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): February 8,
2010
REHABCARE
GROUP, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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001-14655
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51-0265872
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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7733
Forsyth Boulevard, Suite 2300
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St.
Louis, Missouri
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63105
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(Address
of principal executive offices)
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(Zip
Code)
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(800)
677-1238
(Registrant's
telephone number, including area code)
Not
Applicable
(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:
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
5.02.
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Departure
of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain
Officers.
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On
February 8, 2010, RehabCare Group, Inc.’s (the “Company”) Compensation Committee
(the “Committee”) approved base salary adjustments, long-term and short-term
incentive awards and a discretionary cash bonus for certain named executive
officers of the Company as discussed below.
Base
Salary Compensation Adjustments
The base
salaries of the named executive officers listed below were adjusted as
follows:
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Named
Executive Officer
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Effective
Date
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New
Annual Salary
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Percentage
Increase from Prior Annual Salary
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Dr.
John Short, President and Chief Executive Officer
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February
1, 2010 (1)
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$750,000
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20%
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Mr.
Jay Shreiner, Executive Vice President and Chief Financial
Officer
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April
1, 2010
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$388,500
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2.5%
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Ms.
Patricia Henry, Executive Vice President, Skilled Nursing Rehabilitation
Services
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April
1, 2010
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$382,500
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2.5%
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Ms.
Mary Pat Welc, Senior Vice President, Hospital Rehabilitation
Services
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April
1, 2010
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$261,500
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2.5%
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Ms.
Patricia Williams, Senior Vice President and General
Counsel
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April
1, 2010
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$265,500
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2.5%
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(1) On
February 8, 2010, the Committee approved Dr. Short’s new annual rate of pay and
also approved a retroactive effective date of February 1, 2010 for his new
salary.
Fiscal
2009 Short-Term Incentive Plan (the “STIP”) Awards
Under the
Company’s STIP, Dr. Short, Mr. Shreiner and Ms. Williams and other corporate
based named executive officers are eligible to receive cash awards allocated as
follows: 80% of the cash award is based on the Company’s achievement
of earnings per share and revenue targets, and 20% of the cash award is based on
the executive’s overall individual performance as assessed by the
Committee. Ms. Henry and Ms. Welc and other divisional based named
executive officers are eligible to receive cash awards allocated as follows: 80%
of the cash award is based on achievement of respective divisional revenue and
profitability targets as well as achievement of Company earnings per share and
revenue targets, and 20% of the cash award is based on the executive’s overall
individual performance as assessed by the Committee. The Company or
respective division must achieve at least 85% of the financial target for any
award associated with that target to be paid.
Based on
the achievement of the STIP Company, division and individual performance
objectives, the Committee determined the amount of STIP bonus awards to be paid
to certain of the named executive officers for the year ended December 31, 2009,
as follows:
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Named
Executive Officer
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Percentage
of Salary Paid on Achievement of Targets
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Value
of Fiscal 2009 Award
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Dr.
John Short
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148%
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$924,000
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Mr.
Jay Shreiner
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74%
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$280,157
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Ms.
Patricia Henry
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73%
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$270,686
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Ms.
Mary Pat Welc
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45%
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$113,485
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Ms.
Patricia Williams
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55%
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$142,802
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Discretionary
Cash Bonus
The
Committee also approved a one-time, additional cash bonus to certain members of
management of the Company as recognition for the successful completion of the
acquisition of Triumph HealthCare Holdings, Inc. including a cash award of
$25,000 to Mr. Jay Shreiner.
2007
– 2009 Long-Term Incentive Plan (“LTIP”) Cash Awards
Under the
Company’s LTIP, named executive officers are eligible to receive cash awards
allocated as follows: 60% of the cash award is based on the Company’s
achievement of an earnings per share target and 40% of the cash award is based
on the Company’s achievement of a revenue target. The Company must
achieve at least 80% of the financial target for any award associated with that
target to be paid.
Based on
the achievement of the LTIP Company earnings per share and revenue objectives,
the Committee determined the amount of LTIP cash awards to be paid to certain of
the named executive officers for the 2007 – 2009 LTIP performance cycle as
follows:
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Named
Executive Officer
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Value
of 2007 – 2009 LTIP Cash Award
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Dr.
John Short
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$581,644
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Mr.
Jay Shreiner
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$110,608
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Ms.
Patricia Henry
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$225,707
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Ms.
Mary Pat Welc
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$67,018
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Ms.
Patricia Williams
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–
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Because
Ms. Williams was not employed by the Company prior to October 1, 2007, she was
not eligible to receive a cash award under the LTIP.
2010
– 2012 Long-Term Incentive Plan (“2012 LTIP”) Stock
Awards
Under the
Company’s 2012 LTIP, named executive officers are eligible to receive a grant of
three-year cliff vesting restricted stock. Dr. Short’s award of
restricted stock consists of 50% three-year cliff vesting restricted shares and
50% three-year performance vesting shares. The performance vesting
shares will vest based upon Company performance against earnings per share and
revenue targets established by the Committee. Dr. Short can earn up
to 175% of the value of the performance vesting restricted shares if Company
performance meets or exceeds 120% of the established earnings per share target
and 110% of the established revenue target.
The
Committee approved the grant of restricted shares under the Company’s 2012 LTIP
to certain named executive officers with the grant date fair values listed
below. The restricted shares will have a grant date of April 1,
2010. The number of restricted shares granted will be determined by
the closing share price of the Company’s stock on April 1, 2010 and the grant
date fair values listed in the table below:
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Named
Executive Officer
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Grant
Date Fair Value of Restricted Shares to be Issued on April 1,
2010
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Dr.
John Short
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$1,250,000
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Mr.
Jay Shreiner
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$379,000
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Ms.
Patricia Henry
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$373,000
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Ms.
Mary Pat Welc
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$127,500
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Ms.
Patricia Williams
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$194,250
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The grant
date fair value of Dr. Short’s award could increase to $1,718,750 if Company
earnings per share and revenue performance meet or exceed the maximum levels on
the 2010 - 2012 LTIP pay-out scale.
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.
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Dated:
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February
12, 2010
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REHABCARE
GROUP, INC.
(Registrant)
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By:
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/s/
Jay W. Shreiner
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Name:
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Jay
W. Shreiner
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Title:
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Executive
Vice President and Chief Financial
Officer
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