Sec Form 13D Filing - Mill Road Capital II L.P. filing for PERFORMANT FINL CORP (PFMT) - 2020-05-12

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 1)*

Performant Financial Corporation

(Name of Issuer)

Common Stock, par value $0.0001 per share

(Title of Class of Securities)

71377E105

(CUSIP Number)

Mill Road Capital II, L.P.

Attn: Thomas E. Lynch

382 Greenwich Avenue

Suite One

Greenwich, CT 06830

203-987-3500

With a copy to:

Peter M. Rosenblum, Esq.

Foley Hoag LLP

155 Seaport Blvd.

Boston, MA 02210

617-832-1151

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

May 5, 2020

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.  ☐

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

This Amendment No. 1 to the joint statement on Schedule 13D with respect to the common stock, par value $0.0001 per share (the “Common Stock”), of Performant Financial Corporation, a Delaware corporation (the “Issuer”), filed by the Reporting Persons (as defined below) on January 29, 2018 (such joint statement, as amended herein, the “Schedule 13D”), amends the Schedule 13D as follows:

1.    The first paragraph of paragraph (a) of Item 2 of the Schedule 13D shall hereby be amended and restated in full as follows:

This joint statement on Schedule 13D is being filed by Thomas E. Lynch, Justin C. Jacobs, Eric Yanagi, Mill Road Capital II GP LLC, a Delaware limited liability company (the “GP”), and Mill Road Capital II, L.P., a Delaware limited partnership (the “Fund”). Each of the foregoing is referred to in this Schedule 13D as a “Reporting Person” and, collectively, as the “Reporting Persons.” Messrs. Lynch, Jacobs and Yanagi, are the management committee directors of the GP and, in this capacity, are referred to in this Schedule 13D as the “Managers.” The GP is the sole general partner of the Fund. Mr. Lynch has shared authority to vote and dispose of the shares of Common Stock reported in this Schedule 13D.

2.    Paragraph (b) of Item 2 of the Schedule 13D shall hereby be amended and restated in full as follows:

The business address of each of the Managers (other than Mr. Yanagi), and the address of the principal business and the principal office of the GP and the Fund, is 382 Greenwich Avenue, Suite One, Greenwich, CT 06830. The business address of Mr. Yanagi is 400 Oyster Point Blvd, Suite 526, South San Francisco, CA 94080.

3.    Item 3 of the Schedule 13D shall hereby be amended and restated in full as follows:

The Reporting Persons acquired beneficial ownership of an aggregate of 3,479,615 shares of Common Stock for $8,836,354.55 using working capital from the Fund and the proceeds of margin loans under margin loan facilities maintained in the ordinary course of business by the Fund with a broker on customary terms and conditions. In addition, Mr. Yanagi was granted the Director RSUs (as defined in Item 5(c) hereof) in connection with his service as a director of the Issuer.

4.    Item 4 of the Schedule 13D shall hereby be amended by inserting the following paragraph after the first paragraph:

On May 5, 2020, Mr. Yanagi was appointed to the Issuer’s Board of Directors.

5.    Paragraphs (a), (b) and (c) of Item 5 of the Schedule 13D shall hereby be amended and restated in full as follows:

(a, b)    The percentages of beneficial ownership reported in this Item 5, and on each Reporting Person’s cover page to this Schedule 13D, are based on a total of 54,028,174 shares of the Common Stock issued and outstanding as of April 28, 2020, as reported in most recent annual report of the Issuer on Form 10-K for its fiscal year ended December 31, 2019. All of the share numbers reported below, and on each Reporting Person’s cover page to this Schedule 13D, are as of May 12, 2020, unless otherwise indicated. The cover page to this Schedule 13D for each Reporting Person is incorporated by reference in its entirety into this Item 5(a, b).

Each of the Reporting Persons (other than Mr. Yanagi) beneficially owns 3,479,615 shares of Common Stock, or approximately 6.4% of the outstanding shares of Common Stock, Mr. Yanagi beneficially owns 230,415 shares of Common Stock, or approximately 0.4% of the outstanding shares of Common Stock, and the Reporting Persons beneficially own, in the aggregate, 3,710,030 shares of Common Stock, or approximately 6.9% of the outstanding shares of Common Stock. Mr. Jacobs does not have beneficial ownership of any shares of Common Stock.

(c)    Except as otherwise described in this Schedule 13D, no Reporting Person effected any transaction in shares of the Common Stock since March 13, 2020 (the date 60 days prior to the filing of this Schedule 13D).

6.    Item 6 of the Schedule 13D shall hereby be amended by inserting the following paragraph at its beginning:

On May 5, 2020, the Issuer granted 98,749 restricted stock units to Mr. Yanagi in connection with his appointment as a director of the Issuer, which will vest as of the date of the Issuer’s 2021 annual meeting of stockholders or upon a change of control (the “Annual Director RSU”). In addition, on May 5, 2020, the Issuer granted 131,666 restricted stock units to Mr. Yanagi, which will vest ratably over four years or upon a change of control (together with the Annual Director RSU, the “Director RSUs”). Pursuant to a pre-existing contractual obligation, Mill Road Capital Management LLC has the right to receive the economic benefit of the Director RSUs.

7.    Item 7 of the Schedule 13D shall hereby be amended by adding the following exhibit:

Exhibit 4    Confirming Statement of Eric Yanagi dated May 12, 2020.

8.    Except as expressly modified hereby, all provisions of the Schedule 13D shall continue in full force and effect.

[signature pages follow]

Signature

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.