mdrx-def14a_20220621.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.          )

Filed by the Registrant

Filed by a Party other than the Registrant

Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Pursuant to §240.14a-12

Allscripts Healthcare Solutions, Inc.

 

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee paid previously with preliminary materials.

Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

 


 

Allscripts Healthcare Solutions, Inc.
222 Merchandise Mart Plaza, Suite 2024
Chicago, Illinois 60654

 

 

 

 

 

 

 

Dear Allscripts Stockholders,

 

 

 

 

 

 

 

We are extremely proud of the continued momentum we’ve gained as we helped our clients and associates navigate through the difficult times of the last two years.

 

Together, we are building Open, Connected Communities of Health.

For everyone.

As some of the uncertainty of 2020 continued into 2021, the world made great progress in fighting the COVID-19 pandemic, and our vision of building open, connected communities of health—for everyone—remained exceptionally relevant to Allscripts clients across the globe. With the reset we did in 2020to ensure we could deliver to our clients the healthcare technologies and solutions to combat the worldwide pandemic and best support the patients they serve, we were well positioned for a successful 2021.  

 

We are proud that were ready to assist with the global healthcare challenges that continued in 2021, specifically around resource availability and caregiver fatigue. While virtual care, such as telehealth, has received much praise for how it has enabled care in any setting, it is important to consider that virtual care innately creates new challenges for caregivers and the communities that they serve. Allscripts EHR platforms that support these evolving care modalities, and the way in which they are designed with clinician insight to better support their needs, are increasingly foundational to the success of our ongoing response to an ever-evolving healthcare climate. Allscripts has navigated these waters successfully by maintaining a focus on our mission to create healthier lives by generating and providing insights that better support the delivery of care.

 

Specifically looking at what we have accomplished, Allscripts has always worked to digitally transform healthcare. We believe that our clients and the patients they serve should always have their healthcare data readily accessible—that’s why we continue our focus on connecting communities all over the world. As we make progress during the pandemic, we are committed to returning to a reality of wellness—everywhere.  The actions taken in 2021, support our continued forward momentum.

 

Our success is reflected in our financial results. We are extremely proud of the significant year-over-year growth in bookings, operating income, adjusted EBITDA and cash flow that we achieved in 2021, along with the continued momentum we’ve gained as we helped our clients and our associates navigate through these difficult times. We delivered exceptional stockholder  value, with a 27.77% increase in share price between January 2, 2021 and December 31, 2021.

 

In 2021, Allscripts focused on further streamlining our portfolio of solutions to position the company for long-term growth. This sharpened attention toward growth culminated with the binding agreement to sell our Hospitals and Large Physicians Practice business segment to a subsidiary of Constellation Software that we announced in March 2022.  With this streamlining, we can specifically concentrate on our Veradigm® business.

 

Supporting the healthcare ecosystem as it transitions toward value-based care

 

Our Veradigm® business sits at the center of the Provider, Payer, and Life Science healthcare markets. Through its ability to connect these often-disparate silos, it supports the value-based-healthcare-driven demand toward market convergence by leveraging its data, solution platforms and connectivity across the healthcare ecosystem.

 

Throughout 2021, the Veradigm business continued to expand and scale its point-of-care network to include more than 331,000 physicians, representing access to 20% of all the ambulatory physicians in the United States. That includes 73 specialties, in all 50 states.

 


 

 

 

 

The Veradigm Provider business scaled to more than 180 million patient records and transmitted 1 billon prescriptions electronically in 2021. Veradigm now links to more than 70 million EHR and claims data records

 

Leveraging the comprehensive reach of the Veradigm Provider footprint, the Veradigm Payer business unit expanded its ability to link Payers to more than 200,000 Providers with its emerging Clinical Data Exchange Provider network in 2021. Streamlining Payer-Provider data exchange can improve care coordination, lower healthcare costs, and enable value-based care by supporting the improvement of quality scores.

 

The Veradigm Life Science business unit, through natural-language processing and machine-learning capabilities, derives insights about key healthcare topics of interest, such as the social determinants of health.  Our team authored a paper, “Creation of a Mapped, Machine-Readable Taxonomy to Facilitate Extraction of Social Determinants of Health Data from Electronic Health Records” which was published at the American Medical Informatics Association (AMIA)’s 2021 Symposium. This paper was recognized with an AMIA 2021 Distinguished Paper Award, demonstrating how Veradigm is driving value in today’s evolving healthcare market.

 

In 2021, the team continued its clinical-research mission, with many studies focused on understanding various aspects of the COVID-19 virus and vaccines, including:

 

•        The development and management of COVID-19 Vaccination Dashboards as part of the MITRE COVID consortium

•        Participation in the FDA Regan Udall COVID-19 Evidence Accelerator, in which Veradigm investigated the incidence and risk factors of thromboembolic events in COVID-19 patients

 

 

 

Driving shareholder success

 

As our results demonstrate, we also continued our laser focus on driving tangible value for our stockholders. The dedicated work and innovation from our team who took advantage of opportunities presented led to substantial value creation and systematic improvement in our financial metrics.  For the full year that ended on December 31, 2021, cash flow from continuing operations was $248 million compared with $12 million in 2020.  Our improved operating efficiencies and strong cash flow allowed us to repurchase a total of 24.4 million outstanding common shares in 2021. This commitment to exceptional stockholder value will continue to drive our performance in the years ahead.

 

Giving back to our communities in 2021

Within Allscripts, our GiveBack program is often referred to as the soul of our company, and it is central to our 2021 pledge to win in our communities. As we adapted to our constantly changing “new normal,” Allscripts associates never lost their compassion to help others. In 2021, we were proud to be an ambassador sponsor of Nurse Heroes, an organization that provides support, recognition, and scholarships to nurses around the globe. We were also a top sponsor of JDRF and American Heart Association of the Triangle’s Go Red for Women program, as well as their STEM Goes Red and Healthy Communities initiatives. At our ACE 2021 event, we donated the event registration earnings directly to early literacy program Reach Out and Read, raising more than $30,000 on behalf of our clients. Finally, we adopted a new software partner called Benevity, which now empowers our associates to easily donate to and fundraise for their favorite local charities, while also helping support volunteer opportunities for each. Using this program, we launched several large matching-gift campaigns and began incentivizing associates to log volunteer hours. While all of this happened, our associates were busy in their communities volunteering in Habitat for Humanity builds, food banks, animal shelters, community gardens, meal packaging services and more. We are proud of our collective effort and look forward to sharing our 2021 Community Impact Report soon.

 


 

 

 

 

Allscripts commitment to Diversity, Equity and Inclusion (DEI)

 

We believe an environment of diversity, equity and inclusion is essential to Allscripts continued success. When put into practice, a workplace in which every voice is heard and valued provides the groundwork for achieving greater success. In 2021, the Allscripts Women’s Engagement (AWE) enrichment group continued to help Allscripts women advance their careers and professional development. Generation Next (GenNext) continued its work to assist young professionals at Allscripts develop socially, professionally and civically. Additionally, we are proud of the individual launches of new Enrichment Groups, including Allscripts Pride Alliance, Allscripts Black Alliance, HOLA (Hispanic Outreach for Latinos at Allscripts), and Veterans & Allies. Diversity comes in various forms, and all provide our company with a roster of talented associates who can share unique and important ideas, experiences and perspectives. Additionally, Allscripts announced that the Allscripts Developer Program (“ADP”) launched ADP Empower, a new program designed to amplify diverse voices in the healthcare technology industry and offer valuable resources to underrepresented entrepreneurs to grow their businesses and accelerate innovation.  We firmly believe Allscripts can be a champion of creating positive change.

 

Ready for the future

 

We recently announced that we completed the previously announced sale of our net assets of the company’s Hospital and Health and Large Provider Practices portfolios to a subsidiary of Constellation Software. With this transaction closed, we are excited and confident that the remaining Veradigm business will help us achieve growth for our clients, associates and shareholders.

 

We are committed to rewarding your continued confidence in Allscripts with continued exceptional performance.

 

On behalf of Allscripts Board of Directors and the executive team, thank you to our stockholders, our clients and our associates for making 2021 a success. Together, we are building Open, Connected Communities of Health. For everyone. We look forward to the next chapter and all it will entail.

 

 

 

 

Sincerely,

 

 

 

Paul M. Black                           Richard J. Poulton

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

Allscripts Healthcare Solutions, Inc.
222 Merchandise Mart Plaza, Suite 2024
Chicago, Illinois 60654

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 21, 2022

 

 

To the stockholders of Allscripts Healthcare Solutions, Inc.:

Notice is hereby given that the 2022 Annual Meeting of Stockholders (including any adjournment(s) or postponement(s) thereof, the “Annual Meeting”) of Allscripts Healthcare Solutions, Inc., a Delaware corporation (the “Company”), will be held solely by means of live audio webcast (i.e., a virtual-only meeting) on Tuesday, June 21, 2022, at 9:00 a.m. Central time, for the following purposes:

1.  To elect the six directors named in the accompanying proxy statement, each to serve until the Company’s 2023 Annual Meeting of Stockholders and until their successors are duly elected, subject to earlier resignation or removal;

2.  To ratify the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022;

3.  To approve, on an advisory basis, the Company’s named executive officer compensation; and

4.  To transact such other business as may properly come before the Annual Meeting or any adjournment(s) or postponement(s) thereof.

The Board of Directors of the Company unanimously recommends a vote FOR each director nominee and FOR each of Proposals 2 and 3.

These items are described more fully in the accompanying proxy statement. Only stockholders of record as of the close of business on April 29, 2022 are entitled to receive notice of, to attend, and to vote at the Annual Meeting.  If you have properly registered and been verified, you will be able to virtually attend the Annual Meeting, vote your shares electronically and submit your questions during the meeting via live audio webcast by visiting www.virtualshareholdermeeting.com/MDRX2022.

Sincerely,

 

Eric Jacobson

Senior Vice President and Corporate Secretary

Chicago, Illinois

May 6, 2022

 

 

 

Cautionary Note Regarding Forward-Looking Statements

 

This proxy statement and accompanying materials contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties. You can identify forward-looking statements by words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “aim,” “will,” “may,” “should,” “could,” “would,” “likely,” “estimate,” “predict,” “potential,” “continue” or other similar expressions. Actual results may differ from those set forth in the forward-looking statements due to a variety of factors, including those contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and the Company’s other filings with the U.S. Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update or revise any forward-looking statements.

 

 

 

 

 

 

 

 

 


 

IMPORTANT NOTICE REGARDING INTERNET AVAILABILITY OF PROXY MATERIALS

The Company’s Proxy Statement for the 2022 Annual Meeting of Stockholders and the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 are available at: www.proxyvote.com.

YOUR VOTE IS IMPORTANT. PLEASE EXERCISE YOUR STOCKHOLDER RIGHT TO VOTE AS SOON AS POSSIBLE, REGARDLESS OF WHETHER YOU PLAN TO ATTEND THE ANNUAL MEETING.

 

 

 


 

 

Table of Contents

 

 

 

1

GENERAL INFORMATION

 

 

7

DIRECTORS

 

 

13

CORPORATE SOCIAL RESPONSIBILITY

 

 

18

CORPORATE GOVERNANCE

18

Role of the Board

18

Board Leadership Structure

18

Board Meetings

18

Executive Sessions of Independent Directors

18

Annual Board and Committee Evaluations

18

Succession Planning

19

Committees of the Board

20

Consideration of Director Nominees

20

Mandatory Retirement Age

20

Board Oversight of Risk Management

21

Audit Committee Financial Experts

21

Code of Conduct

22

Certain Relationships and Related Transactions

22

Anti-Hedging Policy

22

Attendance of Directors at Annual Meeting of Stockholders

22

Communications with the Board

23

Compensation of Directors

 

 

25

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

 

27

EQUITY COMPENSATION PLAN INFORMATION

 

 

28

EXECUTIVE OFFICERS

 

 

30

COMPENSATION DISCUSSION AND ANALYSIS

30

Executive Summary

33

Executive Compensation Philosophy

34

Consideration of Stockholder Say-on-Pay Vote

34

Compensation Procedures

36

Elements of Compensation

41

Benefits and Perquisites

41

Severance Arrangements in Employment Agreements

42

Stock Ownership Requirements

 

 

43

EXECUTIVE COMPENSATION

43

Summary Compensation Table

44

2021 All Other Compensation

44

2021 Grants of Plan-Based Awards

46

Outstanding Equity Awards as of December 31, 2021

47

Potential Payments Upon Termination or Change of Control

50

CEO Pay Ratio

 

 

52

COMPENSATION COMMITTEE REPORT

 

 

53

AUDIT COMMITTEE REPORT

 

 

55

PROPOSALS

 

 

55

Overview of Proposals

55

Proposal One

 

Election of Directors

55

Proposal Two

 

Ratification of Appointment of Independent Registered Public Accounting Firm

56

Proposal Three

 

Advisory Vote to Approve Named Executive Officer Compensation

 

 

57

Other Matters

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allscripts Healthcare Solutions, Inc

i

 


 

2022 PROXY STATEMENT

 

 

 

PROXY STATEMENT
FOR
2022 ANNUAL MEETING OF STOCKHOLDERS OF

ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.

General Information

Why am I receiving these materials?

Allscripts Healthcare Solutions, Inc., a Delaware corporation (the “Company”), has made these materials available to you on the Internet or, upon your request, has delivered printed versions of these materials to you by mail, in connection with the Company’s solicitation of proxies for use at the Company’s 2022 Annual Meeting of Stockholders (including any adjournment(s) or postponement(s) thereof, the “Annual Meeting”), to be held on Tuesday, June 21, 2022 at 9:00 a.m., Central time. The Annual Meeting will be a virtual-only meeting held solely by means of live audio webcast. If you have properly registered and been verified, you will be able to virtually attend the Annual Meeting, vote your shares electronically and submit your questions during the meeting via live audio webcast by visiting www.virtualshareholdermeeting.com/MDRX2022.

The proxy materials were first sent or made available to the Company’s stockholders on or about May 6, 2022. You are invited to virtually attend the Annual Meeting and are requested to vote on the proposals described in this proxy statement (this “Proxy Statement”).

What is included in these proxy materials?

These proxy materials include:

The Notice of 2022 Annual Meeting of Stockholders;

This Proxy Statement; and

The Company’s Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the Securities and Exchange Commission (the “SEC”) on February 25, 2022 (the “Annual Report”).

If you requested printed versions by mail, these proxy materials also include the proxy card or voting instruction form for the Annual Meeting.

What items will be voted on at the Annual Meeting?

The Company is aware of three items on which stockholders may vote at the Annual Meeting:

The election to the Company’s Board of Directors (the “Board”) of the six nominees named in this Proxy Statement (Proposal One);

The ratification of the appointment of Grant Thornton LLP (“Grant Thornton”) as the Company’s independent registered public accounting firm for the year ending December 31, 2022 (Proposal Two); and

A non-binding advisory resolution to approve the Company’s named executive officer compensation (Proposal Three).

Will any other business be conducted at the meeting?

The Company knows of no matters to be submitted to the Company’s stockholders at the Annual Meeting, other than the proposals referred to in this Proxy Statement. If any other matters properly come before the Company’s stockholders at the Annual Meeting, it is the intention of the persons named on the proxy to vote the shares represented thereby on such matters in accordance with their best judgment.

 

 

Allscripts Healthcare Solutions, Inc

1

 


 

2022 PROXY STATEMENT

General Information

 

What are the Board’s voting recommendations?

The Board recommends that you vote your shares:

“FOR” election of each of the six nominees named in this Proxy Statement to the Board (Proposal One);

“FOR” ratification of the appointment of Grant Thornton as the Company’s independent registered public accounting firm for the year ending December 31, 2022 (Proposal Two); and

“FOR” approval of the advisory resolution to approve the Company’s named executive officer compensation (Proposal Three).

Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?

Pursuant to rules adopted by the SEC, the Company uses the Internet as the primary means of furnishing proxy materials to its stockholders. Accordingly, the Company is sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to its stockholders. All stockholders will have the ability to access the proxy materials on the website indicated in the Notice or request a printed set of the proxy materials. Instructions on how to access the proxy materials over the Internet or how to request a printed set may be found in the Notice. In addition, stockholders may request to receive proxy materials in printed form by mail or electronically by e-mail on an ongoing basis. The Company encourages its stockholders to take advantage of the availability of the proxy materials on the Internet to help reduce the environmental impact of its annual meetings and reduce the cost to the Company associated with the physical printing and mailing of materials.

I share an address with another stockholder, and we received only one paper copy of the proxy materials. How can I obtain an additional copy of the proxy materials?

The Company has adopted an SEC-approved procedure called “householding.” Under this procedure, the Company may deliver a single copy of the Notice and, if applicable, this Proxy Statement and the Annual Report to multiple stockholders who share the same address, unless the Company has received contrary instructions from one or more of the stockholders. This procedure reduces the environmental impact of the Company’s annual meetings and reduces the Company’s printing and mailing costs. Stockholders who participate in householding will continue to receive separate proxy cards. Upon request, the Company will deliver promptly a separate copy of the Notice and, if applicable, this Proxy Statement and the Annual Report to any stockholder at a shared address to which the Company delivered a single copy of any of these documents.

To receive free of charge a separate copy of the Notice and, if applicable, this Proxy Statement and the Annual Report, or separate copies of any future notice, proxy statement, or annual report, stockholders may write or call the Company at: Allscripts Healthcare Solutions, Inc., 222 Merchandise Mart Plaza, Suite 2024, Chicago, Illinois 60654, Attention: Corporate Secretary, or (312) 447-2495.

If you are receiving more than one copy of the proxy materials at a single address and would like to participate in householding, please contact the Company using the mailing address or telephone number above. Stockholders who hold shares in “street name” (as described below) may contact their brokerage firm, bank, broker-dealer, or other similar organization to request information about householding.

How can I get electronic access to the proxy materials?

The Notice will provide you with instructions regarding how to use the Internet to view the Company’s proxy materials for the Annual Meeting and instruct the Company to send future proxy materials to you by e-mail. If you choose to receive future proxy materials by e-mail, you will receive an e-mail message next year with instructions containing a link to those materials and a link to the proxy voting website. Your election to receive proxy materials by e-mail will remain in effect until you terminate it.

Who may vote at the Annual Meeting?

Each share of the Company’s common stock has one vote on each item of business at the Annual Meeting (including one vote for each nominee up for election at the Annual Meeting with respect to Proposal One). Only stockholders of record as of the close of business on April 29, 2022 (the “Record Date”) are entitled to receive notice of, to attend, and to vote on the Annual Meeting. As of the Record Date, there were 115,536,855 shares of the Company’s

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

General Information

 

common stock issued and outstanding. In addition to stockholders of record of the Company’s common stock, beneficial owners of shares held in street name as of the Record Date can vote using the methods described below.

What is the difference between a stockholder of record and a beneficial owner of shares held in “street name”?

Stockholder of Record. If your shares are registered directly in your name with the Company’s transfer agent, Broadridge Investor Communication Solutions, Inc. (“Broadridge”), you are considered the stockholder of record with respect to those shares, and the Notice was sent directly to you by the Company.

Beneficial Owner of Shares Held in “Street Name”. If your shares are held in an account at a brokerage firm, bank, broker-dealer, or other similar organization, then you are the “beneficial owner” of shares held in “street name,” and a Notice was forwarded to you by that organization. As a beneficial owner, you have the right to instruct your broker, bank, trustee, or other nominee how to vote your shares.

If I am a stockholder of record of the Company’s shares, how do I vote?

If you are a stockholder of record, there are four ways to vote:

Via the Internet. You may vote by proxy via the Internet by following the instructions provided in the Notice.

By Telephone. If you request printed copies of the proxy materials by mail, you will receive a proxy card and you may vote by proxy by calling the toll-free number found on the proxy card.

By Mail. If you request printed copies of the proxy materials by mail, you will receive a proxy card and you may vote by proxy by filling out the proxy card and returning it in the envelope provided.

Virtually at the Annual Meeting. If you have properly registered and been verified using the procedures described below, you will be able to vote your shares electronically during the Annual Meeting while the polls are open.

If I am a beneficial owner of the Company’s shares held in “street name”, how do I vote?

If you are a beneficial owner of shares held in “street name”, there are four ways to vote:

Via the Internet. You may vote by proxy via the Internet by visiting www.proxyvote.com and entering the control number found in your Notice. The availability of Internet voting may depend on the voting process of the organization that holds your shares.

By Telephone. If you request printed copies of the proxy materials by mail, you will receive a voting instruction form and you may vote by proxy by calling the toll-free number found on the voting instruction form. The availability of telephone voting may depend on the voting process of the organization that holds your shares.

By Mail. If you request printed copies of the proxy materials by mail, you will receive a voting instruction form and you may vote by proxy by filling out the form and returning it in the envelope provided.

Virtually at the Annual Meeting. If you have properly registered and been verified using the procedures described below, you will be able to vote your shares electronically during the Annual Meeting while the polls are open.

What is the quorum required for the Annual Meeting?

The presence, in person, by remote communication or by proxy, of the holders of not less than one-third of the total number of shares of the Company’s common stock issued and outstanding as of the Record Date and entitled to vote at the Annual Meeting will constitute a quorum. You will be considered part of the quorum if you return a signed and dated proxy card, if you vote over the Internet or by telephone, or if you virtually attend and vote at the Annual Meeting. If a quorum is not present, the Company may propose to adjourn the Annual Meeting to solicit additional proxies.

How are proxies voted?

All shares represented by valid proxies received prior to the taking of the vote at the Annual Meeting will be voted and, where a stockholder specifies by means of the proxy a choice with respect to any matter to be acted upon, the shares will be voted in accordance with the stockholder’s instructions.

 

 

Allscripts Healthcare Solutions, Inc

3

 


 

2022 PROXY STATEMENT

General Information

 

What happens if I do not give specific voting instructions?

Stockholders of Record. If you are a stockholder of record and you (i) indicate when voting on the Internet or by telephone that you wish to vote as recommended by the Board; or (ii) sign and return a proxy card or vote by Internet or telephone without giving specific voting instructions, then the persons named as proxy holders, Richard J. Poulton and Leah S. Jones, will vote your shares in the manner recommended by the Board on all matters presented in this Proxy Statement and as the proxy holders may determine in their discretion with respect to any other matters properly presented for a vote at the Annual Meeting.

Beneficial Owners of Shares Held in Street Name. If you are a beneficial owner of shares held in street name and do not provide the organization that holds your shares with specific voting instructions, then, under applicable rules, the organization that holds your shares may generally vote on “routine” matters but cannot vote on “non-routine” matters. If the organization that holds your shares does not receive instructions from you on how to vote your shares on a non-routine matter, that organization will inform the inspector of election that it does not have the authority to vote on this matter with respect to your shares. This is generally referred to as a “broker non-vote.”

Which proposals are considered “routine” or “non-routine”?

The ratification of the appointment of Grant Thornton as the Company’s independent registered public accounting firm for the year ending December 31, 2022 (Proposal Two) is considered a routine matter under applicable rules. A broker or other nominee may generally vote on routine matters, and therefore no broker non-votes are expected in connection with Proposal Two.

Each of the other proposals, the election of directors (Proposal One) and the advisory resolution to approve the Company’s named executive officer compensation (Proposal Three) are considered non-routine matters under applicable rules. A broker or other nominee cannot vote without instructions on non-routine matters, and therefore broker non-votes may exist in connection with each of Proposals One and Three.

What is the voting requirement to approve each of the proposals?

With respect to the election of directors (Proposal One), in accordance with the policy of majority voting in uncontested director elections set forth in the Company’s by-laws, if the number of shares voted “FOR” any nominee exceeds the number of shares voted “AGAINST” such nominee, he or she will be elected as a director to serve until the Company’s 2023 Annual Meeting of Stockholders and until his or her successor has been duly elected, or until his or her earlier resignation or removal. If any nominee is an incumbent director and fails to receive a majority of the votes cast with respect to his or her nomination, he or she must tender a resignation as director, and such resignation will be considered by the Nominating and Governance Committee of the Board (the “Nominating Committee”) in accordance with the requirements of the Company’s Corporate Governance Guidelines.

Approval of each of Proposals Two and Three requires the affirmative vote of the holders of a majority of the shares present in person, by remote communication or represented by proxy and entitled to vote on such matter.

How are broker non-votes and abstentions treated?

Broker non-votes and abstentions are counted for purposes of determining whether a quorum is present. With respect to the election of directors (Proposal One), a stockholder abstention or broker non-vote with respect to any nominee will have no effect on that nominee’s election. With respect to Proposals Two and Three, a stockholder abstention will have the effect of a vote “AGAINST” the approval of each proposal, but a broker non-vote will have no effect on the approval of the proposal. As noted above, no broker non-votes are expected in connection with Proposal Two.

In order to minimize the number of broker non-votes, the Company encourages you to vote or to provide voting instructions with respect to each proposal to the organization that holds your shares by carefully following the instructions provided in the Notice or voting instruction form.

Can I change my vote after I have voted?

You may revoke your proxy and change your vote at any time before the vote is taken at the Annual Meeting. Prior to the applicable cutoff time, you may change your vote using the Internet or telephone methods described above, in which case only your latest Internet or telephone proxy submitted prior to the Annual Meeting will be counted. You may also revoke your proxy and change your vote by signing and returning a new proxy card or voting instruction

 

 

Allscripts Healthcare Solutions, Inc

4

 


 

2022 PROXY STATEMENT

General Information

 

form dated as of a later date, or by attending the Annual Meeting and voting through the virtual meeting website. However, your virtual attendance at the Annual Meeting will not automatically revoke your proxy unless you properly vote at the Annual Meeting or specifically request that your prior proxy be revoked by delivering a written notice of revocation to the Company’s Corporate Secretary at 222 Merchandise Mart Plaza, Suite 2024, Chicago, Illinois 60654 received prior to the Annual Meeting.

Who will serve as the inspector of election?

A representative of Broadridge will serve as the inspector of election.

Where can I find the voting results of the Annual Meeting?

Preliminary voting results will be announced at the Annual Meeting. Final voting results will be tallied by the inspector of election after the taking of the vote at the Annual Meeting. The Company will publish the final voting results in a Current Report on Form 8-K, which the Company is required to file with the SEC within four business days following the Annual Meeting.

Where are the Company’s principal executive offices located, and what is the Company’s main telephone number?

The Company’s principal executive offices are located at 222 Merchandise Mart Plaza, Suite 2024, Chicago, Illinois 60654. The Company’s main telephone number is (800) 334-8534.

Who is paying the costs of the proxy solicitation?

The Company is providing these proxy materials in connection with the solicitation by the Company’s Board of Directors of proxies to be voted at the Annual Meeting. The Company is paying the costs of the solicitation of proxies. The Company must pay brokerage firms, banks, broker-dealers, or other similar organizations representing beneficial owners of shares held in street name certain fees associated with (i) forwarding the Notice to beneficial owners; (ii) forwarding printed proxy materials by mail to beneficial owners who specifically request them; and (iii) obtaining beneficial owners’ voting instructions. The Company has not, but may in the future decide to, retain a proxy solicitor to assist in the solicitation of proxies. Generally, the fee for such services is approximately $15,000 plus expenses. If the Company does elect to retain a proxy solicitor, the Company will pay the proxy solicitor reasonable and customary fees. In addition to solicitations by mail, the proxy solicitor, if any, and certain of the Company’s directors, officers, and employees, without additional compensation, may solicit proxies on the Company’s behalf in person, by telephone, or by electronic communication.

How can I attend and participate in the Annual Meeting?

Only stockholders of record as of the Record Date or their proxies are entitled to attend the Annual Meeting. Due to the public health impact of the novel coronavirus (COVID-19) pandemic, the Company will be holding the Annual Meeting solely by means of remote communication (i.e., a virtual-only meeting). Stockholders will not be able to attend in person. Stockholders will need to register for the Annual Meeting by 10:59 p.m. Central time (11:59 p.m. Eastern time) on Monday, June 20, 2022 at www.virtualshareholdermeeting.com/MDRX2022. If you have properly registered and been verified you will receive a meeting invitation by e-mail with your unique join link along with a password prior to the meeting date. You will be able to listen, vote and submit questions during the virtual meeting.  

 

If you are a registered or beneficial holder, during the registration process, if you indicated that you will be voting at the meeting, once your registration is approved, an e-mail will be sent to you that will contain your Virtual Control Number.  You will not need the Virtual Control Number to join the meeting, you will need it if you choose to vote during the meeting.

 

If you hold your shares beneficially through a bank or broker, you must provide a legal proxy from your bank or broker during registration and you will be assigned a virtual control number in order to vote your shares during the annual meeting. If you are unable to obtain a legal proxy to vote your shares, you will still be able to attend the 2022 annual meeting (but will not be able to vote your shares) so long as you demonstrate proof of stock ownership. Instructions on how to connect and participate via the Internet, including how to demonstrate proof of stock ownership, are posted at www.virtualshareholdermeeting.com/MDRX2022. On the day of the annual meeting, you may only vote during the meeting by e-mailing a copy of your legal proxy to virtualmeeting@viewproxy.com in advance of the meeting.

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

General Information

 

 

We have created and implemented the virtual format in order to facilitate stockholder attendance and participation by enabling stockholders to participate fully, and equally, from any location around the world, at no cost. However, you will bear any costs associated with your Internet access, such as usage charges from Internet access providers and telephone companies. A virtual Annual Meeting makes it possible for more stockholders (regardless of size, resources or physical location) to have direct access to information more quickly, while saving the company and our stockholders time and money, especially as physical attendance at meetings has dwindled. We also believe that the online tools we have selected will increase stockholder communication. For example, the virtual format allows stockholders to communicate with us in advance of, and during, the Annual Meeting so they can ask questions of our board of directors or management. During the live Q&A session of the Annual Meeting, we may answer questions as they come in and address those asked in advance, to the extent relevant to the business of the Annual Meeting, as time permits.

 

Both stockholders of record and street name stockholders will be able to attend the Annual Meeting via live audio webcast, submit their questions during the meeting and vote their shares electronically at the Annual Meeting.

 

The Annual Meeting will begin promptly at 9:00 a.m. Central time. Online access will open thirty minutes prior to the start of the Annual Meeting, and you should allow ample time to log in to the virtual meeting website and test your computer audio system.

 

Technicians will be available to assist you with any technical difficulties you may have accessing the Annual Meeting live audio webcast. If you encounter any difficulties accessing the webcast during the check-in or meeting time, please email VirtualMeeting@viewproxy.com or call 866-612-8937.

What is the deadline to propose actions for consideration or to nominate individuals to serve as directors at the 2023 Annual Meeting of Stockholders?

Requirements for Stockholder Proposals to be Considered for Inclusion in the Company’s Proxy Materials. Proposals that a stockholder intends to present at the Company’s 2023 Annual Meeting of Stockholders and wishes to be considered for inclusion in the Company’s proxy statement and form of proxy related to the Company’s 2023 Annual Meeting of Stockholders must be received by no later than January 6, 2023. All proposals must comply with Rule 14a-8 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which lists the requirements for the inclusion of stockholder proposals in company-sponsored proxy materials. Stockholder proposals must be delivered to the Company’s Corporate Secretary by mail at 222 Merchandise Mart Plaza, Suite 2024, Chicago, Illinois 60654.

Requirements for Other Stockholder Proposals to be Brought Before the 2023 Annual Meeting of Stockholders and Director Nominations. Notice of any proposal that a stockholder intends to present at the Company’s 2023 Annual Meeting of Stockholders, but does not intend to have included in the Company’s proxy statement related to the Company’s 2023 Annual Meeting of Stockholders, as well as any director nominations, must be delivered to the Company’s Corporate Secretary by mail at 222 Merchandise Mart Plaza, Suite 2024, Chicago, Illinois 60654, not earlier than January 22, 2023, and not later than February 21, 2023. The notice must be submitted by a stockholder of record and must set forth the information required by the Company’s by-laws with respect to each director nomination or other proposal that the stockholder intends to present at the Company’s 2023 Annual Meeting of Stockholders. If you are a beneficial owner of shares held in street name, you can contact the organization that holds your shares for information about how to register your shares directly in your name as a stockholder of record. In addition to satisfying the foregoing requirements under the Company’s by-laws, to comply with the universal proxy rules (once effective), stockholders who intend to solicit proxies in support of director nominees other than our nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than April 22, 2023.


 

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

 

 

 

Directors

Listed below are the six nominees for election as a director. Each nominee, with the exception of Richard J. Poulton, currently serves on the Board.  The Board is currently comprised of nine members and will reduce in size to six members effective as of the Annual Meeting.  The following current Board members are not standing for re-election at the Annual Meeting: Mara G. Aspinall, Paul M. Black, Michael A. Klayko and David D. Stevens.

At the Annual Meeting, proxies cannot be voted for a greater number of individuals than the six nominees named in this Proxy Statement. Each of the nominees listed below has consented to serving as a nominee, being named in this Proxy Statement and serving on the Board if elected. Each director elected at the Annual Meeting will serve a one-year term.

The Board comprises a diverse group of leaders in their respective fields. Many of the Company’s directors have senior leadership experience at major domestic and multinational companies. In these positions, they have also gained significant and diverse management experience, including strategic and financial planning, public company reporting, compliance, risk management (including with respect to cybersecurity risk) and leadership development. Many directors also have experience serving as executive officers of, or on boards of directors and board committees of, other public companies, and have an understanding of corporate governance practices and trends. The Board believes that the collective experiences, viewpoints and perspectives of the Company’s nominees for directors result in a Board with the commitment and energy to advance the interests of the Company’s stockholders.

 

Name

 

Position with the Company

 

Age as of the

Annual

Meeting

 

 

Director

Since

Elizabeth A. Altman

 

Director

 

 

51

 

 

2020

P. Gregory Garrison

 

Director

 

 

68

 

 

2015

Jonathan J. Judge

 

Director

 

 

68

 

 

2016

Richard J. Poulton

 

CEO

 

 

57

 

 

Nominee

Dave B. Stevens

 

Director

 

 

60

 

 

2016

Carol J. Zierhoffer

 

Director

 

 

61

 

 

2020

 

Board Diversity Matrix (As of April 14, 2022)

Total Number of Directors

9

 

Female

Male

Non-Binary

Did Not
Disclose
Gender

Part I: Gender Identity

Directors

3

6

-

-

Part II: Demographic Background

African American or Black

-

-

-

-

Alaskan Native or Native American

-

-

-

-

Asian

-

-

-

-

Hispanic or Latinx

-

-

-

-

Native Hawaiian or Pacific Islander

-

-

-

-

White

3

6

-

-

Two or More Races or Ethnicities

-

-

-

-

LGBTQ+

-

Did Not Disclose Demographic Background

-

 

 

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Directors

 

 

Pursuant to the Company’s Corporate Governance Guidelines, for each open Board seat, any initial list from which new director nominees are to be chosen shall include, but not be limited to, qualified women and persons of color.  The Board from time to time will consider the effectiveness of this selection policy in identifying qualified individuals with diversity of viewpoint as potential Board nominees and currently believes it to be effective.

 

Board Skills and Qualifications

The Board and the Nominating Committee believe the skills, qualities, attributes, and experience of the nominees provide the Company with business acumen and a diverse range of perspectives to engage each other and the Company’s management to address effectively the Company’s evolving needs and represent the best interests of the Company’s stockholders. The biographies below describe the skills, qualities, attributes, and experience of the nominees that led the Board and the Nominating Committee to determine that it is appropriate to nominate these directors.

 

Gender

Tenure

 

 

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Directors

 

 

 

 

 

Allscripts Healthcare Solutions, Inc

9

 


 

2022 PROXY STATEMENT

Directors

 

 

 

Director Biographies

 

 

 

Elizabeth A. Altman

 

 

 

 

 

 

 

 

 

 

 

 

Age 51

Director Since 2020

 

Elizabeth A. Altman worked at accounting firm KPMG, LLP from 1993 to 2019, serving as Managing Partner of its San Diego office from 2014 to 2019, where she led a team of over 260 professionals and 23 partners providing an array of assurance, tax and advisory services to public and private companies across all industry sectors, including work with numerous early-stage, middle market and large global clients in the private and public markets predominately in the life sciences, consumer and technology business sectors. Since October 2019, Ms. Altman has served on the board of directors of CV Sciences, Inc. (CVSI) and is chair of its audit committee and a member of the compensation committee. Additionally, since August 2021, Ms. Altman has served on the board of directors of Alphatec Holdings, Inc. and Chair of its audit committee. Since January 2022, Ms. Altman has served on the board of directors of Papyrus Therapeutics, Inc. and chair of its audit committee. Ms. Altman also served as a board member of the Corporate Directors Forum, a 501(c)(6) nonprofit organization focused on helping directors, and those who support them, build more effective boards through continuous learning and peer networking, and held a leadership position in the Women Corporate Directors, San Diego Chapter, the world's largest membership organization and community of today's preeminent women leaders in business.

 

Among other qualifications, Ms. Altman brings more than 27 years of achievements in accounting, finance, management, business development, strategic planning and corporate governance.

 

 

 

P. Gregory Garrison

 

 

 

 

 

 

 

 

 

 

 

 

Age 68

Director Since 2015

 

P. Gregory Garrison was a senior leader of accounting firm PricewaterhouseCoopers (“PwC”) for over twenty years, most recently serving as its Vice Chairman and Chief Operating Officer from 2006 until 2014. Earlier in his career, Mr. Garrison also led PwC’s U.S. Assurance & Audit Services practice, the Global Risk Management Solutions practice, and served as the Managing Partner of PwC’s Los Angeles and St. Louis practices. Mr. Garrison has experience in strategic planning, operations, finance, information technology, mergers and acquisitions, human capital and sales and marketing. Over the course of his career, Mr. Garrison has also spent considerable time meeting and working with various regulators, as well as advising numerous boards and audit committees.

 

 

 

 

 

 

 

Among other qualifications, Mr. Garrison brings experience as a successful business and operations leader, professional advisor and recognized financial expert.

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Directors

 

 

 

 

 

Jonathan J. Judge

 

 

 

 

 

 

 

 

 

 

 

 

Age 68

Director Since 2016

 

Jonathan J. Judge currently serves as a director of FEXCO Holdings Ltd., a global provider of finance and business solutions that is headquartered in Ireland. Mr. Judge also served as a director of D&H Corporation, a Toronto-based financial technology company, until its sale in June 2017. From April 2004 to January 2016, Mr. Judge served as a director of PMC-Sierra, Inc., where he was the chairman of the board of directors from August 2011 to January 2016 and was chairman of the compensation committee. From August 2010 until his retirement in January 2013, Mr. Judge served as the Chief Executive Officer of First Data Corporation, a global leader in electronic commerce and payment processing. From October 2004 until August 2010, Mr. Judge served as the President and Chief Executive Officer of Paychex Inc. (PAYX), a provider of payroll and human services. Mr. Judge also served as President and Chief Executive Officer of Crystal Decisions, Inc. from October 2002 until the merger of Crystal Decisions with Business Objects S.A. in December 2003. From 1976 until October 2002, Mr. Judge held senior management positions at International Business Machines Corporation (IBM), departing as General Manager of its personal computing division.

 

 

 

 

 

 

 

Among other qualifications, Mr. Judge brings more than 45 years of experience in the technology industry and extensive management, leadership and global operations expertise.

 

 

 

Richard J. Poulton

 

 

 

 

 

 

 

 

 

 

 

 

Age 57

CEO

Director Nominee

 

Richard Poulton was appointed Chief Executive Officer effective as of May 6, 2022.  Prior to that, Mr. Poulton served concurrently as both our President and Chief Financial Officer since March 2020.  Mr. Poulton served as our President since October 2015.  Furthermore, Mr. Poulton served as our Chief Financial Officer from October 2012 to March 2016 and as an Executive Vice President from October 2012 to September 2015.  From 2006 to 2012, Mr. Poulton served in various positions at AAR Corp. (AIR), a provider of products and services to commercial aviation and the government and defense industries. His most recent role at AAR Corp. was Chief Financial Officer and Treasurer.  Mr. Poulton also spent more than ten years at UAL Corporation in a variety of financial and business development roles, including Senior Vice President of Business Development as well as President and Chief Financial Officer of its client-focused Loyalty Services subsidiary.

 

 

 

 

 

 

 

Among other qualifications, Mr. Poulton brings extensive financial and business development experience.

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Directors

 

 

 

 

 

Dave B. Stevens

 

 

 

 

 

 

 

 

 

 

 

 

Age 60

Director Since 2016

 

Dave B. Stevens is the founder and managing director of private equity firm Keelan Capital LLC and currently serves as an advisor to a variety of venture capital and private equity firms and private enterprises in the technology industry. From April 2012 to May 2015, Mr. Stevens served as a director of Imation Corp., a provider of global scalable storage and data security solutions. From September 2008 to June 2013, Mr. Stevens was the Chief Technology Officer of Brocade Communications Systems, Inc., a provider of networking solutions for data centers, enterprises and service providers, having re-joined the company through its acquisition of Rhapsody Networks, where Mr. Stevens was the founding Chief Executive Officer and Vice President of Business Development. Mr. Stevens is co-founder of Palo Alto Networks, Inc. (PANW), a leader in the development of cyber security and next-generation firewall products, and served as its Chief Executive Officer from October 2005 to June 2008. From January 2003 to June 2004, Mr. Stevens was the Chief Technology Officer of Transport systems for Brocade Communications Systems, Inc. Mr. Stevens previously served in senior management positions at Atmosphere Networks, American Nortel Communications, Inc. (ARTM), Bay Networks and SynOptics Communications.

 

 

 

 

 

 

 

Among other qualifications, Mr. Stevens brings extensive technology experience in the security, computer, and data storage industries.

 

 

 

Carol J. Zierhoffer

 

 

 

 

 

 

 

 

 

 

 

 

Age 61

Director Since 2020

 

Carol J. Zierhoffer was Senior Vice President and Global Chief Information Officer for Bechtel Corporation (“Bechtel”) until her retirement in 2019, leading the vision, strategy and planning for Bechtel's information systems and technology on a global basis. Her responsibilities at Bechtel included managing its business and technology solutions, cybersecurity, infrastructure and operations, innovation, emerging technology, big data and analysis and knowledge management for the company's business lines and projects. Prior to joining Bechtel, Ms. Zierhoffer held a variety of leadership positions in information technology, including as Vice President and Global Chief Information Officer for Xerox Corporation (XRX), where she managed all aspects of its information technology operations, as Vice President and Global Chief Information Officer for ITT Corporation (ITT), where she oversaw its transformation initiative to implement SAP worldwide, and as Vice President and Chief Information Officer for three different sectors of Northrup Grumman Corporation (NOC). From April 2013 to January 2016, Ms. Zierhoffer was a member of the board of directors, as well as being the chair of the information technology committee and on the audit committee, of MedAssets, Inc. which was acquired by Vizient Inc. Ms. Zierhoffer continued on the board at Vizient Inc. until December 2021. Currently, Ms. Zierhoffer serves on the board of directors and is a member of the audit and finance committee of Atlas Air Worldwide Holdings, Inc. (AAWW), is on the executive advisory boards of Alium, Inc. and OpsCruise, Inc, and is a founding board member of A Little Compassion (“ALC”), a non-profit company focused on creating opportunities for young adults with disabilities to build a bridge to adulthood. At ALC, she chairs both the finance and governance committees.

 

 

 

 

 

 

 

Among other qualifications, Ms. Zierhoffer brings more than 30 years of leadership experience in cyber security and global information technology operations.  

 

 

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

 

 

 

Corporate Social Responsibility

Allscripts is a Place Where Technology Meets Humanity.

To fulfill our mission to create healthier lives by generating and providing insights that change the delivery of care, we offer solutions that enable doctors, nurses and caregivers to provide the best possible care for healthier patients, populations and communities. As a socially responsible company, that commitment and obligation extend into the communities where we live and work. At Allscripts, we come together to give back and help make the world healthier. We work passionately to change lives for the better. Our global workforce is united and driven by a set of core values. We are solution seekers, community builders and life changers.

 

Together, we’re building a better world.
Together, we’re making it All Possible.

 

SUPPORTING OUR COMMUNITIES

The Allscripts Giveback program is often referred to as the soul of our company and is central to our 2021 pledge to “win in our communities”. Allscripts encourages all associates, no matter where they are in the world, to dedicate one day every year to volunteer with an organization of their choice by providing a paid GiveBack volunteer day. As we adapted to our constantly changing “new normal”, the Allscripts associates never let go of their compassion to help others. In 2021, we were proud to be an ambassador sponsor of Nurse Heroes, an organization that provides support, recognition, and scholarships to nurses around the globe. We were also a top sponsor of JDRF and American Heart Association of the Triangle’s Go Red for Women program, as well as their STEM Goes Red and Healthy Communities initiatives. We celebrated our ACE 2021 event by donating the event registration directly to an early literacy program called Reach Out and Read, raising over $30,000 on behalf of our clients. Finally, we adopted a new software partner called Benevity, which now allows our associates to easily donate, fundraise and volunteer for their favorite local charities. Using this program, we launched several large matching gift campaigns and began incentivizing associates to log volunteer hours. While all of this happened, our associates were busy in their communities volunteering in Habitat for Humanity builds, food banks, animal shelters, community gardens, meal packaging services and more.

 

When we worked collectively, our impact was felt worldwide. Communities supporting and caring for each other – the essence of connecting.

 

2021 GIVEBACK PROGRAM SUMMARY:

 

>1,300

Associates used their GiveBack day to support their community

>$500K

Allscripts donated over half a million dollars to non-profits in 2021.

 

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Corporate Social Responsibility

 

 

 

HOW WE SPENT OUR GIVING:

 

 

TYPES OF CHARITIES SUPPORTED BY THIS FUNDING:

 

SUPPORTING OUR ASSOCIATES

Our employees are our lifeblood and we recognize that attracting, retaining and developing talent at all levels is vital to continuing our success and sustainability. We aim to create an inclusive, respectful and open work environment and culture comprising talented employees of diverse backgrounds, in which our employees can grow and advance their careers, with the overall goal of developing, expanding and retaining our workforce to support our business. We strive to sustain a work environment in which each employee’s perspective, background, skills and abilities are valued in support of our mission.  We invest in our employees through high-quality benefits and various health and wellness initiatives and offer competitive compensation packages.

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Corporate Social Responsibility

 

We actively seek opportunities for regular engagement, communication and transparency by our senior executive leaders with our broader associate workforce. Our CEO reviews overall Company results with employees and leaders at all levels and engages in actions that are aimed at removing barriers to engagement. We regularly solicit feedback through surveys and other mechanisms to gain insights into workplace engagement, what motivates employees to do their best work and overall employee satisfaction. With belief in our associates’ skills and a continuous focus on their development, we were able to promote over 900 associates internally during 2021.

Advancing Diversity, Equity and Inclusion

Allscripts launched a champions network of cross-functional associates from diverse backgrounds and locations to help support the company’s Diversity, Equity and Inclusion (DE&I) program.  The network includes passionate advocates for positive change—visible point people who promote, facilitate and connect colleagues to support important DE&I initiatives.

Allscripts commitment to diversity of background, experiences and thought has been longstanding. ‘Together, we impact people’s lives’ is the foundation our Diversity, Equity and Inclusion (DE&I) program was built upon. Our Champions Network, a diverse network of global associates who are passionate advocates for positive change, is leading the effort in helping us curate and drive learning opportunities as well as community involvement.

Our associates’ diverse personalities, backgrounds and experiences help shape our spirit and culture. We celebrate what makes our associates unique by supporting Enrichment Groups, which are open to all associates, help build a sense of community and foster an environment in which every voice is heard and valued.  Allscripts currently has six Enrichment Groups.

 

WE DEFINE DIVERSITY, EQUITY AND INCLUSION AS FOLLOWS:

Diversity

Diversity is defined broadly and refers to the range of similarities and differences each individual brings to the workplace. These include but are not limited to characteristics such as national origin, language, race, color, disability, ethnicity, gender, age and generation, religion, sexual orientation, gender identity and expression, socioeconomic status, veteran status, neurodiversity and family structure. The concept also encompasses other differences among people, including geographic differences and, importantly, diversity of thought and life experiences.

 

Equity

Equity is creating a work environment in which all associates are treated fairly and respectfully, have equal access to opportunities and resources and can contribute fully to the organization's success.

 

Inclusion

Inclusion is recognizing, valuing and fully leveraging different perspectives and backgrounds, so everybody feels a sense of belonging for who they are.

 

Diversity describes who we are, and Inclusion describes how we work together.

 

 

Since 2013 the Allscripts Women’s Engagement (AWE) enrichment group empowers our female associates to take control of their careers and professional development through sponsored opportunities, such as career development seminars, networking events and mentorship. Allscripts invests in this program for the betterment of any associate who wants to get involved, and to improve the company’s ability to attract, retain and advance women in healthcare IT.

 

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Corporate Social Responsibility

 

 

Since 2017, Allscripts GenNext program has been helping young professionals at Allscripts develop socially, professionally and civically.  It has helped to educate employees and broaden their perspective on potential career paths and business unit’s objectives and provide networking, exposure and leadership opportunities that otherwise may not be easily available.

 

In 2021, Allscripts introduced four new Enrichment Groups.  The Allscripts Military Veterans and Supporters (AMVS) supports active and retired military personnel and promotes a culture within Allscripts that recognized and serves the ongoing needs of the veteran community.  The Allscripts Black Alliance (ABA) serves as a platform for African American colleagues and allies to support and encourage one another from a place of commonality and shared experience.  The Allscripts Pride Alliance (APA) helps promote an inclusive, safe and open work environment that empowers LGBTQ+ employees and allies, as well as informs and educates Allscripts through networking and outreach initiatives. The mission of Allscripts Hispanic Outreach for Latinos at Allscripts (HOLA) is to assist Hispanics in managing their careers and professional development, while developing Allscripts as a workplace of choice and an opportunity to excel.

 

Safety and Health Policy

At Allscripts, we believe the foundation of our success lies with safeguarding our associates, communities and clients, along with the environments in which they work.  This is an integral part of our corporate belief system, and why we actively promote environmental health and safety excellence throughout our organization.  Allscripts pledges to maintain a safe and healthy workplace for all associates by conducting business and regular assessments that are consistent with our corporate standards and applicable safety and health regulations. To further enhance the health and safety of associates, Allscripts also offers comprehensive resources and training, including specialty programs like active shooter training, blood pressure monitors and an active lifestyle incentive program.

As the COVID-19 pandemic continued through 2021, Allscripts leadership has supported a remote working environment for all operations.  Allscripts’ cross-functional emergency response team—consisting of representatives from various functions including business units, safety, security, medical, facilities, HR, IT legal and communications—meets regularly to evaluate the continued impact of the pandemic and its effects on Allscripts associates.  Wellness programs continued to encourage associates to stay active and connected. The Allscripts benefits team promoted COVID-19 response resources offered by our healthcare partner, which included mental health, work/life balance and telehealth services where available.

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

Corporate Social Responsibility

 

COMMITMENT TO ENVIRONMENTAL SUSTAINABILITY

As a strong supporter of sustainable business practices, Allscripts strives to improve existing and introduce new green sustainability efforts in its daily business operations. Allscripts policies are subject to regular review and amendment when new innovative ways to support a sustainable workplace are established, assuring a continued commitment to the environment.  Allscripts is committed to generating less waste and reducing greenhouse gas emissions when conducting business. Besides our headquarters being located in the award-winning LEED-certified offices at the Merchandise Mart in Chicago, here are just a few of the initiatives we’ve launched:

Adopting a managed print standard, resulting in reduced consumption of paper and toner by more than 1,900 reams of paper—approximately 114 trees—annually

Making traditional print materials digital

Recycling 100% of shredded materials

Creating recycle programs across all Allscripts offices

Purchasing workstation furniture made of recycled materials

Consolidating all corporate data centers to purpose-build energy efficient locations that include elements like zero water consumption cooling and power design efficiency

Allscripts provides employees the option of retaining their outdated laptops once they have been cleaned. This is one way we support the reuse of old equipment

Allscripts gives back to the community by donating old laptop monitors, keyboards, mice, and printers to nonprofit organizations that assist low-income people in need

Our commitment to sustainability is for the long-term. Based on the Sustainability Accounting Standard Board (SASB.org) recommendations for Software & IT Services in the Technology and Communications Sector, we are evaluating the environmental footprint of our hardware.  As a first step, we have consolidated all of our corporate data centers into purpose-build energy efficient locations that include elements like zero water consumption cooling and power design efficiency.

Allscripts Corporate Social Responsibility Report details our progress across our global operations and can be viewed in its entirety in the “Governance” section at www.investor.allscripts.com.  The information on our website, including but not limited to the contents of our Corporate Social Responsibility Report, is not, and shall not be deemed to be, a part of this Proxy Statement or incorporated herein or into any of our other filings with the SEC.

  

 

 

 

Allscripts Healthcare Solutions, Inc

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2022 PROXY STATEMENT

 

 

 

Corporate Governance

Role of the Board

The Board oversees the Company’s Chief Executive Officer and other senior management in the competent and ethical operation of the Company in support of the long-term interests of the Company’s stockholders. The Company’s Corporate Governance Guidelines are available at the “Governance” section at investor.allscripts.com.

Board Leadership Structure

The Board believes that its current leadership structure best serves the objectives of the Board’s oversight of management, the Board’s ability to carry out its roles and responsibilities on behalf of the Company’s stockholders, and the Company’s overall corporate governance. The Board currently believes that the separation of the Chairman and the Chief Executive Officer roles allows the Company’s Chief Executive Officer to focus his time and energy on operating and managing the Company. The Board periodically reviews this leadership structure to determine whether it continues to best serve the Company and its stockholders.

 

Mr. Klayko, Chairman of the Board, is not standing for re-election at the Annual Meeting. If Mr. Garrison is elected to the Board by the stockholders at the Annual Meeting, the Board intends to appoint Mr. Garrison as the new independent Chairman of the Board.

Board Meetings

The Board met a total of ten times during 2021. The Board has determined that the following incumbent directors who are standing for election at the Annual Meeting are independent under applicable rules of the Nasdaq Stock Market LLC (“Nasdaq”) and the SEC: Mmes. Altman and Zierhoffer and Messrs. Garrison, Judge, and Dave B. Stevens. The Board also determined that the following current directors who are not standing for re-election at the Annual Meeting are independent under such rules: Ms. Aspinall and Messrs. Klayko and David D. Stevens.  The Board also determined that Mr. Black, who currently serves on the Board and is not standing for re-election at the Annual Meeting was not independent under such rules. Mr. Poulton, who currently serves as the Company’s Chief Executive Officer, is also not independent under such rules.

Executive Sessions of Independent Directors

The independent directors of the Company meet regularly in executive session, i.e., with no management directors or management present. These executive sessions may include such topics as the independent directors determine. During these executive sessions, the independent directors have access to members of management and other guests as the independent directors determine.

Annual Board and Committee Evaluations

In accordance with the Company’s Corporate Governance Guidelines, the Nominating Committee is responsible for facilitating an annual evaluation of the Board. The Nominating Committee also oversees the annual performance evaluation of the committees of the Board.  The Nominating Committee also oversees the annual performance evaluation of each director.

Succession Planning

As part of the annual officer evaluation process, the Nominating Committee works with the CEO to facilitate the Board’s planning for CEO succession (and for other members of senior management), as well as to develop plans for interim succession for the CEO (and for other members of senior management) in the event of an unexpected occurrence. Succession planning may also be reviewed more frequently by the full Board as it deems warranted.

 

 

 

Allscripts Healthcare Solutions, Inc

18

 


 

2022 PROXY STATEMENT

Corporate Governance

 

 

Committees of the Board

The Board has a standing Audit Committee (the “Audit Committee”) and Compensation Committee (the “Compensation Committee”), in addition to the Nominating Committee. The Board has determined that each of the committee members is independent under applicable Nasdaq and SEC rules for committee memberships. The members of the committees are shown in the tables below.

 

Name

 

Audit Committee

 

 

Compensation

Committee

 

 

Nominating and

Governance

Committee

 

Elizabeth A. Altman

 

Member

 

 

-

 

 

-

 

Mara G. Aspinall

 

Member

 

 

-

 

 

-

 

Paul M. Black

 

 

-

 

 

-

 

 

-

 

P. Gregory Garrison

 

Chairman

 

 

 

-

 

 

-

 

Jonathan J. Judge

 

 

-

 

 

Chairman

 

 

Member

 

Michael A. Klayko

 

 

-

 

 

Member

 

 

Member

 

Dave B. Stevens

 

Member

 

 

Member

 

 

 

-

 

David D. Stevens

 

Member

 

 

 

-

 

 

Chairman

 

Carol J. Zierhoffer

 

Member

 

 

 

-

 

 

 

-

 

 

The Audit Committee is primarily responsible for assisting the Board in fulfilling its oversight and monitoring responsibility of reviewing the financial information that will be provided to the Company’s stockholders and others; appointing and overseeing the services performed by the Company’s independent registered public accounting firm, as well as pre-approving all services and fees related thereto; overseeing and periodically evaluating the performance and responsibilities of the Company’s internal audit department, including approving the Company’s annual internal audit plan and reviewing the results of internal audits, including management’s responses thereto; reviewing with the Company’s management, internal audit department, and independent registered public accounting firm the Company’s critical accounting policies and its system of internal controls over financial reporting; and overseeing the risk assessments related to the Company conducted by the Company’s management (including internal and third party assessments relating to cybersecurity risk). The Audit Committee is also responsible for reviewing all related party transactions and has the authority to approve all such transactions. The Audit Committee met a total of ten times during 2021.

The Compensation Committee is primarily responsible for reviewing the compensation arrangements for the Company’s executive officers, administering the Company’s equity compensation plans, and reviewing the Board’s compensation. For a further description of the Compensation Committee’s processes and procedures, including the roles of the Company’s management and independent compensation consultants in the Compensation Committee’s decision-making process, see the “Compensation Discussion and Analysis” section below. The Compensation Committee met a total of two times during 2021.

The Nominating Committee assists the Board in identifying and evaluating qualified individuals to become directors, makes recommendations to the Board concerning the size, structure, and composition of the Board and its committees, monitors the process to assess the Board’s effectiveness, and is primarily responsible for the oversight of corporate governance at the Company, including implementation of the Company’s Corporate Governance Guidelines. In April 2022, the Nominating Committee recommended to the full Board each of the nominees named in this Proxy Statement for election to the Board. The Nominating Committee met a total of two times during 2021.

Each of the Audit Committee, the Compensation Committee, and the Nominating Committee operates under written charters adopted by the Board. These charters are available at the “Governance” section at investor.allscripts.com.

During 2021, each member of the Board attended or participated in 75% or more of the aggregate of (i) the total number of meetings of the Board (held during the period for which such person has been a director) and (ii) the total number of meetings held by each committee of the Board on which such person served (during the period that such person served).

There are no family relationships among the Company’s executive officers and directors.

 

 

Allscripts Healthcare Solutions, Inc

19

 


 

2022 PROXY STATEMENT

Corporate Governance

 

Consideration of Director Nominees

Stockholder Nominees

The Nominating Committee considers properly submitted stockholder nominations for candidates for membership on the Board in accordance with the Company’s by-laws. Stockholders who wish to nominate directors should follow the instructions under “Requirements for Other Stockholder Proposals to be Brought Before the 2023 Annual Meeting of Stockholders and Director Nominations” in this Proxy Statement.

Director Qualifications

The Nominating Committee and the Board consider on an annual basis the appropriate characteristics, skills and experiences for the Board as a whole and its individual members. In evaluating the suitability of individual Board members, the Board takes into account many factors, including their business and professional accomplishments, integrity, demonstrated ability to make independent analytical inquiries, ability to understand the Company’s business and willingness to devote the necessary time to Board duties. In addition, the Nominating Committee endeavors to identify and evaluate candidates based on their specific healthcare and related industry experience and any other areas that may be expected to contribute to an effective Board. With respect to diversity, the Nominating Committee may consider such factors as differences in viewpoint, professional experience, education, skills, and other individual qualifications that contribute to Board heterogeneity, including characteristics such as gender, race, and national origin.  Pursuant to the Company’s Corporate Governance Guidelines, for each open Board seat, any initial list from which new director nominees are to be chosen shall include, but not be limited to, qualified women and persons of color.  The Board from time to time will consider the effectiveness of this selection policy in identifying qualified individuals with diversity of viewpoint as potential Board nominees and currently believes it to be effective.

Identifying and Evaluating Nominees for Directors

The Nominating Committee utilizes a variety of methods for identifying and evaluating nominees for directors. Candidates may come to the attention of the Nominating Committee through management, current Company directors, Company stockholders, or other persons. These candidates are evaluated and discussed by members of the Nominating Committee from time to time. Candidates may be considered at any point during the year.  

The Nominating Committee considers stockholder recommendations for candidates to the Board in the same manner as candidates identified by the Nominating Committee. Any such recommendation should be delivered to the Company’s Corporate Secretary by mail at 222 Merchandise Mart Plaza, Suite 2024, Chicago, Illinois 60654. Following verification of the stockholder status of persons proposing candidates, recommendations are aggregated and considered by the Nominating Committee. If any materials are provided by a Company stockholder in connection with the recommendation of a director candidate, such materials are forwarded to the Nominating Committee. The Nominating Committee also may review materials provided by professional search firms or other parties in connection with a nominee.

Mandatory Retirement Age

The Board has implemented a policy providing that no director who has reached the age of 72 should stand for re-election to the Board, unless the Nominating Committee and the Board, in their discretion, believe an extension would best serve the interests of the Company.

 

Board Oversight of Risk Management

The Board believes that evaluating how the Company’s senior management team manages the various risks confronting the Company is one of its most important areas of oversight. In carrying out this critical responsibility, the Board has designated the Audit Committee with primary responsibility for overseeing enterprise risk management.

In accordance with this responsibility, the Audit Committee monitors the Company’s major financial, operational, privacy, security (including cybersecurity), business continuity, legal and regulatory, and reputational exposures, and reviews the steps management has taken to monitor and control these exposures. The Audit Committee’s oversight includes, among other things, the review of regular reports from the Company’s Senior Vice President, Chief

 

 

Allscripts Healthcare Solutions, Inc

20

 


 

2022 PROXY STATEMENT

Corporate Governance

 

Compliance Counsel; the Company’s Vice President, Corporate Audit; the Company’s Vice President, Chief Security Officer; and other members of the Company’s management as to the identification and status of risks to the Company, including financial risks and litigation claims and risks. As with other matters, the Audit Committee regularly discusses these topics with the Board.

Most recently, the Audit Committee has been focused on, among other things, cybersecurity risk and the policies and procedures developed by the Company to mitigate such risks. Allscripts takes privacy and security seriously and has implemented a security framework, based on ISO 27001, that takes into account physical, administrative, and technical safeguards for patient data and confidential data.  These safeguards cover, among other areas, identity and access management, incident response and monitoring, disaster recovery, data protection, secure development lifecycle, and supply chain security.  Security awareness training is regularly provided to staff that is designed to ensure they stay up to date with the changing cyber risk landscape.  Identified cyber risks and mitigation strategies are reviewed with management and the Board on a quarterly basis.

Additionally, when determined by the Board or by the Company’s management to be advisable, the Board or selected committees of the Board may undertake a formal enterprise risk assessment, at which risks facing the Company and associated responses are evaluated in detail. The Board also receives regular financial and business updates from the Company’s senior management, which updates involve detailed reports on financial and business risks facing the Company when applicable.

While the Audit Committee has primary responsibility for overseeing enterprise risk management, each of the other Board committees also considers risk within its area of responsibility. For example, the Nominating Committee reviews legal and regulatory compliance risks as they relate to corporate governance structure and processes, and the Compensation Committee reviews risks related to compensation matters. The Chairman of each of these committees periodically apprises the Board of significant risks and the Company’s management’s response to these risks, as appropriate.

In establishing and reviewing the Company’s executive compensation program, the Compensation Committee considers whether the program encourages unnecessary or excessive risk-taking and has concluded that it does not. The Company’s executive officers’ base salaries are fixed in amount and thus do not encourage risk-taking, and the majority of compensation provided to the Company’s executive officers is in the form of long-term equity awards that help align executive pay with the long-term interests of the Company’s stockholders. The Compensation Committee believes that these awards do not encourage unnecessary or excessive risk-taking because the ultimate value of the awards is tied to the Company’s financial or stock price performance, and because awards are subject to regular vesting schedules to help ensure that a significant component of executive compensation is tied to long-term stockholder value creation.

The Compensation Committee has also reviewed the Company’s compensation programs for employees generally, and has concluded that these programs do not create risks that are reasonably likely to have a material adverse effect on the Company. The Compensation Committee believes that the Company’s annual cash and long-term equity awards provide an effective and appropriate mix of incentives to help ensure the Company’s performance is focused on long-term stockholder value creation and do not encourage short-term risk-taking at the expense of long-term results.

While the Board and its committees oversee risk management strategy, the Company’s management is responsible for implementing and supervising day-to-day risk management processes and reporting to the Board and its committees on such matters.

Audit Committee Financial Experts

The Board has determined that each of Ms. Altman, Ms. Aspinall, Mr. Garrison, Mr. David D. Stevens and Ms. Zierhoffer qualifies as an “audit committee financial expert” as defined under applicable SEC rules. The Board has also determined that each member of the Audit Committee meets the additional criteria for independence of audit committee members set forth in Rule 10A-3(b)(1) under the Exchange Act.

Code of Conduct

The Company has adopted a Code of Conduct that applies to all of its employees, including the Company’s principal executive officer, principal financial officer, and senior accounting officers, as well as to the Board. The Code of

 

 

Allscripts Healthcare Solutions, Inc

21

 


 

2022 PROXY STATEMENT

Corporate Governance

 

Conduct is available at the “Governance” section at investor.allscripts.com. The Company intends to comply with any disclosure obligation regarding any changes in, or waivers from, the Code of Conduct by posting such information on the same website or by filing a Form 8-K with the SEC.

 

Certain Relationships and Related Transactions

The Company, or one or more of its subsidiaries, may occasionally enter into transactions with certain “related persons.” Related persons include the Company’s executive officers, directors, beneficial owners of more than 5% of the Company’s common stock, immediate family members of any of these persons, and entities in which one or more of these persons has a direct or indirect material interest. The Company refers to transactions with these related persons as “related party transactions.”

In accordance with the Company’s written policy, the Audit Committee (or, in certain circumstances, disinterested members of the Board) is responsible for the review and approval of each related party transaction exceeding $120,000 in which a related person has a direct or indirect material interest. The Audit Committee considers all relevant factors when determining whether to approve a related party transaction, including, without limitation:

The size of the transaction and the amount of consideration payable to a related person;

The nature of the interest of the applicable related person;

Whether the transaction may involve a conflict of interest;

Whether the transaction involves the provision of goods or services to the Company that are available from unaffiliated third parties; and

Whether the proposed transaction is on terms and made under circumstances that are at least as favorable to the Company as would be available in comparable transactions with or involving unaffiliated third parties.

Since January 1, 2021, neither the Board nor the Audit Committee has been made aware of or asked to review and approve any “related party transactions.”  The Company is not aware of any transactions in the last fiscal year where the above policies were not followed.

Anti-Hedging Policy

Under our anti-hedging policy, all Allscripts directors, officers, employees and consultants, as well as their household members and any of their family members whose transactions in the Company’s securities are directed by them or are subject to their influence or control, are prohibited from entering into hedging or monetized transactions or similar arrangements with respect to the Company’s stock, including the purchase or sale of puts or calls or the use of any other derivative instruments.

Attendance of Directors at Annual Meeting of Stockholders

The Company expects all of its directors and director nominees to attend its annual meetings of stockholders, barring emergencies or unusual circumstances.  Where a director is unable to attend an annual meeting in person but is able to do so by electronic conferencing, the Company will arrange for the director’s participation by means where the director can hear and be heard by those present at the meeting. All of the Company’s then-current directors attended the Company’s 2021 Annual Meeting of Stockholders, which was held in a virtual-only format.

Communications with the Board

Any correspondence intended for the Board, or for any individual member or members of the Board, should be directed to the Company’s Corporate Secretary at 222 Merchandise Mart Plaza, Suite 2024, Chicago, Illinois 60654, with a request to forward the communication to the intended recipient(s). In general, any stockholder communication delivered to the Corporate Secretary for forwarding to the Board or specified Board member(s) will be forwarded in accordance with the stockholder’s instructions. However, the Company reserves the right not to forward to Board members any abusive, threatening, or otherwise inappropriate materials, including unsolicited commercial advertisements.

 

 

Allscripts Healthcare Solutions, Inc

22

 


 

2022 PROXY STATEMENT

Corporate Governance

 

Information regarding the submission of comments or complaints relating to the Company’s accounting, internal accounting controls, or auditing matters can be found in the Company’s Code of Conduct, which is available at the “Governance” section at investor.allscripts.com.

Compensation of Directors

The Compensation Committee is responsible for reviewing and approving the compensation program for the Company’s non-employee directors. The Compensation Committee utilizes a combination of cash and equity as a way to attract and retain qualified directors. The 2021 non-employee director compensation program did not change as compared to the 2020 non-employee director compensation program.

Cash Compensation

For 2021, the annual retainer paid to the Company’s non-employee directors was $60,000, payable in equal quarterly installments. Non-employee directors also received a retainer of $2,000 for attendance at Board meetings in excess of ten per year, and $1,500 for attendance at each committee meeting. The Chairman of the Board may waive the additional $2,000 fee for the entire Board, and may waive the $1,500 fee for any applicable committee meeting for the attendees thereof. The Chairman of each committee may also waive the $1,500 fee for any committee meeting he chairs. Each non-employee director of the Company is also reimbursed for expenses incurred when attending Board and committee meetings and other Board-related activities.

The Chairman of the Board receives an additional annual retainer in the amount of $100,000, payable in equal quarterly installments. Each Chairman of the Audit Committee, Compensation Committee, and Nominating Committee receives an additional annual retainer of $25,000, $25,000, and $15,000, respectively, for his service as Chairman of the respective committees, payable in equal quarterly installments. Each member of the Audit Committee, Compensation Committee, and Nominating Committee also receives an additional annual retainer of $2,500 per committee served. All of the foregoing payments are pro-rated for the dates of applicable service.

Prior to the beginning of each calendar year, non-employee directors may elect to receive all or a portion of their quarterly cash retainer payment in the form of deferred stock units (“DSUs”). DSUs represent the right to receive shares of the Company’s common stock at the time the director’s Board service ends. The number of DSUs granted is determined by dividing the portion of the cash compensation with respect to which the election is made by the closing price of the Company’s common stock on the date the cash compensation is due to be paid. DSUs issued in lieu of cash compensation are fully-vested.

Equity Compensation

Under the Company’s 2019 Stock Incentive Plan, the Company’s non-employee directors are eligible to receive equity awards in the form of stock options, restricted stock, or restricted stock units (“RSUs”) at the discretion of the Board or the Compensation Committee. For 2021, the value of each annual equity award was $200,000, delivered in the form of RSUs, which fully vest on the first anniversary of the grant date or, if earlier, upon a change of control of the Company. If a non-employee director retires from the Board prior to the first anniversary of the grant date, a pro-rata portion of the RSUs will vest based on the time elapsed from the grant date to the date of retirement. Annual director equity awards are granted after the Company’s annual meeting of stockholders to coincide with the commencement of director terms.

 

 

Allscripts Healthcare Solutions, Inc

23

 


 

2022 PROXY STATEMENT

Corporate Governance

 

Director Compensation2021

The following table shows information regarding the compensation earned during 2021 by the Company’s non-employee directors who served on the Board during the year. The compensation paid to Mr. Black is shown in the table entitled “Summary Compensation Table – 2021, 2020 and 2019” and the related explanatory tables in the “Executive Compensation” section below. Mr. Black does not receive any additional compensation for his service as a member of the Board.

 

Name

 

Fees Earned or

Paid in Cash (1)

($)

 

 

Stock Awards (2)

($)

 

 

Total

($)

 

Elizabeth A. Altman

 

 

77,500

 

 

 

200,000

 

 

 

277,500

 

Mara G. Aspinall

 

 

77,500

 

 

 

200,000

 

 

 

277,500

 

P. Gregory Garrison

 

 

103,000

 

 

 

200,000

 

 

 

303,000

 

Jonathan J. Judge

 

 

101,000

 

 

 

200,000

 

 

 

301,000

 

Michael A. Klayko

 

 

176,000

 

 

 

200,000

 

 

 

376,000

 

Dave B. Stevens

 

 

81,500

 

 

 

200,000

 

 

 

281,500

 

David D. Stevens

 

 

101,500

 

 

 

200,000

 

 

 

301,500

 

Carol J. Zierhoffer

 

 

77,500

 

 

 

200,000

 

 

 

277,500

 

 

(1)

This column reports the amount of cash compensation earned by each director during 2021 for his or her Board and committee service. As described above, non-employee directors may elect to convert all or a portion of their cash compensation into fully-vested DSUs. None of the non-employee directors elected to do so in 2021.

(2)

In accordance with SEC rules, the amounts shown reflect the aggregate grant date fair value of RSU awards granted to non-employee directors during 2021, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Stock Compensation (“FASB ASC Topic 718”). The grant date fair value of RSUs is measured based on the closing fair market value of the Company’s common stock on the date of grant. The aggregate number of equity awards outstanding, including DSUs issued in lieu of cash compensation, as of December 31, 2021 for each of the Company’s non-employee directors are as follows:

 

Name

 

Number of Shares

Subject to

Outstanding

RSUs/DSUs as of

12/31/2021

 

Elizabeth A. Altman

 

 

12,056

 

Mara G. Aspinall

 

 

12,056

 

P. Gregory Garrison

 

 

12,056

 

Jonathan J. Judge

 

 

12,056

 

Michael A. Klayko

 

 

12,056

 

Dave B. Stevens

 

 

12,056

 

David D. Stevens

 

 

12,056

 

Carol J. Zierhoffer

 

 

12,056

 

 

 

 

 

 

 

Allscripts Healthcare Solutions, Inc

24

 


 

2022 PROXY STATEMENT

 

 

 

Security Ownership of Certain Beneficial Owners and Managements

The following tables show certain information as of April 29, 2022 (the “Table Date”), unless otherwise indicated, with respect to the beneficial ownership of the Company’s common stock by: (i) each person the Company believes beneficially holds more than 5% of the outstanding shares of the Company’s common stock based solely on the Company’s review of SEC filings; (ii) each director and nominee; (iii) each named executive officer listed in the table entitled “Summary Compensation Table – 2021, 2020 and 2019” under the section entitled “Compensation Discussion and Analysis” below; and (iv) all directors and executive officers as of the Table Date as a group.

Unless otherwise indicated, all persons named as beneficial owners of the Company’s common stock have sole voting power and sole investment power with respect to the shares indicated as beneficially owned.

 

>5% Stockholders

 

Shares of

Common Stock

Beneficially

Owned

 

 

Percent of

Common

Stock

Outstanding

 

Blackrock, Inc. (1)

 

 

23,846,502

 

 

 

20.6

%

The Vanguard Group (2)

 

 

13,268,135

 

 

 

11.5

%

Dimensional Fund Advisors LP (3)

 

 

10,090,569

 

 

 

8.7

%

 

 

 

 

 

 

 

 

 

 

Named Executive Officers, Directors and Director

Nominees

 

Shares of

Common

Stock

Beneficially

Owned

 

 

Options,

Exercisable,

Stock

Awards

Vesting,

and DSUs

Convertible

Within

60 Days (4)

 

 

Total

 

 

Percent of

Common

Stock

Outstanding

 

Paul M. Black (5)

 

 

1,363,615

 

 

 

-

 

 

 

1,363,615

 

 

*

 

Richard J. Poulton

 

 

485,827

 

 

 

-

 

 

 

485,827

 

 

*

 

Lisa Khorey (6)

 

 

96,181

 

 

 

247,698

 

 

 

343,879

 

 

*

 

Tejal Vakharia

 

 

136,627

 

 

 

14,680

 

 

 

151,307

 

 

*

 

Elizabeth A. Altman

 

 

16,768

 

 

 

12,056

 

 

 

28,824

 

 

*

 

Mara G. Aspinall

 

 

83,887

 

 

 

12,056

 

 

 

95,943

 

 

*

 

P. Gregory Garrison

 

 

35,757

 

 

 

12,056

 

 

 

47,813

 

 

*

 

Jonathan J. Judge

 

 

107,675

 

 

 

12,056

 

 

 

119,731

 

 

*

 

Michael A. Klayko (7)

 

 

26,525

 

 

 

12,056

 

 

 

38,581

 

 

*

 

Dave B. Stevens

 

 

98,053

 

 

 

12,056

 

 

 

110,109

 

 

*

 

David D. Stevens

 

 

158,324

 

 

 

12,056

 

 

 

170,380

 

 

*

 

Carol J. Zierhoffer

 

 

17,462

 

 

 

12,056

 

 

 

29,518

 

 

*

 

All directors, director nominees and

   executive officers as a group

   (12 persons)

 

 

2,530,990

 

 

 

116,403

 

 

 

2,647,393

 

 

 

2.29

%

 

*

Represents less than 1% of the issued and outstanding shares of the Company’s common stock as of the Table Date.

 

 

Allscripts Healthcare Solutions, Inc

25

 


 

2022 PROXY STATEMENT

Security Ownership of Certain Beneficial Owners and Managements

 

(1)

This information is derived from a Schedule 13G/A filed by BlackRock, Inc. on January 28, 2022, providing information with respect to its beneficial ownership of shares of the Company’s common stock as of December 31, 2021. According to the Schedule 13G/A, BlackRock, Inc. had sole power to vote or direct the vote of 23,031,138 shares, sole power to dispose of or direct the disposition of 23,846,502 shares, shared power to vote or direct the vote of zero shares, and shared power to dispose of or direct the disposition of zero shares. According to the Schedule 13G/A, BlackRock, Inc. lists its address as 55 East 52nd Street, New York, NY 10055.

(2)

This information is derived from a Schedule 13G/A filed by The Vanguard Group (“Vanguard Group”) on February 9, 2022, providing information with respect to its beneficial ownership of shares of the Company’s common stock as of December 31, 2021. According to the Schedule 13G/A, Vanguard Group had sole power to vote or direct the vote of zero shares, sole power to dispose of or direct the disposition of 13,050,368 shares, shared power to vote or direct the vote of 105,226 shares, and shared power to dispose of or direct the disposition of 217,767 shares. According to the Schedule 13G/A, Vanguard Group lists its address as 100 Vanguard Blvd., Malvern, PA 19355.  

(3)

This information is derived from a Schedule 13G/A filed by Dimensional Fund Advisors LP (“DFA”) on February 8, 2022, providing information with respect to its beneficial ownership of shares of the Company’s common stock as of December 31, 2021. According to the Schedule 13G/A, DFA had sole power to vote or direct the vote of 9,888,249 shares, sole power to dispose of or direct the disposition of 10,090,569 shares, shared power to vote or direct the vote of zero shares, and shared power to dispose of or direct the disposition of zero shares. According to the Schedule 13G/A, DFA lists its address as Building One, 6300 Bee Cave Road, Austin, TX 78746.

(4)

Represents shares of the Company’s common stock underlying stock awards held that were vesting, options held that were exercisable and DSUs held that were convertible at the Table Date or within 60 days thereafter. Does not include RSUs that vest more than 60 days after the Table Date. RSUs are awards granted by the Company and payable, subject to vesting requirements, in shares of the Company’s common stock.

(5)

Voting and dispositive power over 77,073 shares of common stock presented for Mr. Black are shared with Mr. Black’s wife.

(6)

Ms. Khorey was an executive officer until August 6, 2021.

(7)

The shares of common stock presented for Mr. Klayko are held in a family trust in which he shares voting and dispositive power.

 

 

 

 

 

Allscripts Healthcare Solutions, Inc

26

 


 

2022 PROXY STATEMENT

 

 

 

Equity Compensation Plan Information

The following table shows information, as of December 31, 2021, concerning shares of the Company’s common stock authorized for issuance under the Company’s equity compensation plans.

 

Name

 

Number of

Securities to be

issued upon

Exercise of

Outstanding

Options,

Warrants

and Rights

(#)(a)

 

 

Weighted-

Average

Exercise Price of

Outstanding

Options, Warrants

and Rights

($)(b)

 

 

Number of

Securities

Remaining

Available

for Future

Issuance

Under Equity

Compensation

Plans (Excluding

Securities

Reflected

in Column(a))

(#)(c)

 

 

Equity compensation plans approved by

   stockholders

 

 

8,219,585

 

 

 

-

 

(1)

 

11,577,363

 

(2)

Equity compensation plans not approved

   by stockholders

 

-

 

 

-

 

 

-

 

 

Total

 

 

8,219,585

 

 

 

-

 

 

 

11,577,363

 

 

 

(1)

The weighted-average exercise price excludes a total of 8,219,585 RSUs and awards granted under equity compensation plans approved by stockholders with no exercise price but with a weighted-average grant date fair market value of approximately $10.68 as of December 31, 2021.

(2)

Includes 5,052,906 shares available for issuance under the Amended and Restated Allscripts Healthcare Solutions, Inc. Employee Stock Purchase Plan. Also, includes 1,105,220 and 5,419,237 shares available for issuance pursuant to the 2011 and 2019 Stock Incentive Plans, respectively.

 

 

 

 

 

Allscripts Healthcare Solutions, Inc

27

 


 

2022 PROXY STATEMENT

 

 

 

Executive Officers

 

 

Name

 

Age

 

Position

Richard Poulton

 

57

 

Chief Executive Officer

Thomas Langan

 

56

 

President

Lisa Hammond

 

50

 

Senior Vice President & Chief Human Resources Officer

Leah Jones

 

50

 

Chief Financial Officer

Tejal Vakharia

 

49

 

Senior Vice President and General Counsel, Marketing and Government Affairs

 

 

 

 

 

 

 

 

Richard Poulton

 

 

Chief Executive Officer

 

 

 

 

 

 

 

Age 57

 

Richard Poulton was appointed Chief Executive Officer as of May 6, 2022.  Prior to that, Mr. Poulton served concurrently as both our President and Chief Financial Officer since March 2020.  Mr. Poulton served as our President since October 2015.  Furthermore, Mr. Poulton served as our Chief Financial Officer from October 2012 to March 2016 and as an Executive Vice President from October 2012 to September 2015.  From 2006 to 2012, Mr. Poulton served in various positions at AAR Corp. (AIR), a provider of products and services to commercial aviation and the government and defense industries. His most recent role at AAR Corp. was Chief Financial Officer and Treasurer.

 

 

 

 

 

 

 

 

 

Mr. Poulton also spent more than ten years at UAL Corporation in a variety of financial and business development roles, including Senior Vice President of Business Development as well as President and Chief Financial Officer of its client-focused Loyalty Services subsidiary.

 

 

Thomas Langan

President

 

 

 

 

Age 56

 

Thomas Langan was appointed as our President as of  May 6, 2022 and was formerly Senior Vice President and General Manager of the Veradigm business unit within Allscripts since 2018.  Prior to that, Mr. Langan was the CEO of Practice Fusion, a cloud-based EHR provider acquired by the Company in 2018, since 2015. Previously, Mr. Langan held executive positions at Symphony Health Solutions and MediMedia where he managed their life sciences data, analytics and consulting business, market access and multi-channel marketing solutions. During his career, Mr. Langan has served as Chief Executive Officer, President, Chief Commercial Officer, SVP of Sales and various business development roles working with payers, life sciences organizations, employers and provider organizations.

 

 

 

 

 

Mr. Langan has more than 25 years of broad-based functional experience in sales, marketing, strategy and P&L management.

 

 

 

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2022 PROXY STATEMENT

Executive Officers

 

 

 

 

Lisa Hammond

 

 

Senior Vice President & Chief Human Resources Officer

 

 

 

 

 

 

 

Age 50

 

Lisa Hammond was appointed as our Senior Vice President & Chief Human Resources Officer in April 2022 and previously served as our Senior Vice President, Global Human Resources since May 2021.  Prior to that, Ms. Hammond was Allscripts Director, Global Talent Acquisition, Development and HR Optimization since March 2020. Ms. Hammond has extensive multi-disciplinary experience in a variety of environments, including leading people functions as Vice President of HR/Training, Sales and Marketing at restaurant group LM Restaurants from 2015 to 2020. Prior to that, Ms. Hammond served as leadership of HR/Training/Risk Management at ACG Texas. Her experience in growing and emerging brands has afforded her the opportunity to lead functions outside of HR, including operations, sales and marketing. Ms. Hammond is a Certified Executive Coach, a Six Sigma Black belt, and is certified in a variety of developmental assessments.

 

 

 

 

 

 

 

 

 

Ms. Hammond brings more than 25 years’ experience as an HR leader, coach and partner to operations.

 

 

Leah Jones

Chief Financial Officer

 

 

 

 

Age 50

 

Leah Jones was appointed as our Chief Financial Officer as of May 6, 2022 and was formerly Senior Vice President and General Manager of Allscripts’ Ambulatory business unit since January, 2020.  Prior to that, Ms. Jones led Allscripts Sales Operations as Senior Vice President from March 2016 to December 2019, a role in which she collaborated with clients, partners and internal teams to achieve successful relationships and respective performance goals. Ms. Jones has also served as Allscripts Vice President Finance and Sales Support from January 2011 to March 2016.  Previously, Ms. Jones held various leadership roles at Infor Global Solutions, Georgia-Pacific, MedQuist and Radiant Systems.  

 

Ms. Jones is a licensed CPA in the state of Georgia.

 

 

 

 

 

Ms. Jones has worked in the technology industry for more than 20 years, gaining experience in complex and creative negotiations, sales support systems and workflows, technical accounting and team leadership.

 

 

 

Tejal Vakharia

 

 

Senior Vice President and General Counsel, Marketing and Government Affairs

 

 

 

 

 

 

 

 

Age 49

 

Tejal Vakharia has served as our Senior Vice President and General Counsel, Marketing and Government Affairs since June 2020 and continues to serve as our Senior Vice President and Chief Compliance Counsel since November 2011. Prior to joining Allscripts, Ms. Vakharia was Chief Compliance Counsel at GE Healthcare IT & Performance Solutions and, over a period of more than ten years, held various positions at Abbott Laboratories (including AbbVie and Hospira) (ABT).

 

 

 

 

 

 

 

 

 

Previously, Ms. Vakharia was an attorney at the multinational law firms of Foley & Lardner and Dentons.

 

 

 

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2022 PROXY STATEMENT

 

 

 

Compensation Discussion and Analysis

This Compensation Discussion and Analysis explains the Company’s executive compensation philosophy and program, the decisions the Compensation Committee made with respect to the Company’s executive compensation program for 2021, and the factors that the Compensation Committee considered in making those decisions. The Compensation Committee has the principal responsibility for establishing, implementing and monitoring the Company’s executive compensation program in accordance with the Company’s executive compensation philosophy and what the Compensation Committee believes to be best practices with respect to executive compensation. This Compensation Discussion and Analysis focuses on the compensation of the Company’s named executive officers (our “NEOs”) for 2021, who were:

Paul Black, Chief Executive Officer (“CEO”);*

Richard Poulton, President & Chief Financial Officer;*

Tejal Vakharia, Senior Vice President & General Counsel, Marketing & Government Affairs; and

Lisa Khorey, the Company’s former Senior Vice President, Chief Client Delivery Officer.

*On May 6, 2022, Mr. Black ceased serving as our Chief Executive Officer and Mr. Poulton was appointed Chief Executive Officer and ceased serving as President and Chief Financial Officer.  Also, effective May 6, 2022, Thomas Langan was appointed President and Leah Jones was appointed as our Chief Financial Officer.   Please see the “Management Transition” section for a summary of the compensation decisions made with respect to Mr. Black and Mr. Poulton in connection with their transitions.

Executive Summary

In 2021 the Company continued to make progress on its key strategic and operational imperatives which are intended to deliver sustained improvements in the Company’s products and financials, and in turn to position the Company for sustainable long-term growth both domestically and globally. The Company also continued to execute on the plan began in 2020 to reset and effectively manage the Company’s cost base, portfolio, balance sheet and capital structure. We believe that these efforts built on the positive momentum developed during 2020 to further improve the Company’s stock price and market capitalization during 2021. The Company’s closing stock price per share on December 31, 2020 was $14.44, and the Company’s closing stock price per share on December 31, 2021 was $18.45, a 27.77% increase over that period.

Operationally, in 2021 the Company continued to leverage our longstanding strategic partnership with Microsoft to enable the development and delivery of cloud-based health information technology solutions. This partnership allows the Company to enhance our client’s high availability, cybersecurity, disaster recovery and business continuity capabilities, each of which have become more important during 2021. In addition, Mercy Iowa City selected the Allscripts Sunrise Platform of Health as the core EHR for its community hospital. Mercy Iowa City is an acute care hospital and regional referral center that draws patients from throughout Eastern Iowa. The Company also substantially expanded our partnership with another client, Blessing Health System, to three facilities—Blessing Health Keokuk, Hannibal Clinic, and partner provider Scotland County Hospital. Blessing Health System has also implemented Allscripts® Managed Services and has extended its agreement through 2028. Further, long-term client BronxCare Health System signed an extension with Allscripts into 2031.     

Throughout the COVID-19 pandemic, the Company’s Veradigm business unit has assisted our clients by providing them with the value needed to manage all aspects of the pandemic. One example of that value is the Veradigm StudySource platform which modernizes clinical research and extends the Company’s EHR systems to include research workflows. During 2021 Veradigm signed a partnership agreement with PRA Health Sciences, Inc. (which has since been acquired by ICON) to create an industry leading EHR-based clinical research network, reaching more than 25,000 physicians and 40 million patients across the United States.  Veradigm also signed a teaming agreement to provide the U.S. Centers for Disease Control and Prevention access to the Company’s Health Insights’ EHR data set to advance and assist COVID-19 research, including analyzing and developing insights related to variants, vaccinations, long-term effects and other COVID-19 related questions. In addition, Veradigm signed an agreement

 

 

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2022 PROXY STATEMENT

Compensation Discussion and Analysis

 

with Moderna during 2021 to provide research consulting and data analytics services for eight real-world database studies focused on gaining a better understanding of Moderna’s COVID-19 vaccine in the U.S. population.  

Finally, during 2021 we further enhanced the Company’s commitment to diversity, equity and inclusion (“DE&I”), through the launch of four additional employee enrichment groups for associates of diverse backgrounds and locations to help support the Company’s DE&I efforts. We also launched ADP Empower, an initiative through the Allscripts Developer Program that is intended to promote diverse voices in the healthcare technology industry by offering resources and support to underrepresented entrepreneurs.  

The chart below compares the average for the three previous years of the target total compensation opportunity provided to Mr. Black, including base salary, annual bonus and equity awards, to the value for each element of compensation that was realized or realizable by Mr. Black as of the end of 2021. For the three-year period from 2019 to 2021, roughly 194% of Mr. Black’s target compensation has either been realized or is realizable. For the chart below, Mr. Black’s annual bonus amount in the column on the right reflects the average of the actual annual bonuses that he earned during the three-year period, as disclosed in the Summary Compensation Table – 2021, 2020 and 2019. Mr. Black’s 2019, 2020 and 2021 realized or realizable equity includes PSUs and restricted stock units (“RSUs”) either earned and vested or eligible to vest in the future under awards granted in 2019, 2020 and 2021.  All equity awards are valued using $18.45 per share, the closing price of the Company’s common stock on December 31, 2021, and, in the case of PSUs subject to on-going performance periods, estimated performance as of December 31, 2021.

CEO Three-Year Average Target Versus Realized or Realizable Compensation

 

 

 

We believe the realized or realizable compensation and their relationship to target compensation over the three-year cumulative period is reflective of the Compensation Committee’s emphasis on “pay-for performance” in that differences between realized and realizable pay and target compensation, as well as fluctuations compared to prior periods, are primarily the result of our stock performance and our varying levels of achievement against pre-established performance goals under our annual incentive plan for senior executives and the PSUs. The very high percentage of Mr. Black’s total compensation that has been realized or is realizable is reflective of the Company’s positive financial performance over the last three years.

 

The Compensation Committee considered financial and operational results, as well as the Company’s stock price performance, when making compensation decisions for 2021. In designing and overseeing the various elements of the 2021 executive compensation program, the Compensation Committee focused on aligning executive compensation with financial metrics that the Compensation Committee believes are indicative of the Company’s ability to build and sustain growth and continued accountability for our long-term stock price performance with the use of rigorously-designed relative TSR PSUs.

 

 

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Compensation Discussion and Analysis

 

The charts below illustrate the 2021 target total direct compensation opportunities (i.e., base salary and target short- and long-term incentive opportunities) for the CEO, as well as the average of such opportunities for the Company’s other NEOs. As shown below, 88% of the CEO’s 2021 target total direct compensation, and 86% of the average of the target total compensation for the other NEOs serving as of December 31, 2021 is at-risk compensation that is dependent on either the Company’s financial or stock price performance. Total direct compensation includes annual cash incentive bonus opportunities and PSUs, each of which are dependent on the Company’s financial or stock price performance, and service-based RSUs, the value of which is dependent on the Company’s stock price performance.

 

 

(1)

Values illustrated reflect the percentage of each compensation element at target.

(2)

“At-Risk Compensation” is compensation where the value is either based upon the Company’s financial performance or stock price.

(3)

“Performance-Based Compensation” is compensation that is dependent on achievement against pre-established quantitative performance goals.

The at-risk elements of the Company’s 2021 executive compensation program are annual incentive cash bonuses and long-term incentive equity awards. With respect to annual incentive cash bonuses, the Compensation Committee approved the Company’s annual incentive cash bonus plan (the “2021 Bonus Plan”) with potential payouts that are fully contingent on the Company’s non-GAAP EPS performance. A threshold level of non-GAAP EPS performance must be attained before payment of any bonuses under the 2021 Bonus Plan.

With respect to equity awards, in 2021 the Compensation Committee approved annual equity grants to the NEOs in the form of:

50% PSUs, 50% of which may be earned based on the Company’s TSR relative to a pre-established peer group, measured over a single three-year performance period; and 50% of which may be earned based on the Company’s generating free cash flow from continuing operations during 2021, and which cliff vest at the end of a three-year period, thereby maintaining accountability for long-term stock price performance; and

50% service-based RSUs, which vest, subject to continuous service, 1/3 per year over three years.

 

 

 

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Compensation Discussion and Analysis

 

 

As in recent years, the Compensation Committee chose to structure a significant portion of each NEO’s compensation as at-risk compensation, with the compensation actually realized by each NEO significantly impacted by the financial and/or stock price performance of the Company.  

Executive Compensation Philosophy

The Compensation Committee engages in an ongoing review of the Company’s executive compensation program to evaluate whether the program supports the Company’s compensation objectives and is aligned with the long-term interests of the Company’s stockholders, taking into account input from stockholders including the results of the annual say-on-pay vote. In connection with this ongoing review, the Compensation Committee has continued to monitor the Company’s executive compensation program to evaluate whether the Company maintains best practices with respect to executive compensation.

The Company’s primary objective for its executive compensation program is to attract, retain, and motivate outstanding leaders who will drive the Company’s long-term success. The Compensation Committee seeks to establish and implement a compensation program for the Company’s NEOs that emphasizes pay-for-performance, and is designed to meet the following objectives:

Reward outstanding performance for an individual’s performance against corporate goals;

Provide long-term incentive compensation through equity awards, a significant portion of which are performance-based;

Provide executive compensation levels and structures that are both competitive in the executive market and internally equitable; and

Align the Company’s executive compensation with the Company’s financial performance in order to incentivize the creation of sustainable value for the Company’s stockholders.

The Company maintains the following balance of compensation practices that it believes enhances its pay-for-performance philosophy and aligns the Company’s executives’ interests with the long-term interests of the Company’s stockholders:

 

The Company HAS This Practice

 

           Annual pay assessments conducted by an independent Compensation Committee with the assistance of an independent compensation advisor, with pay benchmarked against a set of comparable companies

 

           Pay aligned with the Company’s financial performance and stockholder returns

 

           Significant at-risk compensation for NEOs

 

           A significant portion of NEO annual equity awards are performance contingent and tied to rigorous, long-term relative stock price goals

 

           Double-trigger change of control severance benefits

 

           Stock ownership requirements for officers (CEO 6x base salary and other NEOs 2x base salary) and non-employee directors (5x cash retainer)

 

           Limited perquisites

 

           Anti-hedging and anti-pledging policies

 

           Clawback policy

The Company Does NOT Have This Practice

 

X           Repricing of options without stockholder approval

 

X           Tax gross-ups for NEOs

 

X           Excise tax gross-ups for change of control benefits

 

X           Single-trigger or otherwise excessive change of control severance benefits

 

X           Dividend payments on unearned equity awards

 

X           Excessive perquisites

 

X           Supplemental executive retirement benefits

 

X           Guaranteed annual bonuses or equity rights

 

 

 

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2022 PROXY STATEMENT

Compensation Discussion and Analysis

 

 

Consideration of Stockholder Say-on-Pay Vote

The Compensation Committee considers the outcome of the Company’s annual say-on-pay vote when making decisions regarding the Company’s executive compensation program. The Company received approximately 97% support for its say-on-pay vote at the Company’s 2021 Annual Meeting of Stockholders. This 97% approval from stockholders at the Company’s 2021 Annual Meeting of Stockholders follows similar say-on-pay results from 2020 and 2019, which were 95% and 99%, respectively, for those years. The Compensation Committee viewed the outcome of the say-on-pay vote as indicative that an overwhelming majority of the Company’s stockholders view the Company’s approach to executive compensation favorably. Accordingly, the Compensation Committee did not make any changes to the Company’s executive compensation program in response to the 2021 say-on-pay vote. The Company’s management continues to engage in dialogue with many of the Company’s largest stockholders, and the Compensation Committee intends to continue to consider stockholder feedback and the results of the Company’s say-on-pay votes when making future executive compensation decisions.

Compensation Procedures

Compensation Committee

During 2021, Jonathan J. Judge (Chairman), Michael A. Klayko, and Dave B. Stevens served on the Compensation Committee. Mr. Judge joined in May 2016 and became Chairman in May 2018, Mr. Klayko joined in May 2013, and Mr. Stevens joined in May 2017. The Compensation Committee’s responsibilities with respect to executive compensation include:

Establishing the Company’s compensation philosophy;

Overseeing the development and implementation of the Company’s compensation policies;

Reviewing and approving corporate goals and objectives relevant to the compensation of the CEO and other executive officers; and

Approving the compensation levels of each of the executive officers.

Role of Management

The primary objective of the Company’s executive compensation program is to align the program with the Company’s financial performance and the long-term interests of the Company’s stockholders. The Compensation Committee believes that this alignment is best achieved through consultations with members of the Company’s senior management, because management is responsible for the Company’s day-to-day operations and for creating and executing the Company’s business plan. As such, the Company’s management provides the Compensation Committee with valuable insights into the Company’s day-to-day operations and future expectations, which the Company believes are supported by the rewards and incentives in the compensation program. In 2021, the Compensation Committee consulted with Mr. Black, Mr. Poulton and Ms. Vakharia in formulating compensation plans. Mr. Black, Mr. Poulton and Ms. Vakharia attended Compensation Committee meetings during which NEO and employee compensation decisions were made, but each was not present during the Compensation Committee’s discussions regarding his or her own compensation. The Compensation Committee also regularly meets in executive session without any members of management present.

Role of Compensation Consultant

The Compensation Committee retained Compensia to serve as its independent compensation consultant with respect to decisions regarding 2021 compensation. Compensia reported directly to the Compensation Committee and participated in Compensation Committee meetings. Compensia did not perform any other services for the Company in 2021. After considering Compensia’s relationship with the Company, the services provided by Compensia, and information provided to the Compensation Committee by Compensia, the Compensation Committee determined that Compensia met the independence requirements to serve as its independent compensation consultant and that Compensia’s work did not raise any conflict of interest.

Specifically, Compensia:

Advised on the design of the Company’s executive compensation program in order to assist the Compensation Committee in evaluating the linkage between pay and performance;

 

 

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2022 PROXY STATEMENT

Compensation Discussion and Analysis

 

Provided and reviewed market compensation and performance data to assist the Compensation Committee in setting 2021 executive compensation relative to competitive market data;

Advised the Compensation Committee regarding the elements of the Company’s 2021 executive compensation program, equity grants, and equity compensation-related dilution levels relative to the Company’s peers; and

Advised the Compensation Committee regarding the Company’s compensation risk assessment, which assessment concluded that the compensation programs of the Company in 2021 did not create incentives that were reasonably likely to materially harm the Company.

Market Analysis

The Compensation Committee considers relevant market pay practices and relative performance when setting executive compensation and incentive goals. Market practices, or benchmarks, are based on peer group disclosure. When making compensation decisions, the Compensation Committee considers the market data in conjunction with other factors, such as an officer’s individual tenure and performance, unique qualifications, and role and impact within the Company. Working with Compensia, the Compensation Committee established an updated peer group to be used in designing the Company’s 2021 executive compensation program. The peer group used to evaluate the Company’s 2021 compensation decisions included companies with the following characteristics:

Software and business services companies generally in the technology and healthcare-related sectors, with a focus on direct healthcare technology competitors to the extent available;

Revenues ranging generally between 0.5x and 2.5x of the Company’s trailing four quarter revenues, with median revenues of approximately $1.3 billion; and

A market capitalization range generally between 0.25x and 4x of the Company’s market capitalization, with median market capitalization of $4.1 billion. Although Cerner Corporation and Veeva Systems have market capitalizations outside of this range, they were included because Cerner and Veeva Systems are viewed as key healthcare technology competitors that compete directly with the Company for customers and executive talent.

The peer group used to evaluate 2021 compensation decisions consisted of the 21 U.S.-based publicly traded healthcare technology companies and general software companies listed below (the “2021 peer group”). For 2021, the Compensation Committee chose to remove Medidata Solutions, Inc., LogMeIn, Inc., and Navigant Consulting, Inc., due to their acquisitions. To replace those companies, the Compensation Committee chose to add Change Healthcare and R1 RCM, Inc. The Compensation Committee considers each of those companies to be financially or operationally comparable to the Company.

 

Healthcare Technology Companies

 

Software Companies

AMN Healthcare Services, Inc.

 

CDK Global, Inc.

Cerner Corporation

 

Fair Isaac

Change Healthcare Inc.

 

Huron Consulting Group Inc.

Evolent Health, Inc.

 

MAXIMUS, Inc.

Haemonetics Corporation

 

Nuance Communications

Hill-Rom Holdings Inc.

 

Parametric Technology Corporation

HMS Holdings Corp.

 

Teradata

Inovalon Holdings, Inc.

 

Verint Systems

NextGen Healthcare, Inc.

 

 

OmniCell

 

 

Premier Inc.

 

 

R1 RCM Inc.

 

 

Veeva Systems, Inc.

 

 

 

 

 

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2022 PROXY STATEMENT

Compensation Discussion and Analysis

 

 

Elements of Compensation

The Compensation Committee believes that the Company’s compensation programs for its NEOs are competitive and appropriately designed to attract and retain key employees, reward performance, and promote long-term stockholder value. This section describes the elements of the Company’s compensation program for NEOs, together with a discussion of various compensation decisions.

The principal components of the Company’s 2021 executive compensation program were base salary, annual incentive cash bonuses, and long-term incentive equity awards. The Company also provides a 401(k) retirement savings plan with certain matching contributions, group health and welfare plans, and group term life insurance. In addition, the Company provides the NEOs with severance benefits upon a termination of employment under certain circumstances, including following a change of control of the Company, as more fully described elsewhere in this Proxy Statement. The Company does not maintain defined benefit pension plans for its NEOs because the Compensation Committee believes that the existing compensation arrangements enable the Company’s NEOs to adequately plan for their retirement and that wealth creation should primarily be a function of performance for the Company’s stockholders.

Base Salary

Base salaries are paid to the NEOs to compensate them for the performance of their respective job duties and responsibilities. The Compensation Committee reviews base salaries of the NEOs on an annual basis. In setting annual base salaries, the Compensation Committee takes into consideration the Company’s overall financial and operating performance in the prior year, the Company-wide target for base salary increases for all employees, market and competitive salary information, changes in the scope of an NEO’s job responsibilities, and other relevant factors. When considering market and competitive salary information, the Compensation Committee has historically reviewed peer compensation data, although there is no target compensation level. The Compensation Committee also reviews each NEO’s scope of role and performance, as well as the performance of the business units and departments for which he or she is responsible, to the extent applicable. For Mr. Black, the Compensation Committee evaluates his performance and determines any salary adjustment. For each of the other NEOs, the Compensation Committee receives a performance evaluation from the CEO and a recommendation for any salary adjustment. For 2021, the Compensation Committee determined that Mr. Poulton should receive a base salary increase of eleven percent, which is larger than typical annual increases, based on his critical role at the Company encompassing both President and Chief Financial Officer duties and significant impact on the Company’s improved performance since 2020, as well as a review of competitive market data for his roles.

The following table sets forth the base salary rate in effect as of December 31, 2021 for each NEO:

 

Name

 

Salary Rate as

of December 31,

2021 ($)(1)

 

 

% Increase

From 2020

Base Salary

 

Paul Black

 

 

1,030,000

 

 

 

0

%

Richard Poulton

 

 

700,000

 

 

 

11

%

Lisa Khorey

 

 

517,000

 

 

 

3

%

Tejal Vakharia

 

 

412,000

 

 

 

3

%

 

(1)

Ms. Khorey ceased service as an executive officer of the Company on August 5, 2021. The amount reported in this column for such Ms. Khorey represents her base salary in effect as of immediately prior to her ceasing service as an executive officer of the Company.

Annual Incentive Cash Bonuses

Consistent with its approach since 2016, the Compensation Committee chose non-GAAP EPS as the financial performance measure for the 2021 Bonus Plan. The non-GAAP EPS targets established by the Committee tied the 2021 Bonus Plan to a rigorous goal based on a key measure stockholders consider when evaluating the performance of the Company. Non-GAAP EPS is defined as non-GAAP net income divided by weighted average fully diluted shares outstanding in the applicable period. Non-GAAP net income consists of GAAP net income/(loss) as reported, and adds back acquisition-related amortization, stock-based compensation expense, nonrecurring expenses and transaction-related costs, non-cash asset impairment charges, and equity in earnings of unconsolidated investments, in each case net of any related tax effects.

 

 

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2022 PROXY STATEMENT

Compensation Discussion and Analysis

 

Mr. Black and Ms. Khorey’s bonus targets, as a percentage of base salary, did not change for 2021. Mr. Black’s target cash bonus was 150% of his base salary and Ms. Khorey’s target cash bonus was 75% of her base salary. For Mr. Poulton, the Committee chose to increase his bonus target to 125% of his base salary for 2021 based on his critical role at the Company and influence on the Company’s materially improved financial position. Ms. Vakharia’s bonus target for 2021 was increased to 75% of her base salary to align with standard practice for the Company’s NEOs.

  

The chart below shows the non-GAAP EPS performance range that the Compensation Committee approved for 2021:

 

 

 

Non-GAAP

Adjusted

EPS($)(1)

 

 

% Payout

 

Maximum

 

 

0.77

 

 

200.00%

 

 

 

 

0.76

 

 

188.90%

 

 

 

 

0.75

 

 

177.80%

 

 

 

 

0.74

 

 

166.70%

 

 

 

 

0.73

 

 

155.60%

 

 

 

 

0.72

 

 

144.40%

 

 

 

 

0.71

 

 

133.30%

 

 

 

 

0.70

 

 

122.20%

 

 

 

 

0.69

 

 

111.10%

 

Target

 

 

0.68

 

 

100.00%

 

 

 

 

0.67

 

 

93.80%

 

 

 

 

0.66

 

 

87.50%

 

 

 

 

0.65

 

 

81.30%

 

 

 

 

0.64

 

 

75.00%

 

 

 

 

0.63

 

 

68.80%

 

 

 

 

0.62

 

 

62.50%

 

 

 

 

0.61

 

 

56.30%

 

Threshold

 

 

0.60

 

 

50.00%

 

 

Bonus payments for the NEOs under the 2021 Bonus Plan were based on the Company’s non-GAAP EPS performance for the year. Pursuant to the approved non-GAAP EPS performance range, the Company’s reported fiscal 2021 non-GAAP EPS of $1.43, which would result in a bonus payment equal to 200% of target bonus for each NEO. Given the performance of each NEO and the achievement over the maximum of the EPS range, the Committee did not exercise its discretion to decrease the cash incentive bonus payout to any NEO. Accordingly, the Committee approved a bonus payout of 200% of target to each NEO under the 2021 Bonus Plan.

 

 

 

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2022 PROXY STATEMENT

Compensation Discussion and Analysis

 

 

In July 2021 the Company implemented the Global All In to Win Bonus Plan, which paid each employee of the Company, including the NEOs, a bonus of $1 for each $1 million in revenue generated by the Company from July 1 to December 31, 2021. Pursuant to the Global All In to Win Bonus Plan, each NEO received an additional bonus payment of $788 for 2021.   

 

Name

 

2021 Bonus

Plan

Target

Amount

($)(1)

 

 

2021 Actual

Incentive

Bonus

($)

 

 

2021 Actual

Individual

Performance

Bonus

($)

 

Paul Black

 

 

1,545,000

 

 

 

3,090,733

 

 

 

-

 

Richard Poulton

 

 

860,417

 

 

 

1,721,565

 

 

 

-

 

Lisa Khorey

 

 

261,826

 

 

476 (2)

 

 

 

-

 

Tejal Vakharia

 

 

307,501

 

 

 

615,733

 

 

-

 

 

(1)

The target amount reported for each NEO reflects the NEO’s actual earnings in 2021 rather than an annualized base salary level.

(2)

Ms. Khorey's Global All In to Win Bonus payment was prorated to reflect her move to part-time employment after August 5, 2021.

Equity Awards

Under the 2019 Stock Incentive Plan, the Compensation Committee may grant incentive and non-qualified stock options, PSUs, RSUs, and other forms of equity compensation. The Compensation Committee believes that the issuance of equity-based long-term incentive awards to the Company’s NEOs is consistent with its stated objective of establishing an executive compensation program that aligns executives’ interests with the long-term interests of the Company’s stockholders.

In considering annual equity awards, the Compensation Committee conducts an annual review of the Company’s overall equity program, including items such as the Company’s total projected equity budget for the year, the Company’s aggregate equity usage relative to peers, and the available share pool; and it factors that review into its annual award decisions. The Compensation Committee also considers market data for the Company’s peer group, individual factors such as the performance, responsibilities and qualifications of each NEO, each NEO’s past equity awards, and the unvested retention value attributable to past awards when considering the amount and structure of equity awarded to each NEO annually.

For 2021, each of the NEOs was provided 50% of his or her annual equity award in the form of PSUs, and 50% of his or her annual equity award in the form of RSUs. As compared to 2020, the Compensation Committee reduced the percentage of the annual equity awarded to each NEO granted in PSUs from 75% to 50%. The Compensation Committee elected to make this change to align to the Company’s standard executive equity award mix prior to 2020 following a review of the equity practices of the companies in the peer group. Based on this evaluation, the Compensation Committee determined that it was reasonable to return to a mix of 50% PSUs and 50% RSUs for 2021, with such mix previously supported by the Company's stockholders as evidenced by the Company's strong say-on-pay vote support in prior years.

The PSUs were split evenly between PSUs that may be earned based on the Company’s TSR relative to a peer group of broadly comparable companies in terms of industry and revenue range measured over a single three-year performance period; and PSUs that may be earned based on the Company generating free cash flow from continuing operations during 2021 (the “Free Cash Flow PSUs”). The Free Cash Flow PSUs may be earned based on 2021 performance, and then cliff vest at the end of a single three-year vesting period from the grant date to further align compensation outcomes with the long-term interests of the Company’s stockholders. The Compensation Committee chose the free cash flow metric for 2021 rather than the EBITDA margin metric used in 2020 to diversify performance focus in 2021 and because it believed improved cash flow performance would be critical to the Company’s short- and long-term success.

Using three-year relative TSR as the performance measure for 50% of the PSUs granted to each NEO is consistent with the annual approach taken for the Company’s NEOs since 2015. The Company’s relative TSR is determined by comparing the change in the Company’s stock price over the three-year performance period beginning on the grant

 

 

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Compensation Discussion and Analysis

 

date, taking into account any dividends paid (which are assumed to be reinvested in the stock). The change in value over the performance period is then used to calculate a TSR gain/loss percentage for the performance period. That gain/loss percentage is then compared to the TSR gain/loss percentages of the peer group companies to calculate the Company’s relative TSR percentile. The Compensation Committee believes that using relative TSR as a performance measure provides an objective measure of the Company’s performance relative to other investment alternatives similar to the Company with respect to both industry and company size/value characteristics.

The 2021 TSR PSU awards require above-market performance, with the 60th percentile and 90th percentile (or greater) relative to the peer group required for target and maximum vesting, respectively. In addition, if the Company’s TSR is negative at the end of the three-year performance period, the 2021 TSR PSU awards will be capped at the target payout level even if the Company significantly outperforms the peer group.  

The peer group for measuring relative TSR performance under the 2021 TSR PSU awards consists of the following companies:

 

ACI Worldwide

 

Fair Isaac

 

Nuance Communications

AMN Healthcare Services

 

Genpact

 

Omnicell

Cardtronics

 

Hill-Rom Holdings

 

PRA Health Sciences

CDK Global

 

HMS Holdings

 

Premier

Cerner

 

Huron Consulting Group

 

R1 RCM

CoreLogic

 

Inovalon Holdings

 

Teradata

Endurance International

 

j2 Global

 

TTEC Holdings

Euronet Worldwide

 

Mantech International

 

Verint Systems

Evolent Health

 

MAXIMUS

 

Virtusa

Exl Service Holdings

 

NextGen Healthcare

 

 

 

The Compensation Committee selected the 2021 relative TSR peer group based on its review of comparability to the Company on key selection criteria including industry, revenue, market capitalization and stage/time from initial public offering.  The Compensation Committee chose the group of companies listed above because the Compensation Committee determined that those companies are most aligned with the Company when considering the key selection criteria.

 

The Free Cash Flow PSUs represent the remaining 50% of the PSUs granted to each NEO for 2021.  Free cash flow from continuing operations during 2021 measures the cash that the Company had on hand at the end of 2021 after paying operating expenses and capital expenditures. The Company’s management believed that achievement of material free cash flow improvement was the most important metric to continue driving the improvement in the Company’s financial position and stock price during 2021. The Company’s free cash flow performance prior to 2021 was poor. In January 2021, the Company disclosed a goal of generating a range of $90-$100M in free cash flow from continuing operations during 2021. As the vesting target for the Free Cash Flow PSUs, the Compensation Committee chose the midpoint of that disclosed free cash flow generation range.  For the threshold and maximum vesting hurdles the Compensation Committee chose 90% and 115% of the free cash flow generation range, respectively to tie award payouts to a rigorous performance schedule reflecting strong year-over-year improvement. The attainment of the year-end 2021 free cash flow generation range was designed to be challenging but achievable with strong execution of the Company’s operating plan.

 

 

 

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The chart below shows the 2021 cash flow generation range that the Compensation Committee approved for vesting of the Free Cash Flow PSUs:

 

 

 

2021 Free

Cash Flow From

Continuing Operations

(millions)

 

 

Eligible Vesting

(% of Target)

 

Maximum

 

$115.0 or greater

 

 

200.00%

 

 

 

$

113.1

 

 

187.50%

 

 

 

$

111.2

 

 

175.00%

 

 

 

$

109.4

 

 

162.50%

 

 

 

$

107.5

 

 

150.00%

 

 

 

$

105.6

 

 

137.50%

 

 

 

$

103.7

 

 

125.00%

 

 

 

$

101.9

 

 

112.50%

 

Target

 

$

95.0

 

 

100.00%

 

 

 

$

88.5

 

 

92.00%

 

 

 

$

87.0

 

 

83.00%

 

 

 

$

85.5

 

 

75.00%

 

 

 

$

84.0

 

 

67.00%

 

 

 

$

82.5

 

 

58.00%

 

Threshold

 

$

81.0

 

 

50.00%

 

 

 

Below $81.0

 

 

0.00%

 

 

During 2021 the Company generated more than $115M in free cash flow from continuing operations.  Based on the above range that the Compensation Committee approved, the Free Cash Flow PSUs were earned at 200% of target and will vest at the end of a single three-year vesting period on the third anniversary of the grant date.

 

The remaining 50% of the annual equity award made to each NEO for 2021 was in the form of service-based RSUs that vest 1/3 each year for three years.

When determining the amount of the annual equity award for Mr. Black and Mr. Poulton for 2021, the Compensation Committee chose to increase their awards from previous years based on their strong individual performance and the Company’s strong performance during 2020 along with a review of updated competitive market data from Compensia. Mr. Black’s award was increased by $1,250,000 and Mr. Poulton’s award was increased by $1,000,000. For Ms. Vakharia, her 2021 annual equity award was the first award that she received while serving as an executive officer and was determined based on a review of market data, the Company’s historical compensation practices and internal pay equity. The Compensation Committee chose to award Ms. Khorey equity in the same amount she received in 2020. The individual grant decisions reflect a review of quantitative market data and relevant qualitative factors including individual performance, time in role, scope and breadth of duties, and internal pay equity.

 

 

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2022 PROXY STATEMENT

Compensation Discussion and Analysis

 

The following table illustrates the annual equity awards made to the NEOs serving as of December 31, 2021 for 2021:

 

Name

 

Service-

Based

RSUs (1)

($)

 

 

Relative TSR

PSUs (1)

($)

 

 

Free Cash Flow From Continuing Operations

($)

 

 

Total 2021

Grant Value

(1)

($)

 

Paul Black

 

 

3,125,000

 

 

 

1,562,500

 

 

 

1,562,500

 

 

 

6,250,000

 

Richard Poulton

 

 

2,500,000

 

 

 

1,250,000

 

 

 

1,250,000