Toggle SGML Header (+)


Section 1: 8-K (8-K)

Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________
FORM 8-K
_________________________

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

May 28, 2019
Date of Report (Date of earliest event reported)   

Evolent Health, Inc.
(Exact name of registrant as specified in its charter)
_________________________


Delaware 
001-37415
32-0454912
(State or other jurisdiction of
incorporation or organization)
(Commission File Number)
(IRS Employer
Identification No.)
 
800 N. Glebe Road, Suite 500, Arlington, Virginia 22203
 
 
(Address of principal executive offices)(zip code)
 
  
(571) 389-6000
(Registrant’s telephone number, including area code)
 
Not Applicable
(Former name, former address and former fiscal year, if changed since last report.)
_________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Class A Common Stock of Evolent Health, Inc., par value $0.01 per share
EVH
New York Stock Exchange






Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act. ☐





Item 8.01 - Other Items

On May 28, 2019, University Health Care, Inc., d/b/a Passport Health Plan, a Kentucky nonprofit corporation (“Passport”), Passport Health Solutions, LLC, a Kentucky nonprofit limited liability company and subsidiary of Passport (“PHS I”), Evolent Health, Inc., a Delaware corporation (the “Company”) and Justify Holdings, Inc., a Kentucky corporation and a subsidiary of the Company (“Buyer”) entered into an Asset Purchase Agreement (the “Agreement”), pursuant to which Buyer will acquire substantially all of the assets and will assume substantially all of the liabilities of Passport and PHS I for $70,000,000 in cash and the issuance of a 30% equity interest in Buyer to the following provider sponsors of Passport: The University of Louisville, the University of Louisville Physicians, University Medical Center, Jewish Heritage Fund for Excellence, Norton Healthcare, Inc. and the Louisville/Jefferson County Primary Care Association (collectively, the “Sponsors”).

In connection with the execution of the Agreement, Evolent Health LLC and Passport entered into an amendment to the existing management services agreement to expand the services provided by Evolent Health LLC thereunder. The Agreement also contains obligations on the part of the Company to provide capital support following the execution of the Agreement to Passport to the extent necessary for regulatory capital.

The consummation of the transactions contemplated by the Agreement (the “Closing”) is subject to customary closing conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and the receipt of certain regulatory approvals, including the approvals of the U.S. Department of Health and Human Services Centers for Medicare & Medicaid Services, the Kentucky Department of Insurance and the Kentucky Cabinet for Health and Family Services and such other approvals as may be required by the Commonwealth of Kentucky as it relates to the disposition of assets from a nonprofit corporation.

In connection with the Closing, the Sponsors, Buyer and a subsidiary of the Company will enter into a Shareholders’ Agreement that provides for the governance of Buyer following the Closing and certain other rights between the parties thereto.

A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference.

Forward-Looking Statements

In addition to the discussion regarding forward-looking statements in the press releases attached hereto and incorporated herein by reference, this Current Report on Form 8-K contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”), including, but not limited to, statements regarding the Agreement and the expected closing of the acquisition of the Passport assets and liabilities. The Company claims the protection afforded by the safe harbor for forward-looking statements provided by the PSLRA. Actual events or results may differ materially from those contained in these forward-looking statements. Among the factors that could cause future events or results to vary from those contained in the forward-looking statements include, without limitation, risks and uncertainties arising from the possibility that the Closing may be delayed or may not occur; and the risk that litigation or other matters, including the receipt of regulatory approvals, could affect the Closing. In addition, please refer to the periodic reports that the Company files with the Securities and Exchange Commission (“SEC”), including on Forms 10-K, 10-Q and 8-K and the risk factors noted therein. The SEC filings by the Company identify and address other important factors that could cause events or results to vary from the forward-looking statements set forth in this Current Report on Form 8-K. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances that occur after the date of this Form 8-K.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.
Exhibit
 
 
Number
 
Description
 






SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EVOLENT HEALTH, INC.
 
 
 
By:
/s/ Jonathan D. Weinberg
Name:
Jonathan D. Weinberg
Title:
General Counsel and Secretary
 
(Duly Authorized Officer)

Date: May 29, 2019



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit


Exhibit 99.1

Evolent Health Expands Partnership with Passport Health Plan to
Support Medicaid Beneficiaries in the Commonwealth of Kentucky

Passport’s owners select Evolent as Passport’s long-term financial and operating partner for
the health plan joint venture. Evolent will contribute capital for an ownership stake in Passport Health Plan and assume greater management responsibility for day-to-day plan operations.

WASHINGTON, D.C., May 29, 2019 - Evolent Health, a company providing an integrated value-based care platform to the nation's leading providers and payers, today announced it has entered into a definitive agreement to partner with the current owners of Passport Health Plan in continuing to serve the Kentucky Medicaid market. The current owners, which include The University of Louisville, University of Louisville Physicians, University Medical Center, Jewish Heritage Fund for Excellence, Norton Healthcare and the Louisville/Jefferson County Primary Care Association, have been seeking a partner to provide expanded management and operational support, as well as capital through joint ownership of the health plan, and have selected Evolent as its long-term financial and operating partner.

Per the terms of the agreement, Evolent will acquire an ownership interest in Passport Health Plan and will expand the scope and term of its long-term Management Services Agreement with the health plan. Passport will be jointly owned and operated in partnership between Evolent, The University of Louisville and other Passport owners.

Passport is a Louisville-based health plan that serves more than 300,000 Medicaid beneficiaries and has provided managed care services in Kentucky for over 20 years. Evolent has provided extensive services to Passport since 2016, when the organizations formed a relationship to launch the Medicaid Center of Excellence, focused on improving health outcomes for Medicaid beneficiaries in Kentucky and in several states nationwide. Since partnering with Passport, Evolent has directly engaged thousands of Passport members through innovative clinical programs and an integrated model of care in partnership with local providers.

“We strongly believe in Passport’s mission and have been proud to partner with Passport’s leadership team to serve the Commonwealth of Kentucky,” said Evolent Health Chief Executive Officer Frank Williams. “We are honored by the vote of confidence the owners of Passport have given us to continue to build on an extraordinary legacy of delivering an excellent member experience to Kentucky’s Medicaid beneficiaries. We are confident that by leveraging our value-based care platform and the full scope of our clinical programs, as well as providing enhanced functional expertise, we can drive strong operational and financial performance. We look forward to collaborating with The University of Louisville and other Passport owners-as well as local and state regulatory agencies and other key stakeholders-to continue driving improved health outcomes and critical support to one of the Commonwealth’s most vulnerable populations.”

“The University of Louisville helped create Passport Health Plan in 1997, paving the way for what has become a national model for managed care,” said The University of Louisville President Dr. Neeli Bendapudi. “Now, we are proud to partner with Evolent Health to begin a new chapter that will continue to spark innovation in the delivery of care.”

“For the past 20 years, Passport has been proud to work with the Commonwealth, our provider partners and other valued supporters to deliver a quality health plan that promotes our members’ best interests and health outcomes,” said Passport Health Plan Chief Executive Officer Mark Carter. “I am confident that Passport has a bright future ahead, thanks to the solid foundation we’ve built and the significant investment, expertise and support that Evolent brings to the table. Evolent and Passport are dedicated to finding ways to bring the West Louisville Health and Wellbeing Campus to life, as we believe it will





significantly and positively impact the health of the community. Evolent and Passport will be working with developers and key stakeholders to create a definitive plan and select a real estate developer to bring the project to fruition.”

Transaction Details

Per the terms of the agreement, Evolent will contribute $70 million for a 70 percent ownership interest in Passport Health Plan and will also provide interim balance sheet support if necessary to meet near-term regulatory capital requirements. Evolent Health expects to account for its ownership interest in the joint venture as an equity method investment.

Passport will be jointly owned and operated through a partnership between Evolent, The University of Louisville, University of Louisville Physicians, University Medical Center, Jewish Heritage Fund for Excellence, Norton Healthcare and the Louisville/Jefferson County Primary Care Association. The plan will be governed by a newly formed board of directors upon closing with joint representation from the current owners and Evolent Health.

As part of the transaction, Evolent will expand its existing Management Services Agreement (MSA) with Passport, taking on additional responsibilities for day-to-day management of the health plan including administrative, clinical and financial operations and oversight. Evolent will also enhance its clinical scope with additional clinical program support, network optimization and specialty care management, specifically in oncology and cardiovascular services. The amended MSA will have a 10-year term.

The agreement is subject to normal closing conditions including approval from several state and federal regulatory agencies.

Advisors

Wyatt Tarrant and Combs, LLP is acting as legal counsel to The University of Louisville and provider sponsors. Bass, Berry & Sims PLC is acting as legal counsel to Evolent.

Conference Call and Webcast Details

Evolent will hold a conference call to discuss details of the transaction today, May 29, 2019, at 8:00 a.m., Eastern Time. The conference call will be available via live webcast on the company’s Investor Relations website at http://ir.evolenthealth.com. To participate by telephone, dial 1.855.940.9467 and ask to join to the Evolent call. Participants are advised to dial in at least 15 minutes prior to the call to register. The call will be archived on the company’s website for 90 days and will be available beginning later this evening. Evolent invites all interested parties to attend the conference call.

Forward Looking Statements: Cautionary Language

Certain statements made in this release contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended (the “PSLRA"), including, but not limited to, statements regarding the pending expanded partnership with Passport Health Plan and pending expanded management services agreement. Evolent and Evolent Health LLC (the "Evolent Entities") claim the protection afforded by the safe harbor for forward-looking statements provided by the PSLRA. Actual events or results may differ materially from those contained in these forward-looking statements. The factors that could cause future events or results to vary from the forward-looking statements contained herein include, without limitation, risks and uncertainties related to the consummation of the transaction, including the ability to obtain regulatory approvals, and risks and uncertainties relating to the ongoing operation of Passport Health Plan, including unanticipated costs, the ability of Evolent to provide interim balance sheet support to meet near-term regulatory capital requirements and the results of the





ongoing Kentucky Medicaid managed care request for proposal. Please refer to the periodic reports that Evolent has filed with the SEC, including its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and the risk factors noted therein. Such periodic filings by Evolent identify and address other important factors that could cause future events or results to vary from the forward-looking statements set forth in this Current Report on Form 8-K. In addition, the Evolent Entities disclaim any obligation to update any forward-looking statements contained herein to reflect events or circumstances that occur after the date hereof.

###


398114157_evhlogoa08.jpg

About Evolent Health
Evolent Health partners with leading provider and payer organizations to achieve superior clinical and financial results in value-based care and under full-risk arrangements. With a provider heritage and over 20 years of health plan administration experience, Evolent partners with more than 35 health care organizations to actively manage care across Medicare, Medicaid, commercial and self-funded adult and pediatric populations. With the experience to drive change, Evolent confidently stands by a commitment to achieve results. For more information, visit evolenthealth.com.

Contacts:

Bob East or Asher Dewhurst
443.213.0500
Investor Relations
Robin Glass
415.505.8152
Evolent Media Relations

###


(Back To Top)