ATI PHYSICAL THERAPY, INC. : Change in Directors or Principal Officers, Financial Statements and Exhibits (form 8-K)

Item 5.02 Departure of Directors or Certain Officers; Election of Directors;

          Appointment of Certain Officers; Compensatory Arrangements of Certain
          Officers.

Appointment of New Chief Operating Officer

ATI Physical Therapy, Inc. (the “Company”) announced the appointment of Scott
Gregerson as the Company’s Chief Growth Officer to be effective as of January 3,
2023 (the “Effective Date”).

Mr. Gregerson has held executive leadership positions at Envison Healthcare,
Epic Care, Stanford Healthcare and ValleyCare Health. In these chief-executive,
presidential and vice-presidential roles he developed and led strategic business
development and growth, often connecting large-scale provider groups with
hospital and health systems. His prior experience also includes healthcare
leadership positions at Fresenius Medical Care (Chicago), Doctors Community
Hospital (Lanham, MD) and Sonoma Valley Hospital (Sonoma, Calif). Mr. Gregerson holds a bachelor’s degree from the University of California, Santa Barbara and a
juris doctor degree from Washington and Lee University School of Law.

In connection with his appointment, the Company and Mr. Gregerson have entered
into a written employment agreement (the “Employment Agreement”) for an initial
term of three-years that automatically renews for one-year terms thereafter,
unless notice of non-renewal is provided 30 days before the end of the term then
in effect, and a minimum base salary of $490,000 per year. In addition, the
Employment Agreement provides for an annual target bonus equal to 75 % of his
base salary (“Target Bonus”), also be granted long-term incentive equity awards
for 2023 pursuant to the Company’s 2021 Equity Incentive Plan, with a grant-date
fair market value of $500,000 in 2023 as determined by the Compensation
Committee. Each annual grant is to be comprised of 100% of restricted stock
units vesting in three equal annual tranches. Mr. Gregerson is eligible to
participate in the Company’s employee benefit plans as in effect from time to
time on the same basis as generally made available to other senior executives of
the Company.

In addition, the Employment Agreement also provides for certain payments and
benefits in the event of a termination of his employment under specific
circumstances. If, during the term of the Employment Agreement, his employment
is terminated by the Company other than for “Discharge For Cause,” death or
disability (each as defined in his agreement), he would be entitled to: (a)
upon termination at any time other than during the 18-month period following a
Change in Control (as defined in his agreement), (i) an amount equal to 1.25
times the sum of (x) Mr. Gregerson’s base salary and (y) Target Bonus, in
substantially equal installments over 15 months from termination, (ii) an annual
bonus for the then-current fiscal year based on actual performance for such
year, pro-rated from the first date of such fiscal year through Mr. Gregerson’s last date of continued active employment, payable at the same time as annual
bonuses are paid other senior executives of the Company and (iii) if elected,
the employer and employee portion of any COBRA health and welfare premiums for a
period equal to twelve (12) months from the date of termination, or, if earlier,
(x) the first date that Mr. Gregerson is no longer eligible for COBRA, or (y)
the first date that Mr. Gregerson becomes eligible for health benefits from
another employer; or (b) upon termination during the 18-month period following a
Change in Control (i) an amount equal to 1.5 times the sum of (x) Mr.
Gregerson’s base salary and (y) Target Bonus, in a lump sum on the first payroll
date, (ii) an annual bonus for the then-current fiscal year based on actual
performance for such year, pro-rated from the first date of such fiscal year
through Mr. Gregerson’s last date of continued active employment, payable at the
same time as annual bonuses are paid other senior executives of the Company,
(iii) if elected, the employer and employee portion of any COBRA health and
welfare premiums for a period equal to twelve (12) months from the date of such
termination, or, if earlier, (x) the first date that Mr. Gregerson is no longer
eligible for COBRA or (y) the first date that Mr. Gregerson becomes eligible for
health benefits from another employer.

Mr. Gregerson’s receipt of the termination payments and benefits is contingent
upon execution of a general release of any and all claims arising out of or
related to his employment with the Company and the termination of his
employment, and compliance with the restrictive covenants described in the
following paragraph.

Pursuant to his Employment Agreement, Mr. Gregerson has also agreed to customary
restrictions with respect to the disclosure and use of the Company’s
confidential information and has agreed that work product or inventions
developed or conceived by his while employed with the Company relating to its
business is the Company’s property. In addition, during the term of his
employment and for the 15-month period following his termination of employment
if Mr. Gregerson is eligible to receive severance benefits and an 12-month
period following his termination in any other circumstance, Mr. Gregerson has
agreed not to (1) perform services on behalf of a competing business which was
the same or similar to the types services he was authorized, conducted, offered
or provided to the Company, (2) solicit or induce any of the Company’s employees
or independent contractors to terminate their employment with the Company or (3)
solicit any actual or prospective customers with whom he had contact on behalf
of a competing business. In addition, his Employment Agreement mandates that his
confidentiality obligations continue after the termination of employment.

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Mr. Gregerson has no family relationship with any of the executive officers or
directors of the Company. There are no arrangements or understandings between Mr. Gregerson and any other person pursuant to which he was appointed as an
officer of the Company.

The foregoing summary of the Employment Agreement does not purport to be
complete and is qualified in its entirety by reference to the complete text
of the Employment Agreement, a copy of which is attached as Exhibit 10.1.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

EXHIBIT                                    DESCRIPTION
NUMBER
  10.1        Employment Agreement effective December 16, 2022 by and between ATI
              Physical Therapy, Inc. and Scott Gregerson

104           Cover Page Interactive Data File (embedded within the Inline XBRL
              document)

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