto duly authorized.
HORIZON/CMS HEALTHCARE CORPORATION
By: /s/ SCOT SAUDER
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Scot Sauder
VICE PRESIDENT OF LEGAL AFFAIRS, SECRETARY
AND GENERAL COUNSEL
Date: July 2, 1996.
2
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EXHIBITS
EXHIBIT NO. DESCRIPTION
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1 Letter dated June 26, 1996, from Barry M. Portnoy addressed
to Neal M. Elliott, resigning as a director of Horizon/CMS
Healthcare Corporation (the "Company") effective immediately.
2 Letters dated June 27, 1996, from Gerard M. Martin addressed to
Neal M. Elliott, resigning as a director of the Company
effective immediately and continuing his consulting
arrangement.
3 Letters dated June 27, 1996, from Robert A. Ortenzio
addressed to Neal M. Elliott, resigning as a director and
Executive Vice President of the Company effective immediately.
4 Letter dated July 1, 1996, from LeRoy Zimmerman
addressed to Neal M. Elliott, resigning as a director of the
Company effective immediately.
5 Press Release dated July 2, 1996, issued by the Company
announcing the resignations of Barry M. Portnoy, Gerard M.
Martin, Robert A. Ortenzio and LeRoy Zimmerman as directors
of the Company.
3
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[LETTERHEAD of Barry M. Portnoy]
June 26, 1996
Mr. Neal M. Elliott, Chairman
Horizon/CMS Healthcare Corporation
6001 Indian School Road, NE
Albuquerque, NM 87110
RE: Resignation from Board of Directors
Dear Neal:
I hereby resign as a Director of Horizon/CMS Healthcare Corporation.
As evidenced at the last Board meeting I disagree with the approach
adopted by a majority of the Board for dealing with the issues raised in the
pending investigations and litigations.
My resignation should be considered effective immediately.
Sincerely,
/s/ BARRY M. PORTNOY
--------------------------
Barry M. Portnoy
cc: Horizon Board of Directors
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June 27, 1996
Mr. Neal M. Elliott, Chairman
Horizon/CMS Healthcare Corporation
6001 Indian School Road, NE
Albuquerque, NM 89110
Re: DIRECTOR RESIGNATION
Dear Neal:
I wish to resign as a Director of Horizon/CMS Healthcare Corporation. My
resignation as Director should be considered effective immediately.
Very truly yours,
/s/ Gerard M. Martin
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Gerard M. Martin
cc: Board of Directors
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June 26, 1996
Mr. Neal M. Elliott, Chairman
Horizon/CMS Healthcare Corporation
6001 Indian School Road, NE
Albuquerque, NM 89110
Re: DIRECTOR RESIGNATION
In reviewing my Consulting Agreement with the Company dated February 11,
1994, it does not appear to me that the Consulting Agreement requires my
continuing service as a Director. By resigning as a Director I do not
terminate my engagement or terminate the Company's obligations under the
Consulting Agreement. Please acknowledge the Company's agreement with this
position by signing below and returning a copy of this letter to me.
Very truly yours,
/s/ Gerard M. Martin
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Gerard M. Martin
AGREED AND ACCEPTED
Horizon/CMS Healthcare Corporation
By /s/ Neal M. Elliott
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Neal M. Elliott
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[LETTERHEAD OF CONTINENTAL MEDICAL SYSTEMS, INC.]
June 27, 1996
Neal Elliott
Chairman/CEO
Horizon/CMS Healthcare Corporation
6001 Indian School Road, NE
Suite 530
Albuquerque, NM 87110
Dear Neal:
Next week will mark the one year anniversary of the merger of Horizon and
CMS. While matters of disagreement in a merger such as ours are part of the
process, I have become troubled by the confrontation that has taken place at
the Board level over the last year.
As you know, I have disagreed with you on a number of matters that have come
before the Board either for a vote or general discussion. This has not been
easy although I have spoken and voted consistent with my good faith views of
the best interest of the Company. At this point, however, I believe it would
be best if I resigned from the Board. In addition, at your request I will
resign my position of Executive Vice President of Horizon/CMS. I understand
that this title was given to me at the merger with the best of intentions.
However, inasmuch as I have no corporate responsibilities it may be advisable
to vacate that title as well.
With these actions, it is my hope that our professional relationship can be
strengthened. I will continue to serve the Company as head of the CMS
Division. Clearly, consistency in our earnings will have to be a strength of
the Company going forward. This is where I can continue to make the strongest
impact.
Sincerely,
/s/ Robert A. Ortenzio
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Robert A. Ortenzio
President
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[LETTERHEAD OF CONTINENTAL MEDICAL SYSTEMS, INC.]
June 27, 1996
To: Neal Elliott
Chairman/CEO, Horizon/CMS Healthcare Corporation
Please accept this as notice of my resignation from the Board of Directors of
Horizon/CMS Healthcare COrporation effective as of the date hereof.
Sincerely,
/s/ Robert A. Ortenzio
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Robert A. Ortenzio
RAO:mlh
ROBaD
cc: Frank McCord
Ray Novak
Roy Zimmerman
Jerry Martin
Barry Portnoy
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[LETTERHEAD of LeRoy S. Zimmerman]
July 1, 1996
Neal Elliott
Chairman/CEO
Horizon/CMS Healthcare Corporation
6001 Indian School Road, NE
Suite 530
Albuquerque, NM 87110
Dear Neal:
Please be advised that I hereby resign as a member of the Board of Directors
of Horizon/CMS Healthcare Corp. to be effective as of this date.
Very truly yours,
/s/ LeRoy S. Zimmerman
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LeRoy S. Zimmerman
LSZjmc
VIA FACSIMILE (505) 881-5097
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HORIZON/CMS MAKES ANNOUNCEMENT
ALBUQUERQUE, N.M., July 2/PRNewswire/ -- Horizon/CMS Healthcare
Corporation (NYSE:HHC) today announced the resignation of Barry Portnoy,
Gerard Martin, LeRoy Zimmerman and Robert Ortenzio from its Board of
Directors. The Company said that a search for highly qualified independent
candidates is now underway, and that it expects to name new Directors to its
Board in the near future.
Both Mr. Portnoy and Mr. Martin joined the Board of Horizon/CMS following its
1994 acquisition of Greenery Rehabilitation Group, Inc., where Mr. Portnoy
served as a Director and Mr. Martin served as Chairman and Chief Executive
Officer. Mr. Ortenzio and Mr. Zimmerman joined the Board of Horizon/CMS
following its 1995 acquisition of Continental Medical Systems, Inc. ("CMS"),
where Mr. Zimmerman served as a Director and Mr. Ortenzio served as
President. Mr. Ortenzio will relinquish his position as Executive Vice
President of Horizon/CMS but will continue to serve as President and
Chief Executive Officer of Horizon's wholly-owned
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subsidiary, CMS. Mr. Martin will continue to serve under an existing
arrangement as a consultant to Horizon/CMS.
Neal Elliott, Chairman and Chief Executive Officer of Horizon/CMS Healthcare
Corporation stated: "Each of these directors came to Horizon/CMS as a result
of a major acquisition undertaken by the Company. The integration of these
acquisitions is now complete, and we are using the occasion of their
departures as an opportunity to restructure our Board by recruiting new,
highly qualified independent directors to provide guidance and counsel as we
lead the Company forward."
Horizon/CMS Healthcare Corporation is a leading provider of post acute health
care services and long-term care services, principally in the Midwest,
Southwest and Northeast regions of the United States. Horizon/CMS provides
specialty health care services through 37 acute rehabilitation hospitals in
16 states (2,065 beds), 58 specialty hospitals and subacute care units in
17 states (1,905 beds), 186 outpatient rehabilitation clinics in 21 states
and 2,618 rehabilitation therapy contracts in 38 states. Horizon/CMS provides
long-term services through 120 owned or leased facilities (14,953 beds) and
140 managed facilities (15,848 beds) in a total of 19 states. Other medical
services offered by the Company include pharmacy, laboratory, Alzheimer's
care, physician practice management, non-invasive medical diagnostic
services, home respiratory, home infusion therapy, and hospice care, and
CompHealth, our physician/locum tenens services business which provides
temporary physician and allied health professional staffing services
throughout the United States.
CONTACT: Michael H. Seeliger, Vice President, Investor and Corporation
Relations, 5O5-878-6351; or Dawn Dover or Michael Freitag of Kekst and
Company, 212-593-2655
