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Delaware
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6411
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83-3536151
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(State or Other Jurisdiction of
Incorporation or Organization) |
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(Primary Standard Industrial
Classification Code Number) |
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(I.R.S. Employer
Identification Number) |
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|
William B. Brentani
Simpson Thacher & Bartlett LLP 2475 Hanover Street Palo Alto, California 94304 (650) 251-5000 |
| |
Jeffrey Doctoroff
Senior Vice President, General Counsel and Secretary MultiPlan Corporation 115 Fifth Avenue New York, New York 10003 (212) 780-2000 |
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Large accelerated filer
☐
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Accelerated filer
☐
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Non-accelerated filer
☒
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Smaller reporting company
☐
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Emerging growth company
☐
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Page
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| | | | F-1 | | |
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Six Months
Ended June 30, 2020 |
| |
Period from October 30,
2019 (inception) through December 31, 2019 |
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| | |
(unaudited)
|
| | | | | | | |||
Statement of Operations Data: | | | | | | | | | | | | | |
Revenues
|
| | | $ | — | | | | | $ | — | | |
Loss from operations
|
| | | $ | (2,061,847) | | | | | $ | (1,450) | | |
Interest earned on marketable securities held in Trust Account
|
| | | $ | 4,215,679 | | | | | $ | — | | |
Net income (loss)
|
| | | $ | 1,696,498 | | | | | $ | (1,450) | | |
Weighted average shares outstanding, basic and diluted(1)
|
| | | | 30,397,160 | | | | | | 25,000,000 | | |
Basic and diluted net loss per common share(2)
|
| | | $ | (0.03) | | | | | $ | (0.00) | | |
| | |
As of June 30, 2020
|
| |
As of December 31, 2019
|
| ||||||
Balance Sheet Data: | | | | | | | | | | | | | |
Total assets
|
| | | $ | 1,107,564,339 | | | | | $ | 318,930 | | |
| | |
Six
Months Ended June 30, 2020 |
| |
Six
Months Ended June 30, 2019 |
| |
Three
Months Ended March 31, 2020 |
| |
Three
Months Ended March 31, 2019 |
| |
Year
Ended December 31, 2019 |
| |
Year
Ended December 31, 2018 |
| |
Year
Ended December 31, 2017 |
| |
May 2 –
December 31, 2016 |
| | |
January 1 –
June 6, 2016 |
| |
Year Ended
December 31, 2015 |
| ||||||||||||||||||||||||||||||
($ in thousands)
|
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Successor
|
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Successor
|
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Successor
|
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Successor
|
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Successor
|
| |
Successor
|
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Successor
|
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Successor
|
| | |
Predecessor
|
| |
Predecessor
|
| ||||||||||||||||||||||||||||||
| | |
(unaudited)
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(unaudited)
|
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(unaudited)
|
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(unaudited)
|
| | | | | | | | | | | | | | | | | | | |
(unaudited)
|
| | |
(unaudited)
|
| |
(unaudited)
|
| |||||||||||||||||||||
Consolidated Statements of
Income and Comprehensive Income Data: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||
Revenues(1) | | | | $ | 458,902 | | | | | $ | 490,677 | | | | | $ | 252,022 | | | | | $ | 245,024 | | | | | $ | 982,901 | | | | | $ | 1,040,883 | | | | | $ | 1,067,266 | | | | | $ | 575,889 | | | | | | $ | 412,597 | | | | | $ | 865,094 | | |
Operating income (loss)
|
| | | $ | 107,888 | | | | | $ | 184,421 | | | | | $ | 87,617 | | | | | $ | 85,100 | | | | | $ | 368,209 | | | | | $ | 427,541 | | | | | $ | 363,636 | | | | | $ | 89,415 | | | | | | $ | (50,607) | | | | | $ | 245,570 | | |
Net (loss) income
|
| | | $ | (58,840) | | | | | $ | (7,496) | | | | | $ | (2,594) | | | | | $ | (8,364) | | | | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | 648,132 | | | | | $ | (56,503) | | | | | | $ | (247,598) | | | | | $ | 7,749 | | |
Basic and diluted net (loss) income per share:
|
| | | $ | (5,884) | | | | | $ | (750) | | | | | $ | (259) | | | | | $ | (836) | | | | | $ | 971 | | | | | $ | 3,622 | | | | | $ | 64,813 | | | | | $ | (5,650) | | | | | | $ | (24,760) | | | | | $ | 775 | | |
Other Financial Data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Medical charges
processed(2) |
| | | $ | 49,900,000 | | | | | $ | 52,800,000 | | | | | $ | 26,700,000 | | | | | $ | 26,500,000 | | | | | $ | 106,300,000 | | | | | $ | 101,600,000 | | | | | $ | 97,400,000 | | | | | | — | | | | | | | — | | | | | $ | 88,600,000 | | |
Medical cost savings(3)
|
| | | | 18.8% | | | | | | 17.2% | | | | | | 18.7% | | | | | | 17.0% | | | | | | 17.8% | | | | | | 18.3% | | | | | | 18.3% | | | | | | — | | | | | | | — | | | | | | 17.2% | | |
Capital expenditures(4)
|
| | | $ | 34,866 | | | | | $ | 33,696 | | | | | $ | 17,336 | | | | | $ | 16,828 | | | | | $ | 66,414 | | | | | $ | 63,556 | | | | | $ | 60,709 | | | | | $ | 31,055 | | | | | | $ | 22,602 | | | | | $ | 49,714 | | |
Total assets(5)
|
| | | $ | 8,333,189 | | | | | $ | 8,531,227 | | | | | $ | 8,542,617 | | | | | $ | 8,630,880 | | | | | $ | 8,360,411 | | | | | $ | 8,642,973 | | | | | $ | 8,987,709 | | | | | $ | 9,285,126 | | | | | | | — | | | | | $ | 5,297,921 | | |
EBITDA(6) | | | | $ | 305,476 | | | | | $ | 379,948 | | | | | $ | 186,075 | | | | | $ | 182,589 | | | | | $ | 778,463 | | | | | $ | 815,503 | | | | | $ | 731,953 | | | | | $ | 309,651 | | | | | | $ | (77,656) | | | | | $ | 473,581 | | |
Adjusted EBITDA(6)
|
| | | $ | 345,743 | | | | | $ | 376,163 | | | | | $ | 195,944 | | | | | $ | 188,098 | | | | | $ | 750,350 | | | | | $ | 824,886 | | | | | $ | 812,086 | | | | | $ | 416,884 | | | | | | $ | 298,653 | | | | | $ | 611,845 | | |
| | |
Six Months
Ended June 30, 2020 |
| |
Six Months
Ended June 30, 2019 |
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Three Months
Ended March 31, 2020 |
| |
Three Months
Ended March 31, 2019 |
| |
Year
Ended December 31, 2019 |
| |
Year
Ended December 31, 2018 |
| |
Year
Ended December 31, 2017 |
| |
May 2 —
December 31, 2016 |
| | |
January 1 —
June 6, 2016 |
| |
Year
Ended December 31, 2015 |
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($ in thousands)
|
| |
Successor
|
| |
Successor
|
| |
Successor
|
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Successor
|
| |
Successor
|
| |
Successor
|
| |
Successor
|
| |
Successor
|
| | |
Predecessor
|
| |
Predecessor
|
| ||||||||||||||||||||||||||||||
| | |
(unaudited)
|
| |
(unaudited)
|
| |
(unaudited)
|
| |
(unaudited)
|
| | | | | | | | | | | | | | | | | | | |
(unaudited)
|
| | |
(unaudited)
|
| |
(unaudited)
|
| |||||||||||||||||||||
Net (loss) income
|
| | | $ | (58,840) | | | | | $ | (7,496) | | | | | $ | (2,594) | | | | | $ | (8,364) | | | | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | 648,132 | | | | | $ | (56,503) | | | | | | $ | (247,598) | | | | | $ | 7,749 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest expense(a)
|
| | | | 177,015 | | | | | | 193,192 | | | | | $ | 90,965 | | | | | $ | 97,719 | | | | | $ | 376,346 | | | | | $ | 383,261 | | | | | $ | 281,972 | | | | | $ | 155,140 | | | | | | $ | 81,385 | | | | | $ | 152,127 | | |
Interest income
|
| | | | (148) | | | | | | (79) | | | | | $ | (71) | | | | | $ | (33) | | | | | $ | (196) | | | | | $ | (51) | | | | | $ | (9) | | | | | $ | (19) | | | | | | | — | | | | | $ | (12) | | |
Income tax (benefit) provision
|
| | | | (10,139) | | | | | | (1,196) | | | | | $ | (683) | | | | | $ | (4,222) | | | | | $ | 799 | | | | | $ | 8,108 | | | | | $ | (586,512) | | | | | $ | (9,203) | | | | | | $ | (11,701) | | | | | $ | 85,706 | | |
Depreciation
|
| | | | 29,641 | | | | | | 27,570 | | | | | $ | 14,506 | | | | | $ | 13,544 | | | | | $ | 55,807 | | | | | $ | 52,268 | | | | | $ | 53,002 | | | | | $ | 30,244 | | | | | | $ | 19,818 | | | | | $ | 41,650 | | |
Amortization of intangible
assets |
| | | | 167,027 | | | | | | 167,027 | | | | | $ | 83,513 | | | | | $ | 83,513 | | | | | $ | 334,053 | | | | | $ | 334,053 | | | | | $ | 334,053 | | | | | $ | 189,297 | | | | | | $ | 80,152 | | | | | $ | 184,967 | | |
Non-income taxes(b)
|
| | | | 920 | | | | | | 930 | | | | | $ | 439 | | | | | $ | 432 | | | | | $ | 1,944 | | | | | $ | 1,641 | | | | | $ | 1,315 | | | | | $ | 695 | | | | | | $ | 288 | | | | | $ | 1,394 | | |
EBITDA
|
| | | $ | 305,476 | | | | | $ | 379,948 | | | | | $ | 186,075 | | | | | $ | 182,589 | | | | | $ | 778,463 | | | | | $ | 815,503 | | | | | $ | 731,953 | | | | | $ | 309,651 | | | | | | $ | (77,656) | | | | | $ | 473,581 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Other expense (income)(c)
|
| | | | 297 | | | | | | 823 | | | | | $ | 148 | | | | | $ | 463 | | | | | $ | 1,947 | | | | | $ | 4,617 | | | | | $ | 5,857 | | | | | $ | 3,727 | | | | | | $ | 3,144 | | | | | $ | 6,252 | | |
Transaction related expenses(d)
|
| | | | 2,698 | | | | | | 22 | | | | | $ | 360 | | | | | $ | 10 | | | | | $ | 3,270 | | | | | $ | 49 | | | | | $ | 3,435 | | | | | $ | 74,503 | | | | | | $ | 14,907 | | | | | $ | 3 | | |
Loss on extinguishments and modification of debt(e)
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | $ | 20,053 | | | | | | — | | | | | | $ | 127,307 | | | | | | — | | |
Gain on repurchase and cancellation of notes(f)
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | $ | (18,450) | | | | | | — | | | | | | — | | | | | | — | | | | | | | — | | | | | | — | | |
Stock-based compensation(g)
|
| | | | 37,272 | | | | | | (4,630) | | | | | $ | 9,361 | | | | | $ | 5,036 | | | | | $ | (14,880) | | | | | $ | 4,717 | | | | | $ | 50,788 | | | | | $ | 29,003 | | | | | | $ | 230,951 | | | | | $ | 132,009 | | |
Adjusted EBITDA
|
| | | $ | 345,743 | | | | | $ | 376,163 | | | | | $ | 195,944 | | | | | $ | 188,098 | | | | | $ | 750,350 | | | | | $ | 824,886 | | | | | $ | 812,086 | | | | | $ | 416,884 | | | | | | $ | 298,653 | | | | | $ | 611,845 | | |
(dollars in thousands, other than share and per share data)
|
| |
Six Months
Ended June 30, 2020 |
| |
Year Ended
December 31, 2019 |
| ||||||
Summary Unaudited Pro Forma Condensed Combined Statements of (Loss) Income Data
|
| | | ||||||||||
Pro Forma as adjusted net (loss) income attributable to shareholders
|
| | | $ | (43,754) | | | | | $ | 29,523 | | |
Weighted average shares outstanding, basic and diluted
|
| | | | 676,556,145 | | | | | | 676,556,145 | | |
Basic and diluted net (loss) income per share
|
| | | $ | (0.06) | | | | | $ | 0.04 | | |
Summary Unaudited Pro Forma Condensed Combined Balance Sheets Data
|
| | | | | | | | | | | | |
Total current assets
|
| | | $ | 252,233 | | | | | | | | |
Total assets
|
| | | $ | 8,337,301 | | | | | | | | |
Total current liabilities
|
| | | $ | 64,956 | | | | | | | | |
Total liabilities
|
| | | $ | 5,633,150 | | | | | | | | |
Shareholders’ equity
|
| | | $ | 2,704,151 | | | | | | | | |
| | |
As of and for the
Six Months Ended June 30, 2020 |
| |
As of and for the
Year Ended December 31, 2019 |
| ||||||||||||||||||
| | |
Book value per
share – basic and diluted(1) |
| |
Net loss per
share – basic and diluted |
| |
Book value per
share – basic and diluted(1) |
| |
Net income (loss)
per share – basic and diluted |
| ||||||||||||
Churchill | | | | | | | | | | | | | | | | | | | | | |||||
Historical
|
| | | $ | 0.16 | | | | | $ | (0.03) | | | | | $ | 0.00 | | | | | $ | (0.00) | | |
Pro forma as adjusted
|
| | | $ | 4.00 | | | | | $ | (0.06) | | | | | | | | | | | $ | 0.04 | | |
Multiplan Parent
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Historical
|
| | | $ | 196,365,000 | | | | | $ | (5,884,000) | | | | | $ | 198,521,800 | | | | | $ | 971,000 | | |
Equivalent pro forma as adjusted(2)
|
| | | $ | 166,280,000 | | | | | $ | (2,494,200) | | | | | | | | | | | $ | 1,662,800 | | |
| | |
Six Months Ended
June 30, 2020 |
| |
Period from October 30,
2019 (inception) through December 31, 2019 |
| ||||||
| | |
(unaudited)
|
| | | | | | | |||
Statement of Operations Data: | | | | | | | | | | | | | |
Revenues
|
| | | $ | — | | | | | $ | — | | |
Loss from operations
|
| | | $ | (2,061,847) | | | | | $ | (1,450) | | |
Interest earned on Marketable Securities held in Trust Account
|
| | | $ | 4,215,679 | | | | | $ | — | | |
Net (loss) income
|
| | | $ | 1,696,498 | | | | | $ | (1,450) | | |
Weighted average shares outstanding, basic and diluted(1)
|
| | | | 30,397,160 | | | | | | 25,000,000 | | |
Basic and diluted loss per common share(2)
|
| | | $ | (0.03) | | | | | $ | (0.00) | | |
| | |
As of June 30, 2020
|
| |
As of December 31, 2019
|
| ||||||
| | |
(unaudited)
|
| | | | | | | |||
Balance Sheet Data: | | | | | | | | | | | | | |
Cash
|
| | | $ | 2,955,367 | | | | | $ | 34,000 | | |
Marketable Securities in Trust Account, Restricted
|
| | | $ | 1,104,209,313 | | | | | $ | — | | |
Total assets
|
| | | $ | 1,107,564,339 | | | | | $ | 318,930 | | |
Total liabilities
|
| | | $ | 40,464,311 | | | | | $ | 295,380 | | |
Value of common stock which may be redeemed for cash ($10.00 per share)(3)
|
| | | $ | 849,914,313 | | | | | $ | — | | |
Stockholders’ equity
|
| | | $ | 5,000,001 | | | | | $ | 23,550 | | |
| | |
Six
Months Ended June 30, 2020 |
| |
Six
Months Ended June 30, 2019 |
| |
Year Ended
December 31, 2019 |
| |
Year Ended
December 31, 2018 |
| |
Year Ended
December 31, 2017 |
| |
May 2 –
December 31, 2016 |
| | |
January 1 –
June 6, 2016 |
| |
Year Ended
December 31, 2015 |
| ||||||||||||||||||||||||
($ in thousands except share data)
|
| |
Successor
|
| |
Successor
|
| |
Successor
|
| |
Successor
|
| |
Successor
|
| |
Successor
|
| | |
Predecessor
|
| |
Predecessor
|
| ||||||||||||||||||||||||
| | |
(unaudited)
|
| |
(unaudited)
|
| | | | | | | | | | | | | | | | | | | |
(unaudited)
|
| | |
(unaudited)
|
| |
(unaudited)
|
| |||||||||||||||
Consolidated Statements of Income
and Comprehensive Income Data: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues(1) | | | | $ | 458,902 | | | | | $ | 490,677 | | | | | $ | 982,901 | | | | | $ | 1,040,883 | | | | | $ | 1,067,266 | | | | | $ | 575,889 | | | | | | $ | 412,597 | | | | | $ | 865,094 | | |
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of services (exclusive of
depreciation and amortization of intangible assets shown below |
| | | | 96,579 | | | | | | 75,132 | | | | | | 149,607 | | | | | | 149,463 | | | | | | 193,655 | | | | | | 106,639 | | | | | | | 175,470 | | | | | | 217,956 | | |
General and administrative
expenses |
| | | | 57,767 | | | | | | 36,527 | | | | | | 75,225 | | | | | | 77,558 | | | | | | 122,920 | | | | | | 160,294 | | | | | | | 187,764 | | | | | | 174,951 | | |
Depreciation
|
| | | | 29,641 | | | | | | 27,570 | | | | | | 55,807 | | | | | | 52,268 | | | | | | 53,002 | | | | | | 30,244 | | | | | | | 19,818 | | | | | | 41,650 | | |
Amortization of intangible
assets |
| | | | 167,027 | | | | | | 167,027 | | | | | | 334,053 | | | | | | 334,053 | | | | | | 334,053 | | | | | | 189,297 | | | | | | | 80,152 | | | | | | 184,967 | | |
Total expenses
|
| | | | 351,014 | | | | | | 306,256 | | | | | | 614,692 | | | | | | 613,342 | | | | | | 703,630 | | | | | | 486,474 | | | | | | | 463,204 | | | | | | 619,524 | | |
Operating income (loss)
|
| | | | 107,888 | | | | | | 184,421 | | | | | | 368,209 | | | | | | 427,541 | | | | | | 363,636 | | | | | | 89,415 | | | | | | | (50,607) | | | | | | 245,570 | | |
Interest expense(2)
|
| | | | 177,015 | | | | | | 193,192 | | | | | | 376,346 | | | | | | 383,261 | | | | | | 281,972 | | | | | | 155,140 | | | | | | | 81,385 | | | | | | 152,127 | | |
Interest income
|
| | | | (148) | | | | | | (79) | | | | | | (196) | | | | | | (51) | | | | | | (9) | | | | | | (19) | | | | | | | — | | | | | | (12) | | |
Loss on extinguishments and modification of debt
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 20,053 | | | | | | — | | | | | | | 127,307 | | | | | | — | | |
Gain on repurchase and cancellation of notes
|
| | | | — | | | | | | — | | | | | | (18,450) | | | | | | — | | | | | | — | | | | | | — | | | | | | | — | | | | | | — | | |
Net (loss) income before income
taxes |
| | | | (68,979) | | | | | | (8,692) | | | | | | 10,509 | | | | | | 44,331 | | | | | | 61,620 | | | | | | (65,706) | | | | | | | (259,299) | | | | | | 93,455 | | |
(Benefit) provision for income
taxes |
| | | | (10,139) | | | | | | (1,196) | | | | | | 799 | | | | | | 8,108 | | | | | | (586,512) | | | | | | (9,203) | | | | | | | (11,701) | | | | | | 85,706 | | |
Net (loss) income
|
| | | | (58,840) | | | | | | (7,496) | | | | | | 9,710 | | | | | | 36,223 | | | | | | 648,132 | | | | | | (56,503) | | | | | | | (247,598) | | | | | | 7,749 | | |
Weighted-average shares of common stock outstanding − basic and diluted .
|
| | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | | 10 | | | | | | 10 | | |
Net (loss) income per share − basic
and diluted |
| | | $ | (5,884) | | | | | $ | (750) | | | | | $ | 971 | | | | | $ | 3,622 | | | | | $ | 64,813 | | | | | $ | (5,650) | | | | | | $ | (24,760) | | | | | $ | 775 | | |
Other comprehensive income, net
of tax: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Unrealized gain (loss) on change in fair value of derivatives
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | | (2,244) | | | | | | (3,971) | | |
Comprehensive (loss)
income |
| | | $ | (58,840) | | | | | $ | (7,496) | | | | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | 648,132 | | | | | $ | (56,503) | | | | | | $ | (249,842) | | | | | $ | 3,778 | | |
Consolidated Balance Sheets Data (at end of period):
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | $ | 178,860 | | | | | $ | 12,069 | | | | | $ | 21,825 | | | | | $ | 5,014 | | | | | $ | 21,417 | | | | | $ | 26,396 | | | | | | | | | | | | $ | 56,313 | | |
Total assets(3)
|
| | | | 8,333,189 | | | | | | 8,531,227 | | | | | | 8,360,411 | | | | | | 8,642,973 | | | | | | 8,987,709 | | | | | | 9,285,126 | | | | | | | | | | | | | 5,297,921 | | |
Long-term debt
|
| | | | 5,406,138 | | | | | | 5,509,895 | | | | | | 5,397,122 | | | | | | 5,603,413 | | | | | | 5,835,697 | | | | | | 4,700,644 | | | | | | | | | | | | | 2,676,697 | | |
Shareholders’ equity
|
| | | | 1,963,650 | | | | | | 1,978,262 | | | | | | 1,985,218 | | | | | | 1,990,388 | | | | | | 1,949,448 | | | | | | 2,670,238 | | | | | | | | | | | | | 1,378,304 | | |
Cash dividends per share
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 141,971 | | | | | | 38,765 | | | | | | | | | | | | | — | | |
Consolidated Statements of Cash Flows Data:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash flows provided by (used in): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Operating activities
|
| | | $ | 191,867 | | | | | $ | 140,838 | | | | | $ | 284,313 | | | | | $ | 292,303 | | | | | $ | 368,945 | | | | | $ | 157,621 | | | | | | $ | 28,987 | | | | | $ | 347,117 | | |
Investing activities
|
| | | | (34,866) | | | | | | (33,696) | | | | | | (66,414) | | | | | | (63,556) | | | | | | (60,709) | | | | | | (6,838,883) | | | | | | | (22,568) | | | | | | (49,079) | | |
Financing activities
|
| | | | 34 | | | | | | (100,087) | | | | | | (201,088) | | | | | | (245,150) | | | | | | (313,215) | | | | | | 6,707,658 | | | | | | | (52,265) | | | | | | (270,083) | | |
(in millions)
|
| | | | | | |
Share issuance to MultiPlan Parent Owners(1)
|
| | | $ | 4,157.0 | | |
Shares previously issued to Churchill public shareholders, net of redemptions(1)
|
| | | | 1,013.1 | | |
Share issuance to the Sponsor (or any of its affiliates)(1)(2)
|
| | | | 275.0 | | |
Share issuance to Purchasers of the Common PIPE Shares(1)
|
| | | | 1,320.5 | | |
Share consideration – at Closing(3)
|
| | | $ | 6,765.6 | | |
(shares in millions; numbers may not sum due to rounding)
|
| |
Shares
|
| |
%
|
| ||||||
Share issuance to the MultiPlan Parent Owners
|
| | | | 415.7 | | | | | | | | |
Total MultiPlan Parent Owners shares
|
| | | | 415.7 | | | | | | 61.4% | | |
Shares held by current Churchill public shareholders
|
| | | | 110.0 | | | | | | | | |
Less: public shares redeemed
|
| | | | (8.7) | | | | | | | | |
Total held by current Churchill public shareholders
|
| | | | 101.3 | | | | | | 15.0% | | |
Shares held by the Sponsor (or any of its affiliates)(1)
|
| | | | 27.5 | | | | | | 4.1% | | |
Common PIPE Shares
|
| | | | 132.1 | | | | | | 19.5% | | |
Net Churchill shares, Sponsor Shares and Common PIPE Shares
|
| | | | 260.9 | | | | | | 38.6% | | |
Pro Forma shares outstanding(2)
|
| | | | 676.6 | | | | | | 100.0% | | |
| | |
As of
June 30, 2020 |
| | | | | | | | | | |
As of
June 30, 2020 |
| | | | | | | | | | | | | |
As of June 30, 2020
|
| |||||||||||||||
| | |
Churchill
(Historical) |
| |
MultiPlan Parent
(Historical) |
| |
Transactions
Pro Forma Adjustments |
| | | | |
Pro Forma
Combined |
| |
Refinancing
Pro Forma Adjustments |
| | | | | | | |
Pro Forma
Combined As Adjusted |
| ||||||||||||||||||
Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents(1)
|
| | | $ | 2,956 | | | | | $ | 178,860 | | | | | $ | 1,104,209 | | | |
(A)
|
| | | $ | 892,952 | | | | | | (1,624,846) | | | | | | (N) | | | | | $ | 178,073 | | |
| | | | | — | | | | | | — | | | | | | (38,500) | | | |
(B)
|
| | | | — | | | | | | (369,283) | | | | | | (O) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (53,000) | | | |
(C)
|
| | | | — | | | | | | 1,283,750 | | | | | | (P) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (51,745) | | | |
(D)
|
| | | | — | | | | | | (4,500) | | | | | | (Q) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 1,300,000 | | | |
(E)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 1,267,500 | | | |
(F)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (1,210,650) | | | |
(G)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 1,500 | | | |
(J)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (1,521,000) | | | |
(K)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (87,178) | | | |
(M)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Trade accounts receivable, net
|
| | | | — | | | | | | 54,004 | | | | | | — | | | | | | | | | 54,004 | | | | | | — | | | | | | | | | | | | 54,004 | | |
Prepaid expenses and other current assets
|
| | | | 398 | | | | | | 3,456 | | | | | | — | | | | | | | | | 3,854 | | | | | | — | | | | | | | | | | | | 3,854 | | |
Prepaid software and maintenance
|
| | | | — | | | | | | 8,616 | | | | | | — | | | | | | | | | 8,616 | | | | | | — | | | | | | | | | | | | 8,616 | | |
Prepaid taxes
|
| | | | — | | | | | | 7,686 | | | | | | — | | | | | | | | | 7,686 | | | | | | — | | | | | | | | | | | | 7,686 | | |
Total current assets
|
| | | | 3,354 | | | | | | 252,622 | | | | | | 711,136 | | | | | | | | | 967,112 | | | | | | (714,879) | | | | | | | | | | | | 252,233 | | |
Marketable securities held in Trust Account
|
| | | | 1,104,209 | | | | | | — | | | | | | (1,104,209) | | | |
(A)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Property and equipment, net
|
| | | | — | | | | | | 182,011 | | | | | | — | | | | | | | | | 182,011 | | | | | | — | | | | | | | | | | | | 182,011 | | |
Operating lease right-of-use asset
|
| | | | — | | | | | | 25,887 | | | | | | — | | | | | | | | | 25,887 | | | | | | — | | | | | | | | | | | | 25,887 | | |
Goodwill
|
| | | | — | | | | | | 4,142,013 | | | | | | — | | | | | | | | | 4,142,013 | | | | | | — | | | | | | | | | | | | 4,142,013 | | |
Client relationships intangible, net
|
| | | | — | | | | | | 2,998,649 | | | | | | — | | | | | | | | | 2,998,649 | | | | | | — | | | | | | | | | | | | 2,998,649 | | |
Provider network intangible, net
|
| | | | — | | | | | | 653,667 | | | | | | — | | | | | | | | | 653,667 | | | | | | — | | | | | | | | | | | | 653,667 | | |
Other intangibles, net
|
| | | | — | | | | | | 67,300 | | | | | | — | | | | | | | | | 67,300 | | | | | | — | | | | | | | | | | | | 67,300 | | |
Other assets
|
| | | | 1 | | | | | | 11,040 | | | | | | — | | | | | | | | | 11,041 | | | | | | 4,500 | | | | | | (Q) | | | | | | 14,291 | | |
Total assets
|
| | | $ | 1,107,564 | | | | | $ | 8,333,189 | | | | | $ | (393,073) | | | | | | | | $ | 9,047,680 | | | | | $ | (710,379) | | | | | | | | | | | $ | 8,337,301 | | |
Liabilities and Shareholders’ Equity | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 1,512 | | | | | $ | 8,352 | | | | | $ | (1,390) | | | |
(C)
|
| | | $ | 7,294 | | | | | $ | — | | | | | | | | | | | $ | 7,294 | | |
| | | | | — | | | | | | — | | | | | | (1,180) | | | |
(D)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Accrued interest
|
| | | | — | | | | | | 17,895 | | | | | | (8,349) | | | |
(G)
|
| | | | 9,546 | | | | | | (9,263) | | | | | | (N) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | (283) | | | | | | (O) | | | | | | — | | |
Income tax payable
|
| | | | 452 | | | | | | — | | | | | | — | | | | | | | | | 452 | | | | | | — | | | | | | | | | | | | 452 | | |
Operating lease obligations
|
| | | | — | | | | | | 9,649 | | | | | | — | | | | | | | | | 9,649 | | | | | | — | | | | | | | | | | | | 9,649 | | |
Accrued compensation
|
| | | | — | | | | | | 22,855 | | | | | | — | | | | | | | | | 22,855 | | | | | | — | | | | | | | | | | | | 22,855 | | |
Accrued legal
|
| | | | — | | | | | | 9,835 | | | | | | — | | | | | | | | | 9,835 | | | | | | — | | | | | | | | | | | | 9,835 | | |
Accrued administrative fees
|
| | | | — | | | | | | 3,345 | | | | | | — | | | | | | | | | 3,345 | | | | | | — | | | | | | | | | | | | 3,345 | | |
Other accrued expenses
|
| | | | — | | | | | | 11,526 | | | | | | — | | | | | | | | | 11,526 | | | | | | — | | | | | | | | | | | | 11,526 | | |
Total current liabilities
|
| | | | 1,964 | | | | | | 83,457 | | | | | | (10,919) | | | | | | | | | 74,502 | | | | | | (9,546) | | | | | | | | | | | | 64,956 | | |
Long-term debt
|
| | | | — | | | | | | 5,406,138 | | | | | | 1,023,806 | | | |
(F)
|
| | | | 5,264,729 | | | | | | (1,549,850) | | | | | | (N) | | | | | | 4,631,469 | | |
| | | | | — | | | | | | — | | | | | | (1,165,215) | | | |
(G)
|
| | | | — | | | | | | (367,160) | | | | | | (O) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | 1,283,750 | | | | | | (P) | | | | | | — | | |
Operating lease obligations
|
| | | | — | | | | | | 18,635 | | | | | | — | | | | | | | | | 18,635 | | | | | | — | | | | | | | | | | | | 18,635 | | |
Deferred income taxes
|
| | | | — | | | | | | 861,309 | | | | | | 56,781 | | | |
(F)
|
| | | | 918,090 | | | | | | — | | | | | | | | | | | | 918,090 | | |
Deferred underwriting fee payable
|
| | | | 38,500 | | | | | | — | | | | | | (38,500) | | | |
(B)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Total liabilities
|
| | | | 40,464 | | | | | | 6,369,539 | | | | | | (134,047) | | | | | | | | | 6,275,956 | | | | | | (642,806) | | | | | | | | | | | | 5,633,150 | | |
| | |
As of
June 30, 2020 |
| | | | | | | | | | |
As of
June 30, 2020 |
| | | | | | | | | | | | | |
As of
June 30, 2020 |
| |||||||||||||||
| | |
Churchill
(Historical) |
| |
MultiPlan Parent
(Historical) |
| |
Transactions
Pro Forma Adjustments |
| | | | |
Pro Forma
Combined |
| |
Refinancing Pro
Forma Adjustments |
| | | | | | | |
Pro Forma
Combined As Adjusted |
| ||||||||||||||||||
Commitments and contingencies: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||
Common stock subject to possible
redemption |
| | | | 1,062,100 | | | | | | — | | | | | | (1,062,100) | | | |
(I)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Shareholders’ equity: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||
Shareholder interests
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||
Common stock, $0.001 par value; 1,000 shares
authorized (500 Series A and 500 Series B); 5 shares of Series A and 5 shares of Series B issued and outstanding as of June 30, 2020 |
| | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | — | | | | | | | | | | | | — | | |
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding
|
| | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | — | | | | | | | | | | | | — | | |
Class A common stock, $0.0001 par value; 250,000,000
shares authorized; 4,141,928 and no shares issued and outstanding (excluding 105,858,072 and no shares subject to possible redemption) at June 30, 2020 |
| | | | — | | | | | | — | | | | | | 13 | | | |
(E)
|
| | | | 68 | | | | | | — | | | | | | | | | | | | 68 | | |
| | | | | — | | | | | | — | | | | | | 42 | | | |
(K)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 14 | | | |
(I)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (1) | | | |
(M)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Class B common stock, $0.0001 par value; 50,000,000
shares authorized; 27,500,000 shares issued and outstanding at June 30, 2020 |
| | | | 3 | | | | | | — | | | | | | (3) | | | |
(I)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Contributed capital
|
| | | | 3,302 | | | | | | 1,384,928 | | | | | | (41,000) | | | |
(C)
|
| | | | 2,639,766 | | | | | | — | | | | | | | | | | | | 2,639,766 | | |
| | | | | — | | | | | | — | | | | | | (20,000) | | | |
(D)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 1,299,987 | | | |
(E)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 186,913 | | | |
(F)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 1,695 | | | |
(H)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 1,062,089 | | | |
(I)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 1,500 | | | |
(J)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (1,521,042) | | | |
(K)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 368,571 | | | |
(L)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (87,177) | | | |
(M)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Retained earnings
|
| | | | 1,695 | | | | | | 578,722 | | | | | | (10,610) | | | |
(C)
|
| | | | 131,890 | | | | | | (65,733) | | | | | | (N) | | | | | | 64,317 | | |
| | | | | — | | | | | | — | | | | | | (30,565) | | | |
(D)
|
| | | | — | | | | | | (1,840) | | | | | | (O) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (37,086) | | | |
(G)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (1,695) | | | |
(H)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | (368,571) | | | |
(L)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Shareholders’ equity
|
| | | | 5,000 | | | | | | 1,963,650 | | | | | | 803,074 | | | | | | | | | 2,771,724 | | | | | | (67,573) | | | | | | | | | | | | 2,704,151 | | |
Total liabilities and shareholders’ equity
|
| | | $ | 1,107,564 | | | | | $ | 8,333,189 | | | | | $ | (393,073) | | | | | | | | $ | 9,047,680 | | | | | $ | (710,379) | | | | | | | | | | | $ | 8,337,301 | | |
|
| | |
Six Months Ended
June 30, 2020 |
| | | | | | | | | | |
Six Months
Ended June 30, 2020 |
| | | | | | | | | | | | | |
Six Months
Ended June 30, 2020 |
| |||||||||||||||
| | |
Churchill
(Historical) |
| |
MultiPlan Parent
(Historical) |
| |
Transactions
Pro Forma Adjustments |
| | | | |
Pro Forma
Combined |
| |
Refinancing
Pro Forma Adjustments |
| | | | | | | |
Pro Forma
Combined As Adjusted |
| ||||||||||||||||||
Revenues
|
| | | $ | — | | | | | $ | 458,902 | | | | | $ | — | | | | | | | | $ | 458,902 | | | | | $ | — | | | | | | | | | | | $ | 458,902 | | |
Costs of services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | — | | | | | | 96,579 | | | | | | — | | | | | | | | | 96,579 | | | | | | — | | | | | | | | | | | | 96,579 | | |
General and administrative expenses
|
| | | | 2,062 | | | | | | 57,767 | | | | | | (2,062) | | | |
(AA)
|
| | | | 56,582 | | | | | | — | | | | | | | | | | | | 56,582 | | |
| | | | | — | | | | | | — | | | | | | (1,185) | | | |
(BB)
|
| | | | — | | | | | | | | | | | | | | | | | | — | | |
Depreciation
|
| | | | — | | | | | | 29,641 | | | | | | — | | | | | | | | | 29,641 | | | | | | — | | | | | | | | | | | | 29,641 | | |
Amortization of intangible assets
|
| | | | — | | | | | | 167,027 | | | | | | — | | | | | | | | | 167,027 | | | | | | — | | | | | | | | | | | | 167,027 | | |
Total expenses
|
| | | | 2,062 | | | | | | 351,014 | | | | | | (3,247) | | | | | | | | | 349,829 | | | | | | — | | | | | | | | | | | | 349,829 | | |
Operating (loss) income
|
| | | | (2,062) | | | | | | 107,888 | | | | | | 3,247 | | | | | | | | | 109,073 | | | | | | — | | | | | | | | | | | | 109,073 | | |
Interest earned on marketable securities held in Trust Account
|
| | | | (4,216) | | | | | | — | | | | | | 4,216 | | | |
(AA)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Unrealized loss on marketable securities held in Trust Account
|
| | | | 6 | | | | | | — | | | | | | (6) | | | |
(AA)
|
| | | | — | | | | | | — | | | | | | | | | | | | — | | |
Interest expense
|
| | | | — | | | | | | 177,015 | | | | | | (52,552) | | | |
(CC)
|
| | | | 183,191 | | | | | | (56,640) | | | | | | (HH) | | | | | | 158,596 | | |
| | | | | — | | | | | | — | | | | | | 39,000 | | | |
(DD)
|
| | | | — | | | | | | (6,919) | | | | | | (II) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 19,728 | | | |
(EE)
|
| | | | — | | | | | | 438 | | | | | | (JJ) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | (315) | | | | | | (KK) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | 450 | | | | | | (LL) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | 37,375 | | | | | | (MM) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | 1,016 | | | | | | (NN) | | | | | | — | | |
Interest income
|
| | | | — | | | | | | (148) | | | | | | — | | | | | | | | | (148) | | | | | | — | | | | | | | | | | | | (148) | | |
Net Income (loss) before income taxes
|
| | | | 2,148 | | | | | | (68,979) | | | | | | (7,139) | | | | | | | | | (73,970) | | | | | | 24,595 | | | | | | | | | | | | (49,375) | | |
Provision (benefit) for income taxes
|
| | | | 451 | | | | | | (10,139) | | | | | | (1,663) | | | |
(FF)
|
| | | | (11,351) | | | | | | 5,731 | | | | | | (FF) | | | | | | (5,621) | | |
Net income (loss)
|
| | | | 1,697 | | | | | | (58,840) | | | | | | (5,476) | | | | | | | | | (62,619) | | | | | | 18,864 | | | | | | | | | | | | (43,754) | | |
Weighted average shares outstanding – basic and diluted
|
| | | | 30,397,160 | | | | | | 10 | | | | | | 646,158,975 | | | |
(GG)
|
| | | | 676,556,145 | | | | | | — | | | | | | | | | | | | 676,556,145 | | |
Net loss per share – basic and diluted
|
| | | $ | (0.03) | | | | | $ | (5,884,000.00) | | | | | | | | | | | | | | $ | (0.09) | | | | | $ | — | | | | | | | | | | | $ | (0.06) | | |
| | |
For the Period
from October 30, 2019 (inception) through December 31, 2019 |
| |
Twelve Months
Ended December 31, 2019 |
| | | | | | | | | | | | | |
Twelve Months
Ended December 31, 2019 |
| | | | | | | | | | | | | |
Twelve Months
Ended December 31, 2019 |
| ||||||||||||
| | |
Churchill
(Historical) |
| |
MultiPlan Parent
(Historical) |
| |
Transactions
Pro Forma Adjustments |
| | | | | | | |
Pro Forma
Combined |
| |
Refinancing Pro
Forma Adjustments |
| | | | | | | |
Pro Forma
Combined As Adjusted |
| ||||||||||||||||||
Revenues
|
| | | $ | — | | | | | $ | 982,901 | | | | | $ | — | | | | | | | | | | | $ | 982,901 | | | | | $ | — | | | | | | | | | | | $ | 982,901 | | |
Costs of services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | — | | | | | | 149,607 | | | | | | — | | | | | | | | | | | | 149,607 | | | | | | — | | | | | | | | | | | | 149,607 | | |
General and administrative expenses
|
| | | | 1 | | | | | | 75,225 | | | | | | (1) | | | | | | (AA) | | | | | | 75,225 | | | | | | — | | | | | | | | | | | | 75,225 | | |
Depreciation
|
| | | | — | | | | | | 55,807 | | | | | | — | | | | | | | | | | | | 55,807 | | | | | | — | | | | | | | | | | | | 55,807 | | |
Amortization of intangible assets
|
| | | | — | | | | | | 334,053 | | | | | | — | | | | | | | | | | | | 334,053 | | | | | | — | | | | | | | | | | | | 334,053 | | |
Total expenses
|
| | | | 1 | | | | | | 614,692 | | | | | | (1) | | | | | | | | | | | | 614,692 | | | | | | — | | | | | | | | | | | | 614,692 | | |
Operating income
(loss) |
| | | | (1) | | | | | | 368,209 | | | | | | 1 | | | | | | | | | | | | 368,209 | | | | | | — | | | | | | | | | | | | 368,209 | | |
Interest expense
|
| | | | — | | | | | | 376,346 | | | | | | (112,994) | | | | | | (CC) | | | | | | 380,808 | | | | | | (113,149) | | | | | | (HH) | | | | | | 332,064 | | |
| | | | | — | | | | | | — | | | | | | 78,000 | | | | | | (DD) | | | | | | — | | | | | | (13,838) | | | | | | (II) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 39,456 | | | | | | (EE) | | | | | | — | | | | | | 876 | | | | | | (JJ) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | — | | | | | | (315) | | | | | | (KK) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | — | | | | | | 900 | | | | | | (LL) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | — | | | | | | 74,750 | | | | | | (MM) | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | — | | | | | | 2,032 | | | | | | (NN) | | | | | | — | | |
Interest income
|
| | | | — | | | | | | (196) | | | | | | — | | | | | | | | | | | | (196) | | | | | | — | | | | | | | | | | | | (196) | | |
Gain on repurchase and
cancellation of Notes |
| | | | — | | | | | | (18,450) | | | | | | 18,450 | | | | | | (CC) | | | | | | — | | | | | | — | | | | | | | | | | | | — | | |
Net Income (loss) before income
taxes |
| | | | (1) | | | | | | 10,509 | | | | | | (22,911) | | | | | | | | | | | | (12,403) | | | | | | 48,744 | | | | | | | | | | | | 36,341 | | |
Provision (benefit) for income taxes
|
| | | | — | | | | | | 799 | | | | | | (5,338) | | | | | | (FF) | | | | | | (4,539) | | | | | | 11,357 | | | | | | (FF) | | | | | | 6,818 | | |
Net income (loss)
|
| | | | (1) | | | | | | 9,710 | | | | | | (17,573) | | | | | | | | | | | | (7,863) | | | | | | 37,387 | | | | | | | | | | | | 29,523 | | |
Weighted average shares
outstanding — basic and diluted |
| | | | 25,000,000 | | | | | | 10 | | | | | | 651,556,135 | | | | | | (GG) | | | | | | 676,556,145 | | | | | | — | | | | | | | | | | | | 676,556,145 | | |
Net income (loss) per share — basic and diluted
|
| | | $ | (0.00) | | | | | $ | 971,000.00 | | | | | | | | | | | | | | | | | $ | (0.01) | | | | | | | | | | | | | | | | | $ | 0.04 | | |
| | |
Six Months
Ended June 30, 2020 |
| |
Year Ended
December 31, 2019 |
| ||||||
Share issuance to the MultiPlan Parent Owners
|
| | | | 415,700,000 | | | | | | 415,700,000 | | |
Share issuance to purchasers of the Common PIPE Shares
|
| | | | 132,050,000 | | | | | | 132,050,000 | | |
Shares previously issued to Churchill’s Sponsor .
|
| | | | 27,500,000 | | | | | | 27,500,000 | | |
Shares previously issued to Churchill public shareholders
|
| | | | 110,000,000 | | | | | | 110,000,000 | | |
Shares issued in payment of placement fee to Churchill’s Sponsor
|
| | | | (8,693,855) | | | | | | (8,693,855) | | |
Shares issued and redeemed as part of the Transactions
|
| | | | 676,556,145 | | | | | | 676,556,145 | | |
| | |
For the Six Months Ended
June 30, |
| |
For the Year Ended
December 31, |
| ||||||||||||||||||||||||
($ in thousands)
|
| |
2020
|
| |
2019
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||||||||
| | |
(unaudited)
|
| |
(unaudited)
|
| | | | | | | | | | | | | | | | | | | ||||||
Net (loss) income
|
| | | $ | (58,840) | | | | | $ | (7,496) | | | | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | 648,132 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest expense(a)
|
| | | | 177,015 | | | | | | 193,192 | | | | | | 376,346 | | | | | | 383,261 | | | | | | 281,972 | | |
Interest income
|
| | | | (148) | | | | | | (79) | | | | | | (196) | | | | | | (51) | | | | | | (9) | | |
Income tax (benefit) provision
|
| | | | (10,139) | | | | | | (1,196) | | | | | | 799 | | | | | | 8,108 | | | | | | (586,512) | | |
Depreciation
|
| | | | 29,641 | | | | | | 27,570 | | | | | | 55,807 | | | | | | 52,268 | | | | | | 53,002 | | |
Amortization of intangible assets
|
| | | | 167,027 | | | | | | 167,027 | | | | | | 334,053 | | | | | | 334,053 | | | | | | 334,053 | | |
Non-income taxes(b)
|
| | | | 920 | | | | | | 930 | | | | | | 1,944 | | | | | | 1,641 | | | | | | 1,315 | | |
EBITDA
|
| | | $ | 305,476 | | | | | $ | 379,948 | | | | | $ | 778,463 | | | | | $ | 815,503 | | | | | $ | 731,953 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Other (income) expense(c)
|
| | | | 297 | | | | | | 823 | | | | | | 1,947 | | | | | | 4,617 | | | | | | 5,857 | | |
Transaction related expenses(d)
|
| | | | 2,698 | | | | | | 22 | | | | | | 3,270 | | | | | | 49 | | | | | | 3,435 | | |
Loss on extinguishments and modification of
debt(e) |
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 20,053 | | |
Gain on repurchase and cancellation of notes(f)
|
| | | | — | | | | | | — | | | | | | (18,450) | | | | | | — | | | | | | — | | |
Stock-based compensation(g)
|
| | | | 37,272 | | | | | | (4,630) | | | | | | (14,880) | | | | | | 4,717 | | | | | | 50,788 | | |
Adjusted EBITDA
|
| | | $ | 345,743 | | | | | $ | 376,163 | | | | | $ | 750,350 | | | | | $ | 824,886 | | | | | $ | 812,086 | | |
| | |
For the Six Months Ended June 30,
|
| |||||||||||||||||||||
($ in thousands)
|
| |
2020
|
| |
2019
|
| |
Change $
|
| |
Change %
|
| ||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | |
Network Services
|
| | | $ | 135,126 | | | | | $ | 162,760 | | | | | $ | (27,634) | | | | | | (17.0)% | | |
Analytics-Based Solutions
|
| | | | 274,096 | | | | | | 274,799 | | | | | | (703) | | | | | | (0.3)% | | |
Payment Integrity Solutions
|
| | | | 49,680 | | | | | | 53,118 | | | | | | (3,438) | | | | | | (6.5)% | | |
Total Revenues
|
| | | | 458,902 | | | | | | 490,677 | | | | | | (31,775) | | | | | | (6.5)% | | |
Costs of Services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Personnel expenses
|
| | | | 81,731 | | | | | | 58,238 | | | | | | 23,493 | | | | | | 40.3% | | |
Access and bill review fees
|
| | | | 7,307 | | | | | | 8,361 | | | | | | (1,054) | | | | | | (12.6)% | | |
Other
|
| | | | 7,541 | | | | | | 8,533 | | | | | | (992) | | | | | | (11.6)% | | |
Total Costs of Services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | 96,579 | | | | | | 75,132 | | | | | | 21,447 | | | | | | 28.5% | | |
General and administrative expenses
|
| | | | 57,767 | | | | | | 36,527 | | | | | | 21,240 | | | | | | 58.1% | | |
Depreciation expense
|
| | | | 29,641 | | | | | | 27,570 | | | | | | 2,071 | | | | | | 7.5% | | |
Amortization of intangible assets
|
| | | | 167,027 | | | | | | 167,027 | | | | | | — | | | | | | 0.0% | | |
Operating income
|
| | | | 107,888 | | | | | | 184,421 | | | | | | (76,533) | | | | | | (41.5)% | | |
Interest expense
|
| | | | 177,015 | | | | | | 193,192 | | | | | | (16,177) | | | | | | (8.4)% | | |
Interest income
|
| | | | (148) | | | | | | (79) | | | | | | (69) | | | | | | 87.3% | | |
Net loss before income taxes
|
| | | | (68,979) | | | | | | (8,692) | | | | | | (60,287) | | | | | | (693.6)% | | |
Benefit for income taxes
|
| | | | (10,139) | | | | | | (1,196) | | | | | | (8,943) | | | | | | (747.7)% | | |
Net loss
|
| | | $ | (58,840) | | | | | $ | (7,496) | | | | | $ | (51,344) | | | | | | (685.0)% | | |
| | |
For the Year Ended
December 31, |
| |
Change
|
| ||||||||||||||||||
($ in thousands)
|
| |
2019
|
| |
2018
|
| |
$
|
| |
%
|
| ||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | |
Network Services
|
| | | $ | 314,510 | | | | | $ | 363,510 | | | | | $ | (49,000) | | | | | | (13.5)% | | |
Analytics-Based Solutions
|
| | | | 561,525 | | | | | | 584,998 | | | | | | (23,473) | | | | | | (4.0)% | | |
Payment Integrity Solutions
|
| | | | 106,866 | | | | | | 92,375 | | | | | | 14,491 | | | | | | 15.7% | | |
Total Revenues
|
| | | | 982,901 | | | | | | 1,040,883 | | | | | | (57,982) | | | | | | (5.6)% | | |
Costs of Services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Personnel expenses
|
| | | | 115,827 | | | | | | 115,920 | | | | | | (93) | | | | | | (0.1)% | | |
Access and bill review fees
|
| | | | 15,996 | | | | | | 16,735 | | | | | | (739) | | | | | | (4.4)% | | |
Other
|
| | | | 17,784 | | | | | | 16,808 | | | | | | 976 | | | | | | 5.8% | | |
Total Costs of Services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | 149,607 | | | | | | 149,463 | | | | | | 144 | | | | | | 0.1% | | |
General and administrative expenses
|
| | | | 75,225 | | | | | | 77,558 | | | | | | (2,333) | | | | | | (3.0)% | | |
Depreciation expense
|
| | | | 55,807 | | | | | | 52,268 | | | | | | 3,539 | | | | | | 6.8% | | |
Amortization of intangible assets
|
| | | | 334,053 | | | | | | 334,053 | | | | | | — | | | | | | 0.0% | | |
Operating Income
|
| | | | 368,209 | | | | | | 427,541 | | | | | | (59,332) | | | | | | (13.9)% | | |
Interest expense
|
| | | | 376,346 | | | | | | 383,261 | | | | | | (6,915) | | | | | | (1.8)% | | |
Interest income
|
| | | | (196) | | | | | | (51) | | | | | | (145) | | | | | | N/M | | |
Gain on repurchase and cancellation of notes
|
| | | | (18,450) | | | | | | — | | | | | | (18,450) | | | | | | N/M | | |
Net income before income taxes
|
| | | | 10,509 | | | | | | 44,331 | | | | | | (33,822) | | | | | | (76.3)% | | |
Provision for income taxes
|
| | | | 799 | | | | | | 8,108 | | | | | | (7,309) | | | | | | (90.1)% | | |
Net income
|
| | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | (26,513) | | | | | | (73.2)% | | |
| | |
For the Year Ended
December 31, |
| |
Change
|
| ||||||||||||||||||
($ in thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | |
Network Services
|
| | | $ | 363,510 | | | | | $ | 415,759 | | | | | $ | (52,249) | | | | | | (12.6)% | | |
Analytics-Based Solutions
|
| | | | 584,998 | | | | | | 584,925 | | | | | | 73 | | | | | | 0.0% | | |
Payment Integrity Solutions
|
| | | | 92,375 | | | | | | 66,582 | | | | | | 25,793 | | | | | | 38.7% | | |
Total Revenues
|
| | | | 1,040,883 | | | | | | 1,067,266 | | | | | | (26,383) | | | | | | (2.5)% | | |
Costs of Services (exclusive of depreciation and amortization
of intangible assets shown below) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Personnel expenses
|
| | | | 115,920 | | | | | | 153,046 | | | | | | (37,126) | | | | | | (24.3)% | | |
Access and bill review fees
|
| | | | 16,735 | | | | | | 20,921 | | | | | | (4,186) | | | | | | (20.0)% | | |
Other
|
| | | | 16,808 | | | | | | 19,688 | | | | | | (2,880) | | | | | | (14.6)% | | |
Total Costs of Services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | 149,463 | | | | | | 193,655 | | | | | | (44,192) | | | | | | (22.8)% | | |
General and administrative expenses
|
| | | | 77,558 | | | | | | 122,920 | | | | | | (45,362) | | | | | | (36.9)% | | |
Depreciation expense
|
| | | | 52,268 | | | | | | 53,002 | | | | | | (734) | | | | | | (1.4)% | | |
Amortization of intangible assets
|
| | | | 334,053 | | | | | | 334,053 | | | | | | — | | | | | | 0.0% | | |
Operating Income
|
| | | | 427,541 | | | | | | 363,636 | | | | | | 63,905 | | | | | | 17.6% | | |
Interest expense
|
| | | | 383,261 | | | | | | 281,972 | | | | | | 101,289 | | | | | | 35.9% | | |
Interest income
|
| | | | (51) | | | | | | (9) | | | | | | (42) | | | | | | N/M | | |
Loss on extinguishments and modification of debt
|
| | | | — | | | | | | 20,053 | | | | | | (20,053) | | | | | | N/M | | |
Net income before income taxes
|
| | | | 44,331 | | | | | | 61,620 | | | | | | (17,289) | | | | | | (28.1)% | | |
Provision for income taxes
|
| | | | 8,108 | | | | | | (586,512) | | | | | | 594,620 | | | | | | 101.4% | | |
Net income
|
| | | $ | 36,223 | | | | | $ | 648,132 | | | | | $ | (611,909) | | | | | | (94.4)% | | |
| | |
Three Months Ended
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands)
|
| |
June 30,
2020 |
| |
March 31,
2020 |
| |
December 31,
2019 |
| |
September 30,
2019 |
| |
June 30,
2019 |
| |
March 31,
2019 |
| |
December 31,
2018 |
| |
September 30,
2018 |
| |
June 30,
2018 |
| |
March 31,
2018 |
| ||||||||||||||||||||||||||||||
Revenues
|
| | | $ | 206,880 | | | | | $ | 252,022 | | | | | $ | 246,404 | | | | | $ | 245,820 | | | | | $ | 245,653 | | | | | $ | 245,024 | | | | | $ | 240,172 | | | | | $ | 258,444 | | | | | $ | 279,416 | | | | | $ | 262,851 | | |
Costs of services (exclusive of
depreciation and amortization of intangible assets shown below)(1) |
| | | | 51,894 | | | | | | 44,685 | | | | | | 33,416 | | | | | | 41,059 | | | | | | 34,455 | | | | | | 40,677 | | | | | | 16,786 | | | | | | 40,138 | | | | | | 48,576 | | | | | | 43,962 | | |
General and administrative expenses(1)
|
| | | | 36,066 | | | | | | 21,701 | | | | | | 12,712 | | | | | | 25,986 | | | | | | 14,337 | | | | | | 22,190 | | | | | | (2,312) | | | | | | 22,565 | | | | | | 31,899 | | | | | | 25,406 | | |
Depreciation
|
| | | | 15,135 | | | | | | 14,506 | | | | | | 14,084 | | | | | | 14,153 | | | | | | 14,026 | | | | | | 13,544 | | | | | | 13,087 | | | | | | 13,005 | | | | | | 13,252 | | | | | | 12,924 | | |
Amortization of intangible assets
|
| | | | 83,514 | | | | | | 83,513 | | | | | | 83,513 | | | | | | 83,513 | | | | | | 83,514 | | | | | | 83,513 | | | | | | 83,513 | | | | | | 83,513 | | | | | | 83,514 | | | | | | 83,513 | | |
Total expenses
|
| | | | 186,609 | | | | | | 164,405 | | | | | | 143,725 | | | | | | 164,711 | | | | | | 146,332 | | | | | | 159,924 | | | | | | 111,074 | | | | | | 159,221 | | | | | | 177,241 | | | | | | 165,805 | | |
Operating income
|
| | | | 20,271 | | | | | | 87,617 | | | | | | 102,679 | | | | | | 81,109 | | | | | | 99,321 | | | | | | 85,100 | | | | | | 129,098 | | | | | | 99,223 | | | | | | 102,175 | | | | | | 97,046 | | |
Interest expense
|
| | | | 86,050 | | | | | | 90,965 | | | | | | 89,908 | | | | | | 93,246 | | | | | | 95,473 | | | | | | 97,719 | | | | | | 95,762 | | | | | | 96,970 | | | | | | 96,028 | | | | | | 94,501 | | |
Interest income
|
| | | | (77) | | | | | | (71) | | | | | | (63) | | | | | | (54) | | | | | | (46) | | | | | | (33) | | | | | | (28) | | | | | | (15) | | | | | | (7) | | | | | | — | | |
Gain on repurchase and retirement of Notes
|
| | | | — | | | | | | — | | | | | | — | | | | | | (18,450) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Net (loss) income before
income taxes |
| | | | (65,702) | | | | | | (3,277) | | | | | | 12,834 | | | | | | 6,367 | | | | | | 3,894 | | | | | | (12,586) | | | | | | 33,364 | | | | | | 2,268 | | | | | | 6,154 | | | | | | 2,545 | | |
(Benefit) provision for income
taxes |
| | | | (9,456) | | | | | | (683) | | | | | | 990 | | | | | | 1,005 | | | | | | 3,026 | | | | | | (4,222) | | | | | | 10,742 | | | | | | (6,046) | | | | | | 2,569 | | | | | | 843 | | |
(Loss) income from continuing operations
|
| | | | (56,246) | | | | | | (2,594) | | | | | | 11,844 | | | | | | 5,362 | | | | | | 868 | | | | | | (8,364) | | | | | | 22,622 | | | | | | 8,314 | | | | | | 3,585 | | | | | | 1,702 | | |
Net (loss) income
|
| | | | (56,246) | | | | | | (2,594) | | | | | | 11,844 | | | | | | 5,362 | | | | | | 868 | | | | | | (8,364) | | | | | | 22,622 | | | | | | 8,314 | | | | | | 3,585 | | | | | | 1,702 | | |
Weighted average shares outstanding – Basic and Diluted:
|
| | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | | | | | 10 | | |
Net (loss) income per share – Basic and Diluted:
|
| | | $ | (5,624,600) | | | | | $ | (259,400) | | | | | $ | 1,184,400 | | | | | $ | 536,200 | | | | | $ | 86,800 | | | | | $ | (836,400) | | | | | $ | 2,262,200 | | | | | $ | 831,400 | | | | | $ | 358,500 | | | | | $ | 170,200 | | |
Comprehensive (loss) income
|
| | | $ | (56,246) | | | | | $ | (2,594) | | | | | $ | 11,844 | | | | | $ | 5,362 | | | | | $ | 868 | | | | | $ | (8,364) | | | | | $ | 22,622 | | | | | $ | 8,314 | | | | | $ | 3,585 | | | | | $ | 1,702 | | |
|
| | |
Three Months Ended
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands)
|
| |
June 30,
2020 |
| |
March 31,
2020 |
| |
December 31,
2019 |
| |
September 30,
2019 |
| |
June 30,
2019 |
| |
March 31,
2019 |
| |
December 31,
2018 |
| |
September 30,
2018 |
| |
June 30,
2018 |
| |
March 31,
2018 |
| ||||||||||||||||||||||||||||||
Costs of services
|
| | | $ | 12,494 | | | | | $ | 5,452 | | | | | $ | (6,579) | | | | | $ | 1,593 | | | | | $ | (4,714) | | | | | $ | 1,796 | | | | | $ | (12,102) | | | | | $ | 2,784 | | | | | $ | 7,140 | | | | | $ | 2,420 | | |
General and administrative expenses
|
| | | | 15,417 | | | | | | 3,909 | | | | | | (7,992) | | | | | | 2,728 | | | | | | (4,952) | | | | | | 3,240 | | | | | | (16,487) | | | | | | 5,067 | | | | | | 11,632 | | | | | | 4,263 | | |
| | | | $ | 27,911 | | | | | $ | 9,361 | | | | | $ | (14,571) | | | | | $ | 4,321 | | | | | $ | (9,666) | | | | | $ | 5,036 | | | | | $ | (28,589) | | | | | $ | 7,851 | | | | | $ | 18,772 | | | | | $ | 6,683 | | |
|
(in thousands)
|
| |
Three Months Ended
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | |
June 30,
2020 |
| |
March 31,
2020 |
| |
December 31,
2019 |
| |
September 30,
2019 |
| |
June 30,
2019 |
| |
March 31,
2019 |
| |
December 31,
2018 |
| |
September 30,
2018 |
| |
June 30,
2018 |
| |
March 31,
2018 |
| ||||||||||||||||||||||||||||||
Costs of services (exclusive of depreciation and amortization of intangible assets)
|
| | | $ | 51,894 | | | | | $ | 44,685 | | | | | $ | 33,416 | | | | | $ | 41,059 | | | | | $ | 34,455 | | | | | $ | 40,677 | | | | | $ | 16,786 | | | | | $ | 40,138 | | | | | $ | 48,576 | | | | | $ | 43,962 | | |
Less: stock-based compensation
|
| | | | 12,494 | | | | | | 5,452 | | | | | | (6,579) | | | | | | 1,593 | | | | | | (4,714) | | | | | | 1,796 | | | | | | (12,102) | | | | | | 2,784 | | | | | | 7,140 | | | | | | 2,420 | | |
Costs of services excluding stock-based compensation
|
| | | $ | 39,400 | | | | | $ | 39,233 | | | | | $ | 39,995 | | | | | $ | 39,466 | | | | | $ | 39,169 | | | | | $ | 38,881 | | | | | $ | 28,888 | | | | | $ | 37,354 | | | | | $ | 41,436 | | | | | $ | 41,542 | | |
General and administrative expenses
|
| | | $ | 36,066 | | | | | $ | 21,701 | | | | | $ | 12,712 | | | | | $ | 25,986 | | | | | $ | 14,337 | | | | | $ | 22,190 | | | | | $ | (2,312) | | | | | $ | 22,565 | | | | | $ | 31,899 | | | | | $ | 25,406 | | |
Less: stock-based compensation
|
| | | | 15,417 | | | | | | 3,909 | | | | | | (7,992) | | | | | | 2,728 | | | | | | (4,952) | | | | | | 3,240 | | | | | | (16,487) | | | | | | 5,067 | | | | | | 11,632 | | | | | | 4,263 | | |
General and administrative expenses
|
| | | $ | 20,649 | | | | | $ | 17,792 | | | | | $ | 20,704 | | | | | $ | 23,258 | | | | | $ | 19,289 | | | | | $ | 18,950 | | | | | $ | 14,175 | | | | | $ | 17,498 | | | | | $ | 20,267 | | | | | $ | 21,143 | | |
|
| | |
Three Months Ended
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | |
June 30,
2020 |
| |
March 31,
2020 |
| |
December 31,
2019 |
| |
September 30,
2019 |
| |
June 30,
2019 |
| |
March 31,
2019 |
| |
December 31,
2018 |
| |
September 30,
2018 |
| |
June 30,
2018 |
| |
March 31,
2018 |
| ||||||||||||||||||||||||||||||
Revenues
|
| | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | |
Costs of services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | 25% | | | | | | 18% | | | | | | 14% | | | | | | 17% | | | | | | 14% | | | | | | 17% | | | | | | 7% | | | | | | 16% | | | | | | 17% | | | | | | 17% | | |
General and administrative
expenses |
| | | | 17% | | | | | | 9% | | | | | | 5% | | | | | | 11% | | | | | | 6% | | | | | | 9% | | | | | | (1)% | | | | | | 9% | | | | | | 11% | | | | | | 10% | | |
Depreciation
|
| | | | 7% | | | | | | 6% | | | | | | 6% | | | | | | 6% | | | | | | 6% | | | | | | 6% | | | | | | 5% | | | | | | 5% | | | | | | 5% | | | | | | 5% | | |
Amortization of intangible assets
|
| | | | 40% | | | | | | 33% | | | | | | 34% | | | | | | 34% | | | | | | 34% | | | | | | 34% | | | | | | 35% | | | | | | 32% | | | | | | 30% | | | | | | 32% | | |
Total expenses
|
| | | | 90% | | | | | | 65% | | | | | | 58% | | | | | | 67% | | | | | | 60% | | | | | | 65% | | | | | | 46% | | | | | | 62% | | | | | | 63% | | | | | | 63% | | |
Operating income
|
| | | | 10% | | | | | | 35% | | | | | | 42% | | | | | | 33% | | | | | | 40% | | | | | | 35% | | | | | | 54% | | | | | | 38% | | | | | | 37% | | | | | | 37% | | |
Interest expense
|
| | | | 42% | | | | | | 36% | | | | | | 36% | | | | | | 38% | | | | | | 39% | | | | | | 40% | | | | | | 40% | | | | | | 38% | | | | | | 34% | | | | | | 36% | | |
Interest income
|
| | | | (0)% | | | | | | (0)% | | | | | | (0)% | | | | | | (0)% | | | | | | (0)% | | | | | | (0)% | | | | | | (0)% | | | | | | (0)% | | | | | | (0)% | | | | | | 0% | | |
Gain on repurchase and retirement of
Notes |
| | | | 0% | | | | | | 0% | | | | | | 0% | | | | | | (8)% | | | | | | 0% | | | | | | 0% | | | | | | 0% | | | | | | 0% | | | | | | 0% | | | | | | 0% | | |
Net (loss) income before income
taxes |
| | | | (32)% | | | | | | (1)% | | | | | | 5% | | | | | | 3% | | | | | | 2% | | | | | | (5)% | | | | | | 14% | | | | | | 1% | | | | | | 2% | | | | | | 1% | | |
(Benefit) provision for income
taxes |
| | | | (5)% | | | | | | (0)% | | | | | | 0% | | | | | | 0% | | | | | | 1% | | | | | | (2)% | | | | | | 4% | | | | | | (2)% | | | | | | 1% | | | | | | 0% | | |
(Loss) income from continuing operations
|
| | | | (27)% | | | | | | (1)% | | | | | | 5% | | | | | | 2% | | | | | | 0% | | | | | | (3)% | | | | | | 9% | | | | | | 3% | | | | | | 1% | | | | | | 1% | | |
Net (loss) income
|
| | | | (27)% | | | | | | (1)% | | | | | | 5% | | | | | | 2% | | | | | | 0% | | | | | | (3)% | | | | | | 9% | | | | | | 3% | | | | | | 1% | | | | | | 1% | | |
Comprehensive (loss) income
|
| | | | (27)% | | | | | | (1)% | | | | | | 5% | | | | | | 2% | | | | | | 0% | | | | | | (3)% | | | | | | 9% | | | | | | 3% | | | | | | 1% | | | | | | 1% | | |
|
| | |
For the Six Months Ended
June 30, |
| |
For the Year Ended
December 31, |
| ||||||||||||||||||||||||
(in thousands)
|
| |
2020
|
| |
2019
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||||||||
Net cash flows provided by (used in): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Operating activities
|
| | | $ | 191,867 | | | | | $ | 140,838 | | | | | $ | 284,313 | | | | | $ | 292,303 | | | | | $ | 368,945 | | |
Investing activities
|
| | | $ | (34,866) | | | | | $ | (33,696) | | | | | $ | (66,414) | | | | | $ | (63,556) | | | | | $ | (60,709) | | |
Financing activities
|
| | | $ | 34 | | | | | $ | (100,087) | | | | | $ | (201,088) | | | | | $ | (245,150) | | | | | $ | (313,215) | | |
| | |
Payments Due by Period
|
| |||||||||||||||||||||||||||
($ in thousands)
|
| |
Total
|
| |
Less than
1 Year |
| |
1 – 3 Years
|
| |
3 – 5 Years
|
| |
More
than 5 Years |
| |||||||||||||||
Long-term debt obligations(1): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior secured credit facilities:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Term Loan G
|
| | | $ | 2,710,000 | | | | | $ | — | | | | | $ | 2,710,000 | | | | | $ | — | | | | | $ | — | | |
7.125% Notes due 2024
|
| | | | 1,560,000 | | | | | | — | | | | | | — | | | | | | 1,560,000 | | | | | | — | | |
Senior PIK Notes(2)
|
| | | | 1,178,727 | | | | | | — | | | | | | 1,178,727 | | | | | | — | | | | | | — | | |
Finance lease obligations
|
| | | | 187 | | | | | | 86 | | | | | | 101 | | | | | | — | | | | | | — | | |
Operating lease obligations
|
| | | | 36,607 | | | | | | 11,226 | | | | | | 23,560 | | | | | | 1,821 | | | | | | — | | |
Total contractual obligations
|
| | | $ | 5,485,521 | | | | | $ | 11,312 | | | | | $ | 3,912,388 | | | | | $ | 1,561,821 | | | | | $ | — | | |
(in thousands)
|
| |
Total
|
| |
Less than
1 Year |
| |
1 – 3 Years
|
| |
3 – 5 Years
|
| |
More than
5 Years |
| |||||||||||||||
Long-term debt obligations(1): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior secured credit facilities:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Term Loan G
|
| | | $ | 2,341,000 | | | | | $ | — | | | | | $ | — | | | | | $ | 2,341,000 | | | | | $ | — | | |
5.750% Notes due 2028
|
| | | | 1,300,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,300,000 | | |
Convertible Notes(2)
|
| | | | 1,300,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,300,000 | | |
Finance lease obligations
|
| | | | 187 | | | | | | 86 | | | | | | 101 | | | | | | — | | | | | | — | | |
Operating leases
|
| | | | 36,607 | | | | | | 11,226 | | | | | | 23,560 | | | | | | 1,821 | | | | | | — | | |
Total contractual obligations
|
| | | $ | 4,977,794 | | | | | $ | 11,312 | | | | | $ | 23,661 | | | | | $ | 2,342,821 | | | | | $ | 2,600,000 | | |
|
| | |
For the Year Ended
December 31, |
| ||||||
Range of Significant Unobservable Inputs
|
| |
2019
|
| |
2018
|
| |
2017
|
|
Long term growth rate
|
| |
2.75% to 3.25%
|
| |
2.75% to 3.25%
|
| |
2.75% to 3.25%
|
|
Discount rate
|
| |
9.75% to 10.25%
|
| |
10.25% to 10.75%
|
| |
9.75% to 10.25%
|
|
Public company EBITDA multiples
|
| |
10.0x to 11.0x
|
| |
10.0x to 12.0x
|
| |
10.0x to 12.0x
|
|
Acquisition EBITDA multiples
|
| |
11.0x to 12.0x
|
| |
11.0x to 12.0x
|
| |
11.0x to 12.0x
|
|
Name
|
| |
Age
|
| |
Title
|
|
Mark Tabak | | |
70
|
| | Chief Executive Officer and Chair person of the Board | |
David Redmond | | |
69
|
| | Executive Vice President and Chief Financial Officer | |
Paul Galant | | |
52
|
| | President, New Markets | |
Dale White | | |
65
|
| | President, Payor Markets | |
Jeffrey Doctoroff | | |
52
|
| |
Senior Vice President, General Counsel and Secretary
|
|
Michael Kim | | |
54
|
| | Senior Vice President and Chief Information Officer | |
Glenn R. August | | |
59
|
| | Director | |
Richard A. Clarke | | |
70
|
| | Director | |
Anthony Colaluca | | |
54
|
| | Director | |
Paul D. Emery | | |
35
|
| | Director | |
Michael Klein | | |
57
|
| | Director | |
P. Hunter Philbrick | | |
41
|
| | Director | |
Allen R. Thorpe | | |
49
|
| | Director | |
Bill Veghte | | |
53
|
| | Director | |
Name
|
| |
2019
Base Salary |
| |||
Mr. Tabak
|
| | | $ | 858,145 | | |
Mr. Redmond
|
| | | $ | 561,834 | | |
Mr. White
|
| | | $ | 466,272 | | |
Mr. Kim
|
| | | $ | 391,565 | | |
Mr. Doctoroff
|
| | | $ | 347,323 | | |
Name
|
| |
Annual Incentive
Target % of Base Salary |
| |
Base Salary
|
| |
Annual Incentive
Target Payout |
| |||||||||
Mr. Tabak
|
| | | | 125% | | | | | $ | 858,145 | | | | | $ | 1,072,681 | | |
Mr. Redmond
|
| | | | 100% | | | | | $ | 561,834 | | | | | $ | 561,834 | | |
Mr. White
|
| | | | 100% | | | | | $ | 466,272 | | | | | $ | 466,272 | | |
Mr. Kim
|
| | | | 50% | | | | | $ | 391,565 | | | | | $ | 195,783 | | |
Mr. Doctoroff
|
| | | | 50% | | | | | $ | 347,323 | | | | | $ | 173,662 | | |
Name and Principal Position
|
| |
Year
|
| |
Salary
($)(1) |
| |
Bonus
($) |
| |
Stock
Awards ($) |
| |
Option
Awards ($) |
| |
Non-Equity
Incentive Plan Compensation ($) |
| |
Change in
Pension Value and Non- qualified Deferred Compensation Earnings ($) |
| |
All Other
Compensation ($)(2) |
| |
Total
($) |
| |||||||||||||||||||||||||||
Mr. Tabak
|
| | | | 2019 | | | | | | 858,145 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,000 | | | | | | 865,145 | | |
Chief Executive Officer
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Mr. Redmond
|
| | | | 2019 | | | | | | 561,834 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,000 | | | | | | 568,834 | | |
Executive Vice President &
Chief Financial Officer |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Mr. White
|
| | | | 2019 | | | | | | 466,272 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,000 | | | | | | 473,272 | | |
Executive Vice President &
Chief Revenue Officer |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Mr. Kim
|
| | | | 2019 | | | | | | 391,565 | | | | | | 175,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,000 | | | | | | 573,565 | | |
Senior Vice President & Chief
Information Officer |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Mr. Doctoroff
|
| | | | 2019 | | | | | | 347,323 | | | | | | 150,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,000 | | | | | | 504,323 | | |
Senior Vice President & General
Counsel |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | |
Estimated Future Payouts
Under Non-Equity Incentive Plan Awards |
| |||||||||||||||
Name
|
| |
Threshold
($) |
| |
Target
($) |
| |
Maximum
($) |
| |||||||||
Mr. Tabak
|
| | | | — | | | | | $ | 1,072,681 | | | | | | — | | |
Mr. Redmond
|
| | | | — | | | | | $ | 561,834 | | | | | | — | | |
Mr. White
|
| | | | — | | | | | $ | 466,272 | | | | | | — | | |
Mr. Kim
|
| | | | — | | | | | $ | 195,783 | | | | | | — | | |
Mr. Doctoroff
|
| | | | — | | | | | $ | 173,662 | | | | | | — | | |
| | | | | | | | |
Stock Awards
|
| |||||||||||||||||||||
Name
|
| |
Grant Date
|
| |
Number of Shares
or Units of Stock That Have Not Vested (#)(1) |
| |
Market Value
of Shares or Units of Stock That Have Not Vested ($)(2) |
| |
Equity Incentive
Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(3) |
| |
Equity Incentive
Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(4) |
| |||||||||||||||
Mr. Tabak
|
| | | | 6/7/2016 | | | | | | 6,433.39 | | | | | | 2,341,175 | | | | | | 21,444.64 | | | | | | 7,803,919 | | |
Mr. Redmond
|
| | | | 6/7/2016 | | | | | | 4,288.93 | | | | | | 1,560,785 | | | | | | 14,296.42 | | | | | | 5,202,610 | | |
Mr. White
|
| | | | 6/7/2016 | | | | | | 4,288.93 | | | | | | 1,560,785 | | | | | | 14,296.42 | | | | | | 5,202,610 | | |
Mr. Kim
|
| | | | 8/10/2016 | | | | | | 291.65 | | | | | | 106,134 | | | | | | 729.12 | | | | | | 265,334 | | |
Mr. Doctoroff
|
| | | | 8/10/2016 | | | | | | 291.65 | | | | | | 106,134 | | | | | | 729.12 | | | | | | 265,334 | | |
| | |
Stock Awards
|
| |||||||||
Name
|
| |
Number of Shares
Acquired on Vesting (#) |
| |
Value Realized on
Vesting ($) |
| ||||||
Mr. Tabak
|
| | | | 12,866.78 | | | | | | 4,682,350 | | |
Mr. Redmond
|
| | | | 8,577.86 | | | | | | 3,121,569 | | |
Mr. White
|
| | | | 8,577.86 | | | | | | 3,121,569 | | |
Mr. Kim
|
| | | | 437.47 | | | | | | 159,200 | | |
Mr. Doctoroff
|
| | | | 437.47 | | | | | | 159,200 | | |
Name
|
| |
Payment Type
|
| |
Termination Without
Cause or for Good Reason (Including Non- Extension of Term)(6) ($) |
| |
Termination Without
Good Reason Upon a Change in Control ($) |
| ||||||
Mr. Tabak
|
| | Cash Severance(1) | | | | | 4,934,334 | | | | | | 4,934,334 | | |
| | |
Benefit Continuation(2)
|
| | | | 24,518 | | | | | | 24,518 | | |
| | |
Total
|
| | | | 4,958,852 | | | | | | 4,958,852 | | |
Mr. Redmond
|
| | Cash Severance(3) | | | | | 2,247,336 | | | | | | 2,247,336 | | |
| | |
Benefit Continuation(2)
|
| | | | 24,518 | | | | | | 24,518 | | |
| | |
Total
|
| | | | 2,271,854 | | | | | | 2,271,854 | | |
Mr. White
|
| | Cash Severance(4) | | | | | 932,544 | | | | | | — | | |
| | |
Benefit Continuation(2)
|
| | | | 24,518 | | | | | | — | | |
| | |
Total
|
| | | | 957,062 | | | | | | — | | |
Mr. Kim
|
| | Cash Severance(5) | | | | | 195,783 | | | | | | — | | |
| | |
Benefit Continuation(2)
|
| | | | 22,637 | | | | | | — | | |
| | |
Total
|
| | | | 218,420 | | | | | | — | | |
Mr. Doctoroff
|
| | Cash Severance(5) | | | | | 173,662 | | | | | | — | | |
| | |
Benefit Continuation(2)
|
| | | | 40,428 | | | | | | — | | |
| | |
Total
|
| | | | 214,090 | | | | | | — | | |
Name
|
| |
Equity Award
|
| |
Termination
Without “Cause” or For “Good Reason” ($)(1) |
| |
Qualifying
Realization Event ($)(2) |
| |
Liquidity
Event/Qualifying Liquidity Event ($)(3) |
| |||||||||
Mr. Tabak
|
| | Time Vested Units | | | | | 2,341,175 | | | | | | — | | | | | | 2,341,175 | | |
| | |
Performance Vested Units
|
| | | | — | | | | | | — | | | | | | 7,803,919 | | |
| | |
Total
|
| | | | 2,341,175 | | | | | | — | | | | | | 10,145,094 | | |
Mr. Redmond
|
| | Time Vested Units | | | | | 1,560,785 | | | | | | — | | | | | | 1,560,785 | | |
| | |
Performance Vested Units
|
| | | | — | | | | | | — | | | | | | 5,202,610 | | |
| | |
Total
|
| | | | 1,560,785 | | | | | | — | | | | | | 6,763,395 | | |
Mr. White
|
| | Time Vested Units | | | | | 1,560,785 | | | | | | — | | | | | | 1,560,785 | | |
| | |
Performance Vested Units
|
| | | | — | | | | | | — | | | | | | 5,202,610 | | |
| | |
Total
|
| | | | 1,560,785 | | | | | | — | | | | | | 6,763,395 | | |
Mr. Kim
|
| | Time Vested Units | | | | | — | | | | | | — | | | | | | 106,134 | | |
| | |
Performance Vested Units
|
| | | | — | | | | | | — | | | | | | 265,334 | | |
| | |
Total
|
| | | | — | | | | | | — | | | | | | 371,468 | | |
Mr. Doctoroff
|
| | Time Vested Units | | | | | — | | | | | | — | | | | | | 106,134 | | |
| | |
Performance Vested Units
|
| | | | — | | | | | | — | | | | | | 265,334 | | |
| | |
Total
|
| | | | — | | | | | | — | | | | | | 371,468 | | |
Name
|
| |
Fees Earned
or Paid in Cash ($) |
| |
Stock
Awards ($) |
| |
Option
Awards ($) |
| |
Non-Equity
Incentive Plan Compensation ($) |
| |
Change in
Pension Value and Nonqualified Deferred Compensation Earnings ($) |
| |
All Other
Compensation ($) |
| |
Total
($) |
| |||||||||||||||||||||
Richard Clarke
|
| | | | 200,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 200,000 | | |
Committee
|
| |
Committee Member Retainer
|
| |
Committee Chair Retainer
|
| ||||||
Audit Committee
|
| | | $ | 12,500 | | | | | $ | 25,000 | | |
Compensation Committee
|
| | | $ | 10,000 | | | | | $ | 20,000 | | |
Nominating and Corporate Governance Committee
|
| | | $ | 7,500 | | | | | $ | 15,000 | | |
Name and Address of Beneficial Owner(1)
|
| |
Number
of Shares |
| |
Percent
Owned |
| ||||||
Five Percent Holders:
|
| | | | | | | | | | | | |
Churchill Sponsor III LLC(2)
|
| | | | 52,000,000 | | | | | | 7.5% | | |
GIC Investor(3)
|
| | | | 49,612,794 | | | | | | 7.4% | | |
Green Equity Investors(4)
|
| | | | 38,449,957 | | | | | | 5.8% | | |
H&F Investors(5)
|
| | | | 213,802,446 | | | | | | 32.0% | | |
Oak Hill Advisors Entities(6)
|
| | | | 41,111,550 | | | | | | 5.8% | | |
The Public Investment Fund of The Kingdom of Saudi Arabia(7)
|
| | | | 53,750,000 | | | | | | 8.0% | | |
Named Executive Officers and Directors: | | | | | | | | | | | | | |
Mark Tabak(8)
|
| | | | 13,890,202 | | | | | | 2.1% | | |
David Redmond
|
| | | | — | | | | | | — | | |
Dale White
|
| | | | 8,066,106 | | | | | | 1.2% | | |
Jeff Doctoroff
|
| | | | 301,464 | | | | | | * | | |
Michael Kim
|
| | | | 301,464 | | | | | | * | | |
Glenn R. August(9)(10)
|
| | | | 41,111,550 | | | | | | 5.8% | | |
Richard Clarke
|
| | | | — | | | | | | — | | |
Anthony Colaluca
|
| | | | — | | | | | | — | | |
Paul Emery(11)
|
| | | | — | | | | | | — | | |
Michael Klein(2)(12)
|
| | | | 52,000,000 | | | | | | 7.5% | | |
Hunter Philbrick(11)
|
| | | | — | | | | | | — | | |
Allen Thorpe(11)
|
| | | | — | | | | | | — | | |
Bill Veghte(9)
|
| | | | — | | | | | | — | | |
All executive officers and directors as a group (15 individuals)
|
| | | | 115,670,786 | | | | | | 17.3% | | |
| | |
Founder
Shares |
| |||
Glenn R. August(A)
|
| | | | 3,933,137 | | |
Bill Veghte(B)
|
| | | | 294,985 | | |
| | |
Securities Beneficially Owned
Prior to this Offering |
| |
Securities to be
Sold in this Offering(1) |
| |
Securities Beneficially Owned
After this Offering |
| |||||||||||||||||||||||||||||||||||||||
Name of Selling Securityholder
|
| |
Shares of
Class A common stock(2) |
| |
Warrants(3)
|
| |
Shares of
Class A common stock(2) |
| |
Warrants(3)
|
| |
Shares of
Class A common stock(2) |
| |
%
|
| |
Warrants(3)
|
| |
%
|
| ||||||||||||||||||||||||
30 MP Investment, LLC(4)
|
| | | | 19,810,354 | | | | | | — | | | | | | 19,810,354 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Alberta Investment Management Corporation(5)
|
| | | | 1,855,000 | | | | | | — | | | | | | 1,855,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Alyeska Investors(6)
|
| | | | 2,650,000 | | | | | | — | | | | | | 2,650,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
BDG Enterprises, L.P.(7).
|
| | | | 2,135,034 | | | | | | — | | | | | | 2,135,034 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
CCC-III Investments LLC(8)
|
| | | | 10,600,000 | | | | | | — | | | | | | 10,600,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Churchill Sponsor III LLC(9)
|
| | | | 27,500,000 | | | | | | 24,500,000 | | | | | | 27,500,000 | | | | | | 24,500,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Dale White(10)
|
| | | | 8,066,106 | | | | | | — | | | | | | 8,066,106 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Darlington Investors(11)
|
| | | | 2,650,000 | | | | | | — | | | | | | 2,650,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
David L. Redmond Children’s 2007 Irrevocable Trust(12)
|
| | | | 5,911,061 | | | | | | — | | | | | | 5,911,061 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Fidelity Investors(13)
|
| | | | 8,215,000 | | | | | | — | | | | | | 8,215,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Garden State Capital Partners LLC(14)
|
| | | | 9,010,000 | | | | | | — | | | | | | 9,010,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
GIC Investor(15)
|
| | | | 49,612,794 | | | | | | — | | | | | | 49,612,794 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Green Equity Investors(16)
|
| | | | 38,449,957 | | | | | | — | | | | | | 38,449,957 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
H&F Investors(17)
|
| | | | 213,802,446 | | | | | | — | | | | | | 213,802,446 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Integrated Core Strategies (US) LLC(18)
|
| | | | 1,537,000 | | | | | | — | | | | | | 1,537,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Intrinsic Edge Capture, L.P.(19)
|
| | | | 1,590,000 | | | | | | — | | | | | | 1,590,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Lauren Fass 2012 Dynasty Trust(20)
|
| | | | 4,433,296 | | | | | | — | | | | | | 4,433,296 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
LH Capital Markets, LLC(21)
|
| | | | 2,120,000 | | | | | | — | | | | | | 2,120,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Lindsay Levin 2012 Dynasty Trust(22)
|
| | | | 4,433,296 | | | | | | — | | | | | | 4,433,296 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Longfellow Investment Management Co., LLC(23)
|
| | | | 1,219,000 | | | | | | — | | | | | | 1,219,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Mark Tabak(24)
|
| | | | 5,023,610 | | | | | | — | | | | | | 5,023,610 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
The Michael and Susan Dell Foundation(25)
|
| | | | 5,300,000 | | | | | | — | | | | | | 5,300,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Michael Ferrante(26)
|
| | | | 4,534,383 | | | | | | — | | | | | | 4,534,383 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
MMCAP International Inc. SPC(27)
|
| | | | 7,950,000 | | | | | | — | | | | | | 7,950,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Moore Global Investments, LLC(28)
|
| | | | 4,240,000 | | | | | | — | | | | | | 4,240,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
MSD Value Investments, L.P.(29)
|
| | | | 5,300,000 | | | | | | — | | | | | | 5,300,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Nomura Global Financial Products
Inc.(30) |
| | | | 3,180,000 | | | | | | — | | | | | | 3,180,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Oak Hill Advisor Entities(31)
|
| | | | 2,650,000 | | | | | | — | | | | | | 2,650,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Partners Group Entities(32)
|
| | | | 30,309,824 | | | | | | — | | | | | | 30,309,824 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Periscope Capital Inc. (33)
|
| | | | 2,120,000 | | | | | | — | | | | | | 2,120,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
The Public Investment Fund of The Kingdom of Saudi Arabia(34)
|
| | | | 53,750,000 | | | | | | — | | | | | | 53,750,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Schonfeld Strategic 460 Fund LLC(35)
|
| | | | 1,060,000 | | | | | | — | | | | | | 1,060,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
SIH MPH Rollover Co, L.P.(36)
|
| | | | 24,412,106 | | | | | | — | | | | | | 24,412,106 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
TBG AG(37)
|
| | | | 4,770,000 | | | | | | — | | | | | | 4,770,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Tech Opportunities LLC(38)
|
| | | | 2,120,000 | | | | | | — | | | | | | 2,120,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
UBS O’Connor(39)
|
| | | | 4,664,000 | | | | | | — | | | | | | 4,664,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Additional Selling Securityholders(40)
|
| | | | 4,765,736 | | | | | | — | | | | | | 4,765,736 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | |
Page
|
| |||
| | | | F-2 | | | |
| | | | F-3 | | | |
| | | | F-4 | | | |
| | | | F-5 | | | |
| | | | F-6 | | | |
| | | | F-7 | | |
| | | | | F-17 | | | |
| | | | | F-18 | | | |
| | | | | F-19 | | | |
| | | | | F-20 | | | |
| | | | | F-21 | | |
| | | | | F-34 | | | |
| | | | | F-35 | | | |
| | | | | F-36 | | | |
| | | | | F-37 | | | |
| | | | | F-38 | | | |
| | | | | F-39 | | |
| | | | | F-65 | | | |
| | | | | F-66 | | | |
| | | | | F-67 | | | |
| | | | | F-68 | | | |
| | | | | F-69 | | |
| ASSETS | | | | | | | |
|
Current asset – cash
|
| | | $ | 34,000 | | |
|
Deferred offering costs
|
| | | | 284,930 | | |
|
Total Assets
|
| | | $ | 318,930 | | |
| LIABILITIES AND STOCKHOLDER’S EQUITY | | | | | | | |
|
Current liabilities
|
| | | | | | |
|
Accrued expenses
|
| | | $ | 1,450 | | |
|
Accrued offering costs
|
| | | | 168,930 | | |
|
Promissory note-related party
|
| | | | 125,000 | | |
|
Total Current Liabilities
|
| | | | 295,380 | | |
| Commitments | | | | | | | |
| Stockholder’s Equity | | | | | | | |
|
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding
|
| | | | — | | |
|
Class A common stock, $0.0001 par value; 250,000,000 shares authorized; none issued and outstanding
|
| | | | — | | |
|
Class B common stock, $0.0001 par value; 50,000,000 shares authorized; 27,500,000 shares issued and outstanding(1)
|
| | | | 2,750 | | |
|
Additional paid-in capital
|
| | | | 22,250 | | |
|
Accumulated deficit
|
| | | | (1,450) | | |
|
Total Stockholder’s Equity
|
| | | | 23,550 | | |
|
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY
|
| | | $ | 318,930 | | |
|
Formation costs
|
| | | $ | 1,450 | | |
|
Net Loss
|
| | | $ | (1,450) | | |
|
Weighted average shares outstanding, basic and diluted(1)
|
| | | | 25,000,000 | | |
|
Basic and diluted net loss per common share
|
| | | $ | (0.00) | | |
| | |
Common Stock(1)
|
| |
Additional
Paid-in Capital |
| |
Accumulated
Deficit |
| |
Total
Stockholder’s Equity |
| ||||||||||||||||||
| | |
Shares
|
| |
Amount
|
| ||||||||||||||||||||||||
Balance – October 30, 2019 (inception)
|
| | | | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Issuance of Class B common stock to Sponsor(1)
|
| | | | 27,500,000 | | | | | | 2,750 | | | | | | 22,250 | | | | | | — | | | | | | 25,000 | | |
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | (1,450) | | | | | | (1,450) | | |
Balance – December 31, 2019
|
| | | | 27,500,000 | | | | | $ | 2,750 | | | | | $ | 22,250 | | | | | $ | (1,450) | | | | | $ | 23,550 | | |
| Cash Flows from Operating Activities: | | | | | | | |
|
Net loss
|
| | | $ | (1,450) | | |
|
Changes in operating assets and liabilities:
|
| | | | | | |
|
Accrued expenses
|
| | | | 1,450 | | |
|
Net cash used in operating activities
|
| | | | — | | |
| Cash Flows from Financing Activities: | | | | | | | |
|
Proceeds from issuance of common stock to Sponsor
|
| | | | 25,000 | | |
|
Proceeds from promissory note-related party
|
| | | | 125,000 | | |
|
Payment of offering costs
|
| | | | (116,000) | | |
|
Net cash provided by financing activities
|
| | | | 34,000 | | |
|
Net Change in Cash
|
| | | | 34,000 | | |
|
Cash – Beginning
|
| | | | — | | |
| Cash – Ending | | | | $ | 34,000 | | |
| Non-Cash investing and financing activities: | | | | | | | |
|
Deferred offering costs included in accrued offering costs
|
| | | $ | 168,930 | | |
| | |
June 30,
2020 |
| |
December 31,
2019 |
| ||||||
| | |
(unaudited)
|
| | | | | | | |||
ASSETS | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | |
Cash
|
| | | $ | 2,955,367 | | | | | $ | 34,000 | | |
Prepaid expenses
|
| | | | 398,322 | | | | | | — | | |
Total Current Assets
|
| | | | 3,353,689 | | | | | | 34,000 | | |
Deferred offering costs
|
| | | | — | | | | | | 284,930 | | |
Deferred tax asset
|
| | | | 1,337 | | | | | | — | | |
Marketable securities held in Trust Account
|
| | | | 1,104,209,313 | | | | | | — | | |
TOTAL ASSETS
|
| | |
$
|
1,107,564,339
|
| | | | $ | 318,930 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | |
Accrued expenses
|
| | | $ | 1,512,006 | | | | | $ | 1,450 | | |
Accrued offering costs
|
| | | | — | | | | | | 168,930 | | |
Income taxes payable
|
| | | | 452,305 | | | | | | — | | |
Promissory note – related party
|
| | | | — | | | | | | 125,000 | | |
Total Current Liabilities
|
| | | | 1,964,311 | | | | | | 295,380 | | |
Deferred tax liability
|
| | | | — | | | | | | — | | |
Deferred underwriting fee payable
|
| | | | 38,500,000 | | | | | | — | | |
Total Liabilities
|
| | | | 40,464,311 | | | | | | 295,380 | | |
Commitments | | | | | | | | | | | | | |
Common stock subject to possible redemption, 105,858,072 and no shares at redemption value at June 30, 2020 and December 31, 2019, respectively
|
| | | | 1,062,100,027 | | | | | | — | | |
Stockholders’ Equity | | | | | | | | | | | | | |
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding
|
| | | | — | | | | | | — | | |
Class A common stock, $0.0001 par value; 250,000,000 shares authorized;
4,141,928 and no shares issued and outstanding (excluding 105,858,072 and no shares subject to possible redemption) at June 30, 2020 and December 31, 2019, respectively |
| | | | 414 | | | | | | — | | |
Class B common stock, $0.0001 par value; 50,000,000 shares authorized;
27,500,000 shares issued and outstanding at June 30, 2020 and December 31, 2019(1) |
| | | | 2,750 | | | | | | 2,750 | | |
Additional paid-in capital
|
| | | | 3,301,789 | | | | | | 22,250 | | |
Retained earnings/(Accumulated deficit)
|
| | | | 1,695,048 | | | | | | (1,450) | | |
Total Stockholders’ Equity
|
| | | | 5,000,001 | | | | | | 23,550 | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
| | | $ | 1,107,564,339 | | | | | $ | 318,930 | | |
| | |
Three Months Ended
June 30, 2020 |
| |
Six Months Ended
June 30, 2020 |
| ||||||
Operating costs
|
| | | $ | 1,846,344 | | | | | $ | 2,061,847 | | |
Loss from operations
|
| | | | (1,846,344) | | | | | | (2,061,847) | | |
Other income: | | | | | | | | | |||||
Interest earned on marketable securities held in Trust Account
|
| | | | 2,394,013 | | | | | | 4,215,679 | | |
Unrealized gain on marketable securities held in Trust Account
|
| | | | (2,237,592) | | | | | | (6,366) | | |
Other income
|
| | | | 156,421 | | | | | | 4,209,313 | | |
Income before provision for income taxes
|
| | | | (1,689,923) | | | | | | 2,147,466 | | |
Provision for income taxes
|
| | | | 354,883 | | | | | | (450,968) | | |
Net (loss) income
|
| | | $ | (1,335,040) | | | | | $ | 1,696,498 | | |
Weighted average shares outstanding, basic and diluted(1)
|
| | | | 31,167,195 | | | | | | 30,397,160 | | |
Basic and diluted net (loss) income per common share(2)
|
| | | $ | (0.04) | | | | | $ | (0.03) | | |
| | |
Class A
Common Stock |
| |
Class B
Common Stock |
| |
Additional
Paid in Capital |
| |
(Accumulated
Deficit) / Retained Earnings |
| |
Total
Stockholders’ Equity |
| |||||||||||||||||||||||||||
| | |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||||||||||||||||||||||||
Balance – January 1, 2020
|
| | | | — | | | | | $ | — | | | | | | 27,500,000 | | | | | $ | 2,750 | | | | | $ | 22,250 | | | | | $ | (1,450) | | | | | $ | 23,550 | | |
Sale of 110,000,000 Units, net
of underwriting discount and offering expenses |
| | | | 110,000,000 | | | | | | 11,000 | | | | | | — | | | | | | — | | | | | | 1,042,368,980 | | | | | | — | | | | | | 1,042,379,980 | | |
Sale of 23,000,000 Private Placement Warrants
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 23,000,000 | | | | | | — | | | | | | 23,000,000 | | |
Common stock subject to possible redemption
|
| | | | (105,990,308) | | | | | | (10,599) | | | | | | — | | | | | | — | | | | | | (1,063,424,462) | | | | | | — | | | | | | (1,063,435,061) | | |
Net income
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,031,538 | | | | | | 3,031,538 | | |
Balance – March 31, 2020
|
| | | | 4,009,692 | | | | | $ | 401 | | | | | | 27,500,000 | | | | | $ | 2,750 | | | | | $ | 1,966,768 | | | | | $ | 3,030,088 | | | | | $ | 5,000,007 | | |
Change in value of common stock subject to possible redemption
|
| | | | 132,236 | | | | | | 13 | | | | | | — | | | | | | — | | | | | | 1,335,021 | | | | | | — | | | | | | 1,335,034 | | |
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,335,040) | | | | | | (1,335,040) | | |
Balance – June 30, 2020
|
| | | | 4,141,928 | | | | | $ | 414 | | | | | | 27,500,000 | | | | | $ | 2,750 | | | | | $ | 3,301,789 | | | | | $ | 1,695,048 | | | | | $ | 5,000,001 | | |
|
| Cash Flows from Operating Activities: | | | | | | | |
|
Net income
|
| | | $ | 1,696,498 | | |
| Adjustments to reconcile net income to net cash used in operating activities: | | | | | | | |
|
Interest earned on marketable securities held in Trust Account
|
| | | | (4,215,679) | | |
|
Unrealized gain on marketable securities held in Trust Account
|
| | | | 6,366 | | |
|
Deferred tax benefit
|
| | | | (1,337) | | |
|
Changes in operating assets and liabilities:
|
| | | | | | |
|
Prepaid expenses
|
| | | | (398,322) | | |
|
Accrued expenses
|
| | | | 1,510,566 | | |
|
Income taxes payable
|
| | | | 452,305 | | |
|
Net cash used in operating activities
|
| | | | (949,613) | | |
| Cash Flows from Investing Activities: | | | | | | | |
|
Investment of cash in Trust Account
|
| | | | (1,100,000,000) | | |
|
Net cash used in investing activities
|
| | | | (1,100,000,000) | | |
| Cash Flows from Financing Activities: | | | | | | | |
|
Proceeds from sale of Units, net of underwriting discounts paid
|
| | | | 1,081,598,000 | | |
|
Proceeds from sale of Private Placement Warrants
|
| | | | 23,000,000 | | |
|
Proceeds from promissory note – related party
|
| | | | 209,600 | | |
|
Repayment of promissory note – related party
|
| | | | (334,600) | | |
|
Payment of offering costs
|
| | | | (602,020) | | |
|
Net cash provided by financing activities
|
| | | | 1,103,870,980 | | |
|
Net Change in Cash
|
| | | | 2,921,367 | | |
|
Cash – Beginning of period
|
| | | | 34,000 | | |
|
Cash – End of period
|
| | | $ | 2,955,367 | | |
| Non-Cash investing and financing activities: | | | | | | | |
|
Initial classification of common stock subject to redemption
|
| | | $ | 1,060,389,960 | | |
|
Change in value of common stock subject to possible redemption
|
| | | $ | 1,710,067 | | |
|
Deferred underwriting fee payable
|
| | | $ | 38,500,000 | | |
| | |
Three Months
Ended June 30, 2020 |
| |
Six Months
Ended June 30, 2020 |
| ||||||
Net (loss) income
|
| | | $ | (1,335,040) | | | | | | 1,696,498 | | |
Less: Income attributable to common stock subject to possible redemption
|
| | | | — | | | | | | (2,558,125) | | |
Adjusted net loss
|
| | | $ | (1,335,040) | | | | | | (861,627) | | |
Weighted average shares outstanding, basic and diluted
|
| | | | 31,167,195 | | | | | | 30,397,160 | | |
Basic and diluted net loss per common share
|
| | | $ | (0.04) | | | | | | (0.03) | | |
Description
|
| |
Level
|
| |
June 30, 2020
|
| ||||||
Assets: | | | | | | | | | | | | | |
Marketable securities held in Trust Account
|
| | | | 1 | | | | | $ | 1,104,209,313 | | |
| | |
December 31,
|
| |||||||||
| | |
2019
|
| |
2018
|
| ||||||
Assets | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | $ | 21,825 | | | | | $ | 5,014 | | |
Trade accounts receivable, net
|
| | | | 77,071 | | | | | | 82,350 | | |
Prepaid expenses and other current assets
|
| | | | 5,032 | | | | | | 7,885 | | |
Prepaid software and maintenance
|
| | | | 9,556 | | | | | | 9,723 | | |
Prepaid taxes
|
| | | | 2,130 | | | | | | 704 | | |
Total current assets
|
| | | | 115,614 | | | | | | 105,676 | | |
Property and equipment, net
|
| | | | 177,992 | | | | | | 168,486 | | |
Operating lease right-of-use assets
|
| | | | 29,998 | | | | | | — | | |
Goodwill
|
| | | | 4,142,013 | | | | | | 4,142,013 | | |
Client relationships intangible, net
|
| | | | 3,135,782 | | | | | | 3,410,049 | | |
Provider network intangible, net
|
| | | | 683,561 | | | | | | 743,347 | | |
Other intangibles, net
|
| | | | 67,300 | | | | | | 67,300 | | |
Other assets
|
| | | | 8,151 | | | | | | 6,102 | | |
Total assets
|
| | | $ | 8,360,411 | | | | | $ | 8,642,973 | | |
Liabilities and Shareholders’ Equity | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 9,565 | | | | | $ | 10,852 | | |
Accrued interest
|
| | | | 17,966 | | | | | | 18,905 | | |
Operating lease obligation
|
| | | | 9,521 | | | | | | — | | |
Accrued compensation
|
| | | | 26,311 | | | | | | 12,902 | | |
Accrued legal
|
| | | | 10,038 | | | | | | 10,451 | | |
Accrued administrative fees
|
| | | | 3,861 | | | | | | 3,975 | | |
Other accrued expenses
|
| | | | 8,524 | | | | | | 8,077 | | |
Total current liabilities
|
| | | | 85,786 | | | | | | 65,162 | | |
Long-term debt
|
| | | | 5,397,122 | | | | | | 5,603,413 | | |
Operating lease obligation
|
| | | | 23,086 | | | | | | — | | |
Deferred income taxes
|
| | | | 869,199 | | | | | | 980,603 | | |
Other long-term liabilities
|
| | | | — | | | | | | 3,407 | | |
Total liabilities
|
| | | | 6,375,193 | | | | | | 6,652,585 | | |
Commitments and contingencies (Note 12) | | | | | | | | | | | | | |
Shareholders’ equity: | | | | | | | | | | | | | |
Shareholder interests
|
| | | | | | | | | | | | |
Common stock, par value $0.001; 1,000 shares authorized (500 Series A and 500 Series B); 5 shares of Series A and 5 shares of Series B issued and outstanding as of December 31, 2019 and 2018
|
| | | | — | | | | | | — | | |
Contributed capital
|
| | | | 1,347,656 | | | | | | 1,362,536 | | |
Retained earnings
|
| | | | 637,562 | | | | | | 627,852 | | |
Shareholders’ equity
|
| | | | 1,985,218 | | | | | | 1,990,388 | | |
Total liabilities and shareholders’ equity
|
| | | $ | 8,360,411 | | | | | $ | 8,642,973 | | |
|
| | |
Years Ended December 31,
|
| |||||||||||||||
| | |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Revenues
|
| | | $ | 982,901 | | | | | $ | 1,040,883 | | | | | $ | 1,067,266 | | |
Costs of services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | 149,607 | | | | | | 149,463 | | | | | | 193,655 | | |
General and administrative expenses
|
| | | | 75,225 | | | | | | 77,558 | | | | | | 122,920 | | |
Depreciation
|
| | | | 55,807 | | | | | | 52,268 | | | | | | 53,002 | | |
Amortization of intangible assets
|
| | | | 334,053 | | | | | | 334,053 | | | | | | 334,053 | | |
Total expenses
|
| | | | 614,692 | | | | | | 613,342 | | | | | | 703,630 | | |
Operating income
|
| | | | 368,209 | | | | | | 427,541 | | | | | | 363,636 | | |
Interest expense
|
| | | | 376,346 | | | | | | 383,261 | | | | | | 281,972 | | |
Interest income
|
| | | | (196) | | | | | | (51) | | | | | | (9) | | |
Loss on extinguishments and modification of debt
|
| | | | — | | | | | | — | | | | | | 20,053 | | |
Gain on repurchase and cancellation of Notes
|
| | | | (18,450) | | | | | | — | | | | | | — | | |
Net income before income taxes
|
| | | | 10,509 | | | | | | 44,331 | | | | | | 61,620 | | |
Provision (benefit) for income taxes
|
| | | | 799 | | | | | | 8,108 | | | | | | (586,512) | | |
Income from continuing operations
|
| | | | 9,710 | | | | | | 36,223 | | | | | | 648,132 | | |
Net income
|
| | | | 9,710 | | | | | | 36,223 | | | | | | 648,132 | | |
Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | |
Basic
|
| | | | 10 | | | | | | 10 | | | | | | 10 | | |
Diluted
|
| | | | 10 | | | | | | 10 | | | | | | 10 | | |
Net income per share: | | | | | | | | | | | | | | | | | | | |
Basic
|
| | | $ | 971,000 | | | | | $ | 3,622,300 | | | | | $ | 64,813,200 | | |
Diluted
|
| | | $ | 971,000 | | | | | $ | 3,622,300 | | | | | $ | 64,813,200 | | |
Comprehensive income
|
| | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | 648,132 | | |
| | |
Common Stock
Shares |
| |
Common Stock
Amount |
| |
Contributed
Capital |
| |
Retained
Earnings |
| |
Total
Shareholders’ Equity |
| |||||||||||||||
Balance as of December 31, 2016
|
| | | | 10 | | | | | $ | — | | | | | $ | 2,726,741 | | | | | $ | (56,503) | | | | | $ | 2,670,238 | | |
Distribution of capital to shareholders
|
| | | | — | | | | | | — | | | | | | (1,323,025) | | | | | | — | | | | | | (1,323,025) | | |
Distributions to Class B Units holders
|
| | | | — | | | | | | — | | | | | | (96,685) | | | | | | — | | | | | | (96,685) | | |
Class B Unit expense
|
| | | | — | | | | | | — | | | | | | 50,788 | | | | | | — | | | | | | 50,788 | | |
Net income
|
| | | | — | | | | | | — | | | | | | — | | | | | | 648,132 | | | | | | 648,132 | | |
Balance as of December 31, 2017
|
| | | | 10 | | | | | | — | | | | | | 1,357,819 | | | | | | 591,629 | | | | | | 1,949,448 | | |
Class B Unit expense
|
| | | | — | | | | | | — | | | | | | 4,717 | | | | | | — | | | | | | 4,717 | | |
Net income
|
| | | | — | | | | | | — | | | | | | — | | | | | | 36,223 | | | | | | 36,223 | | |
Balance as of December 31, 2018
|
| | | | 10 | | | | | | — | | | | | | 1,362,536 | | | | | | 627,852 | | | | | | 1,990,388 | | |
Class B Unit expense
|
| | | | — | | | | | | — | | | | | | (14,880) | | | | | | — | | | | | | (14,880) | | |
Net income
|
| | | | — | | | | | | — | | | | | | — | | | | | | 9,710 | | | | | | 9,710 | | |
Balance as of December 31, 2019
|
| | | | 10 | | | | | $ | — | | | | | $ | 1,347,656 | | | | | $ | 637,562 | | | | | $ | 1,985,218 | | |
| | |
Years Ended December 31,
|
| |||||||||||||||
| | |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Operating activities: | | | | | | | | | | | | | | | | | | | |
Net income
|
| | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | 648,132 | | |
Adjustments to reconcile net income to net cash provided by operating
activities: |
| | | | |||||||||||||||
Depreciation
|
| | | | 55,807 | | | | | | 52,268 | | | | | | 53,002 | | |
Amortization of intangible assets
|
| | | | 334,053 | | | | | | 334,053 | | | | | | 334,053 | | |
Amortization of debt issuance costs
|
| | | | 11,435 | | | | | | 10,993 | | | | | | 9,462 | | |
Stock-based compensation
|
| | | | (14,880) | | | | | | 4,717 | | | | | | 50,788 | | |
Deferred tax benefit
|
| | | | (111,404) | | | | | | (112,483) | | | | | | (719,239) | | |
Non-cash interest costs
|
| | | | 1,933 | | | | | | 1,932 | | | | | | 289 | | |
Gain on repurchase and cancellation of Notes
|
| | | | (18,450) | | | | | | — | | | | | | — | | |
Non-cash loss on extinguishments and modification of debt
|
| | | | — | | | | | | — | | | | | | 20,053 | | |
Loss on disposal of property and equipment
|
| | | | 163 | | | | | | 2,210 | | | | | | 2,539 | | |
Changes in assets and liabilities, net of acquired balances:
|
| | | | | | | | | | | | | | | | | | |
Accounts receivable, net
|
| | | | 5,279 | | | | | | 3,019 | | | | | | (28,910) | | |
Prepaid expenses and other assets
|
| | | | 772 | | | | | | (4,681) | | | | | | (1,589) | | |
Prepaid taxes
|
| | | | (1,426) | | | | | | 4,402 | | | | | | (5,106) | | |
Accounts payable and accrued expenses and other
|
| | | | 11,321 | | | | | | (40,350) | | | | | | 5,471 | | |
Net cash provided by operating activities
|
| | | | 284,313 | | | | | | 292,303 | | | | | | 368,945 | | |
Investing activities: | | | | | | | | | | | | | | | | | | | |
Purchases of property and equipment
|
| | | | (66,414) | | | | | | (63,556) | | | | | | (60,709) | | |
Net cash used in investing activities
|
| | | | (66,414) | | | | | | (63,556) | | | | | | (60,709) | | |
Financing activities: | | | | | | | | | | | | | | | | | | | |
Repayments of long term debt
|
| | | | (100,000) | | | | | | (245,000) | | | | | | (165,000) | | |
Borrowings on revolving credit facility
|
| | | | — | | | | | | 5,000 | | | | | | — | | |
Repayments on revolving credit facility
|
| | | | — | | | | | | (5,000) | | | | | | — | | |
Repurchase of Notes
|
| | | | (101,013) | | | | | | — | | | | | | | | |
Proceeds from issuance of Senior Notes PIK due 2022
|
| | | | — | | | | | | — | | | | | | 1,287,000 | | |
Distribution of capital to shareholders
|
| | | | — | | | | | | — | | | | | | (1,323,025) | | |
Class B Unit distribution
|
| | | | — | | | | | | — | | | | | | (96,685) | | |
Payment of debt issuance costs
|
| | | | — | | | | | | — | | | | | | (15,329) | | |
Payments on finance leases, net
|
| | | | (75) | | | | | | (150) | | | | | | (176) | | |
Net cash used in financing activities
|
| | | | (201,088) | | | | | | (245,150) | | | | | | (313,215) | | |
Net increase (decrease) in cash and cash equivalents
|
| | | | 16,811 | | | | | | (16,403) | | | | | | (4,979) | | |
Cash and cash equivalents at beginning of period
|
| | | | 5,014 | | | | | | 21,417 | | | | | | 26,396 | | |
Cash and cash equivalents at end of period
|
| | | $ | 21,825 | | | | | $ | 5,014 | | | | | $ | 21,417 | | |
Noncash investing and financing activities: | | | | | | | | | | | | | | | | | | | |
Purchases of property and equipment not yet paid
|
| | | $ | 3,768 | | | | | $ | 3,782 | | | | | $ | 2,276 | | |
Supplemental disclosure of cash flow information: | | | | | | | | | | | | | | | | | | | |
Cash paid during the period for: | | | | | | | | | | | | | | | | | | | |
Interest
|
| | | $ | (363,907) | | | | | $ | (374,168) | | | | | $ | (258,948) | | |
Income taxes, net of refunds
|
| | | $ | (114,569) | | | | | $ | (116,634) | | | | | $ | (138,817) | | |
($ in millions)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Allowance as of January 1,
|
| | | | 0.5 | | | | | | 0.6 | | | | | | 0.6 | | |
Provision for doubtful accounts
|
| | | | — | | | | | | — | | | | | | — | | |
Write-offs of uncollectible receivables
|
| | | | (0.1) | | | | | | (0.1) | | | | | | — | | |
Allowance as of December 31,
|
| | | | 0.4 | | | | | | 0.5 | | | | | | 0.6 | | |
Asset Classification
|
| |
Estimated Used Life
|
|
Leasehold improvements | | |
The shorter of the life of lease or asset life, 5 – 15 years
|
|
Furniture and equipment | | | 5 – 7 years | |
Computer hardware | | | 3 – 5 years | |
Computer software | | | 3 – 5 years | |
Asset Classification
|
| |
Estimated Used Life
|
|
Client relationships | | | 15 years | |
Provider Network | | | 15 years | |
Trade Names | | | Indefinite life | |
| | |
For the Twelve Months Ended December 31,
|
| |||||||||||||||
($ in thousands)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Revenues | | | | | | | | | | | | | | | | | | | |
Network Services
|
| | | $ | 314,510 | | | | | $ | 363,510 | | | | | $ | 415,759 | | |
Percentage of Savings
|
| | | | 249,095 | | | | | | 289,874 | | | | | | 340,084 | | |
PEPM
|
| | | | 56,841 | | | | | | 60,950 | | | | | | 60,748 | | |
Other
|
| | | | 8,574 | | | | | | 12,686 | | | | | | 14,927 | | |
Analytic-Based Services
|
| | | | 561,525 | | | | | | 584,998 | | | | | | 584,925 | | |
Percentage of Savings
|
| | | | 560,675 | | | | | | 584,453 | | | | | | 583,710 | | |
PEPM
|
| | | | 850 | | | | | | 545 | | | | | | 1,215 | | |
Payment Integrity Services
|
| | | | 106,866 | | | | | | 92,375 | | | | | | 66,582 | | |
Percentage of Savings
|
| | | | 106,782 | | | | | | 92,223 | | | | | | 66,582 | | |
PEPM
|
| | | | 84 | | | | | | 152 | | | | | | — | | |
Total Revenues
|
| | | $ | 982,901 | | | | | $ | 1,040,883 | | | | | $ | 1,067,266 | | |
| | |
2019
|
| |
2018
|
| ||||||||||||||||||||||||||||||
($ in thousands)
|
| |
Property
and Equipment |
| |
Accumulated
Depreciation |
| |
Property and
Equipment, Net |
| |
Property
and Equipment |
| |
Accumulated
Depreciation |
| |
Property and
Equipment, Net |
| ||||||||||||||||||
Leasehold improvements
|
| | | $ | 3,569 | | | | | $ | (2,072) | | | | | $ | 1,497 | | | | | $ | 3,078 | | | | | $ | (1,431) | | | | | $ | 1,647 | | |
Furniture & equipment
|
| | | | 5,499 | | | | | | (3,109) | | | | | | 2,390 | | | | | | 5,512 | | | | | | (2,529) | | | | | | 2,983 | | |
Computer hardware
|
| | | | 36,979 | | | | | | (23,174) | | | | | | 13,805 | | | | | | 32,086 | | | | | | (16,601) | | | | | | 15,485 | | |
Computer software
|
| | | | 32,905 | | | | | | (23,055) | | | | | | 9,850 | | | | | | 29,067 | | | | | | (17,657) | | | | | | 11,410 | | |
Capitalized software development
|
| | | | 283,391 | | | | | | (132,941) | | | | | | 150,450 | | | | | | 227,946 | | | | | | (90,985) | | | | | | 136,961 | | |
Total Property and Equipment
|
| | | $ | 362,343 | | | | | $ | (184,351) | | | | | $ | 177,992 | | | | | $ | 297,689 | | | | | $ | (129,203) | | | | | $ | 168,486 | | |
($ in thousands)
|
| | | | | | |
2019
|
| | | $ | 10,658 | | |
2020
|
| | | | 10,628 | | |
2021
|
| | | | 8,579 | | |
2022
|
| | | | 6,583 | | |
2023
|
| | | | 2,336 | | |
Thereafter
|
| | | | — | | |
Total lease payments
|
| | | $ | 38,784 | | |
($ in thousands)
|
| |
Year Ended
December 31, 2019 |
|
Cash paid for amounts included in the measurement of lease liabilities: | | | ||
Operating cash flow from operating leases
|
| |
$10,961
|
|
| | | | | |
2019
|
| |
2018
|
| ||||||||||||||||||||||||||||||
($ in thousands)
|
| |
Amortization
Period |
| |
Gross
Carrying Amount |
| |
Accumulated
Amortization |
| |
Net
Carrying Value |
| |
Gross
Carrying Amount |
| |
Accumulated
Amortization |
| |
Net
Carrying Value |
| ||||||||||||||||||
Client relationships
|
| |
15 years
|
| | | $ | 4,114,000 | | | | | $ | (978,218) | | | | | $ | 3,135,782 | | | | | $ | 4,114,000 | | | | | $ | (703,951) | | | | | $ | 3,410,049 | | |
Provider network
|
| |
15 years
|
| | | | 896,800 | | | | | | (213,239) | | | | | | 683,561 | | | | | | 896,800 | | | | | | (153,453) | | | | | | 743,347 | | |
Trade names
|
| |
Indefinite Life
|
| | | | 67,300 | | | | | | — | | | | | | 67,300 | | | | | | 67,300 | | | | | | — | | | | | | 67,300 | | |
Total
|
| | | | | | $ | 5,078,100 | | | | | $ | (1,191,457) | | | | | $ | 3,886,643 | | | | | $ | 5,078,100 | | | | | $ | (857,404) | | | | | $ | 4,220,696 | | |
|
($ in thousands)
|
| |
2019
|
| |
2018
|
| ||||||
Term Loan G
|
| | | $ | 2,710,000 | | | | | $ | 2,810,000 | | |
Notes due 2024
|
| | | | 1,560,000 | | | | | | 1,560,000 | | |
Senior PIK Note
|
| | | | 1,178,727 | | | | | | 1,300,000 | | |
Capital lease obligations
|
| | | | 101 | | | | | | 101 | | |
Long-term debt
|
| | | | 5,448,828 | | | | | | 5,670,101 | | |
Premium – Notes due 2024
|
| | | | 10,327 | | | | | | 12,280 | | |
Discount – Term Loan G
|
| | | | (6,195) | | | | | | (7,765) | | |
Discount – Senior PIK Notes
|
| | | | (7,436) | | | | | | (10,596) | | |
Debt issuance costs, net: | | | | | | | | | | | | | |
Term Loan G
|
| | | | (18,332) | | | | | | (22,963) | | |
Notes Due 2024
|
| | | | (21,539) | | | | | | (25,490) | | |
Senior PIK Notes
|
| | | | (8,531) | | | | | | (12,154) | | |
Long-term debt, net
|
| | | $ | 5,397,122 | | | | | $ | 5,603,413 | | |
| | |
Payments Due by Period
|
| |||||||||||||||||||||||||||||||||
($ in thousands)
|
| |
Total
|
| |
2020
|
| |
2021
|
| |
2022
|
| |
2023
|
| |
2024
|
| ||||||||||||||||||
Term Loan G
|
| | | $ | 2,710,000 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 2,710,000 | | | | | $ | — | | |
Notes due 2024
|
| | | | 1,560,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,560,000 | | |
Senior PIK Note
|
| | | | 1,178,727 | | | | | | — | | | | | | — | | | | | | 1,178,727 | | | | | | — | | | | | | — | | |
Capital lease obligations
|
| | | | 187 | | | | | | 86 | | | | | | 66 | | | | | | 35 | | | | | | — | | | | | | — | | |
Total contractual obligations
|
| | | $ | 5,448,914 | | | | | $ | 86 | | | | | $ | 66 | | | | | $ | 1,178,762 | | | | | $ | 2,710,000 | | | | | $ | 1,560,000 | | |
| | | | | |
2019
|
| |
2018
|
| ||||||||||||||||||
($ in thousands)
|
| |
Amortization
Period |
| |
Cost
|
| |
Accumulated
Amortization |
| |
Cost
|
| |
Accumulated
Amortization |
| ||||||||||||
Term Loan G
|
| |
84 months
|
| | | $ | 34,654 | | | | | $ | (16,322) | | | | | $ | 34,654 | | | | | $ | (11,691) | | |
Notes due 2024
|
| |
96 months
|
| | | | 34,089 | | | | | | (12,550) | | | | | | 34,089 | | | | | | (8,599) | | |
Senior PIK Note
|
| |
60 months
|
| | | | 14,909 | | | | | | (6,378) | | | | | | 14,909 | | | | | | (2,755) | | |
Revolver G
|
| |
60 months
|
| | | | 971 | | | | | | (692) | | | | | | 971 | | | | | | (495) | | |
| | | | | | | $ | 84,623 | | | | | $ | (35,942) | | | | | $ | 84,623 | | | | | $ | (23,540) | | |
| | |
2019
|
| |
2018
|
| ||||||||||||||||||
($ in thousands)
|
| |
Carrying
Amount |
| |
Fair Value
|
| |
Carrying
Amount |
| |
Fair Value
|
| ||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Notes due 2024, net of premium
|
| | | $ | 1,570,327 | | | | | $ | 1,544,976 | | | | | $ | 1,572,280 | | | | | $ | 1,491,988 | | |
Term Loan G, net of discount
|
| | | | 2,703,805 | | | | | | 2,769,645 | | | | | | 2,802,235 | | | | | | 2,898,934 | | |
Senior PIK Note, net of discount
|
| | | | 1,171,291 | | | | | | 1,191,694 | | | | | | 1,289,404 | | | | | | 1,284,024 | | |
Finance lease obligations
|
| | | | 101 | | | | | | 101 | | | | | | 101 | | | | | | 101 | | |
Total Liabilities
|
| | | $ | 5,445,524 | | | | | $ | 5,506,416 | | | | | $ | 5,664,020 | | | | | $ | 5,675,047 | | |
|
($ in thousands)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Current | | | | | | | | | | | | | | | | | | | |
Federal
|
| | | $ | 96,148 | | | | | $ | 103,806 | | | | | $ | 119,317 | | |
State and local
|
| | | | 16,055 | | | | | | 16,785 | | | | | | 13,410 | | |
| | | | | 112,203 | | | | | | 120,591 | | | | | | 132,727 | | |
Deferred | | | | | | | | | | | | | | | | | | | |
Federal
|
| | | | (97,326) | | | | | | (92,764) | | | | | | (717,152) | | |
State and local
|
| | | | (14,078) | | | | | | (19,719) | | | | | | (2,087) | | |
| | | | | (111,404) | | | | | | (112,483) | | | | | | (719,239) | | |
Total provision (benefit) from continuing operations
|
| | | $ | 799 | | | | | $ | 8,108 | | | | | $ | (586,512) | | |
| | |
For the Years Ended
December 31, |
| |||||||||||||||
($ in thousands)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Tax at Statutory
|
| | | $ | 2,207 | | | | | $ | 9,310 | | | | | $ | 21,567 | | |
Non-Deductible Expenses
|
| | | | 75 | | | | | | 57 | | | | | | 86 | | |
Equity Compensation Plan of Parent
|
| | | | (3,125) | | | | | | 990 | | | | | | 17,776 | | |
State Taxes (net)
|
| | | | 1,704 | | | | | | 2,617 | | | | | | 9,183 | | |
Other
|
| | | | 87 | | | | | | 9 | | | | | | 53 | | |
Tax Law Changes
|
| | | | (149) | | | | | | (4,875) | | | | | | (635,177) | | |
Total
|
| | | | 799 | | | | | | 8,108 | | | | | | (586,512) | | |
($ in thousands)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Deferred income tax assets: | | | | | | | | | | | | | | | | | | | |
Allowances on trade receivables
|
| | | $ | 147 | | | | | $ | 356 | | | | | $ | 271 | | |
Net operating loss carryforwards
|
| | | | 549 | | | | | | 712 | | | | | | 753 | | |
Accrued expenses and reserves
|
| | | | 2,593 | | | | | | 2,677 | | | | | | 2,992 | | |
Interest limitation carryforward
|
| | | | 73,297 | | | | | | 34,766 | | | | | | — | | |
Leases – right-of-use liability
|
| | | | 7,604 | | | | | | — | | | | | | — | | |
Transaction expenses
|
| | | | 5,859 | | | | | | 6,577 | | | | | | 7,314 | | |
Other
|
| | | | — | | | | | | 560 | | | | | | 579 | | |
Deferred income tax assets
|
| | | | 90,049 | | | | | | 45,648 | | | | | | 11,909 | | |
Deferred income tax liabilities: | | | | | | | | | | | | | | | | | | | |
Intangible assets
|
| | | | 907,039 | | | | | | 982,319 | | | | | | 1,066,684 | | |
Depreciable assets
|
| | | | 39,553 | | | | | | 36,866 | | | | | | 29,671 | | |
Leases – right-of-use asset
|
| | | | 6,957 | | | | | | — | | | | | | — | | |
Debt costs
|
| | | | 5,492 | | | | | | 6,900 | | | | | | 8,348 | | |
Other
|
| | | | 207 | | | | | | 166 | | | | | | 292 | | |
Deferred income tax liabilities
|
| | | | 959,248 | | | | | | 1,026,251 | | | | | | 1,104,995 | | |
Net deferred income tax liabilities
|
| | | $ | 869,199 | | | | | $ | 980,603 | | | | | $ | 1,093,086 | | |
| | |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Risk free rate of return
|
| | | | 1.6% | | | | | | 2.5% | | | | | | 2.6% | | |
Expected volatility
|
| | | | 24.9% | | | | | | 25.0% | | | | | | 25.1% | | |
Expected dividend yield
|
| | | | 0.0% | | | | | | 0.0% | | | | | | 0.0% | | |
Discount for Lack of Marketability
|
| | | | 20.0% | | | | | | 20.0% | | | | | | — | | |
| | |
For the Years Ended
December 31, |
| |||||||||||||||
($ in thousands)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Cost of services
|
| | | $ | (7,904) | | | | | $ | 242 | | | | | $ | 23,907 | | |
General and administrative
|
| | | | (6,976) | | | | | | 4,475 | | | | | | 26,881 | | |
Total stock-based compensation
|
| | | $ | (14,880) | | | | | $ | 4,717 | | | | | $ | 50,788 | | |
| | |
For the Years Ended
December 31, |
| |||||||||
($ in thousands, except number of shares and per share data)
|
| |
2019
|
| |
2018
|
| ||||||
Increase in income from continuing operations
|
| | | $ | 17,405 | | | | | $ | 15,958 | | |
Increase in net income
|
| | | | 17,405 | | | | | | 15,958 | | |
Weighted average number of shares outstanding – basic and diluted
|
| | | | 10 | | | | | | 10 | | |
Increase in net income per share – basic and diluted
|
| | | $ | 1,740,500 | | | | | $ | 1,595,800 | | |
($ in thousands)
|
| |
Number of
Units |
| |
Weighted
Average Fair Value |
| ||||||
Nonvested at December 31, 2017
|
| | | | 159,722 | | | | | $ | 654.61 | | |
Awarded
|
| | | | — | | | | | | — | | |
Vested
|
| | | | (37,751) | | | | | $ | 546.40 | | |
Forfeited
|
| | | | (3,682) | | | | | $ | 546.40 | | |
Nonvested at December 31, 2018
|
| | | | 118,289 | | | | | $ | 546.40 | | |
Awarded
|
| | | | — | | | | | | — | | |
Vested
|
| | | | (36,687) | | | | | $ | 363.91 | | |
Forfeited
|
| | | | (931) | | | | | $ | 363.91 | | |
Nonvested at December 31, 2019
|
| | | | 80,671 | | | | | $ | 363.91 | | |
| | |
Year Ended December 31,
|
| |||||||||||||||
($ in thousands, except number of shares and per share data)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Numerator for earnings per share calculation | | | | | | | | | | | | | | | | | | | |
Net Income
|
| | | $ | 9,710 | | | | | $ | 36,223 | | | | | $ | 648,132 | | |
Denominator for earnings per share calculation | | | | | | | | | | | | | | | | | | | |
Weighted average number of shares outstanding – basic and
diluted |
| | | | 10 | | | | | | 10 | | | | | | 10 | | |
Income per share – basic and diluted: | | | | | | | | | | | | | | | | | | | |
Net income per share – basic and diluted
|
| | | $ | 971,000 | | | | | $ | 3,622,300 | | | | | $ | 64,813,200 | | |
| | |
For the Years Ended
December 31, |
| |||||||||||||||
($ in thousands)
|
| |
2019
|
| |
2018
|
| |
2017
|
| |||||||||
Revenues
|
| | | $ | 2,373 | | | | | $ | 2,431 | | | | | $ | 2,837 | | |
Total revenues from related parties
|
| | | $ | 2,373 | | | | | $ | 2,431 | | | | | $ | 2,837 | | |
Cost of services
|
| | | $ | (3,753) | | | | | $ | (4,985) | | | | | $ | (5,594) | | |
General and administrative
|
| | | | (288) | | | | | | (222) | | | | | | (346) | | |
Total expense from related parties
|
| | | $ | (4,041) | | | | | $ | (5,207) | | | | | $ | (5,940) | | |
| | |
As of December 31,
|
| |||||||||
($ in thousands)
|
| |
2019
|
| |
2018
|
| ||||||
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 2,500 | | | | | $ | 2,200 | | |
Total liabilities from related parties
|
| | | $ | 2,500 | | | | | $ | 2,200 | | |
| | |
June 30, 2020
|
| |
December 31, 2019
|
| ||||||
Assets | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | $ | 178,860 | | | | | $ | 21,825 | | |
Trade accounts receivable, net
|
| | | | 54,004 | | | | | | 77,071 | | |
Prepaid expenses and other current assets
|
| | | | 3,456 | | | | | | 5,032 | | |
Prepaid software and maintenance
|
| | | | 8,616 | | | | | | 9,556 | | |
Prepaid taxes
|
| | | | 7,686 | | | | | | 2,130 | | |
Total current assets
|
| | | | 252,622 | | | | | | 115,614 | | |
Property and equipment, net
|
| | | | 182,011 | | | | | | 177,992 | | |
Operating lease right-of-use asset
|
| | | | 25,887 | | | | | | 29,998 | | |
Goodwill
|
| | | | 4,142,013 | | | | | | 4,142,013 | | |
Client relationships intangible, net
|
| | | | 2,998,649 | | | | | | 3,135,782 | | |
Provider network intangible, net
|
| | | | 653,667 | | | | | | 683,561 | | |
Other intangibles, net
|
| | | | 67,300 | | | | | | 67,300 | | |
Other assets
|
| | | | 11,040 | | | | | | 8,151 | | |
Total assets
|
| | | $ | 8,333,189 | | | | | $ | 8,360,411 | | |
Liabilities and Shareholders’ Equity | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 8,352 | | | | | $ | 9,565 | | |
Accrued interest
|
| | | | 17,895 | | | | | | 17,966 | | |
Operating lease obligation
|
| | | | 9,649 | | | | | | 9,521 | | |
Accrued compensation
|
| | | | 22,855 | | | | | | 26,311 | | |
Accrued legal
|
| | | | 9,835 | | | | | | 10,038 | | |
Accrued administrative fees
|
| | | | 3,345 | | | | | | 3,861 | | |
Other accrued expenses
|
| | | | 11,526 | | | | | | 8,524 | | |
Total current liabilities
|
| | | | 83,457 | | | | | | 85,786 | | |
Long-term debt
|
| | | | 5,406,138 | | | | | | 5,397,122 | | |
Operating lease obligation
|
| | | | 18,635 | | | | | | 23,086 | | |
Deferred income taxes
|
| | | | 861,309 | | | | | | 869,199 | | |
Total liabilities
|
| | | | 6,369,539 | | | | | | 6,375,193 | | |
Shareholders’ equity: | | | | | | | | | | | | | |
Shareholder interests
|
| | | | | | | | | | | | |
Common stock, par value $0.001; 1,000 shares authorized
|
| | | | | | | | | | | | |
(500 Series A and 500 Series B); 5 shares of Series A and 5 shares of Series B issued and outstanding as of June 30, 2020 and December 31, 2019
|
| | | | — | | | | | | — | | |
Contributed capital
|
| | | | 1,384,928 | | | | | | 1,347,656 | | |
Retained earnings
|
| | | | 578,722 | | | | | | 637,562 | | |
Shareholders’ equity
|
| | | | 1,963,650 | | | | | | 1,985,218 | | |
Total liabilities and shareholders’ equity
|
| | | $ | 8,333,189 | | | | | $ | 8,360,411 | | |
| | |
Six Months Ended June 30,
|
| |||||||||
| | |
2020
|
| |
2019
|
| ||||||
Revenues
|
| | | $ | 458,902 | | | | | $ | 490,677 | | |
Costs of services (exclusive of depreciation and amortization of intangible assets shown below)
|
| | | | 96,579 | | | | | | 75,132 | | |
General and administrative expenses
|
| | | | 57,767 | | | | | | 36,527 | | |
Depreciation
|
| | | | 29,641 | | | | | | 27,570 | | |
Amortization of intangible assets
|
| | | | 167,027 | | | | | | 167,027 | | |
Total expenses
|
| | | | 351,014 | | | | | | 306,256 | | |
Operating income
|
| | | | 107,888 | | | | | | 184,421 | | |
Interest expense
|
| | | | 177,015 | | | | | | 193,192 | | |
Interest income
|
| | | | (148) | | | | | | (79) | | |
Net loss before income taxes
|
| | | | (68,979) | | | | | | (8,692) | | |
Benefit for income taxes
|
| | | | (10,139) | | | | | | (1,196) | | |
Loss from continuing operations
|
| | | | (58,840) | | | | | | (7,496) | | |
Net loss
|
| | | | (58,840) | | | | | | (7,496) | | |
Weighted average shares outstanding – Basic and Diluted:
|
| | | | 10 | | | | | | 10 | | |
Net loss per share – Basic and Diluted:
|
| | | $ | (5,884,000) | | | | | $ | (749,600) | | |
Comprehensive loss
|
| | | | (58,840) | | | | | | (7,496) | | |
| | |
Common Stock
Shares |
| |
Common Stock
Amount |
| |
Contributed
Capital |
| |
Retained
Earnings (Accumulated Losses) |
| |
Total
|
| |||||||||||||||
Balance as of January 1, 2019
|
| | | | 10 | | | | | $ | — | | | | | $ | 1,362,536 | | | | | $ | 627,852 | | | | | | 1,990,388 | | |
Class B Unit expense
|
| | | | — | | | | | | — | | | | | | (4,630) | | | | | | — | | | | | | (4,630) | | |
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | (7,496) | | | | | | (7,496) | | |
Balance as of June 30, 2019
|
| | | | 10 | | | | | $ | — | | | | | $ | 1,357,906 | | | | | $ | 620,356 | | | | | $ | 1,978,262 | | |
Balance as of January 1, 2020
|
| | | | 10 | | | | | $ | — | | | | | $ | 1,347,656 | | | | | $ | 637,562 | | | | | | 1,985,218 | | |
Class B Unit expense
|
| | | | — | | | | | | — | | | | | | 37,272 | | | | | | — | | | | | | 37,272 | | |
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | (58,840) | | | | | | (58,840) | | |
Balance as of June 30, 2020
|
| | | | 10 | | | | | $ | — | | | | | $ | 1,384,928 | | | | | $ | 578,722 | | | | | $ | 1,963,650 | | |
| | |
Six Months
Ended June 30, 2020 |
| |
Six Months
Ended June 30, 2019 |
| ||||||
Operating activities: | | | | | | | | | | | | | |
Net loss
|
| | | $ | (58,840) | | | | | $ | (7,496) | | |
Adjustments to reconcile net loss to net cash provided by operating activities: | | | | | | | | | | | | | |
Depreciation
|
| | | | 29,641 | | | | | | 27,570 | | |
Amortization of intangible assets
|
| | | | 167,027 | | | | | | 167,027 | | |
Amortization of the right-of-use asset
|
| | | | 4,111 | | | | | | 2,551 | | |
Amortization of debt issuance costs
|
| | | | 8,153 | | | | | | 5,640 | | |
Stock-based compensation
|
| | | | 37,272 | | | | | | (4,630) | | |
Deferred tax benefit
|
| | | | (7,890) | | | | | | (37,634) | | |
Non-cash interest costs
|
| | | | 945 | | | | | | 970 | | |
Loss on disposal of property and equipment
|
| | | | 101 | | | | | | 130 | | |
Changes in assets and liabilities, net of acquired balances:
|
| | | | | | | | | | | | |
Accounts receivable, net
|
| | | | 23,067 | | | | | | 263 | | |
Prepaid expenses and other assets
|
| | | | (474) | | | | | | 18,978 | | |
Prepaid taxes
|
| | | | (5,556) | | | | | | (15,833) | | |
Operating lease obligation
|
| | | | (4,323) | | | | | | (2,455) | | |
Accounts payable and accrued expenses and other
|
| | | | (1,367) | | | | | | (14,243) | | |
Net cash provided by operating activities
|
| | | | 191,867 | | | | | | 140,838 | | |
Investing activities: | | | | | | | | | | | | | |
Purchases of property and equipment
|
| | | | (34,866) | | | | | | (33,696) | | |
Net cash used in investing activities
|
| | | | (34,866) | | | | | | (33,696) | | |
Financing activities: | | | | | | | | | | | | | |
Repayments of long term debt
|
| | | | — | | | | | | (100,000) | | |
Borrowings on revolving credit facility
|
| | | | 98,000 | | | | | | — | | |
Repayment of revolving credit facility
|
| | | | (98,000) | | | | | | — | | |
Borrowings (payments) on capital leases, net
|
| | | | 34 | | | | | | (87) | | |
Net cash provided by (used in) financing activities
|
| | | | 34 | | | | | | (100,087) | | |
Net change in cash and cash equivalents
|
| | | | 157,035 | | | | | | 7,055 | | |
Cash and cash equivalents at beginning of period
|
| | | | 21,825 | | | | | | 5,014 | | |
Cash and cash equivalents at end of period
|
| | | $ | 178,860 | | | | | $ | 12,069 | | |
Noncash investing and financing activities: | | | | | | | | | | | | | |
Purchases of property, plant and equipment not yet paid
|
| | | $ | 2,664 | | | | | $ | 3,188 | | |
Operating lease right-of-use assets obtained in exchange for operating lease
liabilities |
| | | $ | 467 | | | | | $ | 2,436 | | |
Supplemental disclosure of cash flow information: | | | | | | | | | | | | | |
Cash paid during the period for: | | | | | | | | | | | | | |
Interest
|
| | | $ | (167,836) | | | | | $ | (185,864) | | |
Income taxes, net of refunds
|
| | | $ | (3,407) | | | | | $ | (52,727) | | |
| | |
Six Months Ended June 30,
|
| |||||||||
($ in thousands)
|
| |
2020
|
| |
2019
|
| ||||||
Revenues | | | | | | | | | | | | | |
Network Services
|
| | | $ | 135,126 | | | | | $ | 162,761 | | |
Percentage of Savings
|
| | | | 103,407 | | | | | | 129,722 | | |
PEPM
|
| | | | 27,870 | | | | | | 29,070 | | |
Other
|
| | | | 3,849 | | | | | | 3,969 | | |
Analytic-Based Services
|
| | | | 274,096 | | | | | | 274,798 | | |
Percentage of Savings
|
| | | | 273,308 | | | | | | 274,525 | | |
PEPM
|
| | | | 788 | | | | | | 273 | | |
Payment Integrity Services
|
| | | | 49,680 | | | | | | 53,118 | | |
Percentage of Savings
|
| | | | 49,636 | | | | | | 53,076 | | |
PEPM
|
| | | | 44 | | | | | | 42 | | |
Total Revenues
|
| | | $ | 458,902 | | | | | $ | 490,677 | | |
|
($ in thousands)
|
| |
June 30, 2020
|
| |
December 31, 2019
|
| ||||||
Term Loan G
|
| | | $ | 2,710,000 | | | | | $ | 2,710,000 | | |
Notes due 2024
|
| | | | 1,560,000 | | | | | | 1,560,000 | | |
Senior PIK Note
|
| | | | 1,178,727 | | | | | | 1,178,727 | | |
Finance lease obligations
|
| | | | 120 | | | | | | 101 | | |
Long-term debt
|
| | | | 5,448,847 | | | | | | 5,448,828 | | |
Premium – Notes due 2024
|
| | | | 9,302 | | | | | | 10,327 | | |
Discount – Term Loan G
|
| | | | (5,369) | | | | | | (6,195) | | |
Discount – Senior PIK Notes
|
| | | | (6,292) | | | | | | (7,436) | | |
Debt issuance costs, net: | | | | | | | | | | | | | |
Term Loan G
|
| | | | (13,679) | | | | | | (18,332) | | |
Notes Due 2024
|
| | | | (19,452) | | | | | | (21,539) | | |
Senior PIK Notes
|
| | | | (7,219) | | | | | | (8,531) | | |
Long- term debt, net
|
| | | $ | 5,406,138 | | | | | $ | 5,397,122 | | |
| | |
June 30, 2020
|
| |
December 31, 2019
|
| ||||||||||||||||||
($ in thousands)
|
| |
Carrying
Amount |
| |
Fair Value
|
| |
Carrying
Amount |
| |
Fair Value
|
| ||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Notes due 2024, net of premium
|
| | | $ | 1,569,302 | | | | | $ | 1,616,422 | | | | | $ | 1,570,327 | | | | | $ | 1,544,976 | | |
Term Loan G, net of discount
|
| | | | 2,704,631 | | | | | | 2,791,844 | | | | | | 2,703,805 | | | | | | 2,769,645 | | |
Senior PIK Note, net of discount
|
| | | | 1,172,435 | | | | | | 1,226,416 | | | | | | 1,171,291 | | | | | | 1,191,694 | | |
Finance lease obligations
|
| | | | 120 | | | | | | 120 | | | | | | 101 | | | | | | 101 | | |
Total Liabilities
|
| | | $ | 5,446,488 | | | | | $ | 5,634,802 | | | | | $ | 5,445,524 | | | | | $ | 5,506,416 | | |
| | |
As of
|
| |||||||||
| | |
June 30, 2020
|
| |
June 30, 2019
|
| ||||||
Risk free rate of return
|
| | | | 0.2% | | | | | | 1.7% | | |
Expected volatility
|
| | | | 80.0% | | | | | | 23.2% | | |
Expected dividend yield
|
| | | | 0.0% | | | | | | 0.0% | | |
Discount for lack of marketability
|
| | | | 11.0% | | | | | | 19.0% | | |
| | |
Six Months Ended
June 30, |
| |||||||||
($ in thousands)
|
| |
2020
|
| |
2019
|
| ||||||
Cost of services
|
| | | $ | 17,946 | | | | | $ | (2,918) | | |
General and administrative
|
| | | | 19,326 | | | | | | (1,712) | | |
Total stock-based compensation
|
| | | $ | 37,272 | | | | | $ | (4,630) | | |
| | |
Number of
Units |
| |
Weighted
Average Fair Value |
| ||||||
Nonvested at December 31, 2019
|
| | | | 80,671 | | | | | $ | 363.91 | | |
Awarded
|
| | | | — | | | | | | — | | |
Vested
|
| | | | (18,000) | | | | | $ | 533.75 | | |
Forfeited
|
| | | | (1,877) | | | | | $ | 533.75 | | |
Nonvested at June 30, 2020
|
| | | | 60,794 | | | | | $ | 533.75 | | |
($ in thousands, except number of shares and per share data)
|
| |
Six Months Ended
June 30, |
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Numerator for loss per share calculation | | | | | | | | | | | | | |
Net loss
|
| | | $ | (58,840) | | | | | $ | (7,496) | | |
Denominator for loss per share calculation | | | | | | | | | | | | | |
Weighted average number of shares outstanding – basic and diluted
|
| | | | 10 | | | | | | 10 | | |
Loss per share – basic and diluted: | | | | | | | | | | | | | |
Net loss per share – basic and diluted
|
| | | $ | (5,884,000) | | | | | $ | (749,600) | | |
|
($ in thousands)
|
| |
Six Months Ended
June 30, |
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Revenues
|
| | | $ | 1,036 | | | | | $ | 1,164 | | |
Total revenues from related parties
|
| | | $ | 1,036 | | | | | $ | 1,164 | | |
Cost of services
|
| | | $ | 583 | | | | | $ | 1,103 | | |
General and administrative
|
| | | | 100 | | | | | | 149 | | |
Total expense from related parties
|
| | | $ | 683 | | | | | $ | 1,252 | | |
($ in thousands)
|
| |
June 30,
2020 |
| |
December 31,
2019 |
| ||||||
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 2,500 | | | | | $ | 2,500 | | |
Total liabilities from related parties
|
| | | $ | 2,500 | | | | | $ | 2,500 | | |
| | |
Amount paid
or to be paid |
| |||
SEC registration fee
|
| | | $ | 549,198 | | |
Printing and engraving expenses
|
| | | $ | * | | |
Legal fees and expenses
|
| | | $ | * | | |
Accounting fees and expenses
|
| | | $ | * | | |
Miscellaneous
|
| | | $ | * | | |
Total
|
| | | $ | * | | |
| | | | | | |
Incorporated by Reference
|
| ||||||||||||
|
Exhibit
Number |
| |
Description
|
| |
Form
|
| |
File No.
|
| |
Exhibit
|
| |
Filing
Date |
| |
Filed
Herewith |
|
| 10.13#+ | | | Amended and Restated Employment Agreement, dated May 5, 2016, by and among David Redmond, Polaris Investment Holdings, L.P. and MultiPlan, Inc. | | | 8-K | | | 001-39228 | | | 10.12 | | | October 9, 2020 | | | ||
| 10.14#+ | | | Amended and Restated Employment Agreement, dated May 5, 2016, by and among Dale White, Polaris Investment Holdings, L.P. and MultiPlan, Inc. | | | 8-K | | | 001-39228 | | | 10.13 | | | October 9, 2020 | | | ||
| 10.15# | | | Offer Letter to Jeffrey Doctoroff, dated June 25, 2014 | | | 8-K | | | 001-39228 | | | 10.14 | | | October 9, 2020 | | | ||
| 10.16# | | | Form of Director and Officer Indemnification Agreement | | | 8-K | | | 001-39228 | | | 10.15 | | | October 9, 2020 | | | ||
| 14.1 | | | Code of Business Conduct and Ethics of MultiPlan Corporation, effective October 8, 2020 | | | 8-K | | | 001-39228 | | | 14.1 | | | October 9, 2020 | | | ||
| 16.1 | | | Letter from Marcum LLP, dated October 8, 2020 | | | 8-K | | | 001-39228 | | | 16.1 | | | October 9, 2020 | | | ||
| 21.1 | | | List of Subsidiaries | | | 8-K | | | 001-39228 | | | 21.1 | | | October 9, 2020 | | | ||
| 23.1 | | | Consent of Simpson Thacher & Bartlett LLP (included in Exhibit 5.1) | | | | | | | | | | | | | | | | |
| 23.2 | | | Consent of PricewaterhouseCoopers LLP | | | | | | | | | | | | | | |
X
|
|
| 23.3 | | | Consent of Marcum LLP | | | | | | | | | | | | | | |
X
|
|
| 24.1 | | | Power of Attorney (included in the signature page to this Registration Statement) | | | | | | | | | | | | | | | | |
| 101.INS | | | XBRL Instance Document | | | | | | | | | | | | | | |
X
|
|
| 101.SCH | | | XBRL Taxonomy Extension Schema Document | | | | | | | | | | | | | | |
X
|
|
| 101.CAL | | | XBRL Taxonomy Extension Calculation Linkbase Document | | | | | | | | | | | | | | |
X
|
|
| 101.DEF | | | 101.DEF XBRL Taxonomy Extension Definition Linkbase Document | | | | | | | | | | | | | | |
X
|
|
| 101.LAB | | | XBRL Taxonomy Extension Label Linkbase Document | | | | | | | | | | | | | | |
X
|
|
| 101.PRE | | | XBRL Taxonomy Extension Presentation Linkbase Document | | | | | | | | | | | | | | |
X
|
|
|
Signature
|
| |
Title
|
| |
Date
|
|
|
/s/ Mark Tabak
Mark Tabak
|
| | Chief Executive Officer (Principal Executive Officer) and Chairperson of the Board of Directors | | |
October 30, 2020
|
|
|
/s/ David Redmond
David Redmond
|
| |
Executive Vice President and Chief Financial Officer
(Principal Financial Officer) |
| |
October 30, 2020
|
|
|
/s/ Gerald Kozel
Gerald Kozel
|
| |
Chief Accounting Officer
(Principal Accounting Officer) |
| |
October 30, 2020
|
|
|
/s/ Allen R. Thorpe
Allen R. Thorpe
|
| | Lead Independent Director | | |
October 30, 2020
|
|
|
/s/ Glenn R. August
Glenn R. August
|
| | Director | | |
October 30, 2020
|
|
|
/s/ Richard A. Clarke
Richard A. Clarke
|
| | Director | | |
October 30, 2020
|
|
|
/s/ Anthony Colaluca
Anthony Colaluca
|
| | Director | | |
October 30, 2020
|
|
|
/s/ Paul D. Emery
Paul D. Emery
|
| | Director | | |
October 30, 2020
|
|
|
Signature
|
| |
Title
|
| |
Date
|
|
|
/s/ Michael Klein
Michael Klein
|
| | Director | | |
October 30, 2020
|
|
|
/s/ P. Hunter Philbrick
P. Hunter Philbrick
|
| | Director | | |
October 30, 2020
|
|
|
/s/ Bill Veghte
Bill Veghte
|
| | Director | | |
October 30, 2020
|
|
Exhibit 5.1
SIMPSON THACHER & BARTLETT LLP
2475 HANOVER STREET
PALO ALTO, CA 94304
TELEPHONE: +1-650-251-5000
FACSIMILE +1-650-251-5001
October 30, 2020
MultiPlan Corporation
115 Fifth Avenue
New York, New York 10003
Ladies and Gentlemen:
We have acted as counsel to MultiPlan Corporation, a Delaware corporation (the “Company”), in connection with the Registration Statement on Form S-1 (the “Registration Statement”) filed by the Company with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended, relating to the offer and sale by the selling securityholders (the “Selling Securityholders”) named in the prospectus contained in the Registration Statement of (1) up to 633,750,000 shares of the Company’s Class A common stock, par value $0.0001 per share (each, a “Share”), which includes (a) 415,700,000 Shares (the “BC Shares”) issued in connection with the Business Combination (as defined below), (b) 132,050,000 Shares (the “Common PIPE Shares”) issued in connection with the Common PIPE Investment (as defined below), (c) 27,500,000 Shares (the “Conversion Shares”) issued upon conversion of 27,500,000 shares of the Company’s Class B common stock in connection with the Transactions (as defined below), (d) 27,500,000 Shares (the “Public Warrant Shares”) issuable upon the exercise of the Public Warrants (as defined below), (e) 23,000,000 Shares (the “Private Placement Warrant Shares”) issuable upon the exercise of the Private Placement Warrants (as defined below), (f) 1,500,000 Shares (the “Working Capital Warrant Shares”) issuable upon the exercise of the Working Capital Warrants (as defined below) and (g) 6,500,000 Shares (the “Common PIPE Warrant Shares”) issuable upon the exercise of the Common PIPE Warrants (as defined below), and (2) up to 24,500,000 warrants (comprised of the Private Placement Warrants and Working Capital Warrants), each of which is exercisable to purchase one Share at an exercise price of $11.50.
MultiPlan Corporation | -2- |
October 30, 2020 |
For purposes of this opinion letter, the following terms have the meanings specified below:
“Business Combination” means the mergers of (i) Music Merger Sub I, Inc. with and into Polaris Parent Corp. and (ii) Polaris Parent Corp. with and into Music Merger Sub II, LLC, consummated on October 8, 2020, pursuant to the Merger Agreement. In connection with the Transactions, Churchill changed its name to MultiPlan Corporation.
“Board” means the board of directors of the Company.
“Churchill” means Churchill Capital Corp III, which was the name of the Company prior to the Business Combination.
“Common PIPE Investment” means the private placement pursuant to which Churchill entered into subscription agreements with certain investors whereby such investors subscribed for (i) 132,050,000 Shares and (ii) the Common PIPE Warrants.
“Common PIPE Warrant Agreement” means the warrant agreement, dated October 8, 2020, by and between Churchill and Continental Stock Transfer & Trust Company, as warrant agent.
“Common PIPE Warrants” means 6,500,000 warrants issued in connection with the Common PIPE Investment to subscribers in a private placement simultaneously with the closing of the Transactions, each of which is exercisable for one Share at an exercise price of $12.50, in accordance with the terms of the Common PIPE Warrant Agreement.
“Merger Agreement” means that certain agreement and plan of merger, dated as of July 12, 2020, by and among Churchill, Polaris Parent Corp., Polaris Investment Holdings, L.P., Music Merger Sub I, Inc. and Music Merger Sub II, LLC, as the same has been or may be amended, modified, supplemented or waived from time to time, whereby (i) Music Merger Sub I, Inc. merged with and into Polaris Parent Corp., with Polaris Parent Corp. being the surviving company, and (ii) immediately following and as part of the same transaction, Polaris Parent Corp. merged with and into Music Merger Sub II, LLC, with Music Merger Sub II, LLC surviving the merger as a wholly owned subsidiary of the Company.
“Private Placement Warrants” means 23,000,000 warrants issued to Churchill Sponsor III, LLC in a private placement simultaneously with the closing of Churchill’s initial public offering, each of which is exercisable for one Share at an exercise price of $11.50, in accordance with the terms of the Warrant Agreement.
“Public Warrants” means 27,500,000 warrants sold as part of Churchill’s initial public offering, each of which is exercisable for one Share at an exercise price of $11.50, in accordance with the terms of the Warrant Agreement.
“Securities Agreements” means the Common PIPE Warrant Agreement and the Warrant Agreement.
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“Transactions” means the transactions contemplated by the Merger Agreement and the related agreements.
“Warrant Agreement” means the warrant agreement, dated February 13, 2020, by and between Churchill and Continental Stock Transfer & Trust Company, as warrant agent.
“Warrant Shares” means the Common PIPE Warrant Shares, the Private Placement Warrant Shares, the Public Warrant Shares and the Working Capital Warrant Shares.
“Working Capital Warrants” means 1,500,000 warrants issued to Churchill Sponsor III, LLC in connection with the closing of the Transactions, each of which is exercisable for one Share at an exercise price of $11.50, in accordance with the terms of the Warrant Agreement.
We have examined the Registration Statement, the Second Amended and Restated Certificate of Incorporation of the Company, the Warrant Agreement (including the form of warrant set forth therein) and the Common PIPE Warrant Agreement (including the form of warrant set forth therein), each of which is an exhibit to the Registration Statement. In addition, we have examined, and have relied as to matters of fact upon, originals, or duplicates or certified or conformed copies, of such records, agreements, documents and other instruments and such certificates or comparable documents of public officials and of officers and representatives of the Company and have made such other investigations as we have deemed relevant and necessary in connection with the opinions hereinafter set forth.
In rendering the opinions set forth below, we have assumed the genuineness of all signatures, the legal capacity of natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as duplicates or certified or conformed copies, and the authenticity of the originals of such latter documents. We also have assumed that, at the time of execution, authentication, issuance and delivery of any of the Warrant Shares, the applicable Securities Agreements will be the valid and legally binding obligation of each party thereto other than the Company. We have also assumed that, with respect to the issuance of any Shares, the amount of valid consideration paid in respect of such Shares will equal or exceed the par value of such Shares.
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In rendering the opinions set forth below, we have assumed further that, at the time of issuance and delivery of each of the Warrant Shares, (1) the Company will be validly existing and in good standing under the law of the jurisdiction in which it is organized, (2) the issuance and delivery by the Company of such Warrant Shares pursuant to the applicable Securities Agreement will not constitute a breach or violation of its organizational documents or violate the law of the jurisdiction in which it is organized or any other jurisdiction (except that no such assumption is made with respect to the law of the State of New York or the Delaware General Corporation Law, assuming there shall not have been any change in such laws affecting the validity or enforceability of the applicable Securities Agreements and such Warrant Shares) and (3) the issuance and delivery by the Company of such Warrant Shares (a) will not constitute a breach or default under any agreement or instrument which is binding upon the Company and (b) will comply with all applicable regulatory requirements.
Based upon the foregoing, and subject to the qualifications, assumptions and limitations stated herein, we are of the opinion that:
1. The BC Shares, the Common PIPE Shares and the Conversion Shares have been duly authorized and are validly issued, fully paid and nonassessable.
2. The Private Placement Warrants and the Working Capital Warrants constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms.
3. With respect to the Common PIPE Warrant Shares, assuming the due issuance and delivery of the Common PIPE Warrant Shares, upon payment therefor in accordance with the Common PIPE Warrant Agreement and otherwise in accordance with the provisions of such agreement, the Second Amended and Restated Certificate of Incorporation of the Company and the Delaware General Corporation Law, the Common PIPE Warrant Shares will be validly issued, fully paid and nonassessable.
4. With respect to the Private Placement Warrant Shares, assuming the due issuance and delivery of the Private Placement Warrant Shares, upon payment therefor in accordance with the Warrant Agreement and otherwise in accordance with the provisions of such agreement, the Second Amended and Restated Certificate of Incorporation of the Company and the Delaware General Corporation Law, the Private Placement Warrant Shares will be validly issued, fully paid and nonassessable.
5. With respect to the Public Warrant Shares, assuming the due issuance and delivery of the Public Warrant Shares, upon payment therefor in accordance with the Warrant Agreement and otherwise in accordance with the provisions of such agreement, the Second Amended and Restated Certificate of Incorporation of the Company and the Delaware General Corporation Law, the Public Warrant Shares will be validly issued, fully paid and nonassessable.
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6. With respect to the Working Capital Warrant Shares, assuming the due issuance and delivery of the Working Capital Warrant Shares, upon payment therefor in accordance with the Warrant Agreement and otherwise in accordance with the provisions of such agreement, the Second Amended and Restated Certificate of Incorporation of the Company and the Delaware General Corporation Law, the Working Capital Warrant Shares will be validly issued, fully paid and nonassessable.
Our opinion set forth in paragraph 2 above is subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, (ii) general equitable principles (whether considered in a proceeding in equity or at law) and (iii) an implied covenant of good faith and fair dealing.
In connection with the provisions of the Securities Agreements whereby the parties submit to the jurisdiction of the courts of the United States of America for the Southern District of New York, we note the limitations of 28 U.S.C. Sections 1331 and 1332 on subject matter jurisdiction of the federal courts. In connection with the provisions of the Securities Agreements that relate to forum selection (including, without limitation, any waiver of any objection to venue or any objection that a court is an inconvenient forum), we note that under N.Y.C.P.L.R. Section 510 a New York State court may have discretion to transfer the place of trial, and under 28 U.S.C. Section 1404(a) a United States District Court has discretion to transfer an action from one U.S. federal court to another.
We do not express any opinion herein concerning any law other than the law of the State of New York and the Delaware General Corporation Law.
We hereby consent to the filing of this opinion letter as Exhibit 5.1 to the Registration Statement and to the use of our name under the caption “Legal Matters” in the prospectus included in the Registration Statement.
Very truly yours, | |
/s/ Simpson Thacher & Bartlett LLP | |
SIMPSON THACHER & BARTLETT LLP |
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in this Registration Statement on Form S-1 of MultiPlan Corporation of our report dated July 30, 2020 relating to the financial statements of MultiPlan Corporation (formerly known as Polaris Parent Corp.), which appears in this Registration Statement. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Chicago, IL
October 30, 2020
Exhibit 23.3
Independent Registered Public Accounting Firm’s Consent
We consent to the inclusion in this Registration Statement of Multiplan Corporation on Form S-1 of our report dated January 29, 2020, except for Note 8, as to which the date is February 12, 2020, which includes an explanatory paragraph as to the Company’s ability to continue as a going concern with respect to our audit of the financial statements of Churchill Capital Corp. III as of December 31, 2019 and for the period from October 30, 2019 (inception) through December 31, 2019, which report appears in the Prospectus, which is part of this Registration Statement. We also consent to the reference to our Firm under the heading “Experts” in such Prospectus.
/s/ Marcum llp
Marcum llp
New York, NY
October 30, 2020