8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________

FORM 8-K

___________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

May 12, 2022 (May 10, 2022)

Date of Report (date of earliest event reported)

___________________________________

UpHealth, Inc.

(Exact name of registrant as specified in its charter)

___________________________________

Delaware (State or other jurisdiction of incorporation or organization)	001-38924 (Commission File Number)		83-3838045 (I.R.S. Employer Identification Number)
	14000 S. Military Trail,	Suite 203
	Delray Beach,	FL	33484
(Address of principal executive offices and zip code)
(312) 618-1322
(Registrant's telephone number, including area code)

___________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	UPH	New York Stock Exchange
Redeemable Warrants, exercisable for one share of Common Stock at an exercise price of $11.50 per share	UPH.WS	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ 

Item 2.02 - Results of Operations and Financial Condition

On May 12, 2022, UpHealth, Inc. (the “Company”) issued a press release announcing its financial results for the first quarter ended March 31, 2022. A copy of the Company’s press release is attached as Exhibit 99.1 to this Current Report and is incorporated herein by reference.

The information contained in this Item 2.02, including Exhibit 99.1 attached hereto, is furnished and shall not be deemed “filed” with the Securities and Exchange Commission (the “SEC”) for the purposes of Section 18 of the Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933, as amended (the “Securities Act”) or filings under the Exchange Act regardless of any general incorporation language in such filings.

Item 5.02 - Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Employment Agreement with Chief Executive Officer

On May 10, 2022, Samuel J. Meckey and the Company entered into an employment agreement (the “CEO Employment Agreement”), on terms approved by the Board for Mr. Meckey to be employed as the Chief Executive Officer of the Company, effective as of July 5, 2022, or such earlier date as may be agreed between the Company and Mr. Meckey. As provided for in the CEO Employment Agreement, Mr. Meckey will report to the Board.

Under the terms of the CEO Employment Agreement, the Company will pay Mr. Meckey a base salary at the initial annualized rate of $520,000 per year, subject to standard deductions and withholdings, or such other rate as may be determined from time to time by the Board or the Compensation Committee (hereinafter referred to as the “CEO Base Salary”). Such CEO Base Salary will be paid in accordance with the Company’s standard payroll practice. The CEO Base Salary will be reviewed annually and Mr. Meckey will be eligible to receive a salary increase annually, during the compensation cycle, in an amount to be determined by the Board or the Compensation Committee in its sole and exclusive discretion. Once adjusted, the new salary will become the CEO Base Salary for purposes of the CEO Employment Agreement. Any material reduction in the CEO Base Salary of Mr. Meckey, without his written consent, may be deemed grounds for resignation by him for CEO Good Reason (as such term is defined below). Mr. Meckey will, in accordance with Company policy and the terms of the applicable plan documents, be eligible to participate in benefits under any executive benefit plan or arrangement which may be in effect from time to time and made available to the Company’s executives or key management employees, including unlimited paid time off subject to the terms and conditions of the Company’s PTO Policy.

For the period beginning July 1, 2022 and ending on December 31, 2022, Mr. Meckey will be guaranteed to receive a prorated bonus payment in an amount not less than 100% of the CEO Base Salary actually earned by Mr. Meckey during 2022 (the “Initial Bonus”), prorated for the period, provided Mr. Meckey remains employed on the date the Initial Bonus is paid, subject to the termination provisions of the CEO Employment Agreement. Mr. Meckey will be eligible for an annual discretionary bonus beginning as of January 1, 2023 (hereinafter referred to as the “CEO Bonus”) with a target amount of 100% of the CEO Base Salary, subject to standard deductions and withholdings, based on the Board’s determination, in good faith, as to whether Performance Milestones have been achieved. The Performance Milestones for Mr. Meckey will be based on certain factors including, but not limited to, Mr. Meckey’s performance and the Company’s performance and will be consistent with the methodology for other C-suite executives. The CEO Bonus target will be reviewed annually and may be adjusted by the Board or the Compensation Committee in its discretion. Mr. Meckey must be employed on the date the CEO Bonus is paid to be eligible for the CEO Bonus, subject to the termination provisions of the CEO Employment Agreement. The CEO Bonus will be paid during the calendar year following the performance calendar year. For the period beginning January 1, 2023 and ending on June 30, 2023 (or such date as marks the one-year anniversary of the effective date of the CEO Employment Agreement, if earlier), Mr. Meckey will be guaranteed to receive a prorated annual bonus payment in an amount equal to 100% of the CEO Base Salary actually earned by Mr. Meckey during such period, provided Mr. Meckey is employed on the date such bonus is paid, subject to the termination provisions in the CEO Employment Agreement.

As an additional inducement to Mr. Meckey’s commencement of employment with the Company, the CEO Employment Agreement provides that the Company will grant “Initial Awards” pursuant to and subject to the terms of the Company’s

2021 Equity Incentive Plan (“2021 Equity Plan”) and the form of restricted stock unit award agreements (collectively the “Equity Plan Documents”) and compliance with applicable securities laws:

•restricted stock units (“RSUs”) in the amount of 2,580,000 RSUs that are eligible to vest subject to Mr. Meckey’s continued provision of services to the Company (the “Time-Based RSUs”). Subject to Mr. Meckey’s continued provision of services to the Company through the applicable vesting dates, the Time-Based RSUs are eligible to vest in accordance with the following schedule: 25% will vest on June 1, 2023 (the “Cliff Date”) and the remaining 75% will vest in equal quarterly installments on each subsequent August 1st, November 1st, February 1st and June 1st over the three years following the Cliff Date, such that the Time-Based RSUs will be 100% vested on the third anniversary of the Cliff Date and in each case subject to the Executive’s continued services with the Company through each such applicable vesting date.

•RSUs in the amount of 1,720,000 RSUs that are eligible to vest subject to the attainment of certain performance-based metrics established by the Compensation Committee and Mr. Meckey’s continued services as specified by the Compensation Committee and set forth the applicable restricted stock unit agreement for the award (the “Performance-Based RSUs”).

Commencing with the Company’s regular annual equity grant cycle in 2023, Mr. Meckey will be eligible to receive annual refresher equity grants of RSUs with a target grant date value of not less than $2,000,000 (“Annual Grants”). The Annual Grants will be eligible to vest as follows: (i) 50% of each Annual Grant will be eligible to vest subject to Mr. Meckey’s continued services over a four-year period following the applicable date of grant, with 25% one-year annual cliff vesting and quarterly vesting thereafter over the three years following the cliff vesting date, and (ii) 50% of each Annual Grant will be eligible to vest subject to (x) achievement of performance goals to be established by the Compensation Committee in consultation with Mr. Meckey and (y) Mr. Meckey’s continued services as approved by the Compensation Committee and set forth in the applicable restricted stock unit agreement for the award.

In addition, Mr. Meckey will be eligible to receive any additional grants of equity awards under the 2021 Equity Plan or any successor plan, as determined at the sole discretion of the Compensation Committee.

The Company has also agreed to pay to Mr. Meckey as additional compensation the following amounts, subject to applicable withholding, on the corresponding dates, provided that Mr. Meckey remains employed with the Company through each applicable payment date, subject to the termination provisions in the CEO Employment Agreement: $940,568 on January 1, 2023; $1,062,347 on January 1, 2024; and $734,115 on January 1, 2025.

Mr. Meckey’s employment with the Company is “at will” and is terminable by the Company at any time and for any reason or no reason, including as a result of his death or “Complete Disability” (as such term is defined in the CEO Employment Agreement), and with or without CEO Cause (as such term is defined below). Mr. Meckey may terminate his employment with the Company at any time and for any reason or no reason, including with or without CEO Good Reason.

“CEO Cause” for the Company to terminate Mr. Meckey’s employment hereunder shall mean the occurrence of any of the following events, as determined reasonably and in good faith by the Board or a committee designated by the Board: (i) Mr. Meckey’s gross negligence or willful failure to substantially perform his duties and responsibilities to the Company or willful and deliberate violation of a Company policy; (ii) Mr. Meckey’s conviction of a felony or Mr. Meckey’s commission of any act of fraud, embezzlement or dishonesty against the Company or involving moral turpitude that is likely to inflict or has inflicted injury on the business of the Company, to be determined in the sole discretion of the Company; (iii) Mr. Meckey’s unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any other party to which Mr. Meckey owes an obligation of nondisclosure as a result of Mr. Meckey’s relationship with the Company; and (iv) Mr. Meckey’s willful and deliberate breach of the CEO Employment Agreement that causes or could reasonably be expected to cause material injury to the business of the Company.

“CEO Good Reason” for Mr. Meckey to terminate his employment under the CEO Employment Agreement shall mean the occurrence of any of the following events without Mr. Meckey’s consent: (i) a material reduction in his duties, authority, or responsibilities relative to the duties, authority, or responsibilities in effect immediately prior to such reduction, excluding having the same title, duties, authority and responsibilities at a subsidiary level following a Change in Control (as defined in the CEO Employment Agreement); (ii) the relocation of his primary work location to a point more than fifty (50) miles from his current work location that requires a material increase in his one-way driving distance; (iii) a material reduction by the

Company of his base salary or annual target bonus opportunity, without his written consent, as the same may be increased from time to time pursuant to the CEO Employment Agreement, except for across-the-board salary reductions implemented prior to a Change in Control, which are implemented based on the Company’s financial performance and similarly affecting all or substantially all senior management employees of the Company; and (iv) a material breach by the Company of the terms of the CEO Employment Agreement; provided, however that, such termination by Mr. Meckey will only be deemed for Good Reason pursuant to the foregoing definition if (i) he provides to the Company written notice within sixty (60) days following the first occurrence of the condition that he considers to constitute Good Reason describing the condition, and the Company fails to satisfactorily remedy such condition within thirty (30) days following such written notice, and (ii) he terminates employment within thirty (30) days following the end of the period within which the Company was entitled to remedy the condition constituting Good Reason but failed to do so.

If Mr. Meckey’s employment is terminated by the Company for CEO Cause, or if Mr. Meckey terminates employment hereunder without CEO Good Reason, or terminates due to his death or Complete Disability (as defined in the CEO Employment Agreement), or for any other reason other than due to a termination without CEO Cause or CEO Good Reason resignation, the Company will pay the CEO Base Salary, accrued but unpaid business expenses and accrued and unused vacation benefits earned through the date of termination at the rate in effect at the time of termination (the “CEO Accrued Amounts”), less standard deductions and withholdings. If the Company terminates Mr. Meckey’s employment without CEO Cause or Mr. Meckey terminates his employment for CEO Good Reason, and a Change in Control (as defined in the CEO Employment Agreement) trigger has not occurred, the Company will pay the CEO Accrued Amounts subject to standard deductions and withholdings, to be paid as a lump sum no later than thirty (30) days after the date of termination. In addition, subject to the limitations stated in the CEO Employment Agreement and upon Mr. Meckey’s furnishing to the Company an executed release and his continuing to comply with his obligations pursuant to the Proprietary Information and Inventions Agreement attached as an exhibit to the CEO Employment Agreement and entered into by him concurrently with the entry into the CEO Employment Agreement, (a) the equivalent of one times the annual CEO Base Salary in effect at the time of termination, less standard deductions and withholdings, will continue to be paid for a period of eighteen (18) months following the date of termination in equal installments according to the Company’s regular payroll practices following the effectiveness of the release; (b) Mr. Meckey will also be paid a pro-rated portion of his target CEO Bonus amount for the year of termination, if any such CEO Bonus has been determined by the Board or the Compensation Committee to have been achieved in the ordinary course when determinations are made for all officers and employees of the Company based upon the metrics associated with such CEO Bonus (the “Bonus Determination Date”) (pro-rated based upon the portion of the calendar year that Mr. Meckey was employed by the Company), less standard deductions and withholdings, to be paid as a lump sum within ten (10) days after the Bonus Determination Date, (c) continued coverage under the Company’s medical, dental, life and disability insurance until the earlier of either (i) the end of eighteen (18) months following the termination date, or, (ii) the date on which Mr. Meckey begins full time employment with another company or business entity which offers comparable health insurance coverage to Mr. Meckey; and (d) any remaining additional compensation amounts that would have been paid to Mr. Meckey had he continued his employment with the Company through January 1, 2025 will be paid in accordance with the schedule as if her were still so employed. Similarly, such remaining additional compensation amounts that would have been paid to Mr. Meckey had he continued his employment with the Company through January 1, 2025 will be paid in accordance with the schedule as if her were still so employed in the event that Mr. Meckey’s employment terminates due to his death or Complete Disability.

If the Company (or its successor) terminates Mr. Meckey’s employment without CEO Cause or Mr. Meckey terminates his employment for CEO Good Reason and there is a Change in Control trigger, Mr. Meckey will receive the CEO Accrued Amounts subject to standard deductions and withholdings, to be paid as a lump sum no later than thirty (30) days after the date of termination. In addition, subject to the limitations stated in the CEO Employment Agreement and upon Mr. Meckey’s furnishing to the Company (or its successor) an executed release, (a) the equivalent of one times the annual CEO Base Salary in effect at the time of termination, less standard deductions and withholdings, will continue to be paid for a period of eighteen (18) months following the date of termination in equal installments according to the Company’s regular payroll practices following the effectiveness of the release; (b) Mr. Meckey will be paid a pro-rated portion of the target CEO Bonus amount for the year of termination, if any, provided such CEO Bonus has been determined by the Board or the Compensation Committee to have been achieved in the ordinary course on the Bonus Determination Date based upon the metrics associated with such CEO Bonus (pro-rated based upon the portion of the calendar year that Mr. Meckey was employed by the Company), less standard deductions and withholdings, to be paid as a lump sum within ten (10) days after the Bonus Determination Date; (c) Mr. Meckey will receive continued coverage under the Company’s medical, dental, life and disability insurance for the period of eighteen (18) months following the date of termination and (d) any remaining additional

compensation amounts that would have been paid to Mr. Meckey had he continued his employment with the Company through January 1, 2025 will be paid in a lump sum no later than thirty (30) days after the effective date of the release.

In addition, in the event that Mr. Meckey’s employment is terminated without CEO Cause or for CEO Good Reason and a Change in Control trigger has not occurred, or in the event of Mr. Meckey’s death or Complete Disability, the vesting of any Time-Based RSUs or other time-based awards will be fully accelerated such that on the effective date of such termination 100% of any Time-Based RSUs or other time-based awards granted to Mr. Meckey prior to such termination will be fully vested and immediately exercisable, if applicable, by Mr. Meckey. Treatment of any Performance-Based RSUs or other performance-based awards will be governed solely by the terms of the agreements under which such awards were granted and will not be eligible to accelerate vesting.

In the event that Mr. Meckey’s employment is terminated without CEO Cause or for CEO Good Reason and a Change in Control trigger has occurred, the vesting of any Time-Based RSUs or other time-based awards will be fully accelerated such that on the effective date of such termination, 100% of any Time-Based RSUs or other time-based awards granted to Mr. Meckey prior to such termination will be fully vested and immediately exercisable, if applicable, by Mr. Meckey. In such case, the vesting of the Performance-Based RSUs or other performance-based awards will also be fully accelerated at the target performance level.

If any payment Mr. Meckey would receive pursuant to a Change in Control (as defined in the CEO Employment Agreement) from the Company or otherwise would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) but for this sentence, be subject to excise tax imposed by Section 4999 of the Code, then such payment will be reduced to a lower amount (the “Reduced Amount”). The “Reduced Amount” shall be either (x) the largest portion of the payment that would result in no portion of the payment being subject to the excise tax or (y) the largest portion, up to and including the total, of the payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes, and the excise tax (all computed at the highest applicable marginal rate), results in Mr. Meckey’s receipt, on an after-tax basis, of the greater economic benefit notwithstanding that all or some portion of the payment may be subject to excise tax.. If more than one method of reduction will result in the same economic benefit, the items so reduced will be reduced pro rata.

The Proprietary Information and Inventions Agreement entered into by Mr. Meckey pursuant to the terms of, and concurrently with, the CEO Employment Agreement, relates to the protection of confidential information of the Company and the ownership by the Company of proprietary information and patents and other intellectual property.

The foregoing summary of the terms and conditions of the CEO Employment Agreement and the Proprietary Information and Inventions Agreement is not complete and is qualified in its entirety by reference to the full text of the CEO Employment Agreement and the Proprietary Information and Inventions Agreement.

Item 7.01 Regulation FD Disclosure

The information contained in, or incorporated into, this Item 7.01 of this Current Report, is furnished under Item 7.01 of Form 8-K and shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into the filings of the Company under the Securities Act or the Exchange Act regardless of any general incorporation language in such filings.

This Current Report shall not be deemed an admission as to the materiality of any information in this Current Report that is being disclosed pursuant to Regulation FD.

Please refer to Exhibit 99.1 for a discussion of certain forward-looking statements included therein and the risks and uncertainties related thereto.

Please refer to Exhibit 99.2 for a copy of the press release announcing the appointment of Samuel J. Meckey as the Company’s new Chief Executive Officer.

Item 9.01 - Financial Statements and Exhibits

(d) Exhibits:

Exhibit	Description
99.1	Press Release dated May 12, 2022, reporting the financial results for the quarter ended March 31, 2022 (furnished only)
99.2	Press Release dated May 12, 2022, announcing Samuel J. Meckey as the new Chief Executive Officer of the Company (furnished only)
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized on this 12th day of May, 2022.

UpHealth, Inc.
By:	/s/ Dr. Ramesh Balakrishnan
Name:	Dr. Ramesh Balakrishnan
Title:	Chief Executive Officer (Principal Executive Officer)

EX-99.1

Exhibit 99.1

UPHEALTH ANNOUNCES FIRST QUARTER 2022 FINANCIAL RESULTS

Revenue of $36.0 million; Gross Margin of 43%

Continued Shift of Revenue Mix to Higher Margin Integrated Care Management and Virtual Care Infrastructure Businesses

Substantial Progress Achieved Toward Company-wide Transformation

Reiterates 2022 Financial Outlook

Settled the Forward Share Purchase Agreement Obligations Subsequent to Quarter End

Public Company & Healthcare Industry Veteran Samuel J. Meckey to Become Chief Executive Officer in July

DELRAY BEACH, Fla. – May 12, 2022 – UpHealth, Inc. (“UpHealth” or the “Company”) (NYSE: UPH), a global digital health company delivering technology platforms, infrastructure, and services to modernize care delivery and health management, today announced financial results for the first quarter ended March 31, 2022.

“Our first quarter results represent a solid foundation for the remainder of the year and position us to deliver upon our previously stated annual growth expectations supported by our first quarter 2022 top-line growth of 6% sequentially and 18% over the first quarter 2021 on a pro forma basis,” said Dr. Ramesh Balakrishnan, Chief Executive Officer of UpHealth. “The demand for our services in our target markets remains unprecedented and further supports our 2022 outlook. Additionally, I am very proud of our leadership team, all of whom have been fully engaged in helping lead our transformation initiatives. I am pleased to report the full implementation is on time and on target.”

Dr. Balakrishnan continued, “Today, we remain focused on our highest growth businesses: Syntranet™, Martti™ and HelloLyf, which we are enhancing to provide comprehensive care management solutions to payers and governments and are working to grow Martti™ to become the leading tele-consult provider. With revenue recognition matters addressed and vigorous processes now in place to ensure this does not interfere with our results going forward, we will grow revenue considerably and, importantly, expect to be cash flow positive prior to year-end, as we work toward building an industry-leading, global healthcare public enterprise, delivering upon our unique value proposition.”

In a news release this morning, the company announced that Samuel J. Meckey will be stepping into the role of CEO effective in July. Mr. Meckey has nearly 20 years of experience in publicly traded healthcare companies and has consistently driven growth, revenues, and margins across his areas of responsibilities.

Mr. Meckey was most recently Executive Vice President and Head of Healthcare at EXLService Holdings, Inc., a leading data analytics and digital operations and solutions company. Prior to EXLService, he spent 14 years at UnitedHealth Group’s Optum in a variety of roles, including President, Optum Global Solutions. A former United States Naval officer, he holds an MBA from Harvard University and an undergraduate degree in economics from the United States Naval Academy.

First Quarter 2022 Financial Highlights:

•Revenue for the first quarter of 2022 was $36.0 million, compared to $33.9 million in the fourth quarter of 2021, a sequential increase of 6%. Gross margin expanded to 43%, up from 22% in the fourth quarter of 2021.

•Segment results:

•Integrated Care Management generated $2.6 million of revenue (7% of total revenue) with a gross margin of 63%. Similar to the fourth quarter of 2021, during the first quarter of 2022, the Company’s Integrated Care Management segment provided services to a customer but did not recognize revenue associated with those services due to concerns regarding the customer's creditworthiness.In addition, the Company is continuing to make significant strides in efforts to collect accounts receivable from a European customer as previously reported and a positive resolution of the matter is anticipated.

•Virtual Care Infrastructure generated $15.6 million of revenue (43% of total revenue) with a gross margin of 47%.

•The Company expects the revenue contribution from Integrated Care Management and Virtual Care Infrastructure to return to levels reported in Q2 and Q3 2021 as revenue in Integrated Care Management ramps up over the course of 2022.

•Services generated $17.7 million of revenue (49% of total revenue) with a gross margin of 35%.

•Operating loss for the first quarter of $(25.0) to $(33.0) million.

•Adjusted EBITDA for the first quarter of $(1.3) million.

Please refer to the discussion and tables under “Non-GAAP Financial Information.”

First Quarter Business Highlights:

•SyntraNet™ went live to support the largest health plans and providers in the California CalAIM initiative, covering over 8 million lives.

•Continued domestic Martti™ expansion with four large and long-term Martti™ language interpretation contracts with Ascension Texas, Ascension Indiana, Ascension Michigan and Wellstar.Increased consultation volumes drove higher revenues and led to an 11% increase in gross margins, resulting in an estimated $15 million in new contract value.

•Announced comprehensive integration of technology platforms, MarttiTM and SyntraNetTM, expanding the ability of care teams managing value-based and other population health programs to include real-time resources.

•Martti™ currently supports 575,423 encounters per month and over 27,200 video endpoints at over 2,300 healthcare locations in the U.S.

•The Company recorded its largest volume of telehealth use ever in the U.S. with over 9.4 million minutes of consultations in Q1, compared to 7.4 million minutes in Q4 2021.

•HelloLyf CX digital dispensaries in India experienced growth of over 29%, with patient consultations increasing 1.3x, from 376,514 in Q1 2021 to 486,317 in Q1 2022.

•Behavioral Health division recognized as a TRICARE preferred provider, contracted with Cigna and Magellan, has relationships with Zelis and Multiplan and was credentialed by 12 additional players.

•The Company secured three new behavioral health network provider contracts with Florida Blue, New Directions and Bright Health, including detox services for the U.S. Veterans Administration.

Balance Sheet and Cash Flow

At March 31, 2022, UpHealth reported $70.7 million of cash, cash equivalents and restricted cash.On April 9, 2022, the Company repaid its forward share purchase agreement according to the terms of the contract.

Fiscal 2022 Financial Outlook

For the full year 2022, the Company continues to expect total revenue between $205 and $233 million, a 38-56% growth rate, gross margins of 42% to 43% and adjusted EBITDA of $14 to $19 million.The Company expects to become operating cash flow positive during the third quarter, providing sufficient liquidity to execute on current growth plans.

“As we get close to celebrating our first full year as a publicly traded company, UpHealth’s business is on a great trajectory. We remain on-track with our 2022 projections, and our ability to reiterate our full-year guidance reflects the strength and diversification of our business,” said Dr. Balakrishnan.

Conference Call

UpHealth management will host a live question-and-answer session with investors and analysts beginning at 8:30 a.m. Eastern Time today, May 12, 2022. The call can be accessed live over the telephone by dialing (877) 344-8082, passcode 150118, from the U.S. or International callers can dial (213) 992-4618, passcode 150118. There will also be a simultaneous, live webcast available on the Investor Relations section of the Company's web site at https://investors.uphealthinc.com/events-and-presentations/default.aspx or directly here. The webcast will be archived for approximately 30 days.

About UpHealth Inc.

UpHealth is a global digital health company that delivers digital-first technology, infrastructure and services to dramatically improve how healthcare is delivered and managed. The UpHealth platform creates digitally enabled "care communities" that improve access and achieve better patient outcomes at lower cost, through digital health solutions and interoperability tools that serve patients wherever they are, in their native language. UpHealth's clients include global governments, health plans, healthcare providers and community-based organizations. For more information, please visit https://uphealthinc.com and follow us at @UpHealthInc on Twitter and UpHealth Inc on LinkedIn.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of U.S. federal securities laws. Such forward-looking statements include, but are not limited to, the financial statements of UpHealth, its product offerings and developments and reception of its product by customers, the start date of its new CEO, and its expectations, hopes, beliefs, intentions, plans, prospects or strategies regarding the future revenue and the business plans of UpHealth’s management team. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. The forward-looking statements contained in this press release are based on certain assumptions and analyses made by the management of UpHealth in light of their respective experience and perception of historical trends, current conditions, and expected future developments and their potential effects on UpHealth as well as other factors they believe are appropriate in the circumstances. There can be no assurance that future developments affecting UpHealth will be those anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the control of the parties), or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, including the mix of services utilized by UpHealth’s customers and such customers’ needs for these services, market acceptance of new service offerings, the ability of UpHealth to expand what it does for existing customers as well as to add new customers, the ability of the new CEO to begin work when anticipated, that UpHealth will have sufficient capital to operate as anticipated, and the impact that the novel coronavirus and the illness, COVID-19, that it causes, as well as government responses to deal with the spread of this illness and the reopening of economies that have been closed as part of these responses, may have on UpHealth’s operations, the demand for UpHealth’s products, global supply chains and economic activity in general. Should one or more of these risks or uncertainties materialize or should any of the assumptions being made prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.

Investors Relations:

Shannon Devine (MZ North America)

Managing Director

203-741-8811

UPH@mzgroup.us

Media Inquiries:

Kelsie Aziz (Ketchum)

Vice President, Financial Communications

972-408-7103

kelsie.aziz@Ketchum.com

UPHEALTH, INC.

NON-GAAP FINANCIAL INFORMATION

Non-GAAP Financial Information

This press release includes financial measures that are not calculated in accordance with U.S. generally accepted accounting principles (GAAP). To supplement UpHealth’s condensed consolidated financial statements presented in accordance with GAAP, UpHealth presents investors with non-GAAP financial measures, including pro forma revenue, pro forma gross margin and adjusted EBITDA.

•Pro forma revenue consists of GAAP revenue and revenue from UpHealth’s subsidiaries prior to their acquisition.

•Pro forma gross margin consists of GAAP gross margin and gross margin from UpHealth’s subsidiaries prior to their acquisition.

•Adjusted EBITDA consists of net income (loss) attributable to UpHealth, Inc., excluding depreciation and amortization; stock-based compensation; lease abandonment expenses; goodwill/intangible asset impairment; contingent liabilities; acquisition, integration, and transformation costs; other income (expense); income tax benefit (expense); income (loss) from equity method investment; net income (loss) attributable to noncontrolling interests; and other non-recurring charges to GAAP net income (loss) attributable to UpHealth, Inc. Other non-recurring charges to GAAP net income (loss) attributable to UpHealth, Inc. may include transaction expenses in connection with capital raising transactions (whether debt, equity or equity-linked) and acquisitions, whether or not consummated, purchase price adjustments, the cumulative effect of a change in accounting principles, or other expenses determined to be non-recurring.

UpHealth believes that the presentation of these non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to UpHealth’s financial condition and results of operations. Management believes that the items described above provide an additional measure of UpHealth’s operating results and facilitates comparisons of UpHealth’s core operating performance against prior periods and business model objectives. This information is provided to investors in order to facilitate additional analyses of past, present, and future operating performance and as a supplemental means to evaluate UpHealth’s ongoing operations. UpHealth believes that these non-GAAP financial measures are useful to investors in their assessment of UpHealth’s operating performance.

Pro forma revenue, pro forma gross margin and adjusted EBITDA are not calculated in accordance with GAAP, and should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. You should not consider these measures in isolation or as a substitute for analysis of UpHealth’s results as reported under GAAP. UpHealth compensates for these limitations by prominently disclosing GAAP financial measures and providing investors with reconciliations from UpHealth’s GAAP operating results to the non-GAAP financial measures for the relevant periods.

The accompanying tables provide more details on the GAAP financial measures that are most directly comparable to the non-GAAP financial measures described above and the related reconciliations between these financial measures.

UPHEALTH, INC.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (1)

(In thousands)

	Three Months Ended March 31, 2022
	GAAP
Revenue	$	35,972
Gross margin	43		%
Loss from operations	$(25,000) - $(33,000)
Depreciation and amortization	5,000 - 6,000
Stock-based compensation	1,400
Acquisition, integration and transformation costs, lease abandonment expenses, goodwill impairment, and non-recurring expenses (4)	17,300 - 24,300
Adjusted EBITDA	$(1,300)

	Three Months Ended March 31, 2021
	GAAP			Adjustments (2)			Pro Forma (3)
Revenue	$	12,816		$	17,792		$	30,608
Gross margin	54		%	37		%	44		%
Net loss attributable to UpHealth, Inc.	$	(2,949)		$	(923)		$	(3,872)
Net loss attributable to noncontrolling interests	(78)			22			(56)
Net loss	(3,027)			(901)			(3,928)
Other expense	34			9			43
Income tax benefit	(406)			(99)			(505)
Loss from equity method investment	561			—			561
Loss from operations	(2,838)			(991)			(3,829)
Depreciation and amortization	922			1,837			2,759
Acquisition, integration and transformation costs, and non-recurring expenses (5)	2,686			1,407			4,093
Adjusted EBITDA	$	770		$	2,253		$	3,023

(1) See Non-GAAP Financial Information section for definitions of our non-GAAP financial measures.

(2) Amounts reflect operating activity of UpHealth and subsidiaries during the period prior to each subsidiary’s acquisition date, if acquired during the period.

(3) Amounts reflect operating activity of UpHealth and subsidiaries during the period, as if acquired at the beginning of the period.

(4) Amounts reflect acquisition, integration and transformation costs, lease abandonment expenses, and goodwill impairment from the consolidated statements of operations, as well as other operating expenses considered to be non-recurring during the period.

(5) Amounts reflect acquisition, integration and transformation costs from the consolidated statements of operations, as well as other operating expenses considered to be non-recurring during the period.

UPHEALTH, INC.

SEGMENT INFORMATION AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (1)

(In thousands, unaudited)

	Three Months Ended March 31, 2022
	GAAP
Revenue:
Integrated care management (4)	$	2,612
Virtual care infrastructure (5)	15,630
Services (6)	17,730
Total	$	35,972
	Three Months Ended March 31, 2022
	GAAP
Gross Margin:
Integrated care management (4)	$	1,637
Virtual care infrastructure (5)	7,409
Services (6)	6,258
Total	$	15,304
	Three Months Ended March 31, 2022
	GAAP
Gross Margin %:
Integrated care management (4)	63%
Virtual care infrastructure (5)	47%
Services (6)	35%
Total	43%

	Three Months Ended March 31, 2021
	GAAP		Adjustments (2)		Pro Forma (3)
Revenue:
Integrated care management (4)	$	6,289	$	—	$	6,289
Virtual care infrastructure (5)	590		10,209		10,799
Services (6)	5,937		7,583		13,520
Total	$	12,816	$	17,792	$	30,608
	Three Months Ended March 31, 2021
	GAAP		Adjustments (2)		Pro Forma (3)
Gross Margin:
Integrated care management (4)	$	5,219	$	—	$	5,219
Virtual care infrastructure (5)	299		4,194		4,493
Services (6)	1,412		2,407		3,819
Total	$	6,930	$	6,601	$	13,531
	Three Months Ended March 31, 2021
	GAAP		Adjustments (2)		Pro Forma (3)
Gross Margin %:
Integrated care management (4)	83%		n/a		83%
Virtual care infrastructure (5)	51%		41%		42%
Services (6)	24%		32%		28%
Total	54%		37%		44%

UPHEALTH, INC.

SEGMENT INFORMATION AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (1)

(In thousands, unaudited)

(1)	See Non-GAAP Financial Information section for definitions of our non-GAAP financial measures.
(2)	Amounts reflect operating activity of UpHealth and subsidiaries during the period prior to each subsidiary’s’ acquisition date, if acquired during the period.
(3)	Amounts reflect operating activity of UpHealth and subsidiaries during the period, as if acquired at the beginning of the period. Segment Information Our business is organized into three operating business segments: Integrated Care Management—through our Thrasys subsidiary; Virtual Care Infrastructure—through our Glocal and Cloudbreak subsidiaries; and Services—through our Innovations, BHS and TTC subsidiaries. The reportable segments are consistent with how management views our services and products and the financial information reviewed by the chief operating decision makers. We manage our businesses as components of an enterprise for which separate information is available and is evaluated regularly by the chief operating decision makers in deciding how to allocate resources and assess performance.

(4)	In the Integrated Care Management segment, we provide our customers with an advanced, comprehensive, and extensible technology platform, marketed under the umbrella “SyntraNetTM” to manage health, quality of care, and costs, especially for individuals with complex medical, behavioral health, and social needs.
(5)	In the Virtual Care Infrastructure segment, we provide technology and process-based healthcare platforms providing our customers comprehensive primary care, specialty consultations, and translation services, through telemedicine, Digital Dispensaries, and technology-based hospital centers.
(6)	In the Services segment, we provide custom compounded medications for the unique needs of every patient and prescriber. We are a full-service pharmacy filling prescriptions from our inventory of compounded medications, as well as drugs purchased from manufacturers. Additionally, we provide inpatient and outpatient substance abuse and mental health treatment services for individuals with drug and alcohol addiction and other behavioral health issues. We offer a complete continuum of care from detoxification services, residential care, partial hospitalization programs, and intensive outpatient and outpatient programs.

UPHEALTH, INC.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GUIDANCE (1)

(in millions, unaudited)

	Full Year 2022 Guidance
	Low		High
Loss from operations	$	(4)	$	(2)
Depreciation and amortization	11		13
Stock-based compensation	7		8
Adjusted EBITDA	$	14	$	19

EX-99.2

Exhibit 99.2

UpHealth Announces Samuel J. Meckey as New Chief Executive Officer

Meckey, a veteran healthcare leader in leading global institutions, will join the company in July

DELRAY BEACH, Fla., May 12, 2022 -- UpHealth, Inc. (NYSE: UPH) —Samuel J. Meckey will join UpHealth, Inc. as Chief Executive Officer in July. The appointment was announced today by Dr. Avi Katz, Co-Chairman of the company’s Board of Directors.

“Sam has considerable healthcare experience in publicly traded companies and a consistent track record of delivering exceptional results,” said Dr. Katz. “The Board and I are confident that his experience and expertise will accelerate UpHealth’s transformation and growth. Sam excels at building winning teams, creating a client-first culture, driving innovation that meets market needs and delivering against operational excellence goals.”

Meckey was most recently Executive Vice President and Head of Healthcare at EXLService Holdings, Inc., a leading data analytics, digital operations, technology and solutions company. During his tenure, he integrated five separate businesses into one cohesive operating unit and developed the strategic plan to double the business’s size, grew revenues and net income, increased gross margin and significantly improved return on invested capital.

Prior to joining EXL, he was President of Optum Global Solutions, overseeing the company’s global operations and technology services organization. There, Mr. Meckey was responsible for more than 35,000 employees in India, the Philippines, Brazil and the United States. Under his leadership, revenue and earnings significantly increased.

Before beginning his career in healthcare, Mr. Meckey was an officer and pilot in the United States Navy. He completed his undergraduate work in economics at the United States Naval Academy and earned a master’s degree from Harvard Business School.

“It is an honor to join UpHealth almost one year into its journey as a publicly traded company,” said Mr. Meckey. “The company’s potential to affect positive change in healthcare globally is enormous, as is its potential for growth in every aspect of its businesses. I look forward to collaborating with the accomplished leadership team at the company to deliver exceptional results for our clients and shareholders.”

Mr. Meckey replaces Dr. Ramesh Balakrishnan, whom the company announced would be moving to another role last month. Dr. Balakrishnan will become the company’s Chief Strategy Officer when Mr. Meckey joins. Until that time, he will serve as Chief Executive Officer and will be instrumental in Mr. Meckey’s transition into the company.

“Sam and I have had the opportunity to get acquainted, and I see him as a dynamic, ambitious and high integrity leader who will guide us toward our mission to power the world’s most trusted health institutions to achieve their access, quality and affordability goals. His strong client orientation, disciplined approach to operations and passion for innovation will materially accelerate our progress as an institution. I’m eager to partner with him in my new role and am confident the company will see much success under this leadership,” said Dr. Balakrishnan.

Dr. Katz said, “When the Board and I announced last month that we were seeking a new Chief Executive Officer, we said that our ideal candidate would be a proven leader with deep expertise in healthcare, services and technology institutions and with demonstrated operational excellence experience. Sam fits all these criteria—and more. We are looking forward to collaborating with Sam as he shapes our journey toward becoming a leading institution in healthcare."

About UpHealth UpHealth is a global digital health company that delivers digital-first technology, infrastructure, and services to dramatically improve how healthcare is delivered and managed. UpHealth's solutions holistically enable clients to deliver on their affordability, access, quality, outcomes, and patient experience goals. UpHealth's technology platform helps its clients improve access, coordinate care teams, and achieve better patient outcomes at lower cost, with care management solutions, analytics, and telehealth tools that serve patients wherever they are, in their native language. Additionally, UpHealth's technology-enabled virtual care infrastructure and services improves access to quality primary and acute care, behavioral health, and pharmacy services. UpHealth's clients include health plans, global governments, healthcare providers and community-based organizations.

For more information, please visit https://uphealthinc.com and follow us at @UpHealthInc on Twitter and UpHealth Inc on LinkedIn.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of U.S. federal securities laws. Such forward-looking statements include, but are not limited to, the hiring and the start date of UpHealth’s new CEO, and the expectations, hopes, beliefs, intentions, plans, prospects or strategies regarding the future revenue, growth and business plans of UpHealth’s management team. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,”" “potential,”" “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. The forward-looking statements contained in this press release are based on certain assumptions and analyses made by the management of UpHealth in light of their respective experience and perception of historical trends, current conditions, and expected future developments and their potential effects on UpHealth as well as other factors they believe are appropriate in the circumstances. There can be no assurance that future developments affecting UpHealth will be those anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the control of the parties), or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, including the mix of services utilized by UpHealth’s customers and such customers’ needs for these services, market acceptance of new service offerings, the ability of UpHealth to expand what it does for existing customers as well as to add new customers, the ability of the new CEO to begin work when anticipated, that UpHealth will have sufficient capital to operate as anticipated, and the impact that the novel coronavirus and the illness, COVID-19, that it causes, as well as government responses to deal with the spread of this illness and the reopening of economies that have been closed as part of these responses, may have on UpHealth’s operations, the demand for UpHealth’s products, global supply chains and economic activity in general. Should one or more of these risks or uncertainties materialize or should any of the assumptions being made prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.

Media Contact

Amanda Crane

Main: (630) 363-3393

amanda.crane@ketchum.com

XML

Cover	May 12, 2022
Cover [Abstract]
Document Type	8-K
Document Period End Date	May 12, 2022
Entity Registrant Name	UpHealth, Inc.
Entity Address, Address Line One	14000 S. Military Trail,
Entity Address, Address Line Two	Suite 203
Entity Address, City or Town	Delray Beach,
Entity Address, Postal Zip Code	33484
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Document Information [Line Items]
Document Period End Date	May 12, 2022
Entity Registrant Name	UpHealth, Inc.
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Central Index Key	0001770141
Amendment Flag	false
Entity Address, State or Province	FL
Local Phone Number	618-1322
City Area Code	312
Entity Incorporation, State or Country Code	DE
Entity File Number	001-38924
Entity Tax Identification Number	83-3838045
Common Stock, par value $0.0001 per share
Document Information [Line Items]
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	UPH
Security Exchange Name	NYSE
Redeemable Warrants, exercisable for one share of Common Stock at an exercise price of $11.50 per share
Document Information [Line Items]
Title of 12(b) Security	Redeemable Warrants, exercisable for one share of Common Stock at an exercise price of $11.50 per share
Trading Symbol	UPH.WS
Security Exchange Name	NYSE