HealthSouth Settles on Board

Striplin is also attacked for his ties to MedCenter and Capstone, another business "spawned by Scrushy and his close associates." The latter, a real estate investment trust, reportedly purchased HealthSouth properties below their appraisal value and then leased some of them back to the company at above-market rates.

Striplin has served on the boards of both MedCenter and Capstone but denies that he currently has a personal investment in either one. He also works full time as the CEO of Nelson-Brantly Glass Contractors, a company that snagged a HealthSouth contract worth $5.9 million -- nearly a year of annual sales -- just weeks before he joined an internal HealthSouth committee that defended Scrushy's insider stock sales even before it began investigating the transactions.

Finally, Strong -- like Chamberlin -- is criticized for his ownership stake in both MedCenter and Source Medical. Although HealthSouth can choose which directors to boot first, Grant has speculated that Chamberlin and Striplin may top that list.

In the end, however, he said that all five incumbents must go.

"Regime change was desperately needed at HealthSouth," he said. "Accomplishing a regime change through this settlement -- without a court-ordered annual meeting and a full-scale proxy fight -- will allow HealthSouth to stay focused on its turnaround, thereby providing shareholders and other constituents with the best situation of all: a new board and a focused management."

HealthSouth shares -- which traded for mere pennies after the accounting scandal first broke -- jumped 2.7% to $4.56 on Tuesday's news.