prsc20191209_8k.htm
false 0001220754 0001220754 2019-12-06 2019-12-06

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
Date of Report (Date of earliest event reported)
: December 6, 2019

 


The Providence Service Corporation

 

(Exact name of registrant as specified in its charter)


 

 

Delaware

001-34221

86-0845127

(State or other jurisdiction of incorporation)

(Commission File Number)

(IRS Employer Identification No.)

     
 

1275 Peachtree Street, Sixth Floor
Atlanta, Georgia

30309

 

(Address of principal executive offices)

(Zip Code)

 

Registrant’s telephone number, including area code:   (404) 888-5800

 

(Former name or former address, 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

Common Stock, $0.01 par value per share

PRSC

The NASDAQ Global Select Market

 

 

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 Events.

 

On December 6, 2019, the Board of Directors of The Providence Service Corporation (the “Company”) amended the management incentive plan (“MIP”), which was originally established in connection with the acquisition of Circulation, Inc. in 2018 and amended in the first quarter of 2019. This subsequent amendment reduces the total potential payments under the MIP from $12.0 million to approximately $2.6 million, positively impacting the Company’s income from continuing operations before income taxes as well as EBITDA by approximately $9.4 million through December 31, 2021. For the three months ended December 31, 2019, this amendment to the MIP positively impacts the Company’s income from continuing operations before income taxes by approximately $3.3 million. This amendment has no impact to Adjusted EBITDA.

 

Non-GAAP Financial Measures and Adjustments

 

In addition to the financial measures prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), this reports includes references to EBITDA and Adjusted EBITDA for the Company and its segments. EBITDA is defined as income (loss) from continuing operations, net of taxes, before: (1) interest expense, net, (2) provision (benefit) for income taxes and (3) depreciation and amortization. Adjusted EBITDA is calculated as EBITDA before certain items, including (as applicable): (1) restructuring and related charges, including costs related to our corporate reorganization, (2) equity in net loss of investee, (3) certain litigation related expenses, settlement income or other negotiated settlements relating to certain matters from prior periods, (4) certain transaction and related costs, including the MIP, (5) asset impairment charges, and (6) gain on remeasurement of cost investment. We utilize certain non-GAAP performance measures, which exclude certain expenses and amounts, because we believe the timing of such expenses is unpredictable and not driven by our core operating results, and therefore render comparisons with prior periods as well as with other companies in our industry less meaningful. We believe such measures allow investors to gain a better understanding of the factors and trends affecting the ongoing operations of our business. We consider our core operations to be the ongoing activities to provide services from which we earn revenue, including direct operating costs and indirect costs to support these activities. In addition, our net loss in equity investee is excluded from these measures, as we do not have the ability to manage these ventures, allocate resources within the ventures, or directly control their operations or performance.

 

Our non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently. In addition, there are limitations in using non-GAAP financial measures because they are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies, and exclude expenses that may have a material impact on our reported financial results. The presentation of non-GAAP financial information is not meant to be considered in isolation from or as a substitute for the directly comparable financial measures prepared in accordance with GAAP.

 

 

 

 

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.

 

 

THE PROVIDENCE SERVICE CORPORATION

   
   

Date: December 9, 2019

By:        /s/ Kevin Dotts
Name:   Kevin Dotts
Title:     Chief Financial Officer