Centric Health Amends Consulting Agreement with GHIS
TORONTO, March 28, 2013 /CNW/ - Centric Health Corporation ("Centric Health" or "the Company") (TSX: CHH), Canada's leading diversified healthcare company, today announced that it has amended certain terms of its Consulting Agreement with Global Healthcare Investments & Solutions Inc ("GHIS"), originally dated June 2011, and the compensation for the Company's Chairman, Dr. Jack Shevel, who is also President of GHIS. Following a process, the amendments were unanimously agreed to by the Centric Health Board of Directors, excluding Board nominees of GHIS who recused themselves from voting. The amendment is subject to approval of The Toronto Stock Exchange (TSX) and disinterested shareholder approval.
"Following a review of Centric's stage of development, the recent key executive appointments and related party considerations, the Board has successfully negotiated amendments to the Consulting Agreement with GHIS," said David Cutler, President and Chief Executive Officer, Centric Health Corporation.
The key amendments to the Consulting Agreement and Chairman's compensation include:
-- Cancelation of the completion fee of up to 0.5% of the enterprise value of mergers, acquisitions, similar corporation transactions, and capital or finance raised; -- Waiver of the monthly advisory fee of $100,000 per month for the 15 months from October 2012 to December 2013; -- Reduction of the monthly advisory fee from $100,000 to $75,000 per month from January 2014 to June 30, 2015, being the termination date of the agreement (unless extended by mutual agreement of both parties); -- Waiver of existing Chairman's compensation of $200,000 per annum with effect from October 2012. "In addition to the cash flow and earnings benefits of $2.5 million over the term of the Consulting Agreement, not including any prospective completion fees, this transaction importantly addresses certain related party sensitivities and enhances the investment profile going forward," said Daniel Gagnon, Chief Financial Officer, Centric Health Corporation. In consideration for these amendments, the Company will issue Centric Health common shares ("Consideration Shares") from treasury equivalent to $2,150,000 at a price per share equal to the 5 day volume weighted average price ("VWAP") of shares immediately following the announcement of the Company's 2012 annual results, subject to a maximum of 5 million Consideration Shares issued. The Consideration Shares will be subject to a one year hold period from their date of issuance, unless the Board otherwise approves an earlier release. GHIS and entities controlled by common shareholders of GHIS currently own 36,098,976 shares or approximately 25% of the issued and outstanding common shares of the Company as of December 31, 2012. The maximum number of Consideration Shares issued would increase the aggregate ownership to approximately 27.5%. "GHIS' depth and breadth of experience has given Centric Health a leading position with an unrivaled national platform of assets and operations with an overarching focus on quality care and outcomes. We look forward to their continued involvement, applied international expertise and support to the management team as a key differentiator going forward," said David Cutler, President and Chief Executive Officer, Centric Health Corporation. About Centric Health Centric Health's vision is to be Canada's premier healthcare company, providing innovative solutions centered on patients and healthcare professionals. As a diversified healthcare company with investments in several niche service areas, Centric Health currently has operations in medical assessments, disability and rehabilitation management, physiotherapy and surgical centres, homecare, specialty pharmacy and wellness and prevention. With knowledge and experience of healthcare delivery in international markets and extensive and trusted relationships with payers, physicians, and government agencies, Centric Health is pursuing expansion opportunities into other healthcare sectors to create value for all stakeholders with an unwavering commitment to the highest quality of care. Centric Health is listed on the TSX under the symbol CHH. For further information, please visit www.centrichealth.ca and www.lifemark.ca. This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Centric Health and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits Centric Health will derive there-from. David Cutler President and Chief Executive Officer Centric Health Corporation 416-927-8400 firstname.lastname@example.org Lawrence Chamberlain Investor Relations TMX Equicom 416-815-0700 ext. 257 email@example.com SOURCE: Centric Health Corporation To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/March2013/28/c9182.html CO: Centric Health Corporation ST: Ontario NI: HEA -0- Mar/28/2013 18:30 GMT