8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d)

of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 30, 2023

CANO HEALTH, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-39289	98-1524224
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

9725 NW 117th Avenue, Miami, Florida	33178
(Address of principal executive offices)	(Zip Code)

(855) 226-6633

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities Registered Pursuant to Section 12(b) of the Act:

Title of each Class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, $0.0001 par value per share	CANO	The New York Stock Exchange
Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share	CANO WS	The New York Stock Exchange

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

Emerging growth company ☐

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

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

As previously announced by Cano Health, Inc. (the “Company”), three directors have resigned from the Company’s Board of Directors (the “Board”). On March 30, 2023, Elliot Cooperstone, Lewis Gold and Barry Sternlicht (together, the “Directors”) resigned from the Board, effective immediately. At the time of resignation, Mr. Gold served on the Audit Committee and Compensation Committee and Mr. Sternlicht served on the Nominating and Corporate Governance Committee. Effective April 2, 2023, the size of the Board has been reduced to six (6) directors.

In their resignation letters, the Directors made certain statements expressing disagreements with the Company on matters relating to its operations, policies and practices. Specifically, the letters reflect disagreements with respect to the Company’s management leadership, strategic direction, board and corporate governance practices and policies.

The Company strongly disagrees with their representations about the Company and their assessment of Dr. Hernandez’s performance. The Company is also concerned about the disclosure of board confidences and deliberations. We believe the resignation letters are misleading to shareholders and undermine the Board’s ability to engage in the vigorous exchange of diverse views that is necessary for good governance. Our Board and management team devote considerable time and resources to analyzing the Company’s performance, operations, financial strength, and potential against the backdrop of the challenges the Company and the sector have faced. Our Board and management team remain confident in the Company’s mission and fundamentals, and believe in the Company’s continuing prospects for shareholder value creation. Our Board and management intend to continue to work diligently to improve operational execution, enhance cost discipline, and achieve positive free cash flow.

In accordance with the requirements of Item 5.02(a) of Current Report on Form 8-K, the Company has provided each Director with a copy of the disclosures contained in this Current Report on Form 8-K no later than the day of filing this Form 8-K with the Securities and Exchange Commission.

Forward-Looking Statements:

This Current Report on Form 8-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to future events and involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and could materially affect actual results, performance or achievements. Such forward-looking statements include, without limitation, our anticipated performance, operations, financial strength, potential, and prospects for long-term shareholder value creation, our anticipated results of operations, including our business strategies, our projected costs, prospects and plans, and other aspects of our operations or operating results. These forward-looking statements generally can be identified by phrases such as “will,” “expects,” “anticipates,” “believes,” “foresees,” “forecasts,” “plans,” “intends,” “estimates” or other words or phrases of similar import, including, without limitation, (i) our belief that the letters are misleading to shareholders and undermine the Board’s ability to engage in the vigorous exchange of diverse views that is necessary for good governance; (ii) the Board and management team being confident in the Company’s mission and fundamentals, and their belief in the Company’s continuing prospects for shareholder value creation; and (iii) our plans to work diligently to improve operational execution, enhance cost discipline, and achieve positive free cash flow. It is uncertain whether any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what impact they will have on our results of operations and financial condition. Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in forward-looking statements include, among others, changes in market or industry conditions, the regulatory environment, competitive conditions, and/or consumer receptivity to our services; changes in our strategy, future operations, prospects and plans; developments and uncertainties related to the Direct Contracting Entity program;

our ability to realize expected financial results, including with respect to patient membership, total revenue and earnings; our ability to predict and control our medical cost ratio; our ability to grow market share in existing markets and continue our growth; our ability to integrate our acquisitions and achieve desired synergies; our ability to maintain our relationships with health plans and other key payors; our future capital requirements and sources and uses of cash, including funds to satisfy our liquidity needs; our ability to attract and retain members of management and our Board of Directors; and/or our ability to recruit and retain qualified team members and independent physicians. Actual results may also differ materially from such forward-looking statements for a number of other reasons, including those set forth in our filings with the SEC, including, without limitation, in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 15, 2023 (the “2022 Form 10-K”), as well as our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that we have filed or will file with the SEC during 2023 (which may be viewed on the SEC’s website at http://www.sec.gov or on our website at http://www.investors.canohealth.com/ir-home), as well as reasons including, without limitation, our experiencing delays or difficulties in, and/or unexpected or less than anticipated results from its efforts to: (i) create shareholder value, such as due to less than anticipated capacity utilization at its medical centers and/or less than anticipated growth in revenues, Adjusted EBITDA margins and/or cash flows; and/or (ii) improve operational execution, enhance cost discipline, and/or achieve positive free cash flow, such as due to a broad recessionary economic environment, less than anticipated sources of liquidity, unanticipated demands on its available sources of cash, tightness in the credit or M&A markets, higher interest rates and/or a higher inflationary environment. For a detailed discussion of other risks and uncertainties that could cause our actual results to differ materially from those expressed or implied by the forward-looking statements, please refer to our filings with the SEC, including, without limitation, our 2022 Form 10-K. Factors other than those listed above could also cause our results to differ materially from expected results. Forward-looking statements speak only as of the date they are made and, except as required by law, we undertake no obligation or duty to publicly update or revise any forward-looking statement, whether to reflect actual results of operations; changes in financial condition; changes in general U.S. or international economic, industry conditions; changes in estimates, expectations or assumptions; or other circumstances, conditions, developments or events arising after the issuance of this Current Report on Form 8-K. Additionally, the business and financial materials and any other statement or disclosure on or made available through the Company’s websites or other websites referenced herein shall not be incorporated by reference into this release.

Item 7.01 Regulation FD Disclosure.

On March 31, 2023, the Company issued a press release announcing the resignation of the Directors. A copy of the press release is furnished hereto as Exhibit 99.1 and incorporated into this Item 7.01 by reference.

The information in this Item 7.01 of Form 8-K, including the accompanying Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liability of such section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of the general incorporation language of such filing, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
17.1	Resignation Letter of Elliot Cooperstone, dated March 30, 2023.
17.2	Resignation Letter of Lewis Gold, dated March 30, 2023.*
17.3	Resignation Letter of Barry Sternlicht, dated March 30, 2023.
99.1	Press Release dated March 31, 2023.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Information that is confidential and covered by attorney-client privilege has been omitted and provided separately to the Securities and Exchange Commission. Confidential treatment has been requested with respect to this omitted information.

SIGNATURES

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

Date: April 5, 2023	CANO HEALTH, INC.
	By:	/s/ Brian D. Koppy
		Name: Brian D. Koppy
		Title: Chief Financial Officer

EX-17.1

Exhibit 17.1

ELLIOT COOPERSTONE

March 30, 2023

VIA EMAIL

Cano Health, Inc.

9725 NW 117^th Avenue

Miami, Florida 33178

Attn: Board of Directors

Re: Resignation as Director

Dear Members of the Board:

I am writing to tender my resignation from the board of directors (the “Board”) of Cano Health, Inc. (the “Company” or “Cano Health”), effective immediately.

I have served on the Board since a special purpose vehicle affiliate of our private equity investment firm, InTandem Capital Partners, LLC, made an investment in Cano Health in 2016 and remained on the Board after we ceased to be the controlling investor when the Company initially became public through the merger with JAWS Acquisition Corp. in June 2021. Since then, I have sought to work constructively with my fellow Board members to improve the Company’s corporate governance and increase value for all shareholders. However, it has become increasingly apparent that the majority of the Board is unwilling to take the measures necessary to allow the Company to adopt and implement best practices to effectively oversee management.

As you are aware, Barry Sternlicht has also resigned from the Board. I agree with the substance and views raised by Mr. Sternlicht in his letter of resignation. As the single largest shareholder of the Company, my primary focus has always been on unlocking Cano Health’s potential to maximize shareholder value and I have previously urged my fellow directors to proactively consider all strategic opportunities to create shareholder value—in particular, through the immediate sale of non-core assets, while renewing its focus on the Company’s high performing business in Florida to enable a near term “Holdco” sale of what would be a highly profitable and attractive company. However, when I have raised these views, as well as the concerns highlighted by Mr. Sternlicht, they have fallen on deaf ears. Worse, after raising these issues, I, and the other directors who voiced concerns, were excluded from discussions regarding these critical topics and denied access to the full information, discussion and debate to which we are entitled as directors. Most recently, such exclusion was effected through the formation of a “Special Committee”, which has been seemingly operating as a “shadow board” to exclude only the directors who have expressed significant concerns about the Company’s governance and value creation strategy.

Based on our differing views on acceptable corporate governance practices, healthy Board processes, and value creation strategy, I am no longer able to serve on the Board and I hereby tender my resignation, effective immediately.

Sincerely,

Elliot Cooperstone

EX-17.2

Exhibit 17.2

From: lewis gold [***]

Sent: Friday, March 31, 2023 8:57 AM

To: [***]

Subject: Official resignation letter

Dear members of Cano Board:

As u know , I officially resigned without explanation on Thursday’s March 30 th board call- I am now writing to tender my resignation from Cano Board effective March 30 th As u know , I have a long history of being involved in healthcare public and private entities as both a board member and true physician operator—I personally served on Cano Board as a private company and thru the Public transition.

I have tried at all times to act as a true fiduciary to the shareholders and protect their interest—unfortunately, besides Elliot Cooperstone and Barry Sternlicht ( fellow board members , all other board members were more interested in protecting the CEO Marlow Hernandez rather than the shareholders.

About 6 months ago , the board became aware of multiple potential compliance and related party issues - [***]- I concur with all that Barry Sternlicht stated in his public resignation but will now list below the multiple reasons that the Cano board has acted truely in bad faith and has ignored the following :

1- [***]

2- [***] A special committee was formed that excluded Barry. Elliot and myself—this committee sole purpose without our knowledge was to hire outside counsel to address Barry’s prior email about changes in management [***] This special committee was basically formed against the three of us because we disagreed with the performance of the company, the loss of shareholder’s value, our desire to sell all non core non performing assets, [***].

The unfortunate part of this is that there were multiple execs with years of experience that could have quickly taken over and rebuilt an credible compliant profitable company-already some of those qualified execs have handed in their resignations!

Unfortunately, the majority of the board’s sole purpose seems to protect the CEO and totally disregarded any other issues that I listed—I no longer can serve on Cano Board and hereby tender my resignation basically effective yesterday March 30, 2023 ( at the board meeting [***])

Sincerely, Lewis Gold

EX-17.3

Exhibit 17.3

BARRY STERNLICHT

March 30, 2023

Dear Marlow and Fellow Board Members:

I hereby give notice of my resignation from the Board of Directors of Cano Health, Inc. effective immediately.

As you all know, since June 4, 2021 when we closed the merger of JAWS Acquisition Corp. with Cano Health, and Cano officially became a public company, I have worked tirelessly to support the Company’s mission and help it become a professionally run public company. I believed in Cano’s mission of providing high quality health care to the largely underserved and was impressed by the personal story, the passion and conviction of its CEO, Marlow Hernandez. I personally invested $50 million of the $800 million PIPE we raised from blue chip investors/shareholders like Fidelity, Third Point, Maverick, BlackRock and Owl Creek who shared my passion and enthusiasm for the firm. In total, we handed the company in excess of $1.4 billion in June 2021, less than two years ago. Fast forward to today, this management team has expended nearly all this cash and the Company has not enjoyed any demonstrable improvement in its core profitability. My interests are 100% aligned with the shareholders. The directors who have voiced serious concerns about the status quo have much more at stake in the Company, respectively, than the other members of the Board who appear willing to support the CEO at any cost. Unfortunately, I can no longer lend my name and reputation to the Company, nor support actions of the Board and Marlow Hernandez, which I believe are not in the best interest of stockholders.

I have communicated my concerns to the Board and to Marlow Hernandez directly on numerous occasions, but they have largely been ignored. To be crystal clear, I do not believe Marlow should remain the Chairman & CEO of the Company. I believe that his continued tenure is harmful to the interests of stockholders and to Cano employees for all the reasons I have previously stated to you.

I remain extremely troubled by the poor operating decisions and performance, by what I consider the opacity and obfuscation of information furnished to the Board, and by the inability to forecast the Company’s financial performance over which Marlow and his management team have presided. These factors have caused the Company’s stock price to be decimated, dropping over 90% from its debut, and the Company is now saddled with a crippling debt burden. The number and nature of related party transactions, together with what I consider poor governance (demonstrated by transactions such as MSP Recovery), is highly concerning to me as it should be to the rest of the Board.

Instead of the Board calling the CEO to account, the majority of the Board has decided to continue to support the CEO and to continue to preside over the destruction of shareholder value. Over the past year and a half, some shareholders have called me to voice their concern over Marlow’s stewardship and the Company’s financial deterioration. I listened and conveyed their thoughts, which included these negative perceptions of our CEO, to the Board. The minority of the Board – myself, Lew Gold and Elliot Cooperstone – have tried to effectuate change, but as a minority our hands are limited by those who remain firmly aligned with Marlow for reasons I cannot understand. I have never witnessed such poor corporate governance at any company, let alone a public company, and I have been involved in at least nine and served as Chairman or CEO of six.

As a steward of shareholder capital with fiduciary duties to stockholders, I cannot continue as a director under these circumstances.

Lest there be any doubt, I am tendering my resignation because I have a fundamental disagreement with management as set forth in Item 502(a) of Form 8-K.

Sincerely yours,

Barry Sternlicht

2340 Collins Avenue | Miami Beach, FL 33139

EX-99.1

Exhibit 99.1

Cano Health Comments on Resignation of Directors

NEWS PROVIDED BY

Cano Health, Inc. è

Mar 31, 2023, 07:38 ET

MIAMI, March 31, 2023 /PRNewswire/ — Cano Health, Inc. (“Cano Health” or the “Company”) (NYSE: CANO), a leading value-based primary care provider and population health company, issued the following statement:

“Our Board and management team have devoted considerable time and resources to analyzing the Company’s performance, operations, financial strength, and potential against the backdrop of the challenges the Company and the sector have faced. While we fully recognize the recent disappointing share price performance, our work has supported our strong confidence in the Company’s mission and fundamentals, our commitment to driving operational and financial improvements, and our belief in the Company’s continuing prospects for long-term shareholder value creation.

We are disappointed that three directors chose to resign due to what we believe is their focus solely on the short term. We strongly disagree with their representations about the Company and their assessment of Dr. Hernandez’s performance.

It is particularly concerning that Mr. Sternlicht decided to share his individual perspective on confidential Board deliberations and communications, which is misleading to shareholders and undermines the Board’s ability to engage in the vigorous exchange of diverse views that is necessary for good governance. The Company finds Mr. Sternlicht’s method of resignation particularly reckless and obviously at cross-purposes with shareholders’ best interests. Boards must have healthy debate about how best to drive shareholder value, including in difficult circumstances. It is irresponsible to air those debates in ways that are meant to undermine healthy Board debate and harm the Company and shareholders.

Cano Health’s Board and management will continue to work closely together, with intensity, to improve operational execution, enhance cost discipline, and achieve positive free cash flow. Cano Health has established a strong performance track record—providing patients improved access to care, lowering hospital admissions, and significantly reducing medical costs. This is where our focus will remain.

We look forward to communicating further over the coming months as the Company takes meaningful actions to realize its potential on behalf of all of its stakeholders and to create long-term shareholder value.”

About Cano Health

Cano Health (NYSE: CANO) is a high-touch, technology-powered healthcare company delivering personalized, value-based primary care to approximately 310,000 members. With its headquarters in Miami, Florida, Cano Health is transforming healthcare by delivering primary care that measurably improves the health, wellness, and quality of life of its patients and the communities it serves. Founded in 2009, Cano Health has more than 4,000 employees, and operates primary care medical centers and supports affiliated providers in nine states and Puerto Rico. For more information, visit canohealth.com or investors.canohealth.com.

Forward-Looking Statements: This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 19person33, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to future events and involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and could materially affect actual results, performance or achievements. Such forward-looking statement include, without limitation, our commitment to driving operational and financial improvements, working to improve operational execution, enhancing cost discipline and achieving positive cash flow. These forward-looking statements generally can be identified by phrases such as “will,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates” or other words or phrases of similar import. It is uncertain whether any

of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what impact they will have on our results of operations and financial condition. Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in forward-looking statements include, among others, changes in market or industry conditions, regulatory environment, competitive conditions, and receptivity to our services; changes in our strategy, future operations, prospects and plans; developments and uncertainties related to the Direct Contracting Entity program; our ability to realize expected financial results, including with respect to patient membership, total revenue and earnings; our ability to predict and control our medical cost ratio; our ability to grow market share in existing markets or enter into new markets and continue our growth; our ability to integrate our acquisitions and achieve desired synergies; our ability to maintain our relationships with health plans and other key payors; the impact of COVID-19 on our business and results of operations; our future capital requirements and sources and uses of cash, including funds to satisfy our liquidity needs; and our ability to recruit and retain qualified team members and independent physicians. For a detailed discussion of the risks and uncertainties that could cause our actual results to differ materially from those expressed or implied by the forward-looking statements, please refer to our filings with the SEC. Factors other than those listed above could also cause the Company’s results to differ materially from expected results. All information provided in this press release is as of the date hereof, and we undertake no duty to update or revise this information unless required by law.

Media Contact

Kekst CNC

Anntal Silver / Nick Capuano

anntal.silver@kekstcnc.com / nicholas.capuano@kekstcnc.com

Investor Contact

Cano Health IR

investors@canohealth.com

SOURCE Cano Health, Inc.

XML

Document and Entity Information	Mar. 30, 2023
Document And Entity Information [Line Items]
Amendment Flag	false
Entity Central Index Key	0001800682
Document Type	8-K
Document Period End Date	Mar. 30, 2023
Entity Registrant Name	CANO HEALTH, INC.
Entity Incorporation State Country Code	DE
Entity File Number	001-39289
Entity Tax Identification Number	98-1524224
Entity Address, Address Line One	9725 NW 117th Avenue
Entity Address, City or Town	Miami
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33178
City Area Code	(855)
Local Phone Number	226-6633
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Common Class A [Member]
Document And Entity Information [Line Items]
Security 12b Title	Class A common stock, $0.0001 par value per share
Trading Symbol	CANO
Security Exchange Name	NYSE
Warrant [Member]
Document And Entity Information [Line Items]
Security 12b Title	Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share
Trading Symbol	CANO WS
Security Exchange Name	NYSE