UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
In connection with John (Jack) Larsen’s appointment as Executive Chair of ATI Physical Therapy, Inc. (formerly Fortress Value Acquisition Corp. II, “ATI” or the “Company”), as previously disclosed in the Company’s Form 8-K filed on August 9, 2021, the Company has determined to compensate Mr. Larsen by paying him additional cash compensation of $720,000, paid over six (6) months in accordance with the Company’s payroll practices, and Mr. Larsen will receive equity valued at $480,000 at the time of grant, in the form of 50% stock options and 50% restricted stock units. This compensation will be in addition to compensation he receives for his service on the Board of Directors.
| Item 8.01. | Other Events |
On August 16, 2021, two purported ATI shareholders, Kevin Burbige and Ziyang Nie, filed a putative class action complaint in the U.S. District Court for the Northern District of Illinois against ATI, Labeed Diab, Joe Jordan, and Drew McKnight (collectively, the “ATI Individual Defendants,” as defined in the complaint), and Joshua Pack, Marc Furstein, Leslee Cowen, Aaron Hood, Carmen Policy, Rakefet Russak-Aminoach, and Sunil Gulati (collectively, the “FVAC Defendants,” as defined in the complaint). The complaint asserts claims against: (i) the ATI Individual Defendants under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”); and (ii) the ATI Individual Defendants and the FVAC Defendants under Section 14(a) of the Exchange Act. Plaintiffs purport to assert their claims on behalf of those ATI shareholders who purchased or otherwise acquired their ATI shares between April 1, 2021 and July 23, 2021, inclusive, and/or held FVAC Class A common shares as of May 24, 2021 and were eligible to vote at FVAC’s June 15, 2021 special meeting.
Specifically, plaintiffs allege that the proxy materials for the FVAC/ATI merger, as well as other ATI disclosures (including the press release announcing ATI’s financial results for the first quarter of 2021), were false and misleading (and, thus, in violation of Sections 10(b) and 14(a) of the Exchange Act) because they failed to disclose that: (i) ATI was experiencing attrition among its physical therapists; (ii) ATI faced increasing competition for clinicians in the labor market; (iii) as a result, ATI faced difficulty retaining therapists and incurred increased labor costs; (iv) also as a result, ATI would open fewer new clinics; and (v) also as a result, the defendants’ positive statements about ATI’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis. Plaintiffs seek money damages in an unspecified amount. Plaintiffs have not yet served the complaint on any of the defendants.
Cautionary Note Regarding Forward-Looking Statements
Certain statements included in this Form 8-K are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. These are not statements of historical facts and are based on management’s beliefs and assumptions and on information currently available. They are subject to risks and uncertainties that could cause the actual results and the implementation of the Company’s plans to vary materially, including the risks inherent in litigation. Certain of these risks are discussed in the Company’s filings with the U.S. Securities and Exchange Commission (“SEC”), including, without limitation, the Company’s amended S-1 registration statement filed with the SEC on July 28, 2021, its Quarterly Report on Form 10-Q filed with the SEC on August 16, 2021, and our other filings with the SEC. Except as required by law, the Company assumes no obligation to update these forward-looking statements publicly, even if new information becomes available in the future.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: September 3, 2021 | ATI Physical Therapy, Inc. | |||||
| By: | /s/ Joseph Jordan | |||||
| Name: | Joseph Jordan | |||||
| Title: | Chief Financial Officer | |||||