Form 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): April 7, 2021

 

 

Change Healthcare Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Delaware   001-38961   82-2152098

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

424 Church Street, Suite 1400

Nashville, Tennessee 37219

(Address of Principal Executive Offices) (Zip Code)

(615) 932-3000

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

 

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

Common Stock, par value $0.001 per share   CHNG   The Nasdaq Stock Market LLC
6.00% Tangible Equity Units   CHNGU   The Nasdaq Stock Market LLC

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 8.01 Other Events.

The following disclosures supplement the disclosures contained in the definitive proxy statement on Schedule 14A (the “Proxy Statement”), dated March 5, 2021, which was filed by Change Healthcare Inc. (“Change” or “Change Healthcare”) with the U.S. Securities and Exchange Commission (the “SEC”) and mailed on or about March 5, 2021 to Change stockholders of record as of the close of business on February 26, 2021, in connection with the previously announced proposed acquisition of Change by UnitedHealth Group Incorporated (“UnitedHealth Group” and the proposed acquisition, the “Transaction”).

Following the announcement of the Transaction, as of the date of this Current Report on Form 8-K, nine lawsuits challenging the Transaction have been filed. The first lawsuit, a putative class action captioned Krueger v. Change Healthcare Inc., et al., was filed in Tennessee Chancery Court, Davidson County, on February 24, 2021 and voluntarily dismissed without prejudice on March 17, 2021. The second lawsuit, captioned Brash v. Change Healthcare Inc., et al., was filed in the United States District Court for the Southern District of New York on March 18, 2021, and amended on March 23, 2021. The third lawsuit, a putative class action captioned Bushansky v. Change Healthcare Inc., et al., was filed in the United States District Court for the Northern District of California on March 19, 2021. The fourth lawsuit, captioned Wilhelm v. Change Healthcare Inc., et al., was filed in the United States District Court for the District of Delaware on March 23, 2021. The fifth lawsuit, captioned Schwartz v. Change Healthcare Inc., et al., was filed in the United States District Court for the Eastern District of New York on March 23, 2021. The sixth lawsuit, captioned Marin v. Change Healthcare Inc., et al., was filed in the United States District Court for the Eastern District of New York on March 24, 2021. The seventh lawsuit, captioned Raagas v. Change Healthcare Inc., et al., was filed in the United States District Court for the District of Delaware on March 25, 2021. The eighth lawsuit, captioned LR Trust v. Change Healthcare Inc., et al., was filed in the United States District Court for the District of Delaware on April 6, 2021. The ninth lawsuit, captioned Artis v. Change Healthcare Inc., et al., was filed in the United States District Court for the Eastern District of Pennsylvania on April 7, 2021. The operative complaints filed in the pending lawsuits name Change and Change’s board of directors as defendants and allege, among other things, that the Proxy Statement is materially incomplete and misleading in violation of Sections 14(a) and 20(a) of the Securities Exchange Act of 1934 and Rule 14a-9 promulgated thereunder. Change has also received written demands from purported stockholders relating to the Transaction. We refer to the foregoing lawsuits and demands collectively as the “Merger Actions.”

Change believes that the Merger Actions are without merit and that supplemental disclosures are not required or necessary under applicable laws. However, in order to minimize the risk that the Merger Actions delay or otherwise adversely affect the Transaction, and to minimize the costs, risks and uncertainties inherent in defending the lawsuits, and without admitting any liability or wrongdoing, Change has decided to supplement the Proxy Statement as described in this Current Report on Form 8-K in order to moot certain claims asserted in the Merger Actions. Change and the other named defendants deny that they have violated any laws or breached any duties to Change’s stockholders. Nothing in this Current Report on Form 8-K shall be deemed an admission of the legal necessity or materiality under applicable laws of any of the disclosures set forth herein. To the contrary, Change specifically denies all allegations in the Merger Actions that any additional disclosure was or is required to supplement the Proxy Statement under applicable law.

Supplemental Disclosures

The following disclosures should be read in conjunction with the disclosures contained in the Proxy Statement, which should be read in its entirety. To the extent that information set forth herein differs from or updates information contained in the Proxy Statement, the information contained herein supersedes the information contained in the Proxy Statement. All page references are to pages in the Proxy Statement, and any defined terms used but not defined herein shall have the meanings set forth in the Proxy Statement.


The Proxy Statement is hereby amended and supplemented as follows:

1) The following disclosure replaces the first full sentence on page 8. The modified text is underlined below.

In addition, pursuant to the terms of the Merger Agreement, Change’s directors and executive officers will be entitled to certain ongoing indemnification, expense advancement and insurance arrangements. In addition, pursuant to the TRA Letter Agreement (as defined below), certain of Change’s directors and executive officers will become entitled to early termination payments under the 2017 TRA (as defined below). It is also possible that UnitedHealth Group may seek early terminations of other TRAs (as defined below). Should UnitedHealth Group seek to do this, it is possible that other directors and officers could receive early termination payments under those other TRAs.

2) The following disclosure replaces the last full paragraph on page 40. The modified text is underlined or struck-through (as applicable) below.

Following such discussion, the Board met in executive session, without Change management present. Mr. Lance noted that, during an recent update call he had with Messrs. Wichmann and Rex on or about December 8, 2020, Mr. Wichmann expressed interest in speaking with Mr. de Crescenzo about a potential post-closing employment role for Mr. de Crescenzo at UnitedHealth Group. Mr. Lance reported that he told Mr. Wichmann that UnitedHealth Group should not discuss this topic with Mr. de Crescenzo or other members of Change management until the Board provided its consent for UnitedHealth Group to do so. The Board then discussed the topic and determined that, based on the progress that the parties had made in negotiations on key transaction terms thus far (principally, price and provisions related to transaction certainty), the Board was prepared to provide its consent to UnitedHealth Group to reach out to Mr. de Crescenzo regarding potential post-Closing employment with UnitedHealth Group, provided that the Board would receive regular updates regarding the material terms of any such proposed arrangements with Mr. de Crescenzo or other members of Change’s senior management team. It was further determined that Mr. Lance would convey this approval to Mr. Wichmann at their next regularly-scheduled call, on December 18, 2020, so long as no negative developments on the progress of the transaction occurred before such meeting.

3) The following disclosure replaces the first full sentence on page 41. The modified text is underlined or struck-through (as applicable) below.

During the weeks of December 14 and December 21, representatives of Simpson Thacher and Sullivan & Cromwell continued to negotiate and exchange drafts of the Merger Agreement, including provisions relating to (i) the termination fee payable by Change to UnitedHealth Group under certain circumstances, (ii) the pre-Closing restrictions on Change’s operation of its business, (iii) the treatment of Change employee equity awards in the Merger and (iv) the proposed treatment, in connection with the consummation of the Merger, of certain tax receivable agreements between Change and/or its subsidiaries, on the one hand, and certain investment funds affiliated with Blackstone (such funds, the “TRA Letter Agreement Parties”) current or former stockholders of Change, on the other hand (such tax receivable agreements, which are filed as Exhibits 10.2 through 10.7 to Change’s Form 10-K for the fiscal year ended March 31, 2020, the “Applicable TRAs”). In particular, UnitedHealth Group sought to negotiate the treatment of certain investment funds affiliated with Blackstone (such funds, the “TRA Letter Agreement Parties”) under the TRAs to which the TRA Letter Agreement Parties are parties (such TRAs, which are filed as Exhibits 10.3, 10.4 and 10.5 to Change’s Annual Report on Form 10-K for the fiscal year ended March 31, 2020, the “Applicable TRAs”). Each TRA provides Change (or its subsidiary) with the option to terminate such TRA prior to its normal expiration date upon a “Change of Control” (as defined therein), and the proposed acquisition of Change by UnitedHealth Group will constitute a Change of Control under each TRA. In order to terminate a given TRA prior to its normal expiration date, Change (or its subsidiary) must make a termination payment to the counterparties thereunder. Each TRA contains a formula for computing the size of the termination payment. The formula terms require Change (or its subsidiary) to make certain determinations and assumptions (e.g., determinations about the value of certain of the Change party’s tax assets and assumptions regarding the Change party’s taxable income) and apply the appropriate discount rate for the termination payment. UnitedHealth Group requested that the TRA Letter Agreement Parties agree on the method of calculating the termination payments under the Applicable TRAs concurrently with the execution of the Merger Agreement. The purpose of doing so was to provide UnitedHealth Group with greater certainty as to the termination payments that would be owed should UnitedHealth Group choose to terminate the Applicable TRAs in connection with the Closing.


4) The following disclosure replaces the first full paragraph on page 57. The modified text is underlined or struck-through (as applicable) below.

The following table sets forth a summary of the Projections and certain historical financial information for comparison purposes. Dollar totals are in millions and fiscal years end on March 31. The Projections reflected Change’s acquisition, on May 1, 2020, of 100% of the ownership interest in eRx Network Holdings, Inc. (as disclosed in Change’s Current Report on Form 8-K filed on May 4, 2020) and Change’s acquisition, on June 1, 2020, of 100% of the ownership interest in each of PDX, Inc., National Healthcare Information Network, Inc. and Freedom Data Systems, Inc. (as disclosed in Change’s Current Report on Form 8-K filed on June 1, 2020), each as further described in Note 4 to Change’s Quarterly Report for the period ended December 31, 2020 filed on February 4, 2021. The Projections for fiscal years 2021 through 2023 with respect to “Solutions Revenue”, “Adjusted EBITDA” and “Unlevered Free Cash Flow” (the “LRP Projections”) were prepared by management as part of the Board-approved LRP, independent of Change’s evaluation of the proposed transaction with UnitedHealth Group. The Projections for fiscal years 2024 through 2030 with respect to “Solutions Revenue”, “Adjusted EBITDA” and “Unlevered Free Cash Flow” are not part of the LRP but were prepared by management and approved by the Board as extrapolations of the LRP Projections for purposes of the valuation analyses conducted by Goldman Sachs. The Tax Attribute Projections (as defined in Note 4 below) with respect to “Net Impact to Cash Flows from Tax Attributes” were prepared by management in the ordinary course, independent of Change’s evaluation of the proposed transaction with UnitedHealth Group. Change provided a portion of the LRP Projections (but not any of the other Projections) to UnitedHealth Group in connection with UnitedHealth Group’s evaluation of the proposed transaction.

5) Each reference to “Net Impact to Cash Flows from Tax Attributes” included in the Proxy Statement (including in the table on page 57) is replaced with a reference to “Tax Attribute Projections”, as these two terms are synonymous.

6) The following disclosure replaces Note 4 on page 58. The modified text is underlined or struck-through (as applicable) below.

“Net Impact to Cash Flows from Tax Attributes” means the aggregate net cash flow impact of tax attributes of Change, and is comprised of net operating losses, which have been incurred or are expected to be on November 30 in respect of the then-current fiscal year (e.g., incurred on November 30, 2020 in respect of the fiscal year ending March 31, 2021), and payments under the tax receivable agreements filed as Exhibits 10.2 through 10.7 to Change’s Form 10-K for the fiscal year ended March 31, 2020 TRAs, which payments are made on July 15 in respect of the most recently completed fiscal year (e.g., payments made on July 15, 2021 in respect of the fiscal year ending March 31, 2021). Change has historically generated tax losses from its operations (i.e., net operating losses), which can be carried forward and utilized against future taxable income to lower Change’s tax payments in future years. In general, until the TRAs expire, 85% of the future tax savings from a portion of these net operating losses, as well as other tax attributes, such as amortization on certain intangibles, must be paid to current or previous stockholders of Change under the TRAs (as defined below). The “Tax Attribute Projections” reflect the expected reduction in taxes owed by Change generated by these existing, as well as future projected, net operating losses and other tax attributes, net of expected payments under the TRAs with respect thereto. As a hypothetical example, if Change had net operating losses that were expected to save Change $100 in future taxes, but Change owed $85 in future TRA payments on account of such losses, then the “Tax Attribute Projections” from such net operating losses would be $15.

7) The following disclosure replaces the first paragraph under the section entitled “Interests of Change’s Executive Officers and Directors in the Merger” on page 58. The modified text is underlined below.


In considering the recommendation of the Board that you vote to approve the Merger Proposal, you should be aware that, aside from their interests as Change stockholders, Change’s directors and executive officers have interests in the Merger that are different from, or in addition to, the interests of Change stockholders generally, which may create potential conflicts of interest. These interests are described in more detail below, and with respect to the named executive officers of Change, are quantified in the “Golden Parachute Compensation” table below. The Board was aware of these interests and considered them when it adopted the Merger Agreement and approved the Merger. The directors, executive officers and certain other members of management and employees of Change may be deemed “participants” in the solicitation of proxies from Change stockholders in favor of the proposed Merger. You can find information about Change’s executive officers and directors (including information regarding their historical relationships with each other and with current and former stockholders of Change) in its Annual Report on Form 10-K for the fiscal year ended March 31, 2020 filed with the SEC on June 4, 2020, in its Definitive Proxy Statement filed with the SEC on Schedule 14A on July 16, 2020 and in its Current Reports on Form 8-K filed with the SEC on May 13, 2020, June 18, 2020 and December 28, 2020, all of which are incorporated by reference herein (other than the portions of such documents not deemed to be filed).

8) The following disclosure replaces the section entitled “Indemnification; Directors’ and Officers’ Insurance” on page 58. The modified text is underlined below.

Indemnification; Directors’ and Officers’ Insurance

Pursuant to the terms of the Merger Agreement, Change’s directors and executive officers will be entitled to certain ongoing indemnification, expense advancement and insurance arrangements. See the section entitled “The Merger Agreement—Indemnification; Directors’ and Officers’ Insurance” beginning on page 94 for a description of such ongoing arrangements.

Payments Under TRAs

As described above under “Background of the Merger,” Change is party to the TRAs. UnitedHealth Group will have the option, exercisable in its sole discretion, to terminate these TRAs in connection with the Closing. UnitedHealth Group determined, prior to the parties’ execution of the Merger Agreement, that it wished to terminate the Applicable TRAs in connection with the Closing and, accordingly, UnitedHealth Group entered into the TRA Letter Agreement with Change and the TRA Letter Agreement Parties to memorialize such determination and agree on certain aspects of the termination payment calculation, as described below under “Certain Ancillary Agreements—TRA Letter Agreement”. Messrs. Lance, de Crescenzo, Pead and Joshi are parties to the TRA filed as Exhibit 10.3 to Change’s Form 10-K for the fiscal year ended March 31, 2020 (the “2017 TRA”). The 2017 TRA is one of the Applicable TRAs and, accordingly, will be terminated in connection with the Closing pursuant to the TRA Letter Agreement. Additionally, Mr. Pead is a party to the TRA filed as Exhibit 10.6 to Change’s Form 10-K for the fiscal year ended March 31, 2020 (the “Management TRA”). The Management TRA is not one of the Applicable TRAs and, accordingly, is not covered by the TRA Letter Agreement.

As a result of the termination of the 2017 TRA in connection with the Closing, Messrs. Lance, de Crescenzo, Pead and Joshi will each be entitled to an early termination payment. Although the precise amount of these early termination payments cannot be determined until the Closing, and depends on facts and circumstances such as tax rates in effect at the Closing, it is anticipated that, upon the termination of the 2017 TRA in connection with the Closing, Mr. Lance will receive $129,000 or less, Mr. de Crescenzo will receive $86,000 or less, Mr. Joshi will receive $86,000 or less and Mr. Pead will receive $43,000 or less. Each such person’s maximum amount is such person’s pro rata portion of the gross liability under the 2017 TRA, which gross liability is disclosed in the financial statements in Change’s Form 10-Q for the quarterly period ended September 30, 2020.

Additionally, as described below under “The Merger Agreement—TRA Terminations,” prior to the Closing, UnitedHealth Group may elect to cause the early termination of the other TRAs. Should UnitedHealth Group choose to do this, Change will use reasonable best efforts to assist UnitedHealth Group. If UnitedHealth Group chooses to cause the early termination of the Management TRA in connection with the Closing, then Mr. Pead will be entitled to an early termination payment. Although the precise amount of any early termination payment owed to Mr. Pead under the Management TRA cannot be determined until the Closing, and depends on facts and


circumstances such as tax rates in effect at the Closing, it is anticipated that Mr. Pead would receive $20,000 or less upon the termination of the Management TRA. Such maximum amount is Mr. Pead’s pro rata portion of the gross liability under the Management TRA, which gross liability is disclosed in the financial statements in Change’s Form 10-Q for the quarterly period ended September 30, 2020.

9) The following disclosure replaces the first paragraph on page 98. The modified text is underlined below.

TRA Terminations

Change and/or certain of its subsidiaries are obligors under the tax receivable agreements filed as Exhibits 10.2 through 10.7 to Change’s Form 10-K for the fiscal year ended March 31, 2020 (the “TRAs”). Prior to the Closing, in consultation with and at the direction of UnitedHealth Group, Change will use reasonable best efforts to take such actions as may be necessary or appropriate to terminate, as of the date of and immediately following the Closing (but contingent on the Closing), the TRAs (other than the Applicable TRAs, which are covered by the TRA Letter Agreement and thus are required to be terminated in connection with the Closing), on the terms and subject to the conditions set forth therein (such terminations, the “TRA Terminations”). During the Interim Period, UnitedHealth Group and Change will cooperate in good faith to prepare drafts of such TRA Terminations that can be delivered to each party to the TRAs. Thereafter, Change will provide UnitedHealth Group with the opportunity to participate in any substantive communications with such parties related to the TRA Terminations and UnitedHealth Group will direct all such communications in its reasonable discretion to the extent related to the TRA Terminations, including all negotiations and discussions relating to the TRA Terminations. Without UnitedHealth Group’s prior written consent (which may be withheld in UnitedHealth Group’s sole discretion), Change may not enter into any TRA Termination or supplement, amend or otherwise modify any TRA or TRA Termination.

10) The following disclosure replaces the last paragraph on page 107. The modified text is underlined below.

Change and/or certain of its subsidiaries are obligors under the Applicable TRAs, pursuant to which Change has agreed to make certain payments with respect to realized tax savings as a result of certain net operating losses and/or certain other tax attributes, as applicable, which vary depending upon a number of factors, including the amount and timing of the taxable income Change generates in the future and the tax rate then applicable. Concurrently with the entry into the Merger Agreement, UnitedHealth Group, Change and the TRA Letter Agreement Parties entered into the TRA Letter Agreement (which is filed as Exhibit 10.1 to Change’s Current Report on Form 8-K filed on January 6, 2021) pursuant to which, among other matters, UnitedHealth Group will direct Change, pursuant to the terms of the Merger Agreement, to exercise Change’s right, in connection with the Closing, to terminate each of the Applicable TRAs by making the respective early termination payments specified under each Applicable TRA, pursuant to the applicable discount rate set forth in each Applicable TRA and the methodology set forth in the TRA Letter Agreement, in accordance with the terms of each such Applicable TRA. More specifically, calculation of the early termination payment under each Applicable TRA will be based on a set of valuation assumptions specified in such Applicable TRA, including that (i) the taxpayer terminating such agreement will have taxable income sufficient to fully utilize certain tax attributes that are the subject of such Applicable TRA, (ii) certain loss carryovers available as of the date of the early termination will be utilized on a pro rata basis from such date through the scheduled expiration date of such loss carryovers and (iii) the U.S. federal, state and local income tax rates that will be in effect for the relevant years will be those rates actually in effect on the date of early termination. Additionally, the TRA Letter Agreement Parties have agreed, pursuant to the TRA Letter Agreement, that the correct early termination discount rate under each Applicable TRA is 10% per annum, compounded annually. Although the precise amount of any early termination payment owed to the TRA Letter Agreement Parties under the Applicable TRAs cannot be determined until the Closing, and depends on facts and circumstances such as tax rates in effect at the Closing, it is anticipated that, upon the termination of the Applicable TRAs in connection with the Closing, the TRA Letter Agreement Parties will collectively receive $178,000,000 or less. Such maximum amount is the TRA Letter Agreement Parties’ pro rata portion of the gross liability under the Applicable TRAs, which gross liability is disclosed in the financial statements in Change’s Form 10-Q for the quarterly period ended September 30, 2020. The TRA Letter Agreement will terminate upon the valid termination of the Merger Agreement.


Item 9.01 Financial Statements and Exhibits.

As disclosed above, the TRA Letter Agreement is filed as Exhibit 10.1 to Change’s Current Report on Form 8-K filed on January 6, 2021. The TRA Letter Agreement includes Annex I (Amortization Schedule) and Annex II (Net Operating Loss Schedule), though such annexes were not included in the as-filed version of the TRA Letter Agreement. Such annexes are filed as Exhibits 99.1 and 99.2, respectively, to this Current Report.

 

(d)

Exhibits

 

Exhibit

No.

   Description
99.1    Annex I (Amortization Schedule) to the TRA Letter Agreement.
99.2    Annex II (Net Operating Loss Schedule) to the TRA Letter Agreement.

Forward-Looking Statements

This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations and businesses of Change Healthcare. Some of these statements can be identified by terms and phrases such as “anticipate,” “believe,” “intend,” “estimate,” “expect,” “continue,” “could,” “should,” “may,” “plan,” “project,” “predict” and similar expressions. Change Healthcare cautions readers of this communication that such “forward looking statements,” including without limitation, those relating to the timing of the proposed merger and Change Healthcare’s future business prospects, revenue, working capital, liquidity, capital needs, interest costs and income, wherever they occur in this communication or in other statements attributable to Change Healthcare, are necessarily estimates reflecting the judgment of Change Healthcare’s senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the “forward looking statements.”

Factors that could cause Change Healthcare’s actual results to differ materially from those expressed or implied in such forward-looking statements include, but are not limited to, the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement; the inability to complete the proposed merger due to the failure to obtain stockholder approval for the proposed merger or the failure to satisfy other conditions to completion of the proposed merger, including that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the transaction; risks related to disruption of management’s attention from Change Healthcare’s ongoing business operations due to the transaction; the effect of the announcement of the proposed merger on Change Healthcare’s relationships with its customers, operating results and business generally; the risk that the proposed merger will not be consummated in a timely manner; exceeding the expected costs of the merger; Change Healthcare’s ability to retain or renew existing customers and attract new customers; macroeconomic and industry trends and adverse developments in the debt, consumer credit and financial services markets; uncertainty and risks related to the impact of the COVID-19 pandemic on the national and global economy, Change Healthcare’s business, suppliers, customers, and employees; Change Healthcare’s ability to connect a large number of payers and providers; Change Healthcare’s ability to provide competitive services and prices while maintaining its margins; further consolidation in end-customer markets; Change Healthcare’s ability to effectively manage costs; Change Healthcare’s ability to effectively develop and maintain relationships with channel partners; a decline in transaction volume in the U.S. healthcare industry; Change Healthcare’s ability to timely develop new services and the market’s willingness to adopt new services; Change Healthcare’s ability to maintain access to its data sources; Change Healthcare’s ability to maintain the security and integrity of its data; Change Healthcare’s ability to deliver services timely without interruption; Change Healthcare’s ability to make acquisitions and integrate the operations of acquired businesses; government regulation and changes in the regulatory environment; economic and political instability in the U.S. and international markets where Change Healthcare


operates; risks related to international operations; the ability of outside service providers and key vendors to fulfill their obligations to Change Healthcare; litigation or regulatory proceedings; Change Healthcare’s ability to protect and enforce its intellectual property, trade secrets and other forms of unpatented intellectual property; Change Healthcare’s ability to defend its intellectual property from infringement claims by third parties; changes in local, state, federal and international laws and regulations, including related to taxation; Change Healthcare’s reliance on key management personnel; Change Healthcare’s ability to manage and expand its operations and keep up with rapidly changing technologies; our adoption of new, or amendments to existing, accounting standards; losses against which Change Healthcare does not insure; Change Healthcare’s ability to make timely payments of principal and interest on its indebtedness; Change Healthcare’s ability to satisfy covenants in the agreements governing its indebtedness; Change Healthcare’s ability to maintain liquidity, and other risks. For a more detailed discussion of these factors, see the information under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Change Healthcare’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on June 4, 2020, and in Change Healthcare’s most recent Quarterly Report on Form 10-Q filed with the SEC on February 4, 2021.

Change Healthcare’s forward-looking statements speak only as of the date of this communication or as of the date they are made. Change Healthcare disclaims any intent or obligation to update any “forward looking statement” made in this communication to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

Additional Information and Where to Find It

This communication may be deemed solicitation material in respect of the proposed acquisition of Change Healthcare by UnitedHealth Group. In connection with the proposed merger transaction, Change Healthcare has filed with the SEC and furnished to Change Healthcare’s stockholders the Proxy Statement and other relevant documents. This filing does not constitute a solicitation of any vote or approval. Stockholders are urged to read the Proxy Statement and any other documents to be filed with the SEC in connection with the proposed merger or incorporated by reference in the Proxy Statement because they contain important information about the proposed merger.

Investors can obtain free of charge the Proxy Statement, which was filed with the SEC on March 5, 2021, and other documents filed with the SEC at the SEC’s website at https://www.sec.gov. In addition, the Proxy Statement and Change Healthcare’s annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available free of charge through Change Healthcare’s website at https://ir.changehealthcare.com. as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC.

The directors, executive officers and certain other members of management and employees of Change Healthcare may be deemed “participants” in the solicitation of proxies from stockholders of Change Healthcare in favor of the proposed merger. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the stockholders of Change Healthcare in connection with the proposed merger is set forth in the Proxy Statement and the other relevant documents filed with the SEC. You can find additional information about Change’s executive officers and directors in its Annual Report on Form 10-K for the fiscal year ended March 31, 2020 and in its definitive proxy statement filed with the SEC on Schedule 14A on July 16, 2020.


SIGNATURE

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.

 

CHANGE HEALTHCARE INC.
By:  

/s/ Loretta A. Cecil

  Name:   Loretta A. Cecil
  Title:  

Executive Vice President,

General Counsel

Date: April 7, 2021

EX-99.1

Exhibit 99.1

Annex I

Amortization Schedule

[Attached]


Illustrative Calculation

 

Tax Year    3/31/2020     3/31/2021     3/31/2022     3/31/2023     3/31/2024     3/31/2025     3/31/2026     3/31/2027     3/31/2028     3/31/2029     3/31/2030  

Date ITR Paid

     7/15/2020       7/15/2021       7/15/2022       7/15/2023       7/15/2024       7/15/2025       7/15/2026       7/15/2027       7/15/2028       7/15/2029       7/15/2030  

Years from Transaction

     10.9178       11.9178       12.9178       13.9178       14.9205       15.9205       16.9205       17.9205       18.9233       19.9233       20.9233  

Applicable AFR

     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3

Imputed Interest

     4,032,701       4,207,008       4,340,717       3,422,605       3,512,416       2,813,432       2,369,974       2,186,377       1,830,909       1,810,650       1,596,276  

Principal

     6,990,222       6,531,788       6,078,413       4,348,144       4,067,712       2,983,898       2,310,732       1,966,290       1,523,029       1,397,148       1,145,295  

Basis Created

     48,269,772       48,269,772       41,943,487       33,086,688       33,086,688       24,410,126       19,730,943       17,631,133       13,967,691       13,619,281       11,393,985  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Tax Benefits

     48,269,772       48,269,772       41,943,487       33,086,688       33,086,688       24,410,126       19,730,943       17,631,133       13,967,691       13,619,281       11,393,985  

Imputed Interest

     4,821,565       3,453,077       8,239,709       4,340,717       3,422,605       3,512,416       2,813,432       2,369,974       2,186,377       1,830,909       1,810,650  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Deductions

     53,091,336       51,722,849       50,183,196       37,427,404       36,509,292       27,922,541       22,544,375       20,001,106       16,154,068       15,450,190       13,204,634  

 

Blocker TRA Fed & Cons states    Page 1 of 2   


Illustrative Calculation

 

Tax Year    3/31/2031     3/31/2032     3/31/2033     3/31/2034     3/31/2035     3/31/2036     3/31/2037     3/31/2038     3/31/2039     3/31/2040     3/31/2041  

Date ITR Paid

     7/15/2031       7/15/2032       7/15/2033       7/15/2034       7/15/2035       7/15/2036       7/15/2037       7/15/2038       7/15/2039       7/15/2040       7/15/2041  

Years from Transaction

     21.9233       22.9260       23.9260       24.9260       25.9260       26.9288       27.9288       28.9288       29.9288       30.9315       31.9315  

Applicable AFR

     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3     4.3

Imputed Interest

     1,360,719       1,099,328       833,830       566,059       303,545       42,530       6,076       884       131       20       3  

Principal

     909,728       686,068       486,703       309,524       155,719       20,493       2,754       377       53       7       1  

Basis Created

     9,339,213       7,238,545       5,260,950       3,383,374       1,645,965       —         —         —         —         —         —    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Tax Benefits

     9,339,213       7,238,545       5,260,950       3,383,374       1,645,965       —         —         —         —         —         —    

Imputed Interest

     1,596,276       1,360,719       1,099,328       833,830       566,059       303,545       42,530       6,076       884       131       20  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Deductions

     10,935,489       8,599,264       6,360,278       4,217,204       2,212,024       303,545       42,530       6,076       884       131       20  

 

Blocker TRA Fed & Cons states    Page 2 of 2   


Illustrative Calculation

 

Tax Year           11/2/2011      3/31/2019     3/31/2020     3/31/2021     3/31/2022     3/31/2023     3/31/2024     3/31/2025     3/31/2026     3/31/2027     3/31/2028     3/31/2029  

Year

           2019       2020       2021       2022       2023       2024       2025       2026       2027       2028       2029  

Months of Amort in Year From Initial Transaction

           12.00       12.00       12.00       12.00       12.00       12.00       12.00       12.00       1.00       —         —    

Months after year end before payment

     13                            

Months remaining

           75.00       63.00       51.00       39.00       27.00       15.00       3.00       (9.00     (21.00     1.00       1.00  

Date ITR Paid

           7/15/2019       7/15/2020       7/15/2021       7/15/2022       7/15/2023       7/15/2024       7/15/2025       7/15/2026       7/15/2027       7/15/2028       7/15/2029  

Years from Transaction

           7.70       8.71       9.71       10.71       11.71       12.71       13.71       14.71       15.71       16.71       17.71  

Applicable AFR

           1.2     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7

Imputed Interest

           594,770.5       1,497,469.9       1,696,633.5       2,114,053.1       2,326,620.2       2,674,844.3       3,144,029.3       3,516,603.1       2,507,312.9       1,184,768.5       905,464.7  

Principal

           6,179,169       5,806,968       5,821,155       6,485,982       6,438,786       6,724,206       7,225,753       7,427,895       4,889,717       2,141,371       1,522,434  

Basis Created

 

     Date      Year      Amount                                                                               
     3/31/2017        2017        383,386,250        32,301,217        32,301,217        32,301,217        32,301,217        32,301,217        32,301,217        32,301,217        32,301,217        23,954,708        8,184,340        8,184,340  
     3/31/2018        2018                                      
     3/31/2019        2019        4,314,300        545,486        595,075.89        595,076        595,076        595,076        595,076        595,076        198,359        —          —       
     3/31/2020        2020        9,090,904           1,333,333        1,454,544.70        1,454,545        1,454,545        1,454,545        1,454,545        484,848        —          —       
     3/31/2021        2021        6,179,169              1,078,903        1,078,902.55        1,078,903        1,078,903        1,078,903        784,656        —          —       
     3/31/2022        2022        5,806,968                 1,252,483        1,252,483.29        1,252,483        1,252,483        797,035        —          —       
     3/31/2023        2023        5,821,155                 1,027,263        1,369,683.63        1,369,683.63        1,369,684        684,842        —          —       
     3/31/2024        2024        6,485,982                    1,496,765        1,995,686.63        1,995,687        997,843        —          —       
     3/31/2025        2025        6,438,786                       2,146,262        2,146,262        2,146,262        —          —       
     3/31/2026        2026        6,724,206                          4,034,523        2,689,682        —          —       
     3/31/2027        2027        7,225,753                             7,225,753        —          —       
     3/31/2028        2028        7,427,895                                7,427,895        
     3/31/2029        2029        4,889,717                                   4,889,717     
     3/31/2030        2030        2,141,371                                      2,141,371  
     3/31/2031        2031        1,522,434                                   
     3/31/2032        2032        1,363,192                                   
     3/31/2033        2033        1,302,263                                   
     3/31/2034        2034        1,204,036                                   
     3/31/2035        2035        948,748                                   
     3/31/2036        2036        684,517                                   
     3/31/2037        2037        451,176                                   

ADDITIONAL AMORTIZATION FROM STAND ALONE STATES

 

     10,977        62,317        142,581        298,421        418,461        593,745        863,033        1,048,294        493,667        289,497        117,468  
           

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Amortization

              32,857,679        34,291,942        35,572,321        38,007,907        39,967,133        42,787,600        47,091,412        49,358,791        31,876,270        13,363,554        10,443,178  

Imputed Interest from payment made in fiscal year

              357,853        889,503        636,718        3,413,712        2,250,990        2,482,435        2,854,103        3,354,814        3,751,138        2,656,621        1,250,667  
           

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Deductions

              33,215,533        35,181,445        36,209,039        41,421,619        42,218,122        45,270,035        49,945,515        52,713,605        35,627,408        16,020,175        11,693,845  

Note: The principal payments for 2019 and 2020 will be updated when final payments are determined which could will increase the amount of future amortization and imputed interest amounts in future years

 

Unblocked - fed + cons states    Page 1 of 2   


Illustrative Calculation

 

Tax Year           3/31/2030     3/31/2031     3/31/2032     3/31/2033     3/31/2034     3/31/2035     3/31/2036     3/31/2037     3/31/2038     3/31/2039     3/31/2040     3/31/2041     3/31/2042     Total  

Year

        2030       2031       2032       2034       2035       2036       2037       2038       2039       2040       2041       2042       2043    

Months of Amort in Year From Initial Transaction

                               

Months after year end before payment

     13                               

Months remaining

        1.00       1.00       1.00       1.00       1.00       1.00       1.00       1.00       1.00       1.00       1.00       1.00       1.00    

Date ITR Paid

        7/15/2030       7/15/2031       7/15/2032       7/15/2033       7/15/2034       7/15/2035       7/15/2036       7/15/2037       7/15/2038       7/15/2039       7/15/2040       7/15/2041       7/15/2042    

Years from Transaction

        18.71       19.71       20.72       21.72       22.72       23.72       24.72       25.72       26.72       27.72       28.72       29.72       30.72    

Applicable AFR

        2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7     2.7  

Imputed Interest

        868,800.5       886,899.0       874,194.0       732,564.9       560,930.7       391,636.3       220,823.3       54,343.5       11,655.7       2,498.3       534.8       113.6       24.1    

Principal

        1,363,192       1,302,263       1,204,036       948,748       684,517       451,176       240,535       56,067       11,407       2,322       473       96       19    

Basis Created

 

     Date      Year                                                                                                    
     3/31/2017        2017        8,184,340        8,184,340        7,697,025        5,898,544        4,197,978        2,698,394        1,277,735        —          —             —                383,386,251  
     3/31/2018        2018                                               —    
     3/31/2019        2019                                               4,314,300  
     3/31/2020        2020                                               9,090,904  
     3/31/2021        2021                                               6,179,169  
     3/31/2022        2022                                               5,806,968  
     3/31/2023        2023                                               5,821,155  
     3/31/2024        2024                                               6,485,982  
     3/31/2025        2025                                               6,438,786  
     3/31/2026        2026                                               6,724,206  
     3/31/2027        2027                                               7,225,753  
     3/31/2028        2028                                               7,427,895  
     3/31/2029        2029                                               4,889,717  
     3/31/2030        2030                                               2,141,371  
     3/31/2031        2031        1,522,434                                            1,522,434  
     3/31/2032        2032           1,363,192                                         1,363,192  
     3/31/2033        2033              1,302,263                                      1,302,263  
     3/31/2034        2034                 1,204,036                                   1,204,036  
     3/31/2035        2035                    948,748                                948,748  
     3/31/2036        2036                       684,517                             684,517  
     3/31/2037        2037                          451,176        240,535        56,067        11,407        2,322        473        96        761,507  

ADDITIONAL AMORTIZATION FROM STAND ALONE STATES

 

     85,963        77,358        72,852        69,587        66,718        62,862        53,806        34,563        339        77        15        0        0        4,862,604  
        

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Amortization

           9,792,737        9,624,890        9,072,140        7,172,167        5,213,444        3,445,773        1,782,717        275,098        56,406        11,483        2,338        473        96        468,581,756  

Imputed Interest from payment made in fiscal year

           957,540        919,093        937,545        925,788        785,189        613,589        439,393        256,687        54,672        11,734        2,515        535        114        29,802,301  
        

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Deductions

           10,750,277        10,543,983        10,009,685        8,097,955        5,998,633        4,059,362        2,222,110        531,786        111,079        23,218        4,852        1,008        209        451,869,281  

Note: The principal payments for 2019 and 2020 will be updated when final payments are determined which could will increase the amount of future amortization and imputed interest amounts in future years

 

Unblocked - fed + cons states    Page 2 of 2   
EX-99.2

Exhibit 99.2

Annex II

Net Operating Loss Schedule

[Attached]


Change Healthcare, Inc.

New Echo TRA, dated February 28, 2017

Tax Asset Disclosure

 

Attributes

   Generation Date
(Period Ended)
     Original Scheduled
Expiration Date
     As of 2/28        

NOLs of Change, excluding acquisitions

           (196,563,390  
     12/31/2011        12/31/2031          (41,583,796 ) 
     12/31/2012        12/31/2032          (76,855,482 ) 
     12/31/2013        12/31/2033          (4,973,561 )  
     2/28/2017        3/31/2037          (73,150,551 ) 

Acquired NOLs - TC3

           (4,258,927  
     12/31/2007        12/31/2027          (437,206 )  
     12/31/2008        12/31/2028          (1,244,708 )  
     12/31/2009        12/31/2029          (115,676 )  
     12/31/2012        12/31/2032          (2,461,337 )  

Acquired NOLs - Change Healthcare

           (41,635,639  
     12/31/2007        12/31/2027          (168,186 )  
     12/31/2008        12/31/2028          (895,635 )  
     12/31/2009        12/31/2029          (1,488,963 )  
     12/31/2010        12/31/2030          (2,491,582 )  
     12/31/2011        12/31/2031          (3,652,193 )  
     12/31/2012        12/31/2032          (5,939,249 )  
     12/31/2013        12/31/2033          (6,671,380 )  
     12/31/2014        12/31/2034          (20,328,451 ) 

Acquired NOLs - Altegra Healthcare

           (30,655,623  
     12/31/2015        12/31/2035          (30,655,623 ) 

Acquired NOLs - Altegra Healthcare - subject to s382 limitation

           (1,695,801  
     12/31/2007        12/31/2027          (41,048 )  
     12/31/2008        12/31/2028          (958,705 )  
     12/31/2009        12/31/2029          (441,729 )  
     12/31/2010        12/31/2030          (131,283 )  
     12/31/2012        12/31/2032          (123,036 )  
          

 

 

 

Total NOL Tax Attributes

             (274,809,380
          

 

 

 

R&D Credits

           (1,169,464  
     12/31/2011        12/31/2031          (93,803
     12/31/2012        12/31/2032          (393,696
     12/31/2013        12/31/2033          (681,965
          

 

 

 

Total R&D Credit Attributes

             (1,169,464
          

 

 

 

Federal Attributes


Summary of New TRA attributes

 

Remaining attributes excl. attributes expired before 9/30/20  
                              12/31/2011      12/31/2011      4/30/2012      4/30/2012      12/31/2012      12/31/2012      12/31/2013      12/31/2013  

Unitary or
Separate

  

Entity Name

  State
Abbrev
  State    NOL Tracking was
Pre/Post Apportionment
   Carryforward
period (# years)
     CY 2011      2011 NOL
Expiration date
     Stub period
ending
4/30/2012
     4/30/2012 NOL
Expiration date
     CY2012      2012 NOL
Expiration date
     CY 2013      2013 NOL
Expiration date
 

Unitary

   Change Healthcare Performance, Inc. & Sub   AZ   Arizona    Post-Apport.      20        —          12/31/2031        —          4/30/2032        223,566        12/31/2032        86,383        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   AR   Arkansas    Post-Apport.      5        —          12/31/2016        —          4/30/2017        —          12/31/2017        —          12/31/2018  

Unitary

   Change Healthcare Performance, Inc. & Sub   CA   California    Post-Apport.      20        —          12/31/2031        3,331,006        4/30/2032        5,908,721        12/31/2032        935,904        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   DC   DC    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   CO   Colorado    Post-Apport.      20        134,310        12/31/2031        —          4/30/2032        468,738        12/31/2032        33,076        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   CT   Connecticut    Post-Apport.      20        —          12/31/2031        —          4/30/2032        719,196        12/31/2032        87,491        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   FL   Florida    Post-Apport.      20        2,812,427        12/31/2031        54,262        4/30/2032        1,588,541        12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   GA   Georgia    Post-Apport.      20        236,165        12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   HI   Hawaii    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   ID   Idaho    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   IL   Illinois    Post-Apport.      12        3,263,716        12/31/2023        —          4/30/2024        3,840,146        12/31/2024        486,860        12/31/2025  

Unitary

   Change Healthcare Performance, Inc. & Sub   IN   Indiana    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   IA   Iowa    Post-Apport.      20        518,990        12/31/2031        —          4/30/2032        518,100        12/31/2032        158,564        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   MA   Massachusetts    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   MI   Michigan    Post-Apport.      10        —          12/31/2021        —          4/30/2022        —          12/31/2022        —          12/31/2023  

Unitary

   Change Healthcare Performance, Inc. & Sub   MN   Minnesota    Post-Apport.      15        625,837        12/31/2026        587,931        4/30/2027        1,663,931        12/31/2027        317,930        12/31/2028  

Unitary

   Change Healthcare Performance, Inc. & Sub   MO   Missouri    Pre-Apport.      20        64,660,906        12/31/2031        —          4/30/2032        81,689,062        12/31/2032        5,878,851        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   MT   Montana    Post-Apport.      10        —          12/31/2021        —          4/30/2022        —          12/31/2022        —          12/31/2023  

Unitary

   Change Healthcare Performance, Inc. & Sub   NE   Nebraska    Tracked post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   NH   New Hampshire    Post-Apport.      10        12,445        12/31/2021        —          4/30/2022        46,992        12/31/2022        8,835        12/31/2023  

Unitary

   Change Healthcare Performance, Inc. & Sub   NM   New Mexico    Tracked post-Apport.      20        136,683        12/31/2031        —          4/30/2032        4,963,994        12/31/2032        2,231        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   NY   New York    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   ND   North Dakota    Tracked post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   NYC   New York City    Post-Apport.      20        1,582,394        12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   OK   Oklahoma    Post-Apport.      20        234,641        12/31/2031        —          4/30/2032        869,252        12/31/2032        77,687        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   OR   Oregon    Post-Apport.      15        202,939        12/31/2026        195,907        4/30/2027        —          12/31/2027        —          12/31/2028  

Unitary

   Change Healthcare Performance, Inc. & Sub   RI   Rhode Island    Pre-Apport.      5        —          12/31/2016        —          4/30/2017        —          12/31/2017        —          12/31/2018  

Unitary

   Change Healthcare Performance, Inc. & Sub   UT   Utah    Post-Apport.      15        2,486,734        12/31/2026        —          4/30/2027        1,158,236        12/31/2027        25,257        12/31/2028  

Unitary

   Change Healthcare Performance, Inc. & Sub   VT   Vermont    Post-Apport.      10        212,030        12/31/2021        —          4/30/2022        143,386        12/31/2022        17,368        12/31/2023  

Unitary

   Change Healthcare Performance, Inc. & Sub   VA   Virginia    Follows Federal      20        60,181,469        12/31/2031        4,257,147        4/30/2032        83,361,998        12/31/2032        7,880,463        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   WV   West Virginia    Post-Apport.      20        —          12/31/2031        —          4/30/2032        52,212        12/31/2032        9,642        12/31/2033  

Unitary

   Change Healthcare Performance, Inc. & Sub   WI   Wisconsin    Post-Apport.      20        —          12/31/2031        —          4/30/2032        1,274,430        12/31/2032        433,135        12/31/2033  

Separate

   Change Healthcare Holdings, Inc. (CHH (B1)   TN   Tennessee    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        58,622,671        12/31/2028  

Separate

   Change Healthcare Resources Holdings, Inc.   AL   Alabama    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        —          12/31/2028  

Separate

   Change Healthcare Resources Holdings, Inc.   DE   Delaware    Pre-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Resources Holdings, Inc.   KY   Kentucky    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Resources Holdings, Inc.   LA   Louisiana    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Resources Holdings, Inc.   MD   Maryland    Pre-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Resources Holdings, Inc.   MS   Mississippi    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Resources Holdings, Inc.   NJ   New Jersey    Pre-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Resources Holdings, Inc.   NC   North Carolina    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        —          12/31/2028  

Separate

   Change Healthcare Resources Holdings, Inc.   PA   Pennsylvania    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Resources Holdings, Inc.   TN   Tennessee    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        —          12/31/2028  

Separate

   Change Healthcare Solutions LLC (CHS Legal   KY   Kentucky    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Solutions LLC (CHS Legal   LA   Louisiana    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Solutions LLC (CHS Legal   AL   Alabama    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        —          12/31/2028  

Separate

   Change Healthcare Solutions LLC (CHS Legal   MD   Maryland    Pre-Apport.      20        —          12/31/2031        —          4/30/2032        36,929,828        12/31/2032        35,881,167        12/31/2033  

Separate

   Change Healthcare Solutions LLC (CHS Legal   MS   Mississsippi    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Solutions LLC (CHS Legal   NJ   New Jersey    Pre-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Solutions LLC (CHS Legal   NC   North Carolina    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        —          12/31/2028  

Separate

   Change Healthcare Solutions LLC (CHS Legal   OH   OH Toledo    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Solutions LLC (CHS Legal   PA   Pennsylvania    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Solutions LLC (CHS Legal   TN   Tennessee    Post-Apport.      15        37,412,099        12/31/2026        —          4/30/2027        28,168,191        12/31/2027        14,939,844        12/31/2028  

Separate

   Change Healthcare Pharmacy Solutions, Inc.   MD   Maryland    Pre-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Pharmacy Solutions, Inc.   MS   Mississsippi    Post-Apport.      20        —          12/31/2031        —          4/30/2032        —          12/31/2032        —          12/31/2033  

Separate

   Change Healthcare Pharmacy Solutions, Inc.   NC   North Carolina    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        —          12/31/2028  

Separate

   Change Healthcare Pharmacy Solutions, Inc.   TN   Tennessee    Post-Apport.      15        —          12/31/2026        —          4/30/2027        —          12/31/2027        —          12/31/2028  

 

State Attributes    Page 1 of 2   


Summary of New TRA attributes

 

               12/31/2014      12/31/2014      8/12/2015      8/12/2015      12/31/2015      12/31/2015      12/31/2016      12/31/2016      2/28/2017      2/28/2017  

Unitary or
Separate

  

Entity Name

   State
Abbrev
   CY2014      2014 NOL
Expiration date
     Stub period
ending
8/12/2015
     Stub 2015 NOL
Expiration date
     CY 2015      2015 NOL
Expiration date
     CY2016      2016 NOL
Expiration date
     Stub 1/1/17 -
2/28/17
     Stub 2017 NOL
Expiration date
 

Unitary

   Change Healthcare Performance, Inc. & Sub    AZ      —          12/31/2034        1,254,309        8/12/2035        —          12/31/2035        79,233        12/31/2036        368,684        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    AR      —          12/31/2019        —          8/12/2020        —          12/31/2020        —          12/31/2021        3,240        2/28/2022  

Unitary

   Change Healthcare Performance, Inc. & Sub    CA      —          12/31/2034        5,022,375        8/12/2035        —          12/31/2035        443,607        12/31/2036        7,551,349        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    DC      —          12/31/2034        —          8/12/2035        25        12/31/2035        401        12/31/2036        —          2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    CO      —          12/31/2034        847,481        8/12/2035        —          12/31/2035        —          12/31/2036        516,426        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    CT      —          12/31/2034        272,178        8/12/2035        —          12/31/2035        —          12/31/2036        2,425,734        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    FL      —          12/31/2034        14,942,396        8/12/2035        —          12/31/2035        —          12/31/2036        9,431,191        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    GA      —          12/31/2034        5,595,142        8/12/2035        —          12/31/2035        —          12/31/2036        3,479,268        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    HI      —          12/31/2034        —          8/12/2035        —          12/31/2035        54,440        12/31/2036        15,781        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    ID      —          12/31/2034        66,065        8/12/2035        —          12/31/2035        3,078        12/31/2036        23,489        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    IL      —          12/31/2026        1,326,549        8/12/2027        —          12/31/2027        1,442,218        12/31/2028        5,358,379        2/28/2029  

Unitary

   Change Healthcare Performance, Inc. & Sub    IN      —          12/31/2034        77,996        8/12/2035        —          12/31/2035        —          12/31/2036        5,989        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    IA      —          12/31/2034        —          8/12/2035        —          12/31/2035        111,018        12/31/2036        342,295        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    MA      —          12/31/2034        —          8/12/2035        —          12/31/2035        221,527        12/31/2036        1,959,967        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    MI      2,398,399        12/31/2024        236,930        8/12/2025        —          12/31/2025        174,949        12/31/2026        2,505,971        2/28/2027  

Unitary

   Change Healthcare Performance, Inc. & Sub    MN      326,207        12/31/2029        861,659        8/12/2030        688,834        12/31/2030        —          12/31/2031        1,601,526        2/28/2032  

Unitary

   Change Healthcare Performance, Inc. & Sub    MO      —          12/31/2034        151,473        8/12/2035        —          12/31/2035        —          12/31/2036        99,911,702        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    MT      —          12/31/2024        —          8/12/2025        —          12/31/2025        45,834        12/31/2026        11,360        2/28/2027  

Unitary

   Change Healthcare Performance, Inc. & Sub    NE      —          12/31/2034        6,474        8/12/2035        —          12/31/2035        232,909        12/31/2036        190,667        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    NH      —          12/31/2024        —          8/12/2025        —          12/31/2025        17        12/31/2026        6,521        2/28/2027  

Unitary

   Change Healthcare Performance, Inc. & Sub    NM      —          12/31/2034        38,431        8/12/2035        —          12/31/2035        —          12/31/2036        8,227        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    NY      —          12/31/2034        —          8/12/2035        20,089,475        12/31/2035        539,124        12/31/2036        6,168,301        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    ND      —          12/31/2034        —          8/12/2035        —          12/31/2035        —          12/31/2036        —          2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    NYC      —          12/31/2034        —          8/12/2035        320,531        12/31/2035        254,023        12/31/2036        2,997,833        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    OK      —          12/31/2034        —          8/12/2035        —          12/31/2035        —          12/31/2036        220,117        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    OR      —          12/31/2029        251,834        8/12/2030        —          12/31/2030        —          12/31/2031        12,514        2/28/2032  

Unitary

   Change Healthcare Performance, Inc. & Sub    RI      —          12/31/2019        —          8/12/2020        —          12/31/2020        10,628,787        12/31/2021        99,265,997        2/28/2022  

Unitary

   Change Healthcare Performance, Inc. & Sub    UT      —          12/31/2029        241,791        8/12/2030        —          12/31/2030        —          12/31/2031        808,563        2/28/2032  

Unitary

   Change Healthcare Performance, Inc. & Sub    VT      —          12/31/2024        —          8/12/2025        —          12/31/2025        7,324        12/31/2026        56,998        2/28/2027  

Unitary

   Change Healthcare Performance, Inc. & Sub    VA      10,924,576        12/31/2034        32,355,076        8/12/2035        —          12/31/2035        —          12/31/2036        97,296,130        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    WV      —          12/31/2034        —          8/12/2035        —          12/31/2035        —          12/31/2036        9,447        2/28/2037  

Unitary

   Change Healthcare Performance, Inc. & Sub    WI      —          12/31/2034        125,540        8/12/2035        —          12/31/2035        378,623        12/31/2036        4,319,114        2/28/2037  

Separate

   Change Healthcare Holdings, Inc. (CHH (B1)    TN      110,412,009        12/31/2029        —          8/12/2030        103,640,236        12/31/2030        93,275,916        12/31/2031        96,297,331        2/28/2032  

Separate

   Change Healthcare Resources Holdings, Inc.    AL      —          12/31/2029        71,699        8/12/2030        65,800        12/31/2030        44,279        12/31/2031        —          2/28/2032  

Separate

   Change Healthcare Resources Holdings, Inc.    DE      —          12/31/2034        95,257        8/12/2035        21,271        12/31/2035        2,583,645        12/31/2036        2,273,636        2/28/2037  

Separate

   Change Healthcare Resources Holdings, Inc.    KY      —          12/31/2034        2,883,538        8/12/2035        310,281        12/31/2035        214,209        12/31/2036        62,720        2/28/2037  

Separate

   Change Healthcare Resources Holdings, Inc.    LA      —          12/31/2034        108,877        8/12/2035        48,351        12/31/2035        6,718        12/31/2036        909        2/28/2037  

Separate

   Change Healthcare Resources Holdings, Inc.    MD      —          12/31/2034        47,418,037        8/12/2035        14,273,223        12/31/2035        6,018,622        12/31/2036        2,323,121        2/28/2037  

Separate

   Change Healthcare Resources Holdings, Inc.    MS      —          12/31/2034        192,230        8/12/2035        55,856        12/31/2035        20,319        12/31/2036        7,390        2/28/2037  

Separate

   Change Healthcare Resources Holdings, Inc.    NJ      —          12/31/2034        47,418,037        8/12/2035        14,273,223        12/31/2035        6,018,622        12/31/2036        2,323,121        2/28/2037  

Separate

   Change Healthcare Resources Holdings, Inc.    NC      —          12/31/2029        445,756        8/12/2030        153,355        12/31/2030        18,296        12/31/2031        56,496        2/28/2032  

Separate

   Change Healthcare Resources Holdings, Inc.    PA      —          12/31/2034        1,579,846        8/12/2035        —          12/31/2035        302,051        12/31/2036        430,337        2/28/2037  

Separate

   Change Healthcare Resources Holdings, Inc.    TN      385,741        12/31/2029        —          8/12/2030        40,223        12/31/2030        25,802        12/31/2031        8,766        2/28/2032  

Separate

   Change Healthcare Solutions LLC (CHS Legal    KY      —          12/31/2034        —          8/12/2035        11,229        12/31/2035        —          12/31/2036        11,621        2/28/2037  

Separate

   Change Healthcare Solutions LLC (CHS Legal    LA      —          12/31/2034        —          8/12/2035        —          12/31/2035        —          12/31/2036        —          2/28/2037  

Separate

   Change Healthcare Solutions LLC (CHS Legal    AL      —          12/31/2029        —          8/12/2030        —          12/31/2030        —          12/31/2031        —          2/28/2032  

Separate

   Change Healthcare Solutions LLC (CHS Legal    MD      112,104,151        12/31/2034        —          8/12/2035        54,945,984        12/31/2035        —          12/31/2036        8,012,971        2/28/2037  

Separate

   Change Healthcare Solutions LLC (CHS Legal    MS      —          12/31/2034        —          8/12/2035        —          12/31/2035        —          12/31/2036        —          2/28/2037  

Separate

   Change Healthcare Solutions LLC (CHS Legal    NJ      —          12/31/2034        —          8/12/2035        3,844,194        12/31/2035        —          12/31/2036        5,711,295        2/28/2037  

Separate

   Change Healthcare Solutions LLC (CHS Legal    NC      1,324,756        12/31/2029        —          8/12/2030        3,622,353        12/31/2030        —          12/31/2031        161,205        2/28/2032  

Separate

   Change Healthcare Solutions LLC (CHS Legal    OH      —          12/31/2034        —          8/12/2035        65,512        12/31/2035        421,018        12/31/2036        —          2/28/2037  

Separate

   Change Healthcare Solutions LLC (CHS Legal    PA      1,647,497        12/31/2034        —          8/12/2035        1,200,185        12/31/2035        —          12/31/2036        378,331        2/28/2037  

Separate

   Change Healthcare Solutions LLC (CHS Legal    TN      34,993,313        12/31/2029        —          8/12/2030        11,137,156        12/31/2030        —          12/31/2031        1,702,444        2/28/2032  

Separate

   Change Healthcare Pharmacy Solutions, Inc.    MD      —          12/31/2034        —          8/12/2035        —          12/31/2035        1,915,641        12/31/2036        5,276        2/28/2037  

Separate

   Change Healthcare Pharmacy Solutions, Inc.    MS      —          12/31/2034        —          8/12/2035        —          12/31/2035        —          12/31/2036        33,531        2/28/2037  

Separate

   Change Healthcare Pharmacy Solutions, Inc.    NC      —          12/31/2029        —          8/12/2030        —          12/31/2030        7,960        12/31/2031        30,758        2/28/2032  

Separate

   Change Healthcare Pharmacy Solutions, Inc.    TN      —          12/31/2029        —          8/12/2030        —          12/31/2030        —          12/31/2031        225,274        2/28/2032  

 

State Attributes    Page 2 of 2