Exhibit 10.1

Execution Version

TAX MATTERS AGREEMENT

between

McKesson Corporation,

on behalf of itself

and the members

of the Parent Group,

and

PF2 SpinCo Inc.,

on behalf of itself

and the members

of the SpinCo Group,

and

Change Healthcare Inc.,

on behalf of itself

and the members

of the Acquiror Group.

and

Change Healthcare LLC,

on behalf of itself

and the members

of the Acquiror Group

(solely to the extent

set forth herein),

and

Change Healthcare Holdings, LLC

Dated as of March 9, 2020

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Table of Contents

 

 

            Page  

SECTION 1.

     Definitions      1  

SECTION 2.

     Sole Tax Sharing Agreement      12  

SECTION 3.

     Certain Pre-Closing Matters      13  

SECTION 4.

     Allocation of Taxes      13  

SECTION 5.

     Preparation and Filing of Tax Returns      16  

SECTION 6.

     Apportionment of Earnings and Profits and Tax Attributes      19  

SECTION 7.

     Utilization of Tax Attributes      19  

SECTION 8.

     Tax Benefits      20  

SECTION 9.

     Certain Representations and Covenants      21  

SECTION 10.

     Procedures Relating to Opinions and Rulings      26  

SECTION 11.

     Protective Section 336(e) Elections      26  

SECTION 12.

     Indemnities      27  

SECTION 13.

     Acquiror Shareholders Not Parties      29  

SECTION 14.

     Payments      29  

SECTION 15.

     Communication and Cooperation      30  

SECTION 16.

     Audits and Contest      31  

SECTION 17.

     Notices      32  

SECTION 18.

     Costs and Expenses      33  

SECTION 19.

     Effectiveness; Termination and Survival      33  

SECTION 20.

     Specific Performance      33  

SECTION 21.

     Construction      34  

SECTION 22.

     Entire Agreement; Amendments and Waivers      34  

SECTION 23.

     Governing Law and Interpretation      35  

SECTION 24.

     Dispute Resolution      35  

SECTION 25.

     Counterparts      36  

SECTION 26.

     Successors and Assigns; Third Party Beneficiaries      36  

SECTION 27.

     Authorization, Etc.      36  

SECTION 28.

     Change in Tax Law      36  

SECTION 29.

     Principles      37  

 

 

i

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TAX MATTERS AGREEMENT

This TAX MATTERS AGREEMENT (the “Agreement”) is entered into as of March 9, 2020
between McKesson Corporation (“Parent”), a Delaware corporation, on behalf of
itself and the members of the Parent Group, PF2 SpinCo Inc. (“SpinCo”), a
Delaware corporation, on behalf of itself and the members of the SpinCo Group,
Change Healthcare Inc. (“Acquiror”), a Delaware corporation, on behalf of itself
and the members of the Acquiror Group, Change Healthcare LLC (f/k/a PF2 NewCo
LLC) (“JV”), a Delaware limited liability company, on behalf of itself and the
members of the Acquiror Group (solely for purposes of Section 2, Section 4(c),
Section 5(g), Section 12, Section 15(d) and Section 19), and Change Healthcare
Holdings, LLC (f/k/a PF2 NewCo Holdings, LLC) (“OpCo”), a Delaware limited
liability company.

WITNESSETH:

WHEREAS, Parent, SpinCo and Acquiror have entered into a Separation Agreement,
dated as of the date hereof (the “Separation Agreement”) and Parent, SpinCo and
Acquiror have entered into an Agreement and Plan of Merger, dated as of
December 20, 2016 (the “Merger Agreement”), pursuant to which the Internal
Restructuring, the Controlled Transfer, the Distribution and the Merger and
other related transactions will be consummated;

WHEREAS, the Controlled Transfer, the Distribution and the Merger are intended
to qualify for the Intended Tax-Free Treatment; and

WHEREAS, Parent, SpinCo and Acquiror desire to set forth their agreement on the
rights and obligations of Parent, SpinCo, Acquiror and the members of the Parent
Group, the SpinCo Group and the Acquiror Group respectively, with respect to
(a) the administration and allocation of federal, state, local and foreign Taxes
incurred in Taxable periods beginning prior to the Distribution Date, as defined
below, (b) Taxes resulting from the Distribution and transactions effected in
connection with the Distribution and (c) various other Tax matters.

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties agree as follows:

SECTION 1. Definitions.

(a) As used in this Agreement:

“Acquiror” has the meaning set forth in the preamble.

“Acquiror Capital Stock” means, to the extent issued by Acquiror, any shares of
common stock (including Acquiror Common Stock), preferred stock, restricted
stock, restricted stock units, stock appreciation rights, stock-based
performance units, phantom units, capital stock equivalents, mandatorily
convertible instruments or similar synthetic instruments or other capital stock
or nominal interests in Acquiror, including any stock, other securities or
interests that are treated as equity for purposes of Section 355 of the Code, or
that are treated as an option under Treasury regulations Section 1.355-7(e).

 

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“Acquiror Common Stock” means the common stock, par value $0.001 per share, of
Acquiror.

“Acquiror Compensatory Equity Interests” means any options, stock appreciation
rights, restricted stock, stock units or other rights with respect to Acquiror
Capital Stock that are granted on or prior to the Effective Time by any member
of the Acquiror Group in connection with employee, independent contractor or
director compensation or other employee benefits (including, for the avoidance
of doubt, options, stock appreciation rights, restricted stock, restricted stock
units, performance share units or other rights issued in respect of any of the
foregoing by reason of the Merger).

“Acquiror Group” means Acquiror and each of its Subsidiaries, including, after
the Closing, the SpinCo Group and the JV Group.

“Acquiror Shareholder Acquisition” means any acquisition of shares of Parent
common stock on or after January 1, 2016 (in the case of clauses (i) and (ii)
below) or on or after June 22, 2016 (in the case of clauses (iii) and (iv)
below) and prior to the Distribution (which shares continue to be held at the
time of the Distribution and in respect of which shares SpinCo stock is received
in the Distribution) by (i) Blackstone Capital Partners VI L.P., Blackstone
Family Investment Partnership VI L.P., or Blackstone Family Investment
Partnership VI – ESC L.P., (each, a “BX Investor”), (ii) H&F Harrington AIV II,
L.P., HFCP VI Domestic AIV, L.P., Hellman & Friedman Investors VI, L.P.,
Hellman & Friedman Capital Executives VI, L.P. or Hellman & Friedman Capital
Associates VI, L.P. each, an “H&F Investor”), (iii) any Person Under the Control
of Blackstone and any Person Under the Control of H&F or (iv) any Person that is
part of a coordinating group (within the meaning of Section 1.355-7(h)(4) of the
Treasury regulations) with any Person described in clause (i), (ii) or
(iii) above.

“Acquiror Tax Proceeding” has the meaning set forth in Section 16(d).

“Affiliate” means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with such other
Person as of the date on which, or at any time during the period for which, the
determination of affiliation is being made; provided, however, that
(notwithstanding any other provision of this Agreement) prior to the Closing no
member of the JV Group shall be considered to be a member of the Acquiror Group,
Parent Group or SpinCo Group or to be an Affiliate of Parent, Acquiror or SpinCo
prior to the Closing. For purposes of this definition, the term “control”
(including, with correlative meanings, the terms “controlled by” and “under
common control with”), as used with respect to any Person means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities, by Contract or otherwise. For the avoidance of doubt, (a) prior to
the Closing, Affiliates of Parent will include SpinCo and its Affiliates and
(b) after the Closing, Affiliates of Acquiror will include SpinCo and its
Affiliates and the members of the JV Group.

“Agreement” has the meaning set forth in the preamble.

 

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“Applicable Law” (or “Applicable Tax Law,” as the case may be) means, with
respect to any Person, any federal, state, county, municipal, local,
multinational or foreign statute, treaty, law, common law, ordinance, rule,
regulation, order, writ, injunction, judicial decision, decree, permit or other
legally binding requirement of any Governmental Authority applicable to such
Person or any of its respective properties, assets, officers, directors,
employees, consultants or agents (in connection with such officer’s, director’s,
employee’s, consultant’s or agent’s activities on behalf of such Person).

“Business” means the Retained Business or the Controlled Business, as the case
may be.

“Business Day” means any day that is not a Saturday, a Sunday or other day that
is a statutory holiday under the federal Laws of the United States.

“Closing” means the consummation of the Merger.

“Closing of the Books Method” means the apportionment of items between portions
of a Taxable period based on a closing of the books and records at the close of
the Distribution Date (and for purposes of such apportionment, the Taxable year
of any partnership or other passthrough entity or any controlled foreign
corporation within the meaning of Section 957(a) of the Code or passive foreign
investment company within the meaning of Section 1297 of the Code shall be
deemed to terminate at the close of the Distribution Date); and in the event
that the Distribution Date is not the last day of the Taxable period, as if the
Distribution Date were the last day of the Taxable period), subject to
adjustment for items accrued on the Distribution Date that are properly
allocable to the Taxable period following the Distribution, as determined by
agreement among Acquiror, SpinCo, and Parent, with any dispute among them to be
resolved by the Tax Arbiter in accordance with Section 24; provided that Taxes
not susceptible to such apportionment shall be apportioned between the Pre- and
Post-Distribution Periods on a pro rata basis in accordance with the number of
days in each Taxable period; and provided, further, that, for the avoidance of
doubt, the Closing of the Books Method shall not require a closing of the books
and records of any member of the JV Group (i) that is, as of immediately prior
to the Distribution Date, a “domestic corporation” (within the meaning of
Section 7701(a) of the Code) or (ii) all of the JV Group’s equity interests in
which are owned, directly or indirectly, by members of the JV Group described in
the preceding clause (i).

“Code” means the Internal Revenue Code of 1986, as amended.

“Combined Group” means any group that filed or was required to file (or will
file or be required to file) a Tax Return on an affiliated, consolidated,
combined, unitary, fiscal unity or other group basis (including as permitted by
Section 1501 of the Code) that includes at least one member of the Parent Group
and at least one member of the SpinCo Group.

“Combined Tax Return” means a Tax Return filed or required to be filed in
respect of federal, state, local or foreign income Taxes for a Combined Group,
or any other affiliated, consolidated, combined, unitary, fiscal unity or other
group basis (including as permitted by Section 1501 of the Code) Tax Return of a
Combined Group.

 

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“Company” means Parent, SpinCo, Acquiror, or a Group, as appropriate.

“Contribution Agreement” means the Agreement of Contribution and Sale, dated as
of June 28, 2016, by and among JV, Parent, Acquiror, Change Healthcare
Performance, Inc. (formerly Change Healthcare, Inc.), Change Aggregator, L.P.,
H&F Echo Holdings, L.P. and the other parties thereto, as amended from time to
time.

“Controlled Business” means the Parent Group’s business known as the MHS
business, which is engaged in the provision of services, and the manufacture,
marketing, distribution and sale of software products, designed to manage the
cost and quality of care for payers, providers, hospitals and government
organizations, provided that, for the avoidance of doubt, the Controlled
Business shall not include the Imaging and Workflow Solutions (the “IWS
Business”).

“Controlled Transfer” means, collectively, (i) the transfer by Parent to SpinCo
of (x) 100% of the issued and outstanding equity interests of PF2 PST Services
LLC and (y) 100 shares of SpinCo common stock and (ii) the transfer by Parent to
SpinCo of 100% of the issued and outstanding equity interests of PF2 IP LLC, in
each case, solely in exchange for Parent’s receipt of shares of SpinCo Common
Stock.

“Covered Tax Distribution” means any distribution to which any member of the
SpinCo Group is (or, but for an amendment to the LLC Agreement after the
Distribution, would have been) entitled to receive pursuant to Section 8.02(a)
of the LLC Agreement after the Distribution to the extent attributable to Tax
Items allocated to such member of the SpinCo Group for any Pre-Distribution
Period, including as a result of an adjustment to any such Tax Items.

“Disqualifying Action” means a Parent Disqualifying Action or Echo Disqualifying
Action.

“Distribution” means a transaction in which Parent will dispose of all of the
shares of SpinCo Common Stock through (1) one or more exchange offers pursuant
to which Parent will redeem shares of Parent Common Stock for shares of SpinCo
Common Stock (each, a “Split-Off Exchange”), (2) a distribution to Parent
shareholders of shares of SpinCo Common Stock to Parent shareholders without
consideration on a pro rata basis (a “Spin-Off”) (3) one or more exchanges of
SpinCo Common Stock for debt of Parent (each, a “Debt Exchange”) or (4) any
combination of the foregoing; provided that more than 80% of the SpinCo Common
Stock shall be disposed of under a combination of the preceding clauses (1) and
(2).

“Distribution Date” means the first date on or after the date of the
consummation of the first event described in clause (1) or clause (2) of the
definition of “Distribution” on which more than 80% of the SpinCo Common Stock
has been disposed of under a combination of clause (1) or clause (2) of the
definition of “Distribution.”

“Distribution Effective Time” means the first time on or after the consummation
of the first event described in clause (1) or clause (2) of the definition of
“Distribution” at which more than 80% of the SpinCo Common Stock has been
disposed of under a combination of clause (1) or clause (2) of the definition of
“Distribution.”

 

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“Distribution Taxes” means any Taxes incurred as a result of the failure of the
Intended Tax-Free Treatment of the Internal Restructuring, the Controlled
Transfer or the Distribution.

“Echo Cushion Percentage” means a percentage equal to the sum of (a) 50% of the
difference between (i) 49.99% and (ii) the percentage of the total Acquiror
Capital Stock outstanding immediately after the Merger that is held immediately
after the Merger by Persons who held such stock by reason of (A) having held
Acquiror Capital Stock prior to the Merger or (B) having acquired such Acquiror
Capital Stock in the manner described in Section 3.3(b) of the Merger Agreement
(the percentage described in this clause (a)(ii), the “Cushion Starting
Percentage”), and (b) the Cushion Starting Percentage.

“Echo Disqualifying Action” means (i) any Acquiror Shareholder Acquisition,
(ii) from and after the Effective Time, any action (or the failure to take any
action) within Acquiror’s control by any member of the Acquiror Group (including
(x) entering into any agreement, understanding or arrangement or any
negotiations with respect to any transaction or series of transactions or
(y) any action resulting in an adjustment to the fixed settlement rate for any
TEU Purchase Contract), (iii) from and after the Effective Time, any event (or
series of events) involving a transfer of the capital stock of Acquiror,
(iv) any breach by any member of the Acquiror Group of any representation,
warranty or covenant made by them in this Agreement, (v) from and after the
Effective Time, any coordinated acquisition of the stock of Acquiror by (x) any
Person Under the Control of Blackstone with any BX Excluded Person or by (y) any
Person Under the Control of H&F with any H&F Excluded Person; (vi) from and
after the Effective Time, the issuance by Acquiror (other than in a public
offering) of its newly issued capital stock to any fund or other managed
investment vehicle of Blackstone that is not a Person under the Control of
Blackstone or to any fund or other managed investment vehicle of H&F that is not
a Person under the Control of H&F (vii) from and after the Effective Time, any
acquisition (other than in a public offering) of the capital stock of Acquiror
by any fund or other managed investment vehicle of Blackstone that is not a
Person under the Control of Blackstone, which acquisition is consummated,
facilitated or otherwise executed due to the efforts or pursuant to the
instructions of any Person under the Control of Blackstone or (viii) from and
after the Effective Time, any acquisition (other than in a public offering) of
the capital stock of Acquiror by any fund or other managed investment vehicle of
H&F that is not a Person under the Control of H&F, which acquisition is
consummated, facilitated or otherwise executed due to the efforts or pursuant to
the instructions of any Person under the Control of H&F that, in each case ((i)
through (viii)), is not a Parent Disqualifying Action and would affect the
Intended Tax-Free Treatment; provided, however, that the term “Echo
Disqualifying Action” shall not include any action or event entered into
pursuant to any Transaction Document or that is undertaken pursuant to the
Internal Restructuring, the Controlled Transfer, the Distribution (including a
Debt Exchange) or the Merger. For the avoidance of doubt, a sale of Acquiror
stock by any BX Investor or any H&F Investor (or their Permitted Transferees)
shall not constitute an Echo Disqualifying Action.

 

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“Echo Tainted Stock” means Acquiror Equity Interests the issuance, acquisition
or disposition of which was consummated in a manner that did not constitute a
breach of Section 9(a)(i)(D) solely because of the proviso thereto.

“Effective Time” means the date and time of the filing with the Secretary of
State of the State of Delaware of the certificate of merger consummating the
Merger, or such later time as is specified in such certificate of merger and as
is agreed to by Parent and Acquiror.

“Equity Interests” means any stock or other securities treated as equity for Tax
purposes, options, warrants, rights, convertible debt or any other instrument or
security that affords any Person the right, whether conditional or otherwise, to
acquire stock or to be paid an amount determined by reference to the value of
stock.

“Escheat Payment” means any payment required to be made to a Governmental
Authority pursuant to an abandoned property, escheat or similar law.

“Exit Transaction Documents” means, collectively, this Agreement, the Merger
Agreement, the Separation Agreement and the Transition Services Agreement.

“Final Determination” means (i) with respect to federal income Taxes, (A) a
“determination” as defined in Section 1313(a) of the Code (including, for the
avoidance of doubt, an executed IRS Form 906) or (B) the execution of an IRS
Form 870-AD (or any successor form thereto), as a final resolution of Tax
liability for any Taxable period, except that a Form 870-AD (or successor form
thereto) that reserves the right of the taxpayer to file a claim for refund or
the right of the IRS to assert a further deficiency shall not constitute a Final
Determination with respect to the item or items so reserved; (ii) with respect
to Taxes other than federal income Taxes, any final determination of liability
in respect of a Tax that, under Applicable Tax Law, is not subject to further
appeal, review or modification through proceedings or otherwise; or (iii) with
respect to any Tax, any final disposition by reason of the expiration of the
applicable statute of limitations (giving effect to any extension, waiver or
mitigation thereof).

“Governmental Authority” means any federal, state, local, provincial, foreign or
international court, tribunal, judicial or arbitral body, government,
department, commission, board, bureau, agency, official or other regulatory,
administrative or governmental authority or any national securities exchange.

“Group” means the Parent Group, the Acquiror Group, the SpinCo Group or the JV
Group, as the context requires.

“Historic Acquiror Stock” means stock of Acquiror that Acquiror can demonstrate
to have been (i) held by shareholders of Acquiror immediately prior to the
Merger and (ii) either (A) acquired by shareholders of Acquiror prior to the
initial public offering of Acquiror, or (B) acquired by service providers of
Acquiror prior to the Merger pursuant to compensatory arrangements.

 

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“Indemnifying Party” means the party from which another party is entitled to
seek indemnification pursuant to the provisions of Section 12.

“Indemnitee” means the party which is entitled to seek indemnification from
another party pursuant to the provisions of Section 12.

“Intended Tax-Free Treatment” means the qualification of (i) the Controlled
Transfer, together with the Distribution as a reorganization described in
Section 368(a)(1)(D) of the Code, pursuant to which neither Parent nor SpinCo
recognizes any gain or loss for U.S. federal income Tax purposes, and of each of
Parent and SpinCo as a “party to the reorganization” within the meaning of
Section 368(b) of the Code, (ii) the Distribution, as such, as a distribution of
SpinCo Common Stock to Parent’s shareholders and creditors pursuant to
Section 355 of the Code (and, as applicable, Section 361 of the Code), pursuant
to which neither Parent nor SpinCo nor any of Parent’s shareholders recognizes
any gain or loss for U.S. federal income Tax purposes, (iii) the Merger as a
“reorganization” within the meaning of Section 368(a) of the Code pursuant to
which neither Acquiror nor SpinCo nor any of Acquiror’s or SpinCo’s shareholders
recognizes any gain or loss for U.S. federal income Tax purposes, and of each of
Acquiror and SpinCo as a “party to the reorganization” within the meaning of
Section 368(b) of the Code and (iv) the transactions described on Schedule A as
being free from Tax to the extent set forth therein.

“Internal Restructuring” has the meaning set forth in Schedule B.

“IRS” means the United States Internal Revenue Service.

“JV” has the meaning ascribed thereto in the preamble.

“JV Corporate Group” means any member of the JV Group that (i) is treated as a
corporation for U.S. federal income Tax purposes, or (ii) (x) is a direct or
indirect Subsidiary of a member of the JV Group described in clause (i) and (y)
is wholly owned (directly or indirectly) by members of the JV Group described in
clause (i) and/or Persons that are not members of the JV Group.

“JV Group” means the JV and each of its Subsidiaries.

“JV Group Tax” means any Tax of a member of the JV Group.

“Letter Agreement” means the Amended and Restated Letter Agreement, dated as of
September 28, 2018, by and among Parent, the McKesson Members, Acquiror, JV and
the other parties thereto, as amended from time to time.

“LLC Agreement” means the Third Amended and Restated Limited Liability Company
Agreement of Change Healthcare LLC, dated as of March 1, 2017, as amended from
time to time.

“Merger” has the meaning set forth in the Merger Agreement.

 

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“Merger Agreement” has the meaning set forth in the recitals.

“MCK Cushion Amount” means an amount of Acquiror Capital Stock equal to 50% of
the difference between (x) 49.99% of the total Acquiror Capital Stock
outstanding and (y) the amount of Acquiror Capital Stock held immediately after
the Merger by Persons who held such stock by reason of (i) having held Acquiror
Capital Stock prior to the Merger or (ii) having acquired such Acquiror Capital
Stock in the manner described in Section 3.3(b) of the Merger Agreement, in each
case as determined following the Merger.

“Parent” has the meaning ascribed thereto in the preamble.

“Parent Disqualifying Action” means (i) any action (or the failure to take any
action) within Parent’s control by any member of the Parent Group (or, to the
extent the action is taken prior to the Effective Time, any member of the SpinCo
Group) (including entering into any agreement, understanding or arrangement or
any negotiations with respect to any transaction or series of transactions),
(ii) any event (or series of events) involving the transfer of the capital stock
of Parent other than an Acquiror Shareholder Acquisition or (iii) any breach by
any member of the Parent Group (or, to the extent occurring prior to the
Effective Time, by any member of the SpinCo Group) of any representation,
warranty or covenant made by them in this Agreement, that, in each case ((i)
through (iii)), would affect the Intended Tax-Free Treatment; provided, however,
that the term “Parent Disqualifying Action” shall not include any action (or
event otherwise described in clause (ii) above) undertaken pursuant to any
Transaction Document or pursuant to the Controlled Transfer, the Distribution
(other than a Debt Exchange) or the Merger.

“Parent Group” means Parent and each of its Subsidiaries, but excluding any
member of the SpinCo Group.

“Parent Separate Tax Return” means any Tax Return that is required to be filed
by, or with respect to, a member of the Parent Group that is not a Combined Tax
Return.

“Person” has the meaning set forth in Section 7701(a)(1) of the Code.

“Person Under the Control of Blackstone” means (i) the private side businesses
controlled by The Blackstone Group Inc. (“Blackstone”), which businesses are
currently comprised of the Private Equity Business, the Tactical Opportunities
Business, and the Real Estate Business (collectively, the “Existing Private
Businesses”), and which businesses shall include such other businesses that
Blackstone may hereafter form or acquire and that are, at the time of any
determination as to whether any such business is a Person Under the Control of
Blackstone, managed within the same ethical wall as the Existing Private
Businesses and (ii) the employees, directors and officers of Blackstone or the
businesses described in clause (i). For the avoidance of doubt, a Person Under
the Control of Blackstone shall not include (each of the following, a “BX
Excluded Person”): (A) the public side businesses controlled by Blackstone (e.g.
BAAM and GSO) and other businesses on the other side of the ethical wall from
the private businesses described in clause (i), (B) limited partners of any fund
affiliated with Blackstone, (other than individuals who are limited partners
that are described in clause (ii) or to the extent

 

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such individuals are acting in concert with a co-investment with a person
described in clause (i) with respect to a co-investment), (C) portfolio
companies of the businesses described in clause (i), except to the extent such
portfolio company is controlled by the applicable Blackstone business, and
Blackstone actively participates in or approves of the applicable acquisition of
Parent common stock, (D) any company or business in which any business described
in clause (A) of this sentence invests (other than a portfolio company described
in the exception to clause (C)), (E) with regard to any fund of funds controlled
by Blackstone, any pooled investment vehicle or discretionary separate account
in which such fund of funds invests, (F) any employee, director or officer
referenced in clause (ii) prior to or after such person has held such role, or
(G) any investment accounts, estate planning or investment vehicles for the
benefit of family members of Blackstone professionals or other employees or
nonprofit organizations, with respect to which the applicable Blackstone
professional or employee does not have investment discretion.

“Person Under the Control of H&F” means (i) the business entities controlled or
managed by Hellman & Friedman LLC (“H&F”), which business entities consist of
certain private equity investment funds formed for the purpose of investing
capital contributed by investors and that is affiliated with H&F (each, an “H&F
Fund”), the general partners of such H&F Funds, and any entities formed or
acquired by H&F in connection with any other business that H&F may hereafter
form or acquire, and (ii) employees, directors and officers of H&F or the
business entities described in clause (i). For the avoidance of doubt, a Person
Under the Control of H&F shall not include (each of the following, an “H&F
Excluded Person”) (A) limited partners of any H&F Fund (other than individuals
who are limited partners and are described in clause (ii) or limited partners to
the extent they are acting in concert with an H&F Fund with respect to a
co-investment), (B) portfolio companies of any H&F Fund except to the extent
such portfolio company is controlled by the applicable H&F Fund, and H&F
actively participates in or approves of such portfolio company’s acquisition of
Parent common stock, (C) any employee, director or officer referenced above
prior to or after such person has held such role, and (D) any investment
accounts, estate planning or investment vehicles for the benefit of family
members of H&F professionals or other employees or nonprofit organizations, with
respect to which the applicable H&F professional or employee does not have
investment discretion.

“Post-Distribution Period” means any Taxable period (or portion thereof)
beginning after the Distribution Date.

“Pre-Distribution Period” means any Taxable period (or portion thereof) ending
on or before the Distribution Date.

“Principal Shareholder Letter” means the letters, dated as of the date hereof,
addressed to Parent by Blackstone and H&F, respectively, and delivered in
connection with the execution of this Agreement.

“Retained Business” means any business now, previously or hereafter conducted by
Parent or any of its Subsidiaries or Affiliates other than the Controlled
Business and any other constituent business of the Core MTS Business (as defined
in the Contribution Agreement).

 

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“Separation Agreement” has the meaning set forth in the recitals.

“SpinCo” has the meaning set forth in the preamble.

“SpinCo Common Stock” means common stock, par value $0.001 per share, of SpinCo.

“SpinCo Group” means SpinCo and each of its Subsidiaries.

“SpinCo SAG” means a group made up of one or more chains of includible
corporations (including SpinCo) connected through stock ownership if SpinCo owns
directly stock meeting the Stock Ownership Requirement in at least one other
includible corporation and stock meeting the Stock Ownership Requirement in each
of the includible corporations (except SpinCo) is owned directly by one or more
of the other includible corporations.

“SpinCo Separate Tax Return” means any Tax Return that is filed or required to
be filed by, or with respect to, any member of the SpinCo Group that is not a
Combined Tax Return.

“Stock Ownership Requirement” means, with respect to a corporation, stock owned
representing at least 80% of the total voting power and at least 80% of the
total value of the stock of such corporation.

“Subsidiary” means, with respect to any specified Person, any other Person a
majority of whose equity interests (whether by voting power or by economic
interest) are at the time directly or indirectly owned by such specified Person;
provided that before the Effective Time, no member of the JV Group shall be a
Subsidiary of Parent, SpinCo or Acquiror.

“Tax” (and the correlative meaning, “Taxes,” “Taxing” and “Taxable”) means
(i) any tax, including any net income, gross income, gross receipts, recapture,
alternative or add-on minimum, sales, use, business and occupation, value-added,
trade, goods and services, ad valorem, franchise, profits, license, business
royalty, withholding, payroll, employment, capital, excise, transfer, recording,
severance, stamp, occupation, premium, property, asset, real estate acquisition,
environmental, custom duty, impost, obligation, assessment, levy, tariff or
other tax, governmental fee or other like assessment or charge of any kind
whatsoever (including, but not limited to, any Escheat Payment), together with
any interest and any penalty, addition to tax or additional amount imposed by a
Taxing Authority; or (ii) any liability of any member of the Parent Group, the
SpinCo Group or the Acquiror Group for the payment of any amounts described in
clause (i) as a result of any express or implied obligation to indemnify any
other Person (other than under the Transaction Documents).

“Tax Advisor” means Davis Polk & Wardwell LLP and Ropes & Gray LLP, or another
nationally recognized tax advisor reasonably acceptable to Acquiror, Parent, and
SpinCo.

“Tax Attribute” means a net operating loss, net capital loss, unused investment
credit, unused foreign tax credit, excess charitable contribution, unused
general business credit, alternative minimum tax credit or any other Tax Item
that could reduce a Tax liability.

 

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“Tax Benefit” means any refund, credit, offset or other reduction in otherwise
required Tax payments.

“Tax Item” means any item of income, gain, loss, deduction, credit, recapture of
credit or any other item that can increase or decrease Taxes paid or payable.

“Tax Proceeding” means any Tax audit, dispute, examination, contest, litigation,
arbitration, action, suits, claim, cause of action, review, inquiry, assessment,
hearing, complaint, demand, investigation or proceeding (whether administrative,
judicial or contractual).

“Tax Receivable Agreements” means the MCK Tax Receivable Agreement and the New
Echo Tax Receivable Agreement.

“Tax-Related Losses” means, with respect to any Taxes imposed pursuant to any
settlement, determination, or judgment, (i) all accounting, legal and other
professional fees, and court costs incurred in connection with such settlement,
determination, or judgment, as well as any other out-of-pocket costs incurred in
connection with such settlement, determination, or judgment and (ii) all
Damages, costs and expenses associated with stockholder litigation or
controversies and any amount paid by any member of the Parent Group, any member
of the SpinCo Group or any member of the Acquiror Group in respect of the
liability of shareholders, whether paid to shareholders or to the IRS or any
other Taxing Authority, in each case, resulting from the failure of the Intended
Tax-Free Treatment of the Internal Restructuring, the Controlled Transfer or the
Distribution.

“Tax Representation Letters (Distribution)” means the representations provided
by Acquiror, SpinCo and Parent as contemplated by Section 4.4(b)(ii) of the
Merger Agreement, in the form delivered in connection with the filing of the
Applicable SEC Filings and acknowledged by Parent and Acquiror by written notice
in connection therewith to be final.

“Tax Representation Letters (Merger)” means the representations provided by
Acquiror and SpinCo as contemplated by Section 4.4(b)(i) of the Merger
Agreement, in the form delivered in connection with the filing of the Applicable
SEC Filings and acknowledged by Parent and Acquiror by written notice in
connection therewith to be final.

“Tax Representation Letters” means, collectively, the Tax Representation Letters
(Distribution) and the Tax Representation Letters (Merger).

“Tax Return” means any Tax return, statement, report, form, election,
certificate, claim or surrender (including estimated Tax returns and reports,
extension requests and forms, and information returns and reports), or statement
or other document or written information filed or required to be filed with any
Taxing Authority, including any amendment thereof (solely for purposes of
Section 4), appendix, schedule or attachment thereto.

“Taxing Authority” means any Governmental Authority (domestic or foreign),
including, without limitation, any state, municipality, political subdivision or
governmental agency responsible for the imposition, assessment, administration,
collection, enforcement or determination of any Tax.

 

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“TEU Purchase Contract” means a prepaid stock purchase contract constituting a
component of a tangible equity unit issued by Acquiror on or about July 1, 2019.

“Transaction Documents” has the meaning set forth in the LLC Agreement.

“Transfer Taxes” means all U.S. federal, state, local or foreign sales, use,
privilege, transfer, documentary, stamp, duties, real estate transfer,
controlling interest transfer, recording and similar Taxes and fees (including
any penalties, interest or additions thereto) imposed upon any member of the
Parent Group, any member of the SpinCo Group, any member of the Acquiror Group
or any member of the JV Group in connection with the Internal Restructuring, the
Controlled Transfer, the Distribution or the Merger.

(b) Each of the following terms is defined in the Section set forth opposite
such term:

 

Term

  

Section

Due Date

  

Section 14(a)

Final Allocation

  

Section 6(b)

Internal Tax-Free Transactions

  

Schedule A

Parent Tax Proceeding

  

Section 16(b)

Past Practices

  

Section 5(f)(i)

Proposed Allocation

  

Section 6(b)

Section 336(e) Election

  

Section 11(a)

Tax Arbiter

  

Section 24

Tax Benefit Recipient

  

Section 8(b)

(c) All capitalized terms used but not defined herein shall have the same
meanings as in the Contribution Agreement. Any term used in this Agreement which
is not defined in this Agreement or the Contribution Agreement shall, to the
extent the context requires, have the meaning assigned to it in the Code or the
applicable Treasury regulations thereunder (as interpreted in administrative
pronouncements and judicial decisions) or in comparable provisions of Applicable
Tax Law.

SECTION 2. Sole Tax Sharing Agreement. Except for this Agreement, the Tax
Receivable Agreements, the Letter Agreement, Section 11.04(e) of the LLC
Agreement and Section 5.15 of the Contribution Agreement, any and all existing
Tax sharing agreements or arrangements, written or unwritten, between any member
of the Parent Group, on the one hand, and any member of the SpinCo Group, the
Acquiror Group or the JV Group, on the other hand, if not previously terminated,
shall be terminated as of the Distribution Date without any further action by
the parties thereto. Following the Distribution, no member of the SpinCo Group,
the Acquiror Group, the JV Group or the Parent Group shall have any further
rights or liabilities thereunder, and, except for the Tax Receivable Agreements,
the Letter Agreement, Section 11.04(e) of the LLC Agreement and Section 5.15 of
the Contribution Agreement, this Agreement shall be the sole Tax sharing
agreement between the members of the SpinCo Group, the Acquiror Group or the JV
Group, on the one hand, and the members of the Parent Group, on the other hand.

 

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SECTION 3. Certain Pre-Closing Matters. From the date hereof until the
Distribution Effective Time, Acquiror shall cooperate in good faith with any
request by Parent to obtain a private letter ruling, closing agreement or
similar determination to the effect that, in whole or in part, the Controlled
Transfer, the Distribution and/or the Merger will receive the Intended Tax-Free
Treatment.

SECTION 4. Allocation of Taxes.

(a) General Allocation Principles. Except as provided in Section 4(c), all Taxes
shall be allocated as follows:

(i) Allocation of Taxes for Combined Tax Returns. Parent shall be allocated all
Taxes reported, or required to be reported, on any Combined Tax Return that any
member of the Parent Group files or is required to file under the Code or other
Applicable Tax Law; provided, however, that (A) to the extent any such Combined
Tax Return includes any Tax Item attributable to any member of the SpinCo Group
or the Controlled Business in respect of any Post-Distribution Period, SpinCo
shall be allocated all Taxes attributable to such Tax Items and (B) to the
extent any such Combined Tax Return includes any Tax Item in respect of any
Pre-Distribution Period, SpinCo shall be allocated such Taxes to the extent a
member of the SpinCo Group is (or, but for an amendment to, or waiver under, the
LLC Agreement occurring after the Distribution, would be) entitled to a Covered
Tax Distribution (for the avoidance of doubt, other than a Covered Tax
Distribution that has already been made) in respect of the Tax Items giving rise
to such Taxes.

(ii) Allocation of Taxes for Separate Tax Returns.

(A) Except for Taxes allocated to SpinCo pursuant to Section 4(a)(ii)(B), Parent
shall be allocated all Taxes reported, or required to be reported, on a Parent
Separate Tax Return or a SpinCo Separate Tax Return.

(B) SpinCo shall be allocated all Taxes reported, or required to be reported, on
(x) a Parent Separate Tax Return with respect to a Pre-Distribution Period to
the extent a member of the SpinCo Group is (or would be) entitled to a Covered
Tax Distribution (for the avoidance of doubt, other than a Covered Tax
Distribution that has already been made) in respect of the Tax Item(s) giving
rise to such Taxes, (y) a SpinCo Separate Tax Return (including, for the
avoidance of doubt, a SpinCo Separate Tax Return filed or required to be filed
in respect of federal, state, local or foreign income Taxes on an affiliated,
consolidated, combined, unitary, fiscal unity or other group basis (including as
permitted by Section 1501 of the Code) with any member of the Acquiror Group)
with respect to a Post-Distribution Period or (z) a SpinCo Separate Tax Return
with respect to a Pre-Distribution Period, but in the case of this clause (z),
only to the extent a

 

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member of the SpinCo Group is (or, but for an amendment to, or waiver under, the
LLC Agreement occurring after the Distribution, would be) entitled to a Covered
Tax Distribution (for the avoidance of doubt, other than a Covered Tax
Distribution that has already been made) in respect of the Tax Item(s) giving
rise to such Taxes.

(b) Allocation Conventions.

(i) All Taxes allocated pursuant to Section 4(a) shall be allocated in
accordance with the Closing of the Books Method; provided, however, that if
Applicable Tax Law does not permit a SpinCo Group member to close its Taxable
year on the Distribution Date, the Tax attributable to the operations of the
members of the SpinCo Group for any Pre-Distribution Period shall be the Tax
computed using a hypothetical closing of the books consistent with the Closing
of the Books Method.

(ii) Any Tax Item of SpinCo, Acquiror or any member of their respective Groups
arising from a transaction engaged in outside the ordinary course of business on
the Distribution Date after the Distribution Effective Time shall be properly
allocable to SpinCo and any such transaction by or with respect to SpinCo,
Acquiror or any member of their respective Groups occurring after the
Distribution Effective Time shall be treated for all Tax purposes (to the extent
permitted by Applicable Tax Law) as occurring at the beginning of the day
following the Distribution Date in accordance with the principles of Treasury
regulations Section 1.1502-76(b) (assuming no election is made under
Section 1.1502-76(b)(2)(ii) of the Treasury regulations (relating to a ratable
allocation of a year’s Tax Items)); provided that the foregoing shall not
include any action that is undertaken pursuant to the Internal Restructuring,
the Controlled Transfer, the Distribution, the Merger or the Transaction
Documents.

(c) Special Allocation Rules. Notwithstanding any other provision in this
Section 4, the following Taxes shall be allocated as follows:

(i) Transfer Taxes. Transfer Taxes (other than those attributable to the
Internal Restructuring) shall be allocated to SpinCo. Any Transfer Taxes
attributable to the Internal Restructuring shall be allocated to Parent.

(ii) JV Group Taxes. JV Group Taxes shall be allocated to (A) SpinCo, if paid by
a member of the Parent Group pursuant to Section 5(g) and (B) the JV, otherwise.

(iii) Distribution Taxes and Tax-Related Losses.

(A) Any liability for Distribution Taxes (and any associated Tax-Related Losses)
which would not have been incurred but for one or more Echo Disqualifying
Actions (as determined by treating any acquisition of capital stock of Parent,
SpinCo or Acquiror that constitutes a Parent Disqualifying Action as if such
acquisition did not occur) shall be allocated to SpinCo, subject to
Section 4(c)(iii)(B) and Section 4(c)(iii)(C).

 

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(B) Any liability for Distribution Taxes (and any associated Tax-Related Losses)
solely by reason of the application of Section 355(e) which would not have been
incurred if, instead of the occurrence of one or more Debt Exchanges that
exceeds the MCK Cushion Amount, 100% of the SpinCo Common Stock had been
distributed in a Split-Off Exchange or Spin-Off on the Distribution Date to
Persons whose acquisitions of such SpinCo Common Stock were disregarded by
reason of Section 355(e)(3)(A) of the Code, shall be allocated to Parent.

(C) Any liability for Distribution Taxes (and any associated Tax-Related Losses)
not described in Section 4(c)(iii)(B) which (x) would not have been incurred but
for the occurrence of both one or more Echo Disqualifying Actions and one or
more Parent Disqualifying Actions, or which (y) both (I) would not have been
incurred but for the occurrence of one or more Echo Disqualifying Actions (as
determined by treating any Parent Disqualifying Actions as if such Parent
Disqualifying Actions did not occur) and (II) would not have been incurred but
for the incurrence of one or more Parent Disqualifying Actions (as determined by
treating any Echo Disqualifying Actions as if such Echo Disqualifying Actions
did not occur), shall be allocated to Parent.

(D) Any liability for Distribution Taxes (and any associated Tax-Related Losses)
not described in Section 4(c)(iii)(A), Section 4(c)(iii)(B) or
Section 4(c)(iii)(C) shall be allocated to Parent.

(iv) Internal Restructuring Taxes. Notwithstanding any other provision in this
Section 4, all Taxes with respect to the Internal Restructuring shall be
allocated to Parent, except that any Taxes with respect to the Internal
Restructuring to the extent attributable to the failure by the SpinCo Group to
preserve the Intended Tax-Free Treatment of the transaction described in clause
(iv) of the definition of Intended Tax-Free Treatment, as a result of (a) the
failure of the SpinCo Group after the Effective Time to continue the historic
business of the SpinCo Group or use a significant portion of the SpinCo Group’s
business assets in a business, except as a result of any action that any member
of the SpinCo Group was, beginning at any time prior to the Effective Time,
contractually bound to take (including pursuant to any Transaction Document or
Exit Transaction Document), (b) the breach of the representations and covenants
of the Acquiror Group contained in this Agreement or (c) the breach of the
covenants contained in this Agreement after the Effective Time by any member of
the SpinCo Group, in each case, shall be allocated to SpinCo.

 

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SECTION 5. Preparation and Filing of Tax Returns.

(a) Parent Group Combined Tax Returns.

(i) Parent shall prepare and file, or cause to be prepared and filed, Combined
Tax Returns for which a member of the Parent Group is required or, subject to
Section 5(f)(iv), permitted, to file a Combined Tax Return. Each member of any
such Combined Group shall execute and file such consents, elections and other
documents as may be required or requested by Parent in connection with the
filing of such Combined Tax Returns. Items of income, gain, loss, deduction and
credit of the JV for the taxable year which includes the Distribution Date shall
be allocated to the Pre-Distribution Period and the Post-Distribution Period in
accordance with Treasury regulations Section 1.1502-76(b)(2)(vi) (and any
similar state or local provision of Applicable Tax Law). Parent and Acquiror
shall cooperate in determining the allocation described in the preceding
sentence.

(ii) The parties and their respective Affiliates shall elect to close the
Taxable year of each SpinCo Group member on the Distribution Date, to the extent
permitted by Applicable Tax Law. For the avoidance of doubt, no member of the JV
Group shall be treated as a member of the Spinco Group for this purpose.

(b) SpinCo Separate Tax Returns.

(i) Tax Returns to Be Prepared by Parent. Parent shall prepare (or cause to be
prepared) and, to the extent permitted by Applicable Law, file (or cause to be
filed) all SpinCo Separate Tax Returns that relate in whole or in part to any
Pre-Distribution Period for which Parent is liable for any Taxes not allocated
to SpinCo under this Agreement (excluding, for the avoidance of doubt, IRS Form
1065 (U.S. Return of Partnership Income) of JV and corresponding state or local
Tax Returns (each, a “JV Income Tax Return”)); provided, however, that with
respect to any such Tax Return that is prepared by Parent but required to be
filed by a member of the Acquiror Group under Applicable Law, Parent shall
provide such Tax Returns to Acquiror at least thirty (30) days prior to the due
date for filing such Tax Returns (taking into account any applicable extension
periods) with the amount of any Taxes shown as due thereon, and Acquiror shall
execute and file (or cause to be executed and filed) the Tax Returns.

(ii) Tax Returns to be Prepared by Acquiror. Acquiror shall prepare and file (or
cause to be prepared and filed) all SpinCo Separate Tax Returns that are not
described in Section 5(b)(i) (including JV Income Tax Returns).

(c) Provision of Information; Timing. SpinCo and Acquiror shall maintain all
necessary information for Parent (or any of its Affiliates) to file any Tax
Return that Parent is required or permitted to file under this Section 5, and
shall provide to Parent, upon reasonable request, all such necessary information
to which it has access in accordance with the Parent Group’s past practice.
Parent shall maintain all necessary information for Acquiror (or any of its
Affiliates) to file any Tax Return that Acquiror is required or permitted to
file under this Section 5, and shall provide Acquiror with all such necessary
information in accordance with the SpinCo Group’s past practice.

(d) Review of SpinCo Separate Tax Returns. The party that is required to prepare
a SpinCo Separate Tax Return (other than a SpinCo Separate Tax Return that
relates solely to a Post-Distribution Period and/or to JV Group Taxes) that is
required to be filed after the Distribution Date shall submit a draft of such
Tax Return to the non-preparing party at least sixty

 

16

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(60) days prior to the earlier of (i) the due date for the filing of such Tax
Return (taking into account any applicable extensions), or (ii) if applicable,
the date on which such Tax Return must be provided by Parent to Acquiror under
Section 5(b)(i). The non-preparing party shall have the right to review such Tax
Return, and to submit to the preparing party any reasonable changes to such Tax
Return no later than thirty (30) days prior to the earlier of (i) the due date
for the filing of such Tax Return or (ii) if applicable, the date on which such
Tax Return must be provided by Parent to Acquiror under Section 5(b)(i) (and the
preparing party agrees to consider in good faith any such changes submitted).
The parties agree to consult and to attempt to resolve in good faith any issues
arising as a result of the review of any such Tax Return. If the parties are
unable to resolve any such issues, the matter shall be submitted to the Tax
Arbiter pursuant to Section 24.

(e) Review and Approval of JV Income Tax Returns. Acquiror shall submit a draft
of any JV Income Tax Return that it is required to prepare and file pursuant to
Section 5(b)(ii) to Parent at least thirty (30) days prior to the due date for
the filing of such JV Income Tax Return (taking into account any applicable
extensions). Parent shall have the right to review, comment on and approve any
such JV Income Tax Return, such approval not to be unreasonably withheld,
conditioned, or delayed, and Acquiror agrees to consider in good faith any such
changes submitted by Parent. The parties agree to consult and to attempt to
resolve in good faith any issues arising as a result of the review of any such
JV Income Tax Return. If the parties are unable to resolve any such issues, the
matter shall be submitted to the Tax Arbiter pursuant Section 24.

(f) Special Rules Relating to the Preparation of Tax Returns.

(i) General Rule. Except as otherwise required by law, Parent shall prepare (or
cause to be prepared) any Tax Return for which it is responsible under this
Section 5 in accordance with past practices, permissible accounting methods,
elections or conventions (“Past Practices”) used by the members of the Parent
Group and the members of the SpinCo Group prior to the Distribution Date with
respect to such Tax Return, and to the extent any items, methods or positions
are not covered by Past Practices, in accordance with reasonable Tax accounting
practices selected by Parent. With respect to any Tax Return that Acquiror has
the obligation and right to prepare, or cause to be prepared, under this
Section 5 (other than a SpinCo Separate Tax Return that relates solely to a
Post-Distribution Period and/or to JV Group Taxes), except as otherwise required
by law or with the consent of Parent (such consent not to be unreasonably
withheld, conditioned, or delayed), such Tax Return shall be prepared in
accordance with Past Practices used by the members of the Parent Group and the
members of the SpinCo Group (or, in the case of a JV Income Tax Return, JV)
prior to the Distribution Date with respect to such Tax Return, and, with
respect to any such Tax Return other than a JV Income Tax Return, to the extent
any items, methods or positions are not covered by Past Practices, in accordance
with reasonable Tax accounting practices selected by Acquiror.

 

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(ii) Consistency with Intended Tax-Free Treatment.

(A) The parties shall report the Internal Restructuring in the manner determined
by Parent; provided that (x) Parent communicates its treatment of the Internal
Restructuring to Acquiror no fewer than thirty (30) days prior to the due date
(taking into account any applicable extensions) for filing an applicable Tax
Return that reflects the Internal Restructuring (y) such treatment is supported
by substantial authority (within the meaning of Section 6662 of the Code), as
determined by Acquiror in its reasonable discretion, in each case, unless, and
then only to the extent, an alternative position is required pursuant to a Final
Determination, and (z) a member of the Acquiror Group may book reserves or make
disclosures relating to the Internal Restructuring if required to do so under
applicable accounting principles or Tax law.

(B) The parties shall report the Controlled Transfer, the Distribution and the
Merger for all Tax purposes in a manner consistent with the Intended Tax-Free
Treatment unless, and then only to the extent, an alternative position is
required pursuant to a Final Determination.

(iii) SpinCo Separate Tax Returns. With respect to any SpinCo Separate Tax
Return for which Acquiror is responsible pursuant to this Agreement, Acquiror
and the other members of the Acquiror Group shall include such Tax Items in such
SpinCo Separate Tax Return in a manner that is consistent with the inclusion of
such Tax Items in any related Tax Return for which Parent is responsible to the
extent such Tax Items are allocated in accordance with this Agreement.

(iv) Election to File Combined Tax Returns. Parent shall have sole discretion to
file any Combined Tax Return if the filing of such Tax Return is elective under
Applicable Tax Law.

(v) Preparation of Transfer Tax Returns. The Company required under Applicable
Tax Law to file any Tax Returns in respect of Transfer Taxes shall prepare and
file (or cause to be prepared and filed) such Tax Returns. If required by
Applicable Tax Law, Parent, SpinCo and Acquiror shall, and shall cause their
respective Subsidiaries to, cooperate in preparing and filing, and join the
execution of, any such Tax Returns.

(g) Payment of Taxes. Parent shall pay (or cause to be paid) to the proper
Taxing Authority (or to Acquiror with respect to any SpinCo Separate Tax Return
prepared by Parent but required to be filed by a member of the Acquiror Group
under Applicable Tax Law) the Tax shown as due on any Tax Return for which a
member of the Parent Group is responsible under this Section 5, and the members
of the JV Group shall be jointly and severally liable to pay to Acquiror, and
Acquiror shall pay (or cause to be paid) to the proper Taxing Authority the Tax
shown as due on any Tax Return for which a member of the Acquiror Group is
responsible under this Section 5. If any member of the Parent Group is required
to make a payment to a Taxing Authority for JV Group Taxes, Acquiror shall pay
the amount of such Taxes to Parent in accordance with Section 12 and Section 13.
If any member of the Acquiror Group is required to make a payment to a Taxing
Authority for Taxes allocated to Parent under Section 4, Parent shall pay the
amount of such Taxes to Acquiror in accordance with Section 12 and Section 13.

 

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SECTION 6. Apportionment of Earnings and Profits and Tax Attributes.

(a) Tax Attributes arising in a Pre-Distribution Period will be allocated to
(and the benefits and burdens of such Tax Attributes will inure to) the members
of the Parent Group and the members of the SpinCo Group in accordance with the
Code, Treasury regulations and any other Applicable Tax Law, and, in the absence
of controlling legal authority or unless otherwise provided under this
Agreement, Tax Attributes shall be allocated to the legal entity that created
such Tax Attributes.

(b) On or before the earlier of (i) eighteen (18) months after the Distribution
Date or (ii) sixty (60) days prior to the extended due date for the first U.S.
federal income Tax Return of the Acquiror Group following the Distribution Date,
Parent shall deliver to Acquiror its determination in writing of the portion, if
any, of any earnings and profits, Tax Attributes, overall foreign loss or other
affiliated, consolidated, combined, unitary, fiscal unity or other group basis
Tax Attribute which is allocated or apportioned to the members of the SpinCo
Group under Applicable Tax Law and this Agreement (“Proposed Allocation”).
Acquiror shall have forty-five (45) days to review the Proposed Allocation and
provide Parent any comments with respect thereto, and Parent agrees to consider
such comments in good faith. If Acquiror either provides no comments or provides
comments to which Parent agrees in writing, such resulting determination will
become final (“Final Allocation”). If Acquiror provides comments to the Proposed
Allocation and Parent does not agree with such comments, the Final Allocation
will be determined in accordance with Section 24. All members of the Parent
Group and Acquiror Group shall prepare all Tax Returns in accordance with the
Final Allocation. In the event of an adjustment to the earnings and profits, any
Tax Attributes, overall foreign loss or other affiliated, consolidated,
combined, unitary, fiscal unity or other group basis Tax Attribute, Parent shall
promptly notify Acquiror in writing of such adjustment. For the avoidance of
doubt, Parent shall not be liable to any member of the Acquiror Group for any
failure of any determination under this Section 6(b) to be accurate under
Applicable Tax Law; provided that such determination was made in good faith.

(c) Except as otherwise provided herein, to the extent that the amount of any
Tax Attribute is later reduced or increased by a Taxing Authority or as a result
of a Tax Proceeding, such reduction or increase shall be allocated to the
Company to which such Tax Attribute was allocated pursuant to this Section 6, as
agreed by the parties.

SECTION 7. Utilization of Tax Attributes.

(a) Amended Returns. Any amended Tax Return or claim for a refund with respect
to any member of the SpinCo Group may be made only by the party responsible for
preparing the original Tax Return with respect to such member of the SpinCo
Group pursuant to Section 5. Such party shall not file or cause to be filed any
such amended Tax Return or claim for a refund without the prior written consent
of the other party, which consent shall not be unreasonably withheld,
conditioned or delayed, if such filing, assuming it is accepted, could
reasonably be expected to change the Tax liability of such other party (or any
Affiliate of such other party) for any Taxable period (including, for the
avoidance of doubt, the amount of any Tax Attributes allocable under Section 6
to such other party (or any Affiliate of such other party)).

 

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(b) Carryback of Tax Attributes.

(i) To the extent permitted by Applicable Tax Law, Acquiror shall cause the
SpinCo Group to elect to forego carrybacks of any Tax Attributes of the SpinCo
Group to a Pre-Distribution Period.

(ii) If Acquiror is unable to forego carrybacks of any Tax Attributes of the
SpinCo Group to a Pre-Distribution Period, the Parent Group shall, at the
request of Acquiror and at Acquiror’s sole expense, file any amended Tax Returns
reflecting such carryback (unless such filing, assuming it is accepted, could
reasonably be expected to increase by more than a de minimis amount, the Tax
liability of Parent or any of its Affiliates for any Taxable period). If the
Parent Group (or any member thereof) receives (or realizes) a refund as a result
of such a carryback, Parent shall promptly remit the amount of such refund to
Acquiror in accordance with Section 8(b).

(c) Carryforwards to Separate Tax Returns. If a portion or all of any Tax
Attribute is allocated to a member of a Combined Group pursuant to Section 6,
and is carried forward to a SpinCo Separate Tax Return, any Tax Benefits arising
from such carryforward shall be retained by the Acquiror Group. If a portion or
all of any Tax Attribute is allocated to a member of a Combined Group pursuant
to Section 6, and is carried forward to a Parent Separate Tax Return, any Tax
Benefits arising from such carryforward shall be retained by the Parent Group.

SECTION 8. Tax Benefits.

(a) Parent Tax Benefits. Parent shall be entitled to any Tax Benefits
(including, in the case of any refund received, any interest thereon actually
received) received by any member of the Parent Group or any member of the SpinCo
Group, other than any Tax Benefits (or any amounts in respect of Tax Benefits)
to which SpinCo or Acquiror is entitled pursuant to Section 8(b). Neither SpinCo
nor Acquiror shall be entitled to any Tax Benefits received by any member of the
Parent Group or the SpinCo Group, except as set forth in Section 8(b).

(b) SpinCo and Acquiror Tax Benefits. SpinCo or Acquiror, as the case may be,
shall be entitled to any Tax Benefits (including, in the case of any refund
received, any interest thereon actually received) received (i) by any member of
the Parent Group or any member of the SpinCo Group after the Distribution Date
with respect to any Tax allocated to the JV or a member of the SpinCo Group
under this Agreement (including, for the avoidance of doubt, any amounts
allocated to the JV pursuant to Section 4(c)(iii)), or (ii) by a member of the
SpinCo Group in respect of a Post-Distribution Period.

(c) A Company receiving (or realizing) a Tax Benefit (a “Tax Benefit Recipient”)
to which another Company is entitled hereunder shall pay over the amount of such
Tax Benefit (including interest received from the relevant Taxing Authority, but
net of any Taxes imposed with respect to such Tax Benefit and any other
reasonable costs) within thirty (30) days of receipt thereof (or from the due
date for payment of any Tax reduced thereby); provided, however, that the other
Company, upon the request of such Tax Benefit Recipient, shall repay the amount
paid to the other Company (plus any penalties, interest or other charges imposed
by the relevant Taxing Authority) in the event that, as a result of a subsequent
Final Determination, a Tax Benefit that gave rise to such payment is
subsequently disallowed.

 

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SECTION 9. Certain Representations and Covenants.

(a) Representations.

(i) Acquiror and each other member of the Acquiror Group represents that as of
the date hereof, and covenants that as of immediately after the Closing, except
as expressly described in the Exit Transaction Documents, Acquiror has no plan
or intention:

(A) to liquidate or merge or consolidate with any other Person any member of the
SpinCo Group or the JV Group subsequent to the Closing, in each case, except
(x) as provided for under the Merger Agreement or (y) liquidations, mergers, or
consolidations of members of the JV Corporate Group with other members of the JV
Corporate Group;

(B) to sell or otherwise dispose of any material asset of (i) the Controlled
Business held by any member of the SpinCo Group to a Person other than a member
of the SpinCo SAG or (ii) the Controlled Business held by any member of the JV
Group to a Person other than another member of the JV Group that is a direct or
indirect wholly owned Subsidiary of the JV, in each case, subsequent to the
Closing and except for (v) sales or dispositions by members of the JV Corporate
Group to other members of the Acquiror Group, (w) sales or dispositions in the
ordinary course of business, (x) any cash paid to acquire assets in arm’s length
transactions, (y) transactions that are disregarded for U.S. federal Tax
purposes and (z) mandatory or optional repayment or prepayment of indebtedness;

(C) to take or fail to take any action in a manner that is inconsistent with the
written information and representations furnished by SpinCo or Acquiror to the
Tax Advisors in connection with the Tax Representation Letters; ;

(D) to repurchase stock of Acquiror (except for Historic Acquiror Stock) other
than in a manner that satisfies the requirements of Section 4.05(1)(b) of IRS
Revenue Procedure 96-30 (as in effect prior to the amendment of such Revenue
Procedure by IRS Revenue Procedure 2003-48) and consistent with any
representations made to the Tax Advisors in connection with the Tax
Representation Letters ; or

 

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(E) to enter into any negotiations, agreements or arrangements with respect to
transactions or events (including stock issuances, pursuant to the exercise of
options or otherwise, option grants, the adoption of, or authorization of shares
under, a stock option plan, capital contributions, or acquisitions, but not
including any action expressly contemplated by the Transaction Documents) that
could reasonably be expected (assuming no Parent Disqualifying Action occurs) to
cause the Distribution to be treated as part of a plan (within the meaning of
Section 355(e) of the Code) pursuant to which one or more Persons acquire
directly or indirectly SpinCo stock representing a 50% or greater interest
within the meaning of Section 355(d)(4) of the Code; provided that no
negotiations, agreements or arrangements with respect to transactions or events
by Acquiror or any Member of Acquiror Group shall result in a breach of this
Section 9(a)(i)(E) if (a) the percentage equal to the quotient of (I) the sum of
(A) the amount of Acquiror Capital Stock that is, or could be, directly or
indirectly acquired as a result of all such negotiations, agreements or
arrangements, and (B) the product of (x) the Cushion Starting Percentage and
(y) the total Acquiror Capital Stock outstanding immediately after the Merger,
divided by (II) the sum of (A) the amount of Acquiror Capital Stock that would
be issued in such transactions or events, and (B) the total Acquiror Capital
Stock outstanding immediately after the Merger, would not, in the aggregate,
exceed (b) the Echo Cushion Percentage.

(ii) Each member of the Acquiror Group represents that:

(A) as of the date hereof, the only outstanding Acquiror Capital Stock is
(x) shares of Acquiror Common Stock, in number equal to 127,429,058, (y) equity
or equity-linked compensation awards under the HCIT Holdings Inc. Amended and
Restated 2009 Equity Incentive Plan and the Change Healthcare Inc. 2019 Omnibus
Incentive Plan, pursuant to which 21,670,595 shares of Acquiror Common Stock may
vest or be issued and (z) purchase contracts that are components of the 6.0%
Tangible Equity Units, in number equal to 5,137,345 and pursuant to which a
maximum number of 19,758,743 shares of Acquiror Common Stock (subject to any
required settlement rate adjustment occurring after the date hereof) may be
issued; and

(B) from the date hereof to the Effective Time, no other Acquiror Capital Stock
will be issued.

(iii) Each member of the Parent Group represents that:

(A) as of the date hereof, and as of the Effective Time, neither Parent nor
SpinCo has had “substantial negotiations” (within the meaning of Treasury
regulations Section 1.355-7(h)(1)(iv)) during the two-year period ending on the
Effective Time with any Person (other than Acquiror or its Affiliates and their
respective financial, legal and tax advisors, consultants, accountants, and
other representatives and agents, in each case in their capacity as advisors,
representatives, or agents of Acquiror or its Affiliates) regarding any
acquisition of SpinCo stock or of a significant portion of the assets of the JV
Group.

 

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(B) The Distribution is not and never has been motivated to any extent by a
desire on the part of any member of the Parent Group to facilitate a sale or
other disposition of SpinCo, other than the Merger.

(C) The Distribution is not and never has been motivated to any extent by a
desire on the part of any member of the Parent Group to facilitate acquisitions
of any stock of SpinCo, other than (i) the Merger, (ii) issuing stock of SpinCo
to management and employees as incentive compensation, (iii) the use of stock of
SpinCo in Debt Exchanges, or (iv) enhancing the ability of SpinCo to use SpinCo
stock as an acquisition currency.

(D) At the time members of the Parent Group entered into the Contribution
Agreement, Parent was not aware of any Person having a plan or intention to
effect a transaction (other than the Distribution or the Merger) that would
involve a change of control of SpinCo.

(b) Covenants. In each case from and after the Effective Time:

(i) Each of Parent, SpinCo and Acquiror agrees that it shall not, and it will
not permit any member of its respective Group to, take or fail to take, as
applicable, any action that constitutes a Disqualifying Action described in the
definitions of Parent Disqualifying Action (in the case of Parent and the Parent
Group) and Echo Disqualifying Action (in the case of Acquiror for itself and as
a successor to SpinCo and for the Acquiror Group), as applicable.

(ii) Each of SpinCo and Acquiror will not, and will not permit any other member
of their respective Groups to, take or fail to take any action that is
inconsistent with the information and representations furnished by SpinCo or
Acquiror to the Tax Advisors in connection with the Tax Representation Letters.

(iii) No Person Under the Control of Blackstone will join with any BX Excluded
Person in making one or more coordinated acquisitions or dispositions of the
stock of Acquiror, except for coordinated dispositions of Acquiror stock
(i) consisting solely of Historic Acquiror Stock and (ii) resulting from public
offerings by Acquiror or other issuances by Acquirer otherwise permitted by this
Agreement.

(iv) No Person Under the Control of H&F will join with any H&F Excluded Person
in making one or more coordinated acquisitions or dispositions of the stock of
Acquiror, except for coordinated dispositions of Acquiror stock (i) consisting
solely of Historic Acquiror Stock and (ii) resulting from public offerings by
Acquiror or other issuances by Acquiror otherwise permitted by this Agreement.

 

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(v) Each of SpinCo, Acquiror and each other member of their respective Groups
covenants to Parent that, without the prior written consent of Parent, during
the two-year period following the Effective Time, except as described in the
Exit Transaction Documents:

(A) SpinCo will (w) maintain its status as a company engaged in the Controlled
Business for purposes of Section 355(b)(2) of the Code, (x) not engage in any
transaction that would result in it ceasing to be a company engaged in the
Controlled Business for purposes of Section 355(b)(2) of the Code, (y) cause
each other member of the SpinCo Group whose activities are relied upon for
purposes of qualifying the Distribution for the Intended Tax-Free Treatment to
take such actions as may be required to maintain SpinCo’s status as a company
engaged in the Controlled Business for purposes of Section 355(b)(2) of the Code
and any such other Applicable Tax Law and (z) not engage in any transaction or
permit any other member of the SpinCo Group to engage in any transaction that
would result in SpinCo ceasing to be a company engaged in the Controlled
Business for purposes of Section 355(b)(2) of the Code or such other Applicable
Tax Law, taking into account Section 355(b)(3) of the Code for purposes of each
of clauses (w) through (z) hereof;

(B) neither SpinCo nor Acquiror will repurchase stock of Acquiror (except for
Historic Acquiror Stock) in a manner contrary to the requirements of
Section 4.05(1)(b) of IRS Revenue Procedure 96-30 (as in effect prior to the
amendment of such Revenue Procedure by IRS Revenue Procedure 2003-48) or
inconsistent with any representations made by SpinCo to the Tax Advisors in
connection with the Tax Representation Letters;

(C) neither Acquiror nor SpinCo will, or will agree to, merge, consolidate or
amalgamate with any other Person (except as provided for under the Merger
Agreement), unless, in the case of a merger or consolidation, Acquiror or SpinCo
is the survivor of the merger, consolidation or amalgamation;

(D) no member of the Acquiror Group will, or will agree to, sell or otherwise
issue to any Person except as provided for under the Merger Agreement, any
Equity Interests of Acquiror or of any member of the Acquiror Group; provided,
however, that (i) Acquiror shall be permitted to adopt, and issue stock pursuant
to, a stockholder rights plan, (ii) Acquiror may issue an unlimited amount of
Equity Interests that satisfy Safe Harbor VIII (relating to acquisitions in
connection with a person’s performance of services) or Safe Harbor IX (relating
to acquisitions by a retirement plan of an employer) of Treasury regulations
Section 1.355-7(d), and (iii) Acquiror may issue Equity Interests not described
in clauses (i) or (ii) above to the extent such issuances would not cause
(a) the percentage equal to the quotient of (I) the sum of (A) the amount of
such issuances taken together in the aggregate with all Echo Tainted Stock, and
(B) the product of (x) the Cushion Starting Percentage and (y) the total
Acquiror Capital Stock outstanding immediately after the Merger, divided by
(II) the sum of (A) the amount of such issuances taken together in the aggregate
with all Echo Tainted Stock, and (B) the total Acquiror Capital Stock
outstanding immediately after the Merger, to exceed (b) the Echo Cushion
Percentage;

 

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(E) no member of the Acquiror Group will agree to enter into (i) any transaction
or series of transactions, as a result of which one or more persons would
directly or indirectly acquire, within the meaning of Section 355(e), a number
of shares of Acquiror and/or SpinCo capital stock that would, when combined with
(ii) any other direct or indirect acquisitions of SpinCo capital stock pertinent
for purposes of Section 355(e) of the Code (including the Merger) that have
already occurred or will occur simultaneously with the transaction described in
clause (i), reasonably be expected to result in Distribution Taxes; provided
that, notwithstanding the foregoing, SpinCo and/or Acquiror shall be permitted
to (x) adopt, and issue stock pursuant to, a stockholder rights plan or
(y) issue securities that satisfy Safe Harbor VIII (relating to acquisitions in
connection with a person’s performance of services) or Safe Harbor IX (relating
to acquisitions by a retirement plan of an employer) of Treasury regulations
Section 1.355-7(d); provided further that any clarification of, or change in,
the statute or regulations promulgated under Section 355(e) of the Code shall be
incorporated in the restrictions in this clause (E) and the interpretation
thereof; as of the date of issuance or promulgation of such clarification or
change (or, if later, the effective date thereof);

(F) no member of the Acquiror Group will amend its certificate of incorporation
(or other organizational documents), or take any other action, whether through a
stockholder vote or otherwise, affecting the voting rights of the Equity
Interests of SpinCo or Acquiror (including, without limitation, through the
conversion of one class of Equity Interests of SpinCo or Acquiror into another
class of Equity Interests of SpinCo or Acquiror); and

(G) no member of the Acquiror Group will take, or permit to be taken, any
action, whether by merger, liquidation, the making of an entity classification
election or otherwise, that would result in JV ceasing to be treated as a
partnership for U.S. federal income tax purposes.

(c) Acquiror Covenants Exceptions. Notwithstanding the provisions of
Section 9(b), SpinCo, Acquiror and the other members of their respective Groups
may:

(i) pay cash to acquire assets in arm’s length transactions, engage in
transactions that are disregarded for U.S. federal Tax purposes, and make
mandatory or optional repayments or prepayments of indebtedness;

(ii) dispose of assets of members of the JV Corporate Group;

(iii) dispose of assets (other than those described in Section 9(c)(i) or
Section 9(c)(ii)) that could otherwise be subject to Section 9(b)(i), (b)(ii) or
(b)(v) if the aggregate fair value of all such assets does not exceed
$125 million; or

 

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(iv) in the case of any other action that would reasonably be expected to be
inconsistent with the covenants contained in (b), if either: (A) SpinCo or
Acquiror notifies Parent of its proposal to take such action and Acquiror and
Parent obtain a ruling from the IRS to the effect that such action will not
affect the Intended Tax-Free Treatment (a “Favorable Tax Ruling”), provided that
Acquiror agrees in writing to bear any expenses associated with obtaining such a
ruling and, provided further that the Acquiror Group shall not be relieved of
any liability under Section 12(a) of this Agreement by reason of seeking or
having obtained such a ruling; or (B) SpinCo or Acquiror notifies Parent of its
proposal to take such action and obtains an unqualified opinion of counsel or
from a “Big Four” accounting firm (x) from a Tax advisor recognized as an expert
in federal income Tax matters and reasonably acceptable to Parent, (y) on which
Parent may rely and (z) to the effect that such action will not affect the
Intended Tax-Free Treatment (assuming that the Internal Restructuring, the
Controlled Transfer, the Distribution and the Merger would otherwise qualify for
the Intended Tax-Free Treatment) (a “Favorable Tax Opinion”), provided further
that the Acquiror Group shall not be relieved of any liability under
Section 12(a) of this Agreement by reason of having obtained a Favorable Tax
Opinion.

SECTION 10. Procedures Relating to Opinions and Rulings. If a member of the
Acquiror Group notifies Parent that it desires to take an action that would
reasonably be expected to be inconsistent with the covenants contained in
Section 9(b), then the Parent Group shall cooperate in good faith with the
Acquiror Group to obtain the Favorable Tax Ruling and/or a Favorable Tax
Opinion. The Acquiror Group shall reimburse Parent for all reasonable
out-of-pocket expenses incurred by the Parent Group in connection with such
cooperation within fifteen (15) Business Days of receipt of an invoice from
Parent therefor.

SECTION 11. Protective Section 336(e) Elections.

(a) Section 336(e) Election. Pursuant to Treasury regulations Sections
1.336-2(h)(1)(i) and 1.336-2(j), Parent, Acquiror and SpinCo agree that (if and
to the extent determined by Parent) Parent shall make a timely protective
election under Section 336(e) of the Code and the Treasury regulations issued
thereunder for any member of the SpinCo Group that is a domestic corporation for
U.S. federal income Tax purposes with respect to the Distribution (a
“Section 336(e) Election”). It is intended that a Section 336(e) Election will
have no effect unless the Distribution is a “qualified stock disposition,” as
defined in Treasury regulations Section 1.336(e)-1(b)(6), by reason of the
application of Treasury regulations Section 1.336-1(b)(5)(i)(B) or Treasury
regulations Section 1.336-1(b)(5)(ii).

(b) Parent TRA. If and to the extent that there is a Disqualifying Action and
the resulting Taxes (including any Taxes attributable to the Section 336(e)
Election) are allocated to Parent pursuant to Section 4, (i) Parent shall be
entitled to periodic payments from SpinCo equal to the product of (x) 85% of the
tax savings arising from the step-up in tax basis resulting from the
Section 336(e) Election and (y) the percentage of such Taxes that are allocated
to Parent pursuant to Section 4, and (ii) the Parties shall negotiate in good
faith the terms of a tax receivable agreement to govern the calculation of such
payments, with it being agreed that the terms of such agreement shall be
substantially similar to the terms of the MCK Tax Receivable Agreement; provided
that any such tax saving in clause (i) shall be determined using a “with and
without” methodology (treating any deductions or amortization attributable to
the step-up in tax basis resulting from the Section 336(e) Election as the last
items claimed for any taxable year, including after the utilization of any
carryforwards).

 

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SECTION 12. Indemnities.

(a) Acquiror Indemnity to Parent. The Acquiror as successor to SpinCo shall be
obligated to indemnify (and the JV and each other member of the JV Group shall
jointly and severally be obligated to pay to Acquiror all amounts necessary to
allow Acquiror to indemnify) Parent and the other members of the Parent Group
against, and hold them harmless, without duplication, from (i) any payments by
Parent of any Tax liability and any associated Tax-Related Losses allocated to
SpinCo pursuant to Section 4; provided that, the amount of such indemnity shall
be limited to the amount of any payment of Tax or Tax Related Losses required to
be made by Parent or any member of the Parent Group and, for the avoidance of
doubt, shall be calculated without regard to any harm to Parent or any member of
the Parent Group relating to any equity or other interests in Parent or any
other member of the Parent Group directly or indirectly in the JV Group or in
the Acquiror Group and (ii) notwithstanding any provisions of this Agreement,
the Separation Agreement, the Merger Agreement, or otherwise, any Damages
arising from or relating to, directly or indirectly, whether by operation of the
provisions of this Agreement, the Separation Agreement, the Merger Agreement or
otherwise, any failure of the Effective Time to occur immediately following the
Distribution Effective Time primarily as a result of any failure by Acquiror to
perform its obligation to close the Merger in accordance with the Merger
Areement.

(b) Parent Indemnity to Acquiror. Except in the case of any liabilities
described in Section 12(a), Parent and each other member of the Parent Group
will jointly and severally indemnify Acquiror and the other members of the
Acquiror Group against, and hold them harmless, without duplication, from:

(i) any Tax liability and any associated Tax-Related Losses allocated to Parent
pursuant to Section 4;

(ii) any Taxes imposed on any member of the SpinCo Group or Acquiror Group under
Treasury regulations Section 1.1502-6 (or similar or analogous provision of
state, local or foreign law) as a result of any such member being or having been
a member of a Combined Group; and

(iii) notwithstanding any provisions of this Agreement, the Separation
Agreement, the Merger Agreement, or otherwise, any Damages arising from or
relating to, directly or indirectly, whether by operation of the provisions of
this Agreement, the Separation Agreement, the Merger Agreement or otherwise, any
failure of the Effective Time to occur immediately following the Distribution
Effective Time primarily as a result of any failure by MCK or SpinCo to perform
its obligation to close the Merger in accordance with the Merger Agreement.

 

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(c) Discharge of Indemnity. Acquiror, the JV, Parent and the members of their
respective Groups shall discharge their obligations under Section 12(a) or
Section 12(b) hereof, respectively, by paying the relevant amount in accordance
with Section 13, within 30 Business Days of demand therefor. Any such demand
shall include a statement showing the amount due under Section 12(a) or
Section 12(b), as the case may be. Notwithstanding the foregoing, if any member
of the Acquiror Group or any member of the Parent Group disputes in good faith
the fact or the amount of its obligation under Section 12(a) or Section 12(b),
then no payment of the amount in dispute shall be required until any such good
faith dispute is resolved in accordance with Section 24 hereof; provided,
however, that any amount not paid within thirty (30) Business Days of demand
therefor shall bear interest as provided in Section 14.

(d) Tax Benefits. If an indemnification obligation of any Indemnifying Party
under this Section 12 arises in respect of an adjustment that makes allowable to
an Indemnitee any Tax Benefit (other than a Tax Benefit resulting from a
Section 336(e) Election, which shall be governed exclusively by Section 11)
which would not, but for such adjustment, be allowable, then any such
indemnification obligation shall be an amount equal to (i) the amount otherwise
due but for this Section 12(d) minus (ii) the reduction (attributable to such
Tax Benefit) in actual cash Taxes payable by the Indemnitee in the taxable year
such indemnification obligation arises and the two taxable years following such
year, determined on a “with and without” basis.

(e) Sole Remedy. Parent (on behalf of itself and each member of the Parent
Group) covenants and agrees that the remedies provided for in Section 12(a)
shall constitute the sole and exclusive remedy for all Damages, including any
Tax liabilities and any associated Tax-Related Losses, that Parent or any member
of the Parent Group may suffer or incur arising from, or directly or indirectly
relating to any breach or violation of any of the representations, warranties,
covenants and agreements contained in this Agreement, the various Tax
Representation Letters, under Section 11.04(e) of the LLC Agreement, or
Section 5.15 of the Contribution Agreement by the Acquiror, the JV, SpinCo, and
any member of the Acquiror Group, JV Group or SpinCo Group, or otherwise
relating to the failure of the Controlled Transfer, the Distribution, or the
Merger to occur or receive the Intended Tax-Free Treatment, and the Parent (on
behalf of itself and each member of the Parent Group) hereby irrevocably waives
any other rights or remedies (whether at law or in equity and whether based on
contract, tort, statute or otherwise) that it may otherwise have had, now have
or may in the future have against the Acquiror, the JV, SpinCo, and any member
of the Acquiror Group, JV Group or SpinCo Group or any of their respective
direct or indirect Affiliates, officers, managers, directors, employees,
advisors, stockholders, members, consultants, investment bankers, brokers,
controlling persons, partners or other representatives or agents thereof arising
from, or directly or indirectly relating to any breach or violation of any of
the representations, warranties, covenants and agreements contained in this
Agreement, the various Tax Representation Letters, under Section 11.04(e) of the
LLC Agreement, or Section 5.15 of the Contribution Agreement by the Acquiror,
the JV, SpinCo, and any member of the Acquiror Group, JV Group or SpinCo Group
and covenants not to sue or otherwise assert any claim (or assist any Person in
suing or otherwise asserting any claims) encompassed by the foregoing covenant,
agreement and waiver; provided that the foregoing shall not apply to any party’s
right to seek specific performance pursuant to Section 20 hereof.

 

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SECTION 13. Acquiror Shareholders Not Parties. For the avoidance of doubt, and
notwithstanding any provision of this Agreement or any other Transaction
Document to the contrary, (i) no Person who is a direct or indirect shareholder,
member, or interest holder in Acquiror is a party to, or is bound by, or makes
any representations, warranties, or covenants, or indemnities pursuant to, this
Agreement (unless such Person is Parent, SpinCo, Acquiror, or any of their
respective Subsidiaries), and (ii) notwithstanding that certain Persons
described in the foregoing sentence make the representations, warranties, and
covenants in the Principal Shareholder Letter, such Persons shall not be liable
thereunder, under any Transaction Document, or otherwise by reason of having
breached such representations, warranties, or covenants.

SECTION 14. Payments.

(a) Timing. All payments to be made under this Agreement (excluding, for the
avoidance of doubt, any payments to a Taxing Authority described herein) shall
be made in immediately available funds. Except as otherwise provided, all such
payments will be due thirty (30) Business Days after the receipt of notice of
such payment or, where no notice is required, thirty (30) Business Days after
the fixing of liability or the resolution of a dispute (the “Due Date”).
Payments shall be deemed made when received. Any payment that is not made on or
before the Due Date shall bear interest at the rate equal to the “prime” rate as
published on such Due Date in the Wall Street Journal, Eastern Edition, for the
period from and including the date immediately following the Due Date through
and including the date of payment. With respect to any payment required to be
made under this Agreement, Parent has the right to designate, by written notice
to Acquiror, which member of the Parent Group will make or receive such payment;
and Acquiror has the right to designate, by written notice to Parent, which
member of the Acquiror Group will make or receive such payment.

(b) Treatment of Payments. To the extent permitted by Applicable Tax Law, any
payment made by Parent or any member of the Parent Group to Acquiror or any
member of the Acquiror Group, or by Acquiror or any member of the Acquiror Group
to Parent or any member of the Parent Group, pursuant to this Agreement, the
Separation Agreement, the Merger Agreement or any other Exit Transaction
Document that relates to Taxable periods (or portions thereof) ending on or
before the Distribution Date shall be treated by the parties hereto for all Tax
purposes as a distribution by SpinCo to Parent, or capital contribution from
Parent to SpinCo, as the case may be; provided, however, that any payment made
pursuant to the Transition Services Agreement shall instead be treated as a
payment for services. In the event that a Taxing Authority asserts that a
party’s treatment of a payment described in this Section 14(b) should be other
than as required herein, such party shall use its commercially reasonable
efforts to contest such assertion in a manner consistent with Section 16 of this
Agreement.

(c) No Duplicative Payment. It is intended that the provisions of this Agreement
shall not result in a duplicative payment of any amount required to be paid
under the Separation Agreement, the Merger Agreement or any other Exit
Transaction Document, and this Agreement shall be construed accordingly.

 

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SECTION 15. Communication and Cooperation.

(a) Consult and Cooperate. SpinCo, Parent and Acquiror shall consult and
cooperate (and shall cause each other member of their respective Groups to
consult and cooperate) fully at such time and to the extent reasonably requested
by the other party in connection with all matters subject to this Agreement.
Such cooperation shall include, without limitation:

(i) the retention, and provision on reasonable request, of any and all
information including all books, records, documentation or other information
pertaining to Tax matters relating to the SpinCo Group (or, in the case of any
Tax Return of the Parent Group, the portion of such return that relates to Taxes
for which the SpinCo Group or the Acquiror Group may be liable pursuant to this
Agreement), any necessary explanations of information, and access to personnel,
until one year after the expiration of the applicable statute of limitation
(giving effect to any extension, waiver or mitigation thereof);

(ii) the execution, to the extent commercially reasonable, of any document that
may be necessary (including to give effect to Section 16) or helpful in
connection with any required Tax Return or in connection with any audit,
proceeding, suit or action; and

(iii) the use of the parties’ commercially reasonable efforts to obtain any
documentation from a Governmental Authority or a third party that may be
necessary or helpful in connection with the foregoing.

(b) Provide Information. Except as set forth in Section 16, Parent, SpinCo and
Acquiror shall keep each other reasonably informed with respect to any material
development relating to the matters subject to this Agreement.

(c) Tax Attribute Matters. Parent, SpinCo and Acquiror shall promptly advise
each other with respect to any proposed Tax adjustments that are the subject of
an audit or investigation, or are the subject of any proceeding or litigation,
and that may affect any Tax liability or any Tax Attribute (including, but not
limited to, basis in an asset or the amount of earnings and profits) of any
member of the Acquiror Group or any member of the Parent Group, respectively.

(d) Confidentiality. The parties hereby agree that the provisions of
Section 11.02 (Confidentiality) of the LLC Agreement (as in effect prior to any
amendment to, or waiver under, the LLC Agreement occurring after the
Distribution) shall apply, mutatis mutandis, to all information and material
furnished by any party or its representatives hereunder. Notwithstanding the
foregoing or any other provision of this Agreement or any other agreement,
(i) no member of the Parent Group or the Acquiror Group, respectively, shall be
required to provide any member of the Acquiror Group or the Parent Group,
respectively, or any other Person access to or copies of any information or
procedures other than information or procedures that relate solely to the SpinCo
Group or the JV Group, the business or assets of any member of the SpinCo Group
or the JV Group, or matters for which Parent or Acquiror, respectively, has an
obligation to indemnify under this Agreement, and (ii) in no event shall any
member of the Parent Group or the Acquiror Group, respectively, be required to
provide any member of the

 

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Acquiror Group or the Parent Group, respectively, or any other Person access to
or copies of any information if such action could reasonably be expected to
result in the waiver of any privilege. Notwithstanding the foregoing, in the
event that Parent or Acquiror, respectively, determines that the provision of
any information to any member of the Acquiror Group or the Parent Group,
respectively, could be commercially detrimental or violate any law or agreement
to which Parent or Acquiror, respectively, is bound, or result in the waiver of
any privilege, Parent and Acquiror, respectively, shall use reasonable best
efforts to permit compliance with their obligations under this Section 15 while
avoiding such harm or consequence (and shall promptly provide notice to Parent
or Acquiror, to the extent such access to or copies of any information is
provided to a Person other than a member of the Parent Group or the Acquiror
Group (as applicable)).

SECTION 16. Audits and Contest.

(a) Notice. Each of Parent, SpinCo and Acquiror shall promptly notify the other
parties in writing upon the receipt from a relevant Taxing Authority of any
notice of a Tax Proceeding that may give rise to an indemnification obligation
under this Agreement; provided that a party’s right to indemnification under
this Agreement shall not be limited in any way by a failure to so notify, except
to the extent that the Indemnifying Party is prejudiced by such failure.

(b) Parent Control. Notwithstanding anything in this Agreement to the contrary,
but subject to Section 16(c), Parent shall have the right to control any Tax
Proceeding with respect to any Tax matters of (i) a Combined Group or any member
of a Combined Group (as such), (ii) any member of the Parent Group and (iii) any
member of the SpinCo Group relating solely to a Pre-Distribution Period (a
“Parent Tax Proceeding”). Parent shall have absolute discretion with respect to
any decisions to be made, or the nature of any action to be taken, with respect
to any Parent Tax Proceeding; provided, however, that to the extent that any
Parent Tax Proceeding is reasonably likely to give rise to an indemnity
obligation of SpinCo or Acquiror under Section 12 hereof, materially increase
the Taxes payable by or allocated to any member of the Acquiror Group pursuant
to Section 4 or materially affect the Tax Attributes allocated to any member of
the SpinCo Group pursuant to Section 6, (i) Parent shall keep Acquiror informed
of all material developments and events relating to any such Parent Tax
Proceeding, (ii) at its own cost and expense, Acquiror shall have the right to
participate in (but not to control) the defense of any such Parent Tax
Proceeding, and (iii) Parent shall not settle or compromise any such contest
without Acquiror’s written consent, which consent may not be unreasonably
withheld, conditioned or delayed. If the Parent Group acknowledges in writing
that it is liable for the Taxes at issue in any Parent Tax Proceeding subject to
the proviso in the previous sentence, the rights of Acquiror in such proviso
shall not apply to such Parent Tax Proceeding to the extent such Parent Tax
Proceeding relates to the Taxes that are the subject of such acknowledgment.

(c) Distribution Taxes. If any Parent Tax Proceeding relating to Distribution
Taxes is reasonably likely to give rise to an indemnity obligation of the
Acquiror as successor to SpinCo or the JV Group under Section 12 hereof,
Acquiror and Parent shall exercise joint control over the disposition of such
Parent Tax Proceeding (and, for the avoidance of doubt, shall keep each other
informed of all material developments with respect to such Parent Tax Proceeding
to the extent the other party is not otherwise informed thereof). Parent shall
otherwise have the right to elect to control any Parent Tax Proceeding relating
to Distribution Taxes; provided that Parent shall keep Acquiror informed of all
material developments.

 

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(d) Acquiror Control. Acquiror shall have the right to control any Tax
Proceeding with respect to SpinCo or any member of the SpinCo Group relating to
one or more members of the SpinCo Group and to any Post-Distribution Period (an
“Acquiror Tax Proceeding”). Acquiror shall have absolute discretion with respect
to any decisions to be made, or the nature of any action to be taken, with
respect to any Acquiror Tax Proceeding; provided, however, that to the extent
any such matter is reasonably likely to give rise to a claim for indemnity by
SpinCo or Acquiror against Parent under Section 12(b) of this Agreement,
(i) Acquiror shall keep Parent informed of all material developments and events
relating to such Acquiror Tax Proceeding, (ii) at its own cost and expense,
Parent shall have the right to participate in (but not to control) the defense
of any such Acquiror Tax Proceeding and (iii) Acquiror shall not settle or
compromise any such tax claim without the prior written consent of Parent (which
shall not be unreasonably withheld, conditioned or delayed). If the Acquiror
Group acknowledges in writing that it is liable for the Taxes at issue in any
Acquiror Tax Proceeding subject to the proviso in the previous sentence, the
rights of Parent in such proviso shall not apply to such Acquiror Tax Proceeding
to the extent such Acquiror Tax Proceeding relates to the Taxes that are the
subject of such acknowledgment.

SECTION 17. Notices. All notices, requests, permissions, waivers and other
communications hereunder will be in writing and will be deemed to have been duly
given (a) when sent, if sent by telecopy, (b) when delivered, if delivered
personally to the intended recipient and (c) one Business Day following sending
by overnight delivery via an international courier service and, in each case,
addressed to a Company at the following address for such Company,

if to Parent or the Parent Group (or, prior to the Effective Time, to SpinCo or
the SpinCo Group), to:

McKesson Corporation

6555 State Hwy 161

Irving, TX 75039

Attention: An Nguyen

Telecopy:

with a copy (which shall not constitute notice) to:

Davis Polk & Wardwell LLP

450 Lexington Avenue

New York, New York 10017

Attention: Patrick Sigmon

Telecopy:

 

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if to Acquiror or the Acquiror Group (or, after the Effective Time, to SpinCo or
the SpinCo Group), to:

Change Healthcare Inc.

3055 Lebanon Pike

Suite 1000

Nashville, Tennessee 37214

Attention: General Counsel

Telecopy:

with a copy (which shall not constitute notice) to:

Ropes & Gray LLP

Three Embarcadero Center

San Francisco, California 94111-4006

Attention: Benjamin J. Rogers

Telecopy:

or to such other address(es) as may be furnished in writing by any such Company
to the other Companies in accordance with the provisions of this Section 17.

SECTION 18. Costs and Expenses.

Except as expressly set forth in this Agreement, each party shall bear its own
costs and expenses incurred pursuant to this Agreement. For purposes of this
Agreement, costs and expenses shall include, but not be limited to, reasonable
attorneys’ fees, accountants’ fees and other related professional fees and
disbursements. For the avoidance of doubt, unless otherwise specifically
provided in the Exit Transaction Documents, all liabilities, costs and expenses
incurred in connection with this Agreement by or on behalf of SpinCo or any
member of the SpinCo Group with respect to actions taken at or prior to the
Effective Time shall be the responsibility of Parent and shall be assumed in
full by Parent.

SECTION 19. Effectiveness; Termination and Survival. Except as expressly set
forth in this Agreement, as between Parent, SpinCo Acquiror, and the JV Group,
this Agreement shall become effective upon the consummation of the Merger. All
rights and obligations arising hereunder shall survive until they are fully
effectuated or performed; provided that, notwithstanding anything in this
Agreement to the contrary, this Agreement shall remain in effect and its
provisions shall survive for one year after the full period of all applicable
statutes of limitation (giving effect to any extension, waiver or mitigation
thereof) and, with respect to any claim hereunder initiated prior to the end of
such period, until such claim has been satisfied or otherwise resolved. This
agreement shall terminate without any further action at any time before the
Closing upon termination of the Merger Agreement.

SECTION 20. Specific Performance. Each party hereto agrees that irreparable
damage would occur if any provision of this Agreement was not performed in
accordance with its specific terms or was otherwise breached. It is accordingly
agreed that the parties hereto will be entitled to an injunction or injunctions
to prevent breaches of this Agreement and to enforce

 

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specifically the performance of the terms and provisions of this Agreement
without proof of actual Damages, this being in addition to any other remedy to
which any such party is entitled at Law or in equity. Each party hereto further
agrees that no other party or any other Person will be required to obtain,
furnish or post any bond or similar instrument in connection with or as a
condition to obtaining any remedy referred to in this Section 20, and each party
hereto irrevocably waives any right it may have to require the obtaining,
furnishing or posting of any such bond or similar instrument.

SECTION 21. Construction. The descriptive headings herein are inserted for
convenience of reference only and are not intended to be a substantive part of
or to affect the meaning or interpretation of this Agreement. Reference to any
agreement, document, or instrument means such agreement, document, or instrument
as amended or otherwise modified from time to time in accordance with the terms
thereof, and if applicable hereof. References to any document, instrument or
agreement (including this Agreement) includes and incorporates all exhibits,
disclosure letters, schedules and other attachments thereto. Unless the context
otherwise requires, any references to a “Section” or “Schedule” will be to a
Section or Schedule to or of this Agreement. The use of the words “include” or
“including” in this Agreement will be deemed to be followed by the words
“without limitation.” The use of the word “covenant” will mean “covenant and
agreement.” The use of the words “or,” “either” or “any” will not be exclusive.
Days means calendar days unless specified as Business Days. References to
statutes will include all regulations promulgated thereunder, and references to
statutes or regulations will be construed to include all statutory and
regulatory provisions consolidating, amending or replacing the statute or
regulation, in each case, as of the date hereof. In the event an ambiguity or
question of intent or interpretation arises, this Agreement will be construed as
if drafted jointly by the parties hereto, and no presumption or burden of proof
will arise favoring or disfavoring any party by virtue of the authorship of any
of the provisions of this Agreement. Except as otherwise expressly provided
elsewhere in this Agreement or any other Exit Transaction Document, any
provision herein which contemplates the agreement, approval or consent of, or
exercise of any right of, a party, such party may give or withhold such
agreement, approval or consent, or exercise such right, in its sole and absolute
discretion, the parties hereby expressly disclaiming any implied duty of good
faith and fair dealing or similar concept.

SECTION 22. Entire Agreement; Amendments and Waivers.

(a) Entire Agreement.

(i) This Agreement and the other Transaction Documents, including any related
annexes, schedules and exhibits, as well as any other agreements and documents
referred to herein and therein, together constitute the entire agreement among
the parties with respect to the subject matter hereof and thereof and supersede
all prior negotiations, agreements and understandings of the parties of any
nature, whether oral or written, with respect to such subject matter. If there
is a conflict between any provision of this Agreement and a provision of any
other Transaction Document, the provision of this Agreement will control unless
specifically provided otherwise in this Agreement.

 

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(ii) THE PARTIES ACKNOWLEDGE AND AGREE THAT NO REPRESENTATION, WARRANTY,
PROMISE, INDUCEMENT, UNDERSTANDING, COVENANT OR AGREEMENT HAS BEEN MADE OR
RELIED UPON BY ANY PARTY OTHER THAN THOSE EXPRESSLY SET FORTH IN THIS AGREEMENT
AND IN THE OTHER TRANSACTION DOCUMENTS, INCLUDING ANY CERTIFICATE ISSUED IN
ACCORDANCE THEREWITH.

(b) Amendments and Waivers.

(i) This Agreement may be amended, and any provision of this Agreement may be
waived, if and only if such amendment or waiver, as the case may be, is in
writing and signed, in the case of an amendment, by the parties or, in the case
of a waiver, by the party against whom the waiver is to be effective.

(ii) No failure or delay by either party in exercising any right, power or
privilege under this Agreement shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. Except as
otherwise provided herein, no action taken pursuant to this Agreement, including
any investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any representations,
warranties, covenants or agreements contained in this Agreement. Any term,
covenant or condition of this Agreement may be waived at any time by the party
that is entitled to the benefit thereof, but only by a written notice signed by
such party expressly waiving such term, covenant or condition. The waiver by any
party of a breach of any provision hereunder shall not operate or be construed
as a waiver of any prior or subsequent breach of the same or any other provision
hereunder.

SECTION 23. Governing Law and Interpretation. The validity, interpretation and
enforcement of this Agreement will be governed by the Laws of the State of
Delaware, without regard to the conflict of Laws provisions thereof that would
cause the Laws of another state to apply.

SECTION 24. Dispute Resolution. In the event of any dispute relating to this
Agreement, including but not limited to whether a Tax liability is a liability
of the Parent Group, the SpinCo Group or the Acquiror Group, the parties shall
work together in good faith to resolve such dispute within thirty (30) days. In
the event that such dispute is not resolved, upon written notice by a party
after such thirty (30)-day period, the matter shall be referred to a U.S. Tax
counsel or other Tax advisor of recognized national standing (the “Tax Arbiter”)
that will be jointly chosen by the Parent and Acquiror; provided, however, that,
if the Parent and the Acquiror do not agree on the selection of the Tax Arbiter
after five (5) days of good faith negotiation, the Tax Arbiter shall consist of
a panel of three U.S. Tax counsel or other Tax advisor of recognized national
standing with one member chosen by the Parent, one member chosen by the
Acquiror, and a third member chosen by mutual agreement of the other members
within the following ten (10)-day period. Each decision of a panel Tax Arbiter
shall be made by majority vote of the members. The Tax Arbiter may, in its
discretion, obtain the services of any third party necessary to assist it in
resolving the dispute. The Tax Arbiter shall furnish written

 

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notice to the parties to the dispute of its resolution of the dispute as soon as
practicable, but in any event no later than ninety (90) days after acceptance of
the matter for resolution. Any such resolution by the Tax Arbiter shall be
binding on the parties, and the parties shall take, or cause to be taken, any
action necessary to implement such resolution. All fees and expenses of the Tax
Arbiter shall be shared equally by the parties to the dispute.

SECTION 25. Counterparts. This Agreement may be executed in multiple
counterparts (any one of which need not contain the signatures of more than one
party), each of which will be deemed to be an original but all of which taken
together will constitute one and the same agreement. This Agreement, and any
amendments hereto, to the extent signed and delivered by means of a facsimile
machine or other electronic transmission, will be treated in all manner and
respects as an original agreement and will be considered to have the same
binding legal effects as if it were the original signed version thereof
delivered in person. At the request of any party hereto, the other parties
hereto will re-execute original forms thereof and deliver them to the requesting
party.

SECTION 26. Successors and Assigns; Third Party Beneficiaries. Except as
provided below, this Agreement shall be binding upon and shall inure only to the
benefit of the parties hereto and their respective successors and assigns, by
merger, acquisition of assets or otherwise (including but not limited to any
successor of a party hereto succeeding to the Tax Attributes of such party under
Applicable Tax Law). This Agreement is not intended to benefit any Person other
than the parties hereto and such successors and assigns, and no such other
Person shall be a third party beneficiary hereof. Upon the Closing, this
Agreement shall be binding on Acquiror and Acquiror shall be subject to the
obligations and restrictions imposed on SpinCo hereunder, including, without
limitation, the indemnification obligations of SpinCo under Section 12.

SECTION 27. Authorization, Etc. Each of the parties hereto hereby represents and
warrants that it has the power and authority to execute, deliver and perform
this Agreement, that this Agreement has been duly authorized by all necessary
corporate action on the part of such party, that this Agreement constitutes a
legal, valid and binding obligation of each such party, and that the execution,
delivery and performance of this Agreement by such party does not contravene or
conflict with any provision or law or of its charter or bylaws or any agreement,
instrument or order binding on such party.

SECTION 28. Change in Tax Law. In the event of a change in law or regulation
following the date of this Agreement that is or is believed by any of the
parties hereto to be relevant to the interpretation or effect of this Agreement
(including any change in any law or regulations expressly referenced herein),
the parties will use reasonable best efforts to agree upon such changes to this
Agreement as may be necessary or advisable so as to give effect to the original
intent, purposes and effect of such Agreement (based on law and regulation in
effect as of the date of signing of this Agreement) as nearly as practicable
without altering the respective rights or obligations of the parties, or
otherwise adversely affecting any party in any non-de minimis respect.

 

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SECTION 29. Principles. This Agreement is intended to calculate and allocate
certain Tax liabilities of the members of the SpinCo Group and the members of
the Parent Group to SpinCo, Parent and Acquiror (and their respective Groups),
and any situation or circumstance concerning such calculation and allocation
that is not specifically contemplated by this Agreement shall be dealt with in a
manner consistent with the underlying principles of calculation and allocation
in this Agreement.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the day and year first written above.

 

Parent on its own behalf and on behalf of the members of

the Parent Group

By:  

/s/ Britt J. Vitalone

Name:   Britt J. Vitalone Title:   Executive Vice President and Chief Financial
Officer

SpinCo on its own behalf and on behalf of

the members of the SpinCo Group

By:  

/s/ Paul A. Smith

Name:   Paul A. Smith Title:   President and Secretary

Acquiror on its own behalf and on behalf

of the members of the Acquiror Group

By:  

/s/ Loretta A. Cecil

Name:   Loretta A. Cecil Title:   Executive Vice President,
General Counsel CHANGE HEALTHCARE, LLC By:  

/s/ Loretta A. Cecil

Name:   Loretta A. Cecil Title:   Secretary

CHANGE HEALTHCARE HOLDINGS,

LLC

By:  

/s/ Loretta A. Cecil

Name:   Loretta A. Cecil Title:   Secretary

 

[SIGNATURE PAGE TO TAX MATTERS AGREEMENT]