Hospital operator MedCath‘s (NASDAQ:MDTH) dissolution plan has been approved by shareholders clearing the way for MedCath to sell all of its remaining assets and close the company.
Charlotte, North Carolina-based MedCath also said that its board of directors approved a cash distribution amounting to $6.85 per share, payable to stockholders on Oct. 6, 2011. That price is the same amount listed in the company’s Aug. 17 proxy statement.
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MedCath built a portfolio of hospitals focused on cardiac care. But the company, which has been losing money since 2008, last year formed a strategic committee to consider a sale of the company or its assets. The company disclosed to shareholders in May that it was preparing to dissolve as a company.
Approval of the dissolution plan follows the disclosure of new termination agreements for MedCath’s top executives. CEO Edwin French departs with a lump-sum payment of more than $1.7 million. On Sept. 14, MedCath entered into new termination agreements with its top executives in anticipation that their employment would be terminated in connection with the sale of company assets, the company said in securities filings. CFO Art Parker, who is replacing French as CEO, is set to receive $901,254. Senior Vice President and Chief Clinical and Compliance Officer Joan McCanless will receive $633,888. The new termination agreements release the executives from claims to any cash severance benefits that they would have been eligible to receive.
In the last year, MedCath has completed 10 transactions selling facilities in locations such as Arizona, Arkansas, New Mexico and North Carolina. MedCath’s remaining assets are stakes in four hospitals with a total of 366 licensed beds located in Arizona, California, Louisiana and Texas.
