Item 2.02 Results of Operations and Financial Condition.
On July 11, 2023, Semler Scientific, Inc., or Semler, issued a press release in which it announced that it expects to report record quarterly revenues for the quarter ended June 30, 2023. The full text of the press release is being furnished as Exhibit 99.1 to this current report on Form 8-K and is incorporated herein by reference.
The information contained in this Item 2.02 and in the accompanying Exhibit 99.1 shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, or incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended, or the Securities Act, except as shall be expressly set forth by specific reference in such filing.
Item 2.05 Costs Associated with Exit or Disposal Activities.
On July 11, 2023, Semler announced the approval by its board of directors, or the Board, of a plan to strategically realign Semler’s operations and proactively improve its operating leverage through the implementation of a headcount reduction as well as the curtailment of other operating expenses. Through this plan Semler intends to streamline its activities and redeploy its resources to focus on goals expected to drive near-term value.
The strategic plan to streamline operations will reduce Semler’s headcount by approximately 30%. Semler expects to complete its headcount reduction and the implementation of the curtailment on or around September 15, 2023. Semler currently anticipates this will result in the reduction in quarterly operating expenses of approximately $1.5 million to $2.0 million, which are expected to be realized during the fourth quarter ended December 31, 2023. Semler currently estimates that it will incur severance costs in the range of $0.7 million to $0.9 million consisting of one-time termination benefits, which are expected to be paid by December 31, 2023. The charges Semler expects to incur in connection with its streamlining efforts are subject to a number of assumptions, risks and uncertainties, and actual results may materially differ. Semler may also incur other material charges not currently contemplated due to events that may occur as a result of, or associated with, these actions.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Chief Financial Officer
On July 7, 2023, the Board appointed Renae Cormier as Semler’s chief financial officer, principal financial officer and principal accounting officer effective July 10, 2023.
Ms. Cormier, age 51, will continue as Semler’s head of corporate communications and business strategy, a role she has held since May 2022. In this capacity, Ms. Cormier led Semler’s investor relations efforts and was instrumental in helping to shape the overall direction of Semler. From 2001 to until joining Semler, Ms. Cormier held various positions at investment management firms. Most recently she was partner at Aravt Global from 2013 to 2022, where she was responsible for allocating investment capital in public and private companies across a variety of industries, as well as leading accounting focused risk management across the portfolio’s holdings. From 1997 to 2001 she was an auditor and provided mergers and acquisitions transaction advisory services at PricewaterhouseCoopers. Ms. Cormier holds a dual bachelor’s degree in accounting and finance from the University of Colorado.
Ms. Cormier’s employment and compensation will continue to be governed by the terms of her May 2022 employment agreement. Under the terms of the agreement, Ms. Cormier can be terminated at any time and her job titles, salaries and benefits may be modified from time to time as Semler deems necessary. Ms. Cormier continues to be eligible to receive grants of equity awards under Semler’s 2014 stock incentive plan and participate in Semler’s health, welfare and other benefit programs, including its 401 (k), on the same terms as all other Semler employees. In connection with her promotion to chief financial officer effective July 10, 2023, Ms. Cormier’s base salary was increased to $360,000 with target incentive of 20% of base salary. In addition, upon the recommendation of its compensation committee, the Board granted Ms. Cormier an option to acquire 5,000 shares of Semler’s common stock effective July 10, 2023. The option was granted under Semler’s 2014 Stock Incentive Plan, or the Plan, has an exercise price of $25.47 per share (the closing price on the grant date), a 10-year term, and is governed by Semler’s standard form of stock option agreement under the Plan.