CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2021

CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

12.	CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

DMEscripts LLC— In connection with the formation of the JV, the Company entered into a promissory note that evidences a LOC pursuant to a JV Loan Agreement, to which the Company has agreed to provide up to $3.0 million in debt funding to the JV. In accordance with the JV Loan Agreement, the LOC bears interest at the rate of 7.5% per annum. The LOC calls for monthly interest only payments until the sooner of August 16, 2025 or the borrower achieving Breakeven Performance, at which time the remaining outstanding principal amount is amortized in equal monthly installments over five years. Amounts due under the LOC may be prepaid at any time. As of December 31, 2021, the outstanding balance of $2.1 million under the LOC was recorded as a note receivable, related party on the consolidated balance sheet. In addition, the Company has $0.1 million of accounts receivable due from the JV pursuant to a transition services agreement included within prepaid expenses and other current assets on the consolidated balance sheet.

Commercial Transactions with Sponsor’s Portfolio Companies:

Change Healthcare—In December 1999, the Company entered into an agreement with Change Healthcare, a company affiliated with the Sponsor since 2011, to perform various revenue and payment cycle management functions. The Company paid Change Healthcare approximately $3.4 million, $3.4 million and $3.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. Amounts included in accounts payable were $0.2 million as of December 31, 2021 and 2020.

BREIT Industrial Canyon PA1W01 LLC—In May 2018, the Company began paying BREIT Industrial Canyon, a subsidiary of Blackstone Real Estate Income Trust, Inc., which is a non-exchange traded, perpetual life real estate investment trust externally managed by an affiliate of the Sponsor, which had acquired a property for which the Company is in a lease agreement through October 2023. The Company paid BREIT Industrial Canyon approximately $1.2 million, $0.7 million and $0.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. The discounted operating lease liability for the remaining non-cancelable lease term is $1.2 million and $1.7 million as of December 31, 2021 and 2020, respectively.

Mphasis—In September 2019, the Company entered into an eighty-seven-month agreement with Mphasis, a Company affiliated with the Sponsor since 2016, to perform various technology related services previously performed by another outsource vendor. The Company has the right to terminate for convenience with a minimum three-month notice. If the Company terminated the agreement, the required obligation to the vendor would be approximately $1.9 million for services during the three-month cancellation notice period plus termination fees. The Company paid Mphasis approximately $5.9 million, and $4.5 million for the years ended December 31, 2021 and 2020, respectively. Amounts included in accounts payable were $0.9 million and $0.4 million as of December 31, 2021 and 2020, respectively.

Alight Solutions—In December 2019, the Company entered into an agreement with Alight Solutions, a Company affiliated with the Sponsor since 2017, to perform services related to the deployment of a new financial management system. The Company also entered into a three-year post-implementation support contract that is expected to begin in 2022. The Company has the right to terminate for convenience with a minimum thirty-day notice. If the Company terminated the agreement, the required obligation to the vendor would be approximately $0.4 million for termination fees. The Company paid Alight approximately $1.5 million and $1.2 million for the years ended December 31, 2021 and 2020, respectively. Amounts included in accounts payable were $0.2 million and $0.3 million as of December 31, 2021 and 2020, respectively.

Blue Yonder— Blue Yonder, a Company affiliated with the Sponsor, provides software solutions for supply chain planning optimization. The Company paid Blue Yonder, approximately $0.0 million and $0.9 million for the period ended September 17, 2021, the date Blue Yonder was sold, and the year ended December 31, 2020, respectively. No amounts were included in accounts payable as of December 31, 2021 and December 31, 2020.

Apria, Inc. 10-K