Risk Factors Update Summary

• Failure to predict exposure under health care cost risk for New Century Health and NIA could result in a significant decrease in profitability, with $9 million of restricted cash in 2022 increasing to $16 million in 2023.
• Recorded a Tax Receivable Agreement (TRA) liability of $107.9 million in 2023, compared to $90.3 million in 2022.
• Increasing inflationary pressures and rising consumer costs may negatively impact profit margins and earnings, with inflation levels remaining elevated through 2023.
• Issued $402.5 million of 3.50% Convertible Senior Notes due 2029 in December 2023.
• Changes in the competitive environment for performance-based products could lead to pricing pressures, potentially causing a reduction in rates, impacting profitability.
• Potential future payments under the TRA could be substantial, exceeding hypothetical amounts disclosed.
• The company faces cybersecurity risks, with potential impacts on business strategy, results of operations, financial condition, and liquidity, especially with the increased use of mobile and cloud technologies.
• Compliance with new data security and privacy laws and regulations may be time-consuming and expensive, with failure to implement changes leading to liability for noncompliance.
• The company's ability to deliver solutions, particularly cloud-based ones, may be affected by interruptions in technology platforms, potentially resulting in lengthy service disruptions.
• The company's reliance on a limited number of partners, with the three largest partners contributing 15%, 7%, and 12% of revenue in 2023, respectively, poses a concentration risk.