CLOVER HEALTH INVESTMENTS, CORP. /DE 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed under the Exchange Act, such as this report, is recorded, processed, summarized, and reported within the time period specified in the SEC's rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including the chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Our management evaluated, with the participation of our current chief executive officer and chief financial officer (our "Certifying Officers"), the effectiveness of our disclosure controls and procedures as of December 31, 2021, pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Based upon that evaluation, our Certifying Officers concluded that, as of December 31, 2021, our disclosure controls and procedures were not effective due to a material weakness in internal control over financial reporting, as described below. We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Internal Control over Financial Reporting Internal control over financial reporting is defined in Rule 13a-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the Corporation’s principal executive and principal financial officers and effected by the Corporation’s Board, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles (GAAP) and includes those policies and procedures that: • pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of assets of the Corporation; • provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Corporation are being made only in accordance with authorizations of management and directors of the Corporation; and • provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Corporation’s assets that could have a material effect on the financial statements. 129 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate. With the exception of the material weakness noted below, no change occurred during the fourth quarter of 2021 that has materially affected, or is reasonably likely to materially affect, the Corporation’s internal control over financial reporting. Management’s report on internal control over financial reporting is set forth below and should be read with these limitations in mind. Management’s Report on Internal Control over Financial Reporting The Corporation’s management is responsible for establishing and maintaining adequate internal control over financial reporting for the Corporation. Management assessed the effectiveness of the Corporation’s internal control over financial reporting as of December 31, 2021, using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework (2013) . Based on this assessment, management identified a deficiency in internal control over financial reporting that resulted in a material weakness as discussed below. Notwithstanding the identified material weakness, management believes the consolidated financial statements included in this Annual Report on Form 10-K fairly represent in all material respects our financial condition, results of operations, and cash flows at and for the periods presented in accordance with GAAP. The effectiveness of our internal control over financial reporting as of December 31, 2021, has been audited by Ernst & Young LLP, an independent registered public accounting firm (PCAOB ID: 42 ), as stated in their report which appears below. Background and Remediation of Material Weakness - Technical Accounting Related to Stock-Based Compensation Expense A material weakness is a deficiency, or combination of deficiencies, in internal controls over financial reporting, such that there is a reasonable possibility that a material misstatement of the Corporation’s annual or interim financial statements will not be prevented or detected on a timely basis. The Corporation’s management, with the oversight of the Audit Committee of our Board of Directors, concluded that the deficiency described below rises to the level of a material weakness, as it had the potential to allow for a material dollar amount of misstatement to our financial statements being made without being detected. As a result of management’s review, in connection with the preparation of the Corporation’s audited financial statements for the year ended December 31, 2021, of certain performance restricted stock unit awards (PRSUs) issued by the Corporation in connection with its January 2021 business combination with Social Capital Hedosophia Holdings Corp. III, the expense associated with the PRSUs was determined to have been recognized over a shorter vesting period than required under Accounting Standards Codification 718, during the first three quarters of 2021. As a result, the Corporation overstated the stock-based compensation expense, total operating expenses, loss from operations, net loss, comprehensive loss, additional paid-in capital, and accumulated deficit by approximately $13.2 million in the aggregate for the quarters ended March 31, 2021, June 30, 2021, and September 30, 2021. Our controls, specifically the review of assumptions related to determining the expense associated with stock-based compensation awards, did not operate as designed, resulting in an adjustment in fourth quarter 2021 to decrease operating expenses within the consolidated statements of operations and additional paid-in capital within the Corporation’s consolidated balance sheet. Management has concluded that these adjustments were immaterial both individually and in the aggregate with respect to each interim period during the year ended December 31, 2021. As a result of this deficiency, management has concluded that we did not maintain effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria described above. In response to the material weakness, we intend to continue to take steps to remediate the material weakness through enhancements that include, but are not limited to, hiring additional resources and further enhancing our business processes and related internal controls. Additionally, the staff responsible for preparing and reviewing stock-based compensation expense will complete additional training in the accounting of these types of complex stock awards as prescribed by current accounting standards. We are committed to maintaining a strong internal control environment. With the implementation and operating effectiveness of these corrective actions, we anticipate that the material weakness identified above could be deemed remediated as early as the quarter ending March 31, 2022. . 130 Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Clover Health Investments, Corp. Opinion on Internal Control Over Financial Reporting We have audited Clover Health Investments, Corp.’s internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, because of the effect of the material weakness described below on the achievement of the objectives of the control criteria, Clover Health Investments, Corp. (the Company) has not maintained effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. The following material weakness has been identified and included in management’s assessment. Management has identified a material weakness in controls; specifically, the review of assumptions used in determining the expense associated with stock-based compensation awards did not operate as designed. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, changes in stockholders’ deficit and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and the financial statement schedules listed in the Index at Item 15(a). This material weakness was considered in determining the nature, timing and extent of audit tests applied in our audit of the 2021 consolidated financial statements, and this report does not affect our report dated February 28, 2022, which expressed an unqualified opinion thereon. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP New York, New York 131 February 28, 2022 Item 9B. Other Information None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. Part III Item 10. Directors, Executive Officers and Corporate Governance Executive Officers and Directors The following table provides information regarding our executive officers and directors as of February 22, 2022: Name Age Position(s) Executive Officers Vivek Garipalli 43 Chief Executive Officer and Chairman Andrew Toy 43 President, Chief Technology Officer and Director Mark C. Herbers 67 Interim Chief Financial Officer Jamie L. Reynoso 52 Chief Operating Officer Prabhdeep Singh 37 Chief Growth Officer Non-Employee Directors Chelsea Clinton (1)(2) 41 Director Demetrios L. Kouzoukas (3) 46 Director William G. Robinson, Jr. (1)(3) 57 Director Lee A. Shapiro (2)(3) 65 Director Nathaniel S. Turner 36 Director (1) Member of the Talent and Compensation Committee. (2) Member of the Nominating and Corporate Governance Committee. (3) Member of the Audit Committee. Executive Officers Vivek Garipalli . Vivek Garipalli has served as our Chief Executive Officer and as a member of our Board of Directors since the Closing and previously held the same positions with Clover, which Mr. Garipalli co-founded, since July 2014. Previously, Mr. Garipalli also served as Clover’s President from July 2014 to March 2019. Mr. Garipalli holds a B.B.A. in entrepreneurship from Emory University. We believe that Mr. Garipalli is qualified to serve as a member of our Board of Directors due to the perspective and experience he brings as Clover’s co-founder and Chief Executive Officer and due to his extensive experience managing healthcare companies. Andrew Toy . Andrew Toy has served as our President, our Chief Technology Officer and as a member of our Board of Directors since the Closing and previously held the same positions with Clover since March 2019, February 2018 and November 2018, respectively. Prior to joining Clover, from May 2014 to February 2018, Mr. Toy served as a Product Director at Google LLC, a multinational technology company, where we coordinated enterprise activities for the Android team and ran Machine Learning, Enterprise Search, and analytics for the G-Suite team. Before that, he was the CEO and co-founder of Divide, a company focused on creating a split between work and personal data on mobile devices, which was acquired by Google in 2014. Mr. Toy holds a B.S. and an M.S. in computer science from Stanford University. 132 We believe that Mr. Toy is qualified to serve as a member of our Board of Directors due to the perspective and experience he brings as Clover’s President and Chief Technology Officer and due to his extensive experience overseeing technology and analytics and serving in leadership positions at other companies. Mark C. Herbers . Mark C. Herbers has served as our Interim Chief Financial Officer since August 2021. Since 2014, Mr. Herbers has served as a Director of AlixPartners, LLP, a global consulting firm. He also served as Interim CFO of American Renal Associates, a provider of outpatient dialysis services, from 2019 to 2021, as CEO/CRO of El Paso Children’s Hospital, a hospital, from 2015 to 2016, as Chief Financial Officer of St. Clare’s Health System, a hospital system, from 2012 to 2014, and as Managing Director at FTI Consulting, a consulting firm, from 2005 to 2014. Mr. Herbers holds a B.S. from Georgetown University and an MBA from Washington University in St. Louis, and he is a certified public accountant. Jamie L. Reynoso . Jamie L. Reynoso has served as our Chief Operating Officer since the Closing and previously held the same position with Clover since July 2020. Prior to joining Clover, Ms. Reynoso served as the Chief Executive Officer and the Chief Operating Officer of Memorial Hermann Health Solutions, Inc., a provider of health insurance plans, from April 2016 to December 2019. From November 2012 to April 2016, Ms. Reynoso served as the Regional Vice President of Payer Strategy and Operations at Catholic Health Initiatives, a nonprofit, faith-based health system. Ms. Reynoso holds a B.B.A. from Texas A&M University-Kingsville. Prabhdeep Singh . Prabhdeep Singh has served as our Chief Growth Officer since July 2021. Prior to joining Clover, Mr. Singh held the following positions at WeWork, a commercial real estate company: Global Head of Marketplace from February 2020 to July 2021, and Global Head of WeWork Labs from October 2018 to February 2020. Mr. Singh also held several positions at Uber Eats, an online food ordering and delivery company, including Head of Enterprise from January 2018 to October 2018 and as a General Manager from December 2016 to December 2017. From January 2013 to December 2016, Mr. Singh was a General Manager and Head of GLG Labs at the Gerson Lehrman Group, an international consulting firm. Mr. Singh holds a B.A. in Political Science and Philosophy from Boston College. Non-Employee Directors Chelsea Clinton . Chelsea Clinton has served as a member of our Board of Directors since the Closing and previously held the same position with Clover since February 2017. Since March 2013, Ms. Clinton has served as Vice Chair of the Clinton Foundation, where her work emphasizes improving global and domestic health, creating service opportunities and empowering the next generation of leaders. Ms. Clinton has also served as an Adjunct Assistant Professor at Columbia University’s Mailman School of Public Health since 2012. Ms. Clinton has served as a member of the board of directors of the Clinton Health Access Initiative since September 2011. Ms. Clinton has served as a member of the boards of directors of IAC Holdings, Inc., a media and internet company, since September 2011, Expedia Group, Inc. (formerly Expedia, Inc.), an online travel shopping company, since March 2017 and Nurx Inc., a telemedicine start-up company, since June 2018. In addition to her for-profit affiliations, Ms. Clinton currently serves on the boards of directors of The School of American Ballet, The Africa Center, the Weill Cornell Medical College and Columbia University’s Mailman School of Public Health, and as Co-Chair of the Advisory Board of the Of Many Institute at New York University. Ms. Clinton holds a B.A. in history from Stanford University, an MPhil and a DPhil in international relations from Oxford University and an M.P.H. from Columbia University’s Mailman School of Public Health. We believe that Ms. Clinton is qualified to serve as a member of our Board of Directors because of her extensive health background, her experience as a director of public companies and non-profit organizations and her knowledge of our industry. Demetrios L. Kouzoukas . Demetrios L. Kouzoukas has served as a member of Clover’s Board of Directors since April 13, 2021. From February 2017 until January 2021, Mr. Kouzoukas served as the Director of the Center for Medicare and the Principal Deputy Administrator of the Centers for Medicare & Medicaid Services (CMS). Prior to joining CMS, from 2012 to 2016, Mr. Kouzoukas served as General Counsel of the Medicare and Retirement Division of UnitedHealthcare, a health insurance company. Prior to UnitedHealthcare, from 2003 to 2009, Mr. Kouzoukas was Principal Associate Deputy Secretary of the U.S. Department of Health and Human Services (HHS), with responsibility for regulatory policy across HHS, and Deputy General Counsel. In 2014, Mr. Kouzoukas was appointed a Public Member of the Administrative Conference of the United States. Mr. Kouzoukas holds a B.A. in Political Science and Public Policy from The George Washington University and a J.D. from the University of Illinois College of Law. We believe that Mr. Kouzoukas is qualified to serve as a member of our Board of Directors because of his in depth regulatory healthcare background, his experience as general counsel of a division of a health insurance company and his knowledge of our industry. William G. Robinson, Jr. William G. Robinson, Jr. has served as a member of our Board of Directors since March 25, 2021. Mr. Robinson has served as the President of Broadgate Human Capital, LLC, a management consulting firm, since October 2018. Prior to Broadgate, Mr. Robinson served as the Executive Vice President and Chief Human Resources Officer for Sabre Corporation, a travel 133 technology company, from December 2013 to September 2017. Prior to Sabre, Mr. Robinson served as the Senior Vice President and Chief Human Resources Officer at Coventry Health Care, a diversified managed health care company from 2012 to 2013. From 2010 to 2011, Mr. Robinson served as Senior Vice President for human resources at Outcomes Health Information Solutions, a healthcare analytics and information company specializing in the optimization and acquisition of medical records. Prior to that, from 1990 to 2010, he worked for General Electric, where he held several human resources leadership roles in diverse industries including information technology, healthcare, energy, security and industrial. Mr. Robinson has served as a member of the board of directors of American Public Education, Inc. since June 2016 and Must Ministries since June 2019. He has also served as a member of the board of trustees for the American Public University System since May 2020. Mr. Robinson holds a B.A. in communications from Wake Forest University and an M.A. in human resources from Bowie State University. We believe that Mr. Robinson is qualified to serve as a member of our Board of Directors because of his extensive experience as an executive officer in technology and healthcare companies, his experience as a director of a public company, and his knowledge of our industry. Lee A. Shapiro . Lee A. Shapiro has served as a member of our Board of Directors since the Closing. Mr. Shapiro co-founded and has served as the Managing Partner at 7Wire Ventures, an early-stage healthcare venture fund, since June 2013. Mr. Shapiro previously served as Chief Financial Officer of Livongo Health, Inc., a mobile health monitoring technology company, from December 2018 to November 2020, and as a member of the board of directors from August 2013 until April 2019. Mr. Shapiro joined Allscripts Healthcare Solutions, Inc., a provider of electronic prescribing, practice management and electronic health record technology, in April 2000 and served as President from April 2002 to December 2012. He previously served as a director of Tivity Health, Inc., a provider of fitness and health improvement programs, from May 2015 to May 2020 and a director of Medidata Solutions, Inc., a global provider of cloud-based solutions for life sciences, from June 2011 to October 2019. He has served as a director of Click Therapeutics, Inc., a biotechnology company, since April 2021, and also serves as a director of some of the 7Wire Ventures portfolio companies. He serves on the National Board of the American Heart Association and the advisory board of the University of Chicago George Schulz Innovation Fund. Mr. Shapiro holds a B.S. in accountancy from the University of Illinois Urbana-Champaign and a J.D. from The University of Chicago Law School. We believe that Mr. Shapiro is qualified to serve as a member of our Board of Directors because of his extensive finance background, including service as a Chief Financial Officer of a public company, his experience as a director of a public company, and his knowledge of our industry. Nathaniel S. Turner . Nathaniel S. Turner has served as a member of our Board of Directors since the Closing and previously held the same position with Clover since April 2015. Mr. Turner co-founded and served as the Chief Executive Officer of Flatiron Health, Inc., a cancer research and data collection software company, from June 2012 to April 2021 and since that time has served as Chairman of the Board of that entity. Since July 2021, Mr. Turner has served as a director of Sema4 Holdings Corp., a health intelligence company. From June 2010 to June 2012, Mr. Turner served as a Product Manager at Google Inc. Mr. Turner holds a B.S. in economics from the Wharton School of the University of Pennsylvania. We believe that Mr. Turner is qualified to serve as a member of our Board of Directors because of his extensive experience as an investor in many technology, high-growth, healthcare companies, his experience as an executive at a healthcare company, and his knowledge of our industry. Family Relationships There are no family relationships among any of our directors or executive officers. Delinquent Section 16 Reports Section 16(a) of the Exchange Act requires our directors, executive officers and any persons who own more than 10% of our common stock to file initial reports of ownership and reports of changes in ownership with the SEC. Based solely on our review of the copies of such forms filed with the SEC and written representations from the directors and executive officers, we believe that all Section 16(a) filing requirements were timely met in the year ended December 31, 2021, except for one Form 4 reporting a grant of restricted stock units to Lee A. Shapiro, which was filed one day late due to an administrative error. Code of Business Conduct and Ethics Our Board of Directors has adopted a code of ethics that applies to all of our executive officers, directors and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. The code of ethics is available on our website, www.investors.cloverhealth.com. In addition, we intend to make any legally 134 required disclosures regarding amendments to, or waivers of, provisions of our code of ethics on our website rather than by filing a Current Report on Form 8-K. Nominating and Corporate Governance Committee Our Nominating and Corporate Governance Committee consists of Chelsea Clinton and Lee A. Shapiro, with Mr. Shapiro serving as chair of the committee. The composition of our nominating and governance committee meets the requirements for independence under the current Nasdaq listing standards and SEC rules and regulations. Our Nominating and Corporate Governance Committee is responsible for, among other things: • identifying, evaluating and recommending nominees to our Board of Directors and its committees; • conducting searches for appropriate directors; • evaluating the performance of our Board of Directors and of individual directors; • considering and making recommendations to our Board of Directors regarding the composition of the board and its committees; • reviewing developments in our corporate governance practices; • evaluating the adequacy of our corporate governance practices and reporting; and • making recommendations to our Board of Directors concerning corporate governance matters. Our Nominating and Corporate Governance Committee has a written charter approved by our Board of Directors. A copy of the charter is available on the Investor Relations section of our website, which is located at https://investors.cloverhealth.com, by clicking on “Governance Overview” in the “Governance” section of our website. Nomination to the Board of Directors Candidates for nomination to our Board of Directors are selected by our Board of Directors based on the recommendation of our Nominating and Corporate Governance Committee in accordance with its charter, our restated certificate of incorporation and restated bylaws, our Corporate Governance Guidelines and the criteria approved by our Board of Directors regarding director candidate qualifications. In recommending candidates for nomination, our Nominating and Corporate Governance Committee considers candidates recommended by directors, officers, employees, stockholders and others, using the same criteria to evaluate all candidates. Among the criteria the Nominating and Corporate Governance Committee and the Board of Directors may consider are experience and diversity; and with respect to diversity, the Board may consider, among others, demographic factors, differences in professional background, experience at policy-making levels in business, finance, healthcare, law, technology, and other areas, education, skill, and other individual qualities and attributes. The Committee and the Board endorse the value of seeking qualified directors from backgrounds otherwise relevant to the Corporation’s mission, strategy and business operations and perceived needs of the Board at a given time. Our restated bylaws provide that stockholders may present nominations to be considered at an annual meeting by providing timely notice to our Secretary at our principal executive office. A stockholder’s notice to the Secretary must set forth the information required by our restated bylaws. If a stockholder who has notified Clover Health of such stockholder’s intention to present a nomination for persons for election at an annual meeting does not appear to present such stockholder’s proposal at such meeting, Clover Health does not need to present the nomination of persons for election for vote at such meeting. Audit Committee Our Audit Committee consists of Lee A. Shapiro, William G. Robinson, Jr., and Demetrios L. Kouzoukas, with Mr. Shapiro serving as the chair of the committee. The composition of our Audit Committee meets the requirements for independence under the current Nasdaq listing standards and SEC rules and regulations. Each member of our Audit Committee is financially literate. In addition, our Board of Directors has determined that Mr. Shapiro is an Audit Committee financial expert within the meaning of Item 407(d) of Regulation S-K of the Securities Act. Our Audit Committee is responsible for, among other things: • selecting a firm to serve as the independent registered public accounting firm to audit our financial statements; • helping to ensure the independence of the independent registered public accounting firm; • discussing the scope and results of the audit with the independent registered public accounting firm, and reviewing, with management and the independent accountants, our interim and year-end operating results; 135 • developing procedures for employees to anonymously submit concerns about questionable accounting or audit matters; and • considering the adequacy of our internal accounting controls and audit procedures. Our Audit Committee has a written charter approved by our Board of Directors. A copy of the charter is available on the Investor Relations section of our website, which is located at https://investors.cloverhealth.com, by clicking on “Governance Overview” in the “Governance” section of our website. Item 11. Executive Compensation Director Compensation Prior to the Closing, we had neither a formal compensation policy for our non-employee directors nor a formal policy of reimbursing expenses incurred by non-employee directors in connection with their board service. However, we reimbursed our non-employee directors for reasonable expenses incurred in connection with their attendance at Board of Directors or committee meetings and occasionally granted stock options. Non-Employee Director Compensation Policy In connection with the Business Combination, we adopted a new non-employee director compensation policy that became effective as of the Closing. Our non-employee director compensation policy is designed to align the interests of the non-employee directors with the interests of stockholders through equity awards and to attract and retain high quality non-employee directors by providing competitive compensation. Our policy is also designed to provide the appropriate amount of compensation based on the roles served, with additional cash retainers for service on committees and higher retainers for service as the lead independent director of our Board of Directors and as chairperson of our committees. Our policy also provides that we will reimburse our non-employee directors for reasonable expenses incurred in connection with their attendance at Board of Directors or committee meetings. During the year ended December 31, 2021, the non-employee directors eligible for compensation under the Non-Employee Director Compensation Policy were Chelsea Clinton, Demetrios L. Kouzoukas, William G. Robinson, Jr., Lee A. Shapiro, and Nathaniel S. Turner. Neither Mr. Garipalli nor Mr. Toy received any additional compensation for service as a director for 2021. The policy provides for the following annual cash retainers, which are payable quarterly in arrears and pro-rated for partial quarters of service: Annual Board Member Service Retainer • All Outside Directors: $50,000 • Outside Director serving as Chairperson: $50,000 (in addition to above) • Outside Director serving as Lead Independent Director: $30,000 (in addition to above) Annual Committee Member Service Retainer • Member of the Audit Committee: $10,000 • Member of the Talent and Compensation Committee: $7,500 • Member of the Nominating and Corporate Governance Committee: $5,000 Annual Committee Chair Service Retainer (in lieu of the Annual Committee Member Service Retainer) • Chairperson of the Audit Committee: $25,000 • Chairperson of the Talent and Compensation Committee: $20,000 • Chairperson of the Nominating and Corporate Governance Committee: $15,000 The policy also provides for equity awards of restricted stock units (RSUs) to be granted to the non-employee directors. Beginning with our 2022 annual meeting of stockholders (2022 Annual Meeting), these grants will be made to non-employee directors upon their initial election or appointment to our Board of Directors and annually during their continued service thereafter. During 2021 and until our 2022 Annual Meeting, transitional initial and annual RSU grants have been or will be made to our non-employee directors as follows: 136 Equity Grants Prior to 2022 Annual Meeting Prior to the 2022 Annual Meeting, non-employee directors will receive transitional RSU grants upon the following terms, which will vest, subject to continuous service through the applicable vesting dates: • Non-employee directors who are initially elected or appointed on or after January 7, 2021, but before April 1, 2021, will be granted RSUs valued at $400,000, which will vest as to 50% of the RSUs on the first anniversary of the Closing and as to the remaining RSUs on the date of the 2022 Annual Meeting. • Non-employee directors who are initially elected or appointed on or after April 1, 2021, but before the 2022 Annual Meeting, will be granted RSUs valued at $200,000, which will vest in full on the date of the 2022 Annual Meeting. • Non-employee directors who served as members of the Board of Directors of Legacy Clover prior to the Business Combination and continue to serve as members of our Board of Directors after the Closing Date will be granted RSUs valued at $400,000 multiplied by the anticipated number of whole months from the Closing Date until the 2022 Annual Meeting divided by 24, which will vest in full on the date of the 2022 Annual Meeting. • We granted 54,200 transitional RSUs to each of Mr. Robinson and Mr. Shapiro, effective April 1, 2021, 38,392 transitional RSUs to each of Mr. Turner and Ms. Clinton effective April 1, 2021, and 25,608 transitional RSUs to Mr. Kouzoukas effective April 13, 2021. Equity Grants Beginning at 2022 Annual Meeting Beginning at the 2022 Annual Meeting, non-employee directors will receive RSU grants upon the following terms, which will vest, subject to continuous service through the applicable vesting dates: • Non-employee directors who are initially elected or appointed on or after the 2022 Annual Meeting will be granted RSUs valued at $200,000, which will vest in full on the one-year anniversary of the director’s election or appointment. • In addition, at the close of business on each annual meeting of the shareholders beginning with the 2022 Annual Meeting, each non-employee director who has served at least three full months prior to such annual meeting will be granted RSUs valued at $200,000, which will vest in full on the earlier to occur of the next annual meeting of the shareholders or the one-year anniversary of the date of grant. Other Equity Grant Terms If a non-employee director remains in service on our Board of Directors until immediately prior to the closing of a “change in control” (as defined in our 2020 Equity Incentive Plan), the unvested portion of any RSU award granted to such director under the policy will vest in full immediately prior to and contingent upon the consummation of such change in control. In addition, the number of RSUs granted based on the values specified in our policy is determined by dividing the specified value by the closing price of our Class A common stock on the date of grant (or on the closest prior trading date), rounded down to the nearest whole number. Director Compensation Table for Fiscal Year 2021 The following table contains information concerning the compensation of our non-employee directors for the year ended December 31, 2021: Name Fees Earned or Paid in Cash ($) Stock Awards ($) (1)(2) All Other Compensation ($) Total ($) Chelsea Clinton 65,625 283,333 (3) — 348,958 Demetrios L. Kouzoukas 58,250 199,998 (4) — 258,248 William G. Robinson, Jr. 60,999 399,996 (5) — 460,995 Lee A. Shapiro 90,000 399,996 (5) — 489,996 Nathaniel S. Turner 55,007 283,333 (3) — 338,340 (1) Amounts shown in this column reflect the aggregate grant date fair value calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (FASB ASC Topic 718) for the transitional RSUs granted during 2021. These amounts reflect our accounting expense for these RSUs and do not represent the actual economic value that may be realized by the non-employee director. The grant date fair value of the RSUs is measured based on the closing price of our Class A common stock on the date of grant. See Note 18 (Employee Benefit Plans) to our audited financial statements in this report for further information about the assumptions underlying the calculations made with respect to RSU grants. (2) Our non-employee directors who served in 2021 held the following number of unexercised stock options and unvested RSUs as of December 31, 2021: 137 Name Options Outstanding Unvested Restricted Stock Units Outstanding Chelsea Clinton 685,690 38,392 Demetrios L. Kouzoukas N/A 25,608 William G. Robinson, Jr. N/A 54,200 Lee A. Shapiro N/A 54,200 Nathaniel S. Turner N/A 38,392 (3) Represents the aggregate grant date fair value of 38,392 RSUs granted on April 1, 2021, which vest in full on the date of our 2022 annual meeting of our stockholders (2022 Annual Meeting). (4) Represents the aggregate grant date fair value of 25,608 RSUs granted on April 13, 2021, which vest in full on the date of our 2022 Annual Meeting. (5) Represents the aggregate grant date fair value of 54,200 RSUs granted on April 1, 2021, 50% of which vested on January 7, 2022, and 50% of which will vest on the date of our 2022 Annual Meeting. The information contained in the following report of the Talent and Compensation Committee is not considered to be “soliciting material,” “filed,” or incorporated by reference in any past or future filing by the Corporation under the Securities Exchange Act of 1934 or the Securities Act of 1933 unless and only to the extent that the Corporation specifically incorporates it by reference. Compensation Committee Report The Talent and Compensation Committee has reviewed and discussed the following Compensation Discussion and Analysis with management. Based upon this review and discussion, the Talent and Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Submitted by the Compensation Committee of the Board of Directors: Chelsea Clinton William G. Robinson, Jr. Compensation Discussion and Analysis This Compensation Discussion and Analysis, or CD&A, explains our executive compensation philosophy and objectives. It also describes our fiscal year 2021 executive compensation program and the compensation paid in 2021 to our our named executive officers (NEOs), who were: • Vivek Garipalli, our Chief Executive Officer (CEO) • Mark C. Herbers, our Interim Chief Financial Officer • Andrew Toy, our President and Chief Technology Officer • Jamie L. Reynoso, our Chief Operating Officer • Prabhdeep Singh, our Chief Growth Officer • Joseph Wagner, our former Chief Financial Officer In July 2021, Prabhdeep Singh joined the company as our Chief Growth Officer. In August 2021, Joseph Wagner stepped down from his role as Chief Financial Officer of the Corporation, and Mark C. Herbers joined the Corporation as Interim Chief Financial Officer. Mr. Herbers provides services to us under an agreement with AP Services, LLC, an affiliate of Mr. Herbers’ employer, AlixPartners, LLP. Mr. Herbers is expected to serve in the role of Interim Chief Financial Officer while the Company conducts a search for a permanent Chief Financial Officer and until it appoints his replacement. This CD&A provides an overview of our executive compensation philosophy, the overall objectives of our executive compensation program, how each element of our executive compensation program is designed to satisfy those objectives, the policies underlying our 2021 executive compensation program, and the compensation awarded to our named executive officers for 2021. The following discussion and analysis of compensation arrangements of our named executive officers should be read together with the compensation tables and related disclosures. 138 2021 Executive Compensation Overview Philosophy and Objectives The cornerstone of our compensation philosophy is pay for performance. We tie a significant portion of our compensation for our named executive officers (NEOs) to the achievement of both near-term and long-term Corporation operating and financial goals. We consider all equity awards to be “at-risk” compensation because their value depends on Corporation performance. Under this rubric, all of the compensation awarded in fiscal 2021 to Vivek Garipalli, our CEO, was performance-based or at risk, and a substantial majority of t he target compensation awarded in fiscal 2021 to our other NEOs, as a group, was performance-based or at risk. Pay-for-performance compensation motivates our NEOs to achieve our strategic plan targets. By linking compensation to the achievement of the Corporation’s performance goals and refraining from special benefits, “golden parachute” excise tax gross-ups, or accelerated equity vesting (except in limited circumstances), we create long-term stockholder value and aligns the interests of our NEOs with those of our stockholders. We also seek to attract, motivate, and retain highly-qualified, top-performing executives who are committed to the Corporation’s mission, performance, and culture, by paying them competitively compared to our peer companies. What We Do • Reward performance that meets our predetermined goals • Base a significant portion of our CEO’s and NEOs’ compensation on performance • Align the interests of our NEOs with our stockholders by having a significant portion of compensation be equity awards • Cap payouts under our plans to discourage inappropriate risk taking by our NEOs • Have double-trigger change in control provisions for equity awards • Have only independent directors on our Talent and Compensation Committee • Our Talent and Compensation Committee retains an independent compensation consultant What We Do Not Do • Permit short-sales, hedging or pledging of our stock • Enter into employment agreements that provide for fixed terms or automatic compensation increases • Pay excessive change in control benefits • Provide executives with golden parachute tax gross-ups or excessive perquisites • Permit repricing or cashing out underwater stock options without stockholder approval • Maintain executive pension plans or retirement programs not generally available to all employees • Take excessive risks due to our compensation program’s annual risk assessment Executive Compensation Decisions Related to Executive Team Changes Employment Agreement with Prabhdeep Singh In June 2021, we entered into an employment agreement with Mr. Singh, our Chief Growth Officer, under which Mr. Singh will receive an annual base salary of $400,000 and an initial target cash bonus opportunity of fifty percent (50%) of his base salary, which was prorated for his first year of employment. Pursuant to his employment agreement, we also granted Mr. Singh certain equity awards as described in “ — Equity Awards for Other Executive Officers ” below. Mr. Singh’s employment agreement also provides for certain severance benefits, which we discuss in “ Potential Payments upon Termination or Change in Control ” below. 139 Joseph Wagner Separation Agreement In connection with his departure from employment on August 13, 2021, the Corporation entered into a separation agreement with Mr. Wagner, pursuant to which in exchange for a general release of claims against the Corporation, Mr. Wagner (i) received one month of COBRA premiums, (ii) received an extension of the post-termination exercise period in which he can exercise his then-vested and unexercised non-qualified stock options until August 13, 2022, and (iii) retained his Corporation-issued laptop. Pursuant to the separation agreement, Mr. Wagner will also receive $10,000 per month for a period of up to one year in exchange for consulting services provided to the Corporation. This agreement is discussed in more detail in “ Severance and Change in Control Benefits ” below. Agreement with AP Services, LLC Upon the departure of Mr. Wagner on August 13, 2021, Mr. Herbers was appointed to serve as our Interim Chief Financial Officer. Mr. Herbers is expected to serve in this role while we conducts our search for a permanent Chief Financial Officer and appoint his replacement. In connection with Mr. Herbers’ appointment, we entered into an Agreement for the Provision of Interim Management Services (Interim Service Agreement) with AP Services, LLC (APS), an affiliate of AlixPartners, LLP, where Mr. Herbers has been employed as a Director since 2014. Pursuant to the terms of the Interim Services Agreement, Mr. Herbers will continue to be employed by APS during the term of his service to us, and we will pay $175,000 per month in professional fees and $3,500 per month in administrative fees for his services as interim Chief Financial Officer. The Interim Services Agreement may be terminated by either party at any time by written notice to the other party, subject to the payment of fees and expenses incurred by APS through the date of the termination. Employment Agreement with Jamie L. Reynoso Effective as of December 31, 2021, we entered into an employment agreement with Ms. Reynoso, our Chief Operating Officer, which provides for an annual base salary of $425,000 and an initial target cash bonus opportunity of sixty (60%) of her base salary. Pursuant to her employment agreement, Ms. Reynoso is also entitled to receive certain equity awards as described in “ — Equity Awards for Other Executive Officers ” below. The December 31, 2021, employment agreement replaced an offer letter agreed to between Ms. Reynoso and the Corporation when Ms. Reynoso joined the Corporation as Chief Operating Officer in July 2020. Ms. Reynoso’s employment agreement also provides for certain severance benefits, which we discuss in “ Potential Payments upon Termination or Change in Control ” below. Elements of Compensation The three core components of our NEO direct compensation program are base salary, annual incentive bonuses, and equity awards. The Talent and Compensation Committee considers each compensation component individually and all components in the aggregate when making decisions regarding amounts awarded under each component. The Talent and Compensation Committee’s intent is generally to set each NEO’s base salary, target total cash compensation (base salary plus annual incentive bonuses at the target performance level), and total direct compensation (which also includes equity awards) to be competitive with the 50th to 75th percentile of the peer group survey data received from the Talent and Compensation Committee’s independent consultant, with appropriate adjustments to reflect the specific situation of each NEO, including how their roles may differ from those at other companies. Base salary is viewed as a primary indicator of the market value needed to attract and retain executives with the skills and expertise to perform the duties and discharge the responsibilities of their positions. Annual incentive awards are a means of rewarding job performance against that year’s operating plan. Equity awards are generally utilized as a means of linking executives’ long-term compensation to the Corporation’s long-term performance and retaining talent. 140 The Corporation’s compensation program rewards executive officers for progress against corporate operating goals and for their individual contributions. Element Form Objectives and Basis Base Salary Cash Attract and retain highly qualified executives to drive our success Annual Incentive Bonuses Cash Drive short-term Corporation performance Target bonus amount set as a percentage of base salary Actual payout based 80% on achievement of specified Corporation operating goals and 20% on individual performance Equity Awards Performance-Based RSUs (PRSUs) and Time-Based RSUs Drive long-term Corporation performance, align interests of executives with those shareholders, retain executives through long-term vesting, and provide potential wealth accumulation PRSUs for CEO and President are earned based on pre-established stock price milestones and continued service PRSUs for Ms. Reynoso were earned based on achievement of pre-established Corporation performance operating goals and vest with continued service RSUs typically vest annually over four-year periods, subject to continued service with us, and become more valuable as our stock price increases, which aligns our NEOs’ interests with those of all stockholders Other Executive Benefits Limited (See “ Other Executive Benefits ” below) Provide for the safety and wellness of our executives Offer competitive benefits generally available to all employees There are two notable exceptions to our overall 2021 compensation program. Mr. Garipalli, our CEO, pursuant to his employment agreement with us, agreed to forgo any base salary and annual incentive compensation. In addition, Mr. Herbers, our Interim Chief Financial Officer, is compensated through our agreement with AP Services, LLC, an affiliate of Mr. Herbers’ employer, AlixPartners, LLP, under which the Corporation pays $175,000 per month in professional fees and a monthly administrative fee of $3,50 0 for Mr. Herbers’ services. Mr. H erbers and AP Services, LLC are entitled to no other compensation from us in connection with Mr. Herbers’ service to the Corporation. Base Salary Base salary is a fixed component of our NEOs’ compensation and does not vary with Corporation performance. Base salaries are generally set at levels intended to be competitive and commensurate with each executive officer’s position, performance, skills and experience to attract and retain the best talent. The Talent and Compensation Committee reviews base salaries for our executive officers annually and adjusts them, if needed, to reflect changes in market conditions or other factors, including changed responsibilities as our executive officers’ positions evolve. Two of our NEOs’ base salaries increased in fiscal 2021. Pursuant to his employment agreement, effective as of the closing of the Business Combination, Mr. Toy’s annual base salary increased from $400,000 to $450,000. In addition, in July 2021, our Talent and Compensation Committee raised Ms. Reynoso’s base salary from $400,000 to $425,000. These base salary increases reflected market competitiveness and Mr. Toy’s and Ms. Reynoso’s increased duties. Annual Incentive Bonuses The Corporation implemented an annual cash bonus program in 2021. We use annual cash bonuses to align NEO performance with our near-term financial and operating objectives. Cash bonus target amounts are set as a percentage of base salary, and our Talent and Compensation Committee establishes Corporation performance goals, which are described in more detail below. For each executive officer eligible for an annual cash bonus for fiscal year 2021, 80% of the target bonus payout was based on Corporation performance against the pre-determined performance goals, and 20% was based on individual performance. In January 2022, the Talent and 141 Compensation Committee certified the bonus payouts based on achievement against the pre-determined performance goals and its assessment of individual NEO performance. As noted above, Mr. Garipalli and Mr. Herbers were not eligible for annual cash bonuses and did not receive bonus payments for 2021, and Mr. Wagner forfeited eligibility for a cash bonus when he departed employment in August 2021. Mr. Toy, Ms. Reynoso, and Mr. Singh, pursuant to their employment agreements with us, were eligible for annual cash bonuses of up to 100%, 60%, and 50% of their annual base salaries, respectively. Name 2021 Target Cash Bonus (% of Base Salary) Vivek Garipalli — Mark C. Herbers — Andrew Toy 100% Jamie L. Reynoso 60% Prabhdeep Singh 50% Joseph Wagner N/A For fiscal year 2021, the Talent and Compensation Committee established three equally-weighted Corporation performance metrics for annual incentive bonuses for the Corporation’s executive officers: • Growth in the number of our Medicare Advantage members on January 1, 2022, versus January 1, 2021 (MA Growth); • Growth in the number of our Direct Contracting beneficiaries on January 1, 2022, versus the launch of the program in April 2021 (DC Growth); and • The normalized medical care ratio for our Medicare Advantage plans, which is a measure that excludes the impacts of the COVID-19 pandemic from the calculation of our Medicare Advantage medical care ratio, which is defined as total net medical claims incurred divided by premiums earned, net (MCR). It also established threshold and target performance levels and maximum payout amounts for annual bonuses for each metric, with the achievement percentage to be interpolated between these levels linearly. In January 2022, the Talent and Compensation Committee reviewed Corporation performance against these performance levels and determined that the MA Growth performance metric was achieved at 66%, based on Corporation performance against the MA Growth performance levels, which were as follows: MA Growth 50% (Threshold) 75% 100% (Target) 150% (Maximum) FY 2021 Achievement % 82,303 85,595 88,888 93,826 66% The Talent and Compensation Committee also determined that the threshold performance level of 200,000 Direct Contract beneficiaries for the DC Growth performance metric and the threshold performance level of 94% for the normalized MCR performance metric were not satisfied and that these performance metrics would therefore be assigned an achievement percentage of 0%. Accordingly, the Talent and Compensation Committee determined that overall performance against the Corporation performance metrics was achieved at 22% for the Corporation’s executive officers. In January 2022, our Talent and Compensation Committee also assigned each executive officer eligible to receive an annual bonus an individual performance at 0% of target for fiscal year 2021 based on factors which included the Corporation’s overall performance achievement level. Based on these performance determinations, i.e., 22% company performance weighted at 80% and 0% individual performance weighted at 20%, Mr. Toy, Ms. Reynoso, and Mr. Singh were paid cash incentive bonuses for fiscal year 2021 of $79,200, $ 43,459, and $17,600, respectively. Ms. Reynoso’s incentive bonus payment reflects the fact that her base salary was increased part-way through the year, and Mr. Singh’s incentive bonus payment was pro-rated to reflect the fact that he joined us halfway through the fiscal year. Equity Awards The majority of the target total direct compensation of our NEOs is provided through equity awards of restricted stock units (RSUs) and performance-based vesting RSUs (PRSUs). For example, for fiscal year 2021, 100% of Mr. Garipalli’s compensation was in the form of RSU and PRSU grants. By having a significant percentage of target total direct compensation payable in the form of equity 142 awards that vest over a number of years and, for PRSUs, upon the achievement of Corporation goals and, thus, subject to higher risk than cash compensation, our executive officers are motivated to remain employed and to take actions that will benefit us and our stockholders over the long term. We structure our equity awards to maximize retention in consideration of the executive officer’s total compensation package. Pursuant to this end, we have made equity grants in connection with the Business Combination, the hiring of an executive officer, and the annual review of compensation packages by our Talent and Compensation Committee. The Talent and Compensation Committee considers each NEO’s role, responsibilities, past performance, future potential, current level of ownership, and amount of unvested equity holdings in determining whether and the amount of equity to grant to each NEO. We grant service-based vesting RSUs that generally vest annually over a four-year period, PRSUs, and hybrid PRSUs that have both service and performance-based vesting requirements. Our PRSUs require achievement of a threshold level of performance to vest in the minimum number of PRSUs. If the performance level is satisfied, generally one third of the PRSUs for which the requisite performance level has been satisfied vest on the date on which the Talent and Compensation Committee certifies the performance results, and the remaining portion of the PRSUs vest in two equal installments on the first day of the two fiscal years following the certification date, subject to the applicable executive officer’s continued service through each vesting date. Equity Awards for Vivek Garipalli and Andrew Toy In 2021, our Board of Directors granted the following special long-term equity awards to Mr. Garipalli and Mr. Toy in connection with the Business Combination and pursuant to their employment agreements with us. Vivek Garipalli Mr. Garipalli was granted a hybrid PRSU award covering 7,164,581 shares of Class B common stock, which vests if both of the following two conditions are satisfied: • Service - 20% will be satisfied on each anniversary of January 7, 2021, subject to Mr. Garipalli’s continued service to us as our CEO, Co-CEO or Executive Chairman through each date; and • Performance - Measured beginning after January 7, 2022, 50% will be satisfied upon our volume-weighted average stock closing price reaching $20 for 90 consecutive calendar days, and the remaining 50% will be satisfied upon our volume-weighted average stock closing price reaching $25 for 90 consecutive calendar days; provided such events occur within five years of January 7, 2021. In addition, Mr. Garipalli received a hybrid PRSU award covering 5,571,164 shares of Class B common stock, which vest if each of the following two conditions are satisfied: • Service - 20% will be satisfied on each anniversary of January 7, 2021, subject to Mr. Garipalli’s continued service to us as our CEO, Co-CEO or Executive Chairman through each date; and • Performance - Measured beginning after January 7, 2022, the performance condition will be satisfied if our volume-weighted average stock closing price reaches $30 for 90 consecutive calendar days, provided such events occur within five years of January 7, 2021. Mr. Garipalli was also granted an RSU award covering 16,713,491 shares of Class B common stock that vests as to 20% of the RSUs on each of the first five anniversaries of January 7, 2021, subject to Mr. Garipalli’s continuous service as our CEO, Co-CEO or Executive Chairman through each vesting date. Andrew Toy Mr. Toy was granted a hybrid PRSU award covering 3,582,291 shares of Class B common stock, which vests if both of the following two conditions are satisfied: • Service - 20% will be satisfied on each anniversary of January 7, 2021, subject to Mr. Toy’s continued service to us through each date; and • Performance - Measured beginning after January 7, 2022, the performance condition will be satisfied upon our volume-weighted average stock closing price reaching $20 for 90 consecutive calendar days; provided it occurs within five years of January 7, 2021. 143 In addition, Mr. Toy received a hybrid PRSU award covering 11,142,328 shares of Class B common stock, which vest if each of the following two conditions are satisfied: • Service - 20% will be satisfied on each anniversary of January 7, 2021, subject to Mr. Toy’s continued service to us through each date; and • Performance - Measured beginning after January 7, 2022, 50% will be satisfied upon our volume-weighted average stock closing price reaching $25 for 90 consecutive calendar days, and the remaining 50% will be satisfied upon our volume-weighted average stock closing price reaching $30 for 90 consecutive calendar days; provided it occurs within five years of January 7, 2021. Also in connection with the Business Combination and pursuant to his employment agreement, the Board of Directors accelerated in full the vesting of Mr. Toy’s stock option granted on February 4, 2020, to purchase 3,669,607 shares of our Class A common stock. For a description of the change in control and severance provisions related to Mr. Garipalli’s and Mr. Toy’s PRSU and RSU grants in 2021, please see “ —Potential Payments Upon Termination or Change in Control ” below. To date, none of the performance conditions for Mr. Garipalli’s and Mr. Toy’s hybrid PRSU awards has been satisfied. Equity Awards for Other Executive Officers Jamie L. Reynoso For fiscal year 2021, Ms. Reynoso received an equity award, 70% of which was in the form of service-based RSUs covering 220,820 shares of Class A common stock, and 30% of which was in the form of performance-earned PRSUs covering 94,637 shares of Class A common stock, representing the number of PRSUs that would be earned if the target level of performance was achieved. The specific number of PRSUs earned was determined based on the Corporation’s achievement against MA Growth and DC Growth goals as of January 1, 2022, and an MCR goal for fiscal year 2021. Please see the discussion under “Annual Incentive Bonuses ,” above, for more information about these Corporation operating metrics. The three metrics were weighted equally, and the Talent and Compensation Committee assigned threshold (50%), target (100%) and maximum (150%) performance levels and the number of units earned at each level for each metric. The maximum number of PRSUs that could have been earned if maximum performance was achieved under each metric was 141,955. The Talent and Compensation Committee reviewed Corporation performance against the performance goals for 2021 and determined that performance was achieved at 17% of target. Accordingly, effective January 31, 2022, Ms. Reynoso earned 15,771 PRSUs, which will vest in three equal installments on January 31, 2022, January 1, 2023, and January 1, 2024, subject to her continued service to the Corporation through each vesting date. The 220,820 RSUs vest in four equal installments on the first four anniversaries of January 7, 2021, subject to Ms. Reynoso continuing to provide services to the Corporation through each vesting date. Under her employment agreement with the Corporation, Ms. Reynoso is also eligible for future annual RSU or PRSU awards. For a description of the change in control and severance provisions related to Ms. Reynoso’s equity grants, please see “ —Potential Payments Upon Termination or Change in Control” below. Prabhdeep Singh Pursuant to his employment agreement, Mr. Singh received a grant of 52,798 RSUs, which will vest in full on July 6, 2022, and a grant of 211,193 RSUs, which will vest as to 25% of the RSUs on each of the first four anniversaries of July 6, 2021, in each case subject to his continued service to us through such vesting dates. In addition, pursuant to his employment agreement, Mr. Singh was also eligible for additional RSU grants if the number of members enrolled in one of the Corporation’s Medicare Advantage plans met or exceeded certain thresholds established by the Talent and Compensation Committee. After the end of the fiscal year, the Talent and Compensation Committee reviewed Corporation performance against these performance goals and determined that the thresholds were not met and that these grants would not be made to Mr. Singh. For a description of the change in control and severance provisions related to Mr. Singh’s equity grants, please see “ —Potential Payments Upon Termination or Change in Control ” below. Joseph Wagner and Mark C. Herbers Mr. Wagner did not receive any equity awards during fiscal year 2021. Please see the discussion below under “ Separation Agreement – Joseph Wagner ” for information about the treatment of his equity awards in connection with his separation from the Corporation in 144 August 2021. Pursuant to the agreement between AP Services, LLC, an affiliate of AlixPartners, LLP, Mr. Herbers’ employer, and the Corporation, Mr. Herbers was not eligible for and did not receive any equity awards during 2021. Severance and Change in Control Benefits The following table describes the severance benefits in the employment agreements we have with our NEOs. Termination and Change in Control Protections Philosophy Considerations Terms Attract and Retain Executives: Intended to ease an NEO’s transition due to an unexpected employment termination or retirement. Retain and encourage our NEOs to remain focused on our business and the interests of our stockholders when considering strategic alternatives. The employment of our NEOs is “at will,” meaning we can terminate them at any time and they can terminate their employment with us at any time. Arrangements should be designed to: (i) provide reasonable compensation to executive officers who leave the Corporation under certain circumstances to facilitate their transition to new employment and (ii) require a departing executive officer to sign a separation and release agreement acceptable to us as a condition to receiving post-employment compensation payments or benefits. Agreements with Certain NEOs: Provide for certain cash payments, and/or the vesting of certain equity awards and COBRA benefits, in the event there is a separation of employment under various circumstances, subject to the execution of a release of claims. Generally provide for accelerated vesting of equity awards upon a change in control if the recipient is terminated by the acquiring entity in connection with the change in control under specified circumstances, subject to the execution of a release of claims. Align Interests with Stockholders: Mitigate any potential employer liability and avoid future disputes or litigation “Double-trigger” provisions preserve morale and productivity, and encourage executive retention in the event of a change in control. These provisions are considered typical components of compensation programs for executive officers among our fiscal year 2021 peer group. Separation Agreement with Joseph Wagner In August 2021, we entered into a separation agreement with our former Chief Financial Officer, Mr. Wagner, pursuant to which in exchange for a general release of claims against the Corporation, Mr. Wagner (i) received reimbursement of one month of COBRA premiums, (ii) received an extension of the post-termination exercise period in which he can exercise his then-vested and unexercised non-qualified stock options until August 12, 2022, and (iii) retained his Corporation-issued laptop. Pursuant to the separation agreement, Mr. Wagner also entered into a consulting relationship with the Corporation for a period of up to one year for which he will be compensated $10,000 per month of service. If during Mr. Wagner’s one year consulting period we hire and onboard a new Chief Financial Officer, Mr. Wagner’s services to us will terminate 60 days after the Chief Financial Officer begins employment, and Mr. Wagner will become entitled to the consulting fees that he would have received if he had continued providing services to us for the full one-year consulting period. For additional information, please see “ —Potential Payments Upon Termination or Change in Control ” below. Other Executive Benefits In fiscal year 2021, subject to minor exceptions, we did not provide perquisites to our NEOs that were not generally available to other employees. Our executive officers are eligible to participate in our employee benefit plans, including our medical, dental, vision, group life, disability and accidental death and dismemberment insurance plans, in each case, on the same basis as all other employees. We maintain a 401(k) plan that provides eligible employees, including our executive officers, with an opportunity to save for retirement on a tax advantaged basis. Eligible employees are able to defer eligible compensation subject to applicable annual Code limits. Employees are immediately and fully vested in their contributions. The 401(k) plan permits us to make matching contributions and profit-sharing contributions to eligible participants. We believe these benefits are generally consistent with those offered by other companies and specifically with those companies with which we compete for employees. 145 Executive Compensation Policies and Practices Hedging, Pledging and Insider Trading Our Insider Trading Policy applies to all of our directors, officers, employees and certain designated contractors and vendors and expressly bars ownership of financial instruments or participation in investment strategies that hedge the economic risk of owning our equity securities, such as prepaid variable forward contracts, equity swaps, collars, and exchange funds. Directors, officers, and other employees are prohibited from holding the Corporation’s securities in a margin account or otherwise pledging the Corporation’s securities as collateral for a loan unless approved by the Corporation’s Corporate Compliance Officer. In addition, we prohibit our executive officers, directors and employees from purchasing or selling our securities while in possession of material, non-public information, or otherwise using such information for their personal benefit, and we maintain quarterly black-out windows during which applicable individuals may not trade. Our executive officers and members of our Board of Directors are permitted to enter into trading plans that are intended to comply with the requirements of Exchange Act Rule 10b5-1 so they may make predetermined trades of our stock. Equity Grant Practices Equity awards for our executive officers are typically granted pursuant to a formula based on a specified dollar amount, with the number of RSUs for each RSU and PRSU grant determined by dividing the dollar amount by the closing market price of our stock for a specified period through the grant date. In addition, the Talent and Compensation Committee has delegated authority to our CEO and President to make new hire and promotion grants, within certain parameters, to employees at the vice president level and below. All other equity grants must be approved by the Talent and Compensation Committee. Our Compensation-Setting Process Role of Talent and Compensation Committee The Talent and Compensation Committee works closely with its independent consultant and meets regularly, including in executive sessions without members of management present, to make decisions about the compensation of our CEO and other executive officers. The committee reviews a variety of market data and information, including Corporation, peer company and industry compensation information, and considers the recommendations of its independent consultant when making compensation decisions. The committee chairperson reports the actions of the committee to our Board of Directors. The responsibilities of the Talent and Compensation Committee include, among other things, reviewing and approving (or making recommendations to the Board of Directors, as applicable, regarding): • overall compensation strategy; • amounts and forms of executive compensation, including base salary, incentive compensation and equity-based compensation; • goals and objectives to be considered in determining the compensation of the CEO and other executive officers; • annual and long-term incentive plans and benefit plans; • Board of Director compensation; • annual proxy disclosure/CD&A disclosure; and • compensation peer group. Role of Independent Compensation Consultant The Talent and Compensation Committee generally retains an independent compensation consultant to help understand competitive compensation levels and incentive designs. The independent compensation consultant is solely hired by, and reports directly to, the Talent and Compensation Committee. The committee has sole authority to retain and terminate the independent compensation consultant. At the Talent and Compensation Committee’s discretion, the independent compensation consultant: • provides independent advice to the committee on current trends and best practices in compensation design; • advises on plans or practices that may improve the effectiveness of our compensation program; • attends committee meetings; • assists the committee in determining peer companies and evaluation compensation proposals; and 146 • conducts compensation-related research. In making fiscal year 2021 compensation decisions, the Talent and Compensation Committee retained Radford Data & Analytics of Aon (Radford) to assist with selecting an appropriate peer group for executive compensation benchmarking purposes, designing and reviewing our executive compensation programs and understanding executive compensation trends and best practices in compensation design. The Talent and Compensation Committee has analyzed and determined that the work of Radford, as a compensation consultant, has not created any conflict of interest and is independent under the applicable listing rules. Role of Management Our CEO and our other executive officers do not set their own compensation nor are they present when the Talent and Compensation Committee establishes their specific individual compensation. Our CEO will provide an evaluation of each other NEO’s performance to the Talent and Compensation Committee and will make recommendations regarding the base salary, target annual incentive bonuses and equity awards for other executive officers than himself. The CEO’s recommendations are considered by the Talent and Compensation Committee, which makes its own ultimate determinations as to compensation. The human resources department provides additional analysis and guidance as requested by the Talent and Compensation Committee related to NEO compensation, including the following: • developing, summarizing, and presenting information and analyses to enable the committee to execute its responsibilities, as well as addressing specific requests for information from the committee; • attending committee meetings, as requested, to provide information, respond to questions, and otherwise assist the committee; and • assisting the CEO in making preliminary recommendations of base salary structure and cash and equity incentive awards. Peer Group For fiscal 2021, the primary peer group used to inform our Talent and Compensation Committee of pay decisions and practices included: Primary Peer Group Companies 1Life Healthcare Lemonade Inc. Alarm.com Livongo Health Allscripts Healthcare Solutions Medallia Change Healthcare Oak Street Health Dropbox Omnicell eHealth Progyny Evolent Health SelectQuote, Inc GoHealth, Inc. Stitch Fix Guidewire Software Tabula Rasa HealthCare HealthEquity Teladoc Health Inovalon The peer group companies were chosen based on, among other things, (i) industry, including healthcare and technology companies, (ii) revenue, (iii) revenue growth, (iv) market cap and (v) market cap as a multiple of revenue. Tax Considerations Section 162(m) of the Internal Revenue Code of 1986, as amended, places a limit of $1 million on the amount of compensation that we may deduct as a business expense in any year with respect to certain of our most highly paid executive officers. While the Talent and Compensation Committee considers the deductibility of compensation as one factor in determining executive compensation, the Talent and Compensation Committee retains the discretion to award compensation that is not deductible as it believes that it is in the 147 best interests of our stockholders to maintain flexibility in our approach to executive compensation in order to structure a program that we consider to be the most effective in attracting, motivating and retaining key executives. Compensation Risk Assessment The Talent and Compensation Committee has assessed our compensation philosophy and objectives, and the forms of compensation and benefits for all employees, including executives, and has concluded that our compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Corporation. The Talent and Compensation Committee believes that the design and objectives of our executive compensation program provide an appropriate balance of incentives for our NEOs, thereby discouraging them from taking inappropriate risks. Among other things, our executive compensation program includes the following design features: • a balanced mix of cash and equity; as well as appropriately balanced fixed (base salary) and variable compensation (cash incentives and equity-based awards); • a mix of short-term and long-term incentives, with short-term incentives currently representing a lower proportion of the total mix; • cash and equity incentives solely based on achieving company performance objectives; • caps on annual cash incentive payouts; • general alignment with prevalent low-risk pay practices; and • policies prohibiting hedging and pledging by our employees, officers or directors. Summary Compensation Table The following table sets forth information concerning the compensation of the named executive officers for each of the last three or fewer fiscal years during which such individuals were determined to be NEOs: Name and Principal Position Fiscal Year Salary ($) (1) Bonus ($) (2) Stock Awards ($) (3) Option Awards ($) Non-Equity Incentive Plan Compensation ($) (3) All Other Compensation ($) (4) Total ($) Vivek Garipalli 2021 — (5) — 389,569,439 (6) — — — 389,569,439 Chief Executive Officer 2020 — (5) — — — — — — 2019 — (5) — — — — — — Mark C. Herbers 2021 — — — — — 1,034,886 (7) 1,034,886 Interim Chief Financial Officer Andrew Toy 2021 450,000 200 141,449,617 (6) — 79,200 8,490 141,987,507 President and Chief Technology Officer 2020 415,385 — — 8,190,695 (8) — 11,805 8,617,885 2019 400,000 — — — — 23,593 423,593 Jamie L. Reynoso 2021 411,539 200 2,586,747 (9) — 43,459 6,539 3,048,484 Chief Operating Officer Prabhdeep Singh 2021 190,769 — 2,470,956 (9) — 17,600 — 2,679,325 Chief Growth Officer Joseph Wagner 2021 291,958 200 60,000 (10) — — 55,184 407,342 Former Chief Financial Officer (1) For 2019 and 2020, this column represents base salary earned. For 2021, this column represents base salary or base compensation earned, and the figure reported for Mr. Wagner for 2021 includes (i) base salary of $253,846 and (ii) accrued and unused vacation of $38,112 paid to Mr. Wagner in connection with his termination of employment. (2) Amounts in this column reflect employee appreciation bonuses. (3) See the “Grants of Plan-Based Awards for the Year Ended December 31, 2021” table below for information on awards reported in these columns. (4) The amounts reported consist of (i) car services and related transportation costs for Mr. Toy, (ii) matching 401(k) contributions by the Corporation, (iii) consulting fees for Mr. Wagner earned in the period after his August 13, 2021 termination of employment, (iv) one month of COBRA premiums paid for Mr. Wagner, (v) the value of Mr. Wagner’s Corporation-issued laptop ((iv) and (v), as further described in “--Separation Agreement with Joseph Wagner”) and (vi) the value of a gift card awarded to Mr. Toy, in the following amounts: 148 Name Fiscal Year Transportation 401(k) Contributions Consulting Fees COBRA premium Laptop Gift Card Andrew Toy 2021 $ 456 $ 8,001 $ 33 Prabhdeep Singh 2021 — Jamie L. Reynoso 2021 6,539 Joseph Wagner 2021 11,577 $ 40,000 $ 2,407 $ 1,200 (5) At his own recommendation to our Board of Directors and in accordance with his employment agreement, Mr. Garipalli elected to forgo any compensation other than equity awards for 2021, 2020, and 2019. (6) Represents the aggregate grant date fair value of RSU and hybrid PRSU awards granted computed in accordance with FASB ASC Topic 718, as discussed in Note 18 to our Consolidated Financial Statements included elsewhere in this report. Note that the amounts reported in this column reflect the accounting value for the RSU and hybrid PRSU awards and may not correspond to the actual economic value that may be received by the named executive officer from the award. The grant date fair value of the RSU awards to Mr. Garipalli and Mr. Toy were measured based on the closing price of our Class A common stock on the date of grant. The stock price milestone conditions of the PRSUs awarded during 2021 to Mr. Garipalli and Mr. Toy constitute a “market condition” under FASB ASC Topic 718. The full grant date fair value of the hybrid PRSUs was determined using a Monte Carlo simulation pricing model (Monte Carlo model) on the date the hybrid PRSUs were awarded. The table below sets forth the significant inputs and assumptions used in the Monte Carlo model for the hybrid PRSUs: Name Fiscal Year Grant Date Units Market-Related Component Grant Date Fair Value ($) Expected Volatility (%) Risk-Free Interest Rate for Remaining Performance Period (%) Expected Dividend Yield Vivek Garipalli 2021 01/07/2021 7,164,581 76,804,308 40.70 0.05 — 2021 01/07/2021 5,571,164 45,015,005 40.70 0.05 — Andrew Toy 2021 01/07/2021 3,582,281 41,948,628 40.70 0.05 — 2021 01/07/2021 11,142,328 99,500,989 40.70 0.05 — (7) Effective August 13, 2021, Mr. Wagner departed as our Chief Financial Officer, and Mr. Herbers began providing professional services as our Interim Chief Financial Officer. Compensation for Mr. Herbers’ services to the Corporation is made directly to AP Services, LLC, an affiliate of Mr. Herbers’ employer, AlixPartners LLP, pursuant to the Agreement for the Provision of Interim Management Services between the Corporation and AP Services, LLC. For Mr. Herbers’ services, the Corporation pays AP Services, LLC, $175,000 per month in professional fees and a monthly administrative fee of $3,500. (8) Represents t he aggregate grant date fair value of stock options granted in the applicable year computed in accordance with FASB ASC Topic 718. The assumptions used in calculating the dollar amount recognized for financial statement reporting purposes of the stock option awards are set forth in Note 18 to our Consolidated Financial Statements included elsewhere in this report. Note that the amounts reported reflect the accounting value for the stock optio n awards and may not correspond to the actual economic value that may be received by the named executive officer from the awards. The grant date fair value of the stock options was determined using the Black-Scholes option pricing model based on the fair market value on the date of grant without regard to the service-based vesting conditions. (9) The amounts reported represent the aggregate grant date fair value of RSU awards and, for Ms. Reynoso, PRSU awards, granted in the applicable year computed in accordance with FASB ASC Topic 718. The assumptions used in calculating the dollar amounts recognized for financial statement reporting purposes of the RSUs and PRSUs are set forth in Note 18 to our Consolidated Financial Statements included elsewhere in this report. Note that the amounts reported reflect the accounting value for the RSU and PRSU awards and may not correspond to the actual economic value that may be received by the named executive officers from the awards. The grant date fair value of the RSUs is measured based on the closing price of our Class A common stock on the date of grant, and the grant date fair value of the PRSUs is measured using the same fair value as service based RSUs and recognized in compensation expense in accordance with ASC 718. Ms. Reynoso’s RSU and PRSU grants for fiscal year 2021 are further described in the following table: Name Grant Date Approval Date Award Grant Date Fair Value ($) Probable Outcome of Performance Conditions Grant Date Fair Value ($) Maximum Outcome of Performance Conditions Grant Date Fair Value ($) Jamie L. Reynoso 7/16/2021 7/16/2021 RSUs 1,810,724 N/A N/A Jamie L. Reynoso 7/16/2021 1/31/2022 PRSUs 776,023 776,023 1,164,031 (10) The amount reported represents the incremental fair value of the amendment to Mr. Wagner’s non-statutory stock options effective August 13, 2021 to extend the post-termination exercise period applicable to his vested and unexercised shares until August 13, 2022. 149 Grants of Plan-Based Awards for the Year Ended December 31, 2021 Name Grant Date Approval Date Estimated Possible Payouts Under Non-Equity Incentive Plan Awards ($) (1) Estimated Future Payouts Under Equity Incentive Plan Awards (#) All Other Stock Awards Number of Shares or Units (#) Exercise or Base Price of Option Awards ($)/Sh) Grant Date Fair Value of Stock and Option Awards ($) Threshold ($) Target ($) Maximum ($) Threshold (#) Target (#) Maximum (#) Vivek Garipalli 1/7/2021 (2) 16,713,491 267,750,126 1/7/2021 (3) 3,582,290 7,164,581 76,804,308 1/7/2021 (4) 5,571,164 45,015,005 Mark C. Herbers N/A — — Andrew Toy N/A 450,000 675,000 — — 1/7/2021 (4) 3,582,291 41,948,628 1/7/2021 (3) 5,571,164 11,142,328 99,500,989 Jamie L. Reynoso N/A 246,923 370,385 7/16/2021 (5) 1/31/2022 47,313 94,637 141,955 776,023 7/16/2021 (6) 220,820 1,810,724 Prabhdeep Singh N/A 95,385 143,078 7/8/2021 (7) 211,193 1,976,767 7/8/2021 (8) 52,798 494,189 Joseph Wagner N/A (9) N/A N/A (1) Represents possible cash incentive awards to be earned under our 2020 Executive Incentive Bonus Plan (Bonus Plan) based 80% upon the achievement of certain performance levels with respect to Corporation operating metrics of MA Growth, DC Growth and normalized MCR, with each metric weighed equally, and 20% based on individual NEO performance. Th e actual total incentive award could range from 0% of the NEO’s target incentive amounts to 150% of the NEO’s target incentive amounts if the goals were all achieved at the maximum level and individual performance was determined to be exceptional . Cash incentives earned for 2021 performance are reported in the Non-Equity Incentive Plan Compensation column of the Summary Compensation Table above. See “--Annual Incentive Bonuses” above for more information about these awards. Mr. Wagner forfeited any right to a cash incentive award upon his termination of employment. (2) Represents an RSU award covering shares of Class B common stock which vest in five equal annual installments on the anniversaries of the grant date. For additional detail on the grant date fair value, see footnote (6) to the Summary Compensation Table. (3) Represents a hybrid PRSU award covering shares of Class B common stock which will vest if both the service and performance requirements are met. The service requirement will be satisfied in five equal annual installments on the anniversaries of the grant date. The performance requirement will be satisfied at 50% and 100% upon the Corporation’s reaching certain stock price milestones on or before January 7, 2026. For additional detail regarding the vesting terms of the award, see “--Equity Awards of Vivek Garipalli and Andrew Toy” above. For additional detail on the grant date fair value, see footnote (6) to the Summary Compensation Table. (4) Represents a hybrid PSRU award covering shares of Class B common stock which will vest if both the service and performance requirements are met. The service requirement will be satisfied in five equal annual installments on the anniversaries of the grant date. The performance requirement will be fully satisfied upon the Corporation’s reaching a stock price milestone on or before January 7, 2026. For additional detail regarding the vesting terms of this award, see “--Equity Awards of Vivek Garipalli and Andrew Toy” above. For additional detail on the grant date fair value, see footnote (6) to the Summary Compensation Table. (5) Represents a PRSU award covering shares of Class A common stock for which units were earned based on the achievement of certain performance levels with respect to Corporation operating metrics of MA Growth, DC Growth, and normalized MCR, with each metric weighed equally. The PRSUs earned could range from 0 to 141,955 if the goals were all achieved at the highest level. The Talent and Compensation Committee certified achieved performance on January 31, 2022 at 17%. The earned PRSUs vest as to 1/3rd of the PRSUs on each of January 31, 2022, January 1, 2023 and January 1, 2024. See “Equity Awards for Other Executive Officers” above for more information about this award. For additional detail on the grant date fair value, see footnote (9) to the Summary Compensation Table. (6) Represents an RSU award covering shares of Class A common stock which vests in four equal annual installments on the anniversaries of January 7, 2021. For additional detail on grant date fair value, see footnote (9) to the Summary Compensation Table. (7) Represents an RSU award covering shares of Class A common stock which vests in four equal installments on the anniversaries of July 6, 2021. For additional detail on grant date fair value, see footnote (10) to the Summary Compensation Table. (8) Represents an RSU award covering shares of Class A common stock which vests in full on July 6, 2022. For additional detail on grant date fair value, see footnote (10) to the Summary Compensation Table. (9) Mr. Wagner did not receive any new equity awards in fiscal year 2021, and he forfeited eligibility for a cash incentive bonus for fiscal year 2021 when he departed employment in August 2021. 150 Outstanding Equity Awards at December 31, 2021 The following table summarizes the number of shares of common stock underlying outstanding equity incentive plan awards for each named executive officer as of December 31, 2021. Option Awards Stock Awards Name Grant Date Approval Date Number of Securities Underlying Unexercised Options (#) Exercisable (1) Number of Securities Underlying Unexercised Options (#) Unexercisable Option Exercise Price ($) (2) Option Expiration Date Number of Shares or Units of Stock That Have Not Vested (#) Market Value of Shares or Units of Stock That Have Not Vested ($) (3) Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That have Not Vested (#) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (3) Vivek Garipalli 1/7/2021 (4) — — — — 16,713,491 62,174,187 1/7/2021 (5) — — — — 7,164,581 13,326,119 1/7/2021 (6) — — — — 5,571,164 20,724,730 Mark C. Herbers N/A N/A N/A N/A N/A N/A N/A Andrew Toy 7/22/2018 (7) 631,033 — 1.67 7/21/2028 — — 7/22/2018 (8) 3,155,168 — 1.67 7/21/2028 736,207 2,738,690 2/4/2020 (9) 5,344,515 — 2.23 2/3/2030 2,667,258 9,922,200 2/4/2020 (10) 3,669,607 — 5.45 2/3/2030 — — 1/7/2021 (11) 3,582,291 13,326,123 1/7/2021 (12) 11,142,328 20,724,730 Jamie L. Reynoso 6/29/2020 (13) 51,701 — 3.66 6/28/2030 36,190 134,627 7/27/2020 (14) 465,316 — 4.67 7/26/2030 333,476 1,240,531 7/16/2021 (15) 220,820 821,450 7/16/2021 (16) 1/31/2022 15,771 58,668 Prabhdeep Singh 7/8/2021 (17) 211,193 785,638 7/8/2021 (18) 52,798 196,409 Joseph Wagner 8/22/2020 (19) 39,741 — 5.41 8/17/2022 — — 2/4/2020 (19) 118,864 — 2.23 8/17/2022 — — (1) All of the outstanding options granted under our 2014 Equity Incentive Plan (2014 Plan) are options to purchase shares of our Class A common stock and are immediately exercisable. The below chart summarizes the vested and unvested shares subject to the options as of December 31, 2021. There have been no early exercises of any unvested options by the named executive officers. Name Grant Date Total Number of Options Vested Options Unvested Options Andrew Toy 7/22/2018 631,033 631,033 — 7/22/2018 3,155,168 2,418,961 736,207 2/4/2020 5,344,515 2,677,257 2,667,258 2/4/2020 3,669,607 3,669,607 — Jamie L. Reynoso 6/29/2020 51,701 15,511 36,190 7/27/2020 465,316 131,840 333,476 (2) Represents the fair market value of a share of our Class A common stock on the date of grant for all stock options except for the stock option granted on February 4, 2020 to Mr. Toy for 3,669,607 shares, which represents two times the fair market value on the date of grant, each as determined by our Board of Directors. (3) RSUs and PRSUs represent the right to receive a share of the applicable class of our common stock upon vesting. Market and payout values were determined by multiplying the number of shares or units by the closing price per share of our Class A common stock of $3.72 on December 31, 2021. (4) Represents an RSU award under the 2020 Management Incentive Plan (Management Plan) denominated in shares of Class B common stock that vests in five equal installments on each anniversary of January 7, 2021. (5) The number of underlying unvested units listed reflects the maximum outcome of the performance conditions for the hybrid PRSU award granted under our 2014 Plan denominated in shares of our Class B common stock. The hybrid PRSU award vests if both the service and performance requirements are met. The service requirement will be satisfied in five equal annual installments on the anniversaries of the grant date. The performance requirement will be satisfied 50% and 100% upon the Corporation’s reaching certain stock price milestones or before January 7, 2026. The payout value assumes performance was achieved at the threshold level. (6) The number of underlying unvested units listed reflect the maximum outcome of the performance conditions for the hybrid PRSU award granted under our Management Plan denominated in shares of our Class B common stock. The hybrid PRSU award vests if both the service and performance requirements are met. The service requirement will be satisfied in five equal annual installments on the anniversaries of the grant date. The performance requirement will be satisfied upon the Corporation’s reaching a stock price milestone or before January 7, 2026. (7) Represents a fully vested and exercisable stock option. The grant vested in full on February 5, 2019. (8) Represents a fully exercisable stock option received in connection with the Business Combination in exchange for an option to acquire 1,525,655 shares of common stock of Legacy Clover for $3.45 per share. 1/5th of the shares subject to the option vested on February 5, 2019, and an additional 1/48th of the remaining shares vest monthly thereafter. (9) Represents a fully exercisable stock option received in connection with the Business Combination in exchange for an option to acquire 2,579,460 shares of common stock of Legacy Clover for $4.61 per share. 1/60th of the shares subject to the option vested on July 1, 2019 and an additional 1/60th of the remaining shares vest monthly thereafter. (10) Represents fully vested and exercisable stock options received in connection with the Business Combination in exchange for options to acquire 1,774,408 shares of common stock of Legacy Clover for $11.27 per share. The vesting of the shares subject to this option was fully accelerated in connection with the Business Combination as of January 7, 2021. 151 (11) The number of underlying unvested units listed reflects the maximum outcome of the performance conditions for the hybrid PRSU award granted under our 2014 Plan denominated in shares of our Class B common stock. The hybrid PRSU award vests if both the service and performance requirements are met. The service requirement will be satisfied in five equal annual installments on the anniversaries of the grant date. The performance requirement will be satisfied upon the Corporation’s reaching a stock price milestones or before January 7, 2026. (12) The number of underlying unvested units listed reflect the maximum outcome of the performance conditions for the hybrid PRSU award granted under our Management Plan denominated in shares of our Class B common stock. The hybrid PRSU award vests if both the service and performance requirements are met. The service requirement will be satisfied in five equal annual installments on the anniversaries of the grant date. The performance requirement will be satisfied 50% and 100% upon the Corporation’s reaching certain stock price milestones or before January 7, 2026. The payout value assumes performance was achieved at the threshold level. (13) Represents a fully exercisable stock option of which 1/5th of the shares subject to the option vested on June 8, 2021, and an additional 1/48th of the remaining shares vest monthly thereafter. (14) Represents a fully exercisable stock option of which 1/5th of the shares subject to the option vested on July 27, 2021, and an additional 1/48th of the remaining shares vest monthly thereafter. (15) Represents an RSU award granted under the 2020 Equity Incentive Plan (2020 Plan) denominated in shares of our Class A common stock that vests in four equal installments on each anniversary of January 7, 2021. (16) Represents a PRSU award granted under the 2020 Plan denominated in shares of our Class A common stock that was earned based on our performance during fiscal 2021, and which vests as to one third of the units on each of January 31, 2022, January 1, 2023, and January 1, 2024. (17) Represents an RSU award granted under the 2020 Plan denominated in shares of our Class A common stock that vests in four equal annual installments on the anniversaries of January 7, 2021. (18) Represents an RSU award granted under the 2020 Plan denominated in shares of our Class A common stock that fully vests on July 6, 2022. (19) Mr. Wagner forfeited the unvested shares subject to his stock options upon his August 2021 departure from employment. Pursuant to our Separation Agreement with Mr. Wagner, his non-qualified stock options that were vested and unexercised as of his departure date will remain exercisable until August 17, 2022. 2021 Option Exercises and Stock Vested The following table shows the number of shares of common stock acquired and their value upon the exercise of stock options and the vesting of RSUs and PRSUs during 2021 for each NEO. Option Awards Stock Awards Name Number of Shares Acquired on Exercise (#) Value Realized on Exercise ($) Number of Shares Acquired on Vesting (#) Value Realized on Vesting ($) Vivek Garipalli — — — — Mark C. Herbers N/A N/A N/A N/A Andrew Toy — — — — Jamie L. Reynoso — — — — Prabhdeep Singh — — — — Joseph Wagner 44,858 274,513 (1) — — (1) The value realized on the exercise of a stock option is calculated by multiplying the number of shares underlying the stock option exercised by the difference between (i) the closing price of our Class A common stock on the exercise date and (ii) the exercise price of the stock option, and does not necessarily reflect actual proceeds received. Potential Payments Upon Termination or Change in Control Separation Arrangements We have entered into employment agreements with our executive officers that provide them severance protections in certain circumstances following their termination of employment without cause or with good reason, whether or not in connection with change in control. Vivek Garipalli If Mr. Garipalli’s employment is terminated by us without “cause” or by Mr. Garipalli for “good reason” (in each case, as defined in his employment agreement), during the period beginning one month prior to and ending 12 months following a change in control (as defined in the 2020 Plan) (CIC Period), subject to his execution and non-revocation of a release of claims in our favor and continued compliance with customary confidentiality and non-solicitation requirements, Mr. Garipalli will be entitled to receive full accelerated vesting of all outstanding and unvested equity awards. In addition, if the benefits payable to Mr. Garipalli are subject to Sections 280G and 4999 of the Internal Revenue Code of 1986, as amended (Code), such payments will be reduced to the extent necessary to provide Mr. Garipalli the greatest after-tax benefit. Andrew Toy If Mr. Toy is terminated by us without “cause” or by Mr. Toy for “good reason” (in each case, as defined in his employment agreement), Mr. Toy will be entitled, subject to his execution and non-revocation of a release of claims in our favor, to the following: (i) continued payment of his current annual base salary for 12 months following the termination date and (ii) reimbursement of COBRA health care premiums for 12 months after the termination date. In addition, if Mr. Toy terminates his employment due to the 152 failure to promote him to Chief Executive Officer immediately following the resignation or termination of Mr. Garipalli as our Chief Executive Officer, he will receive full accelerated vesting of all outstanding and unvested equity awards. If either such qualifying termination of Mr. Toy’s employment occurs during the CIC Period, subject to his execution and non-revocation a general release of claims in our favor and continued compliance with restrictive covenants, then, instead of the benefits described above, Mr. Toy will be entitled to receive the following: (i) an amount equal to one and one-half times Mr. Toy’s annual base salary then in effect, (ii) reimbursement of COBRA health care premiums for 18 months after the termination date and (iii) full accelerated vesting of all outstanding and unvested equity awards. Furthermore, if the benefits payable to Mr. Toy are subject to Sections 280G and 4999 of the Code, such payments will be reduced to the extent necessary to provide Mr. Toy the greatest after-tax benefit. Prabhdeep Singh and Jamie L. Reynoso If Mr. Singh’s or Ms. Reynoso’s employment is terminated by us without “cause” (as defined in the NEO’s employment agreement), subject to the execution and and non-revocation of a general release of claims in our favor, Mr. Singh or Ms. Reynoso will be entitled to receive the following severance payments and benefits: (i) an amount equal to annual base salary then in effect and (ii) reimbursement of COBRA health care premiums for 12 months after the termination date. If either such termination of employment occurs during the CIC Period, subject to the NEO’s execution and non-revocation a general release of claims in our favor and continued compliance with restrictive covenants, the, Mr. Singh or Ms. Reynoso, instead of the benefits described above, will be entitled to receive the following severance payments and benefits: (i) a lump sum payment equal to twelve months of base salary as in effect immediately prior to the date of his termination plus applicable cash bonus, (ii) reimbursement of COBRA health care premiums for twelve months after the termination date, and (iii) full accelerated vesting of all outstanding and unvested time-based equity awards. Any unvested and outstanding performance-based awards shall be subject to the terms and conditions of the 2020 Plan. Joseph Wagner In connection with Mr. Wagner’s departure from the Company on August 13, 2021, the Company entered into a separation agreement with Mr. Wagner pursuant to which in exchange for his execution and non-revocation of a release of claims in our favor, Mr. Wagner (i) received an extension of the period in which he can exercise his vested and unexercised non-qualified stock options until August 13, 2022, (ii) received one month reimbursement of COBRA health care premiums, and (iii) retained his Corporation-issued laptop. Mark C. Herbers Mr. Herbers’ employer, AP Services, LLC, is entitled to no payment or benefit other than accrued compensation upon his termination of service as our Interim Chief Financial Officer. Change in Control Arrangements The three hybrid PRSU awards granted to Mr. Garipalli and Mr. Toy in connection with the closing of our Business Combination (as described further above under “ —Equity Awards for Vivek Garipalli and Andrew Toy ”), in addition to having the acceleration provisions discussed above in connection with certain terminations of Mr. Garipalli’s and Mr. Toy’s employment, will accelerate upon certain changes in control of the Corporation. “Change in control” in each hybrid PRSU award is defined in the respective equity plan under which the hybrid PRSUs was granted. Upon a change in control, the hybrid PRSU awards will each fully vest as to their service conditions, and if the per share value in the change in control equals or exceeds the required stock closing price under the hybrid PRSU award’s performance conditions, the awards will also fully vest as to the applicable performance conditions. Any portion of the PRSU award unvested at the consummation of the change in control will be forfeited. The table below summarizes the approximate value of benefits that would be received in connection with qualifying terminations of Mr. Garipalli’s, Mr. Toy’s, Mr. Singh’s, and Ms. Reynoso’s employment, assuming each NEO’s termination of employment occurred on December 31, 2021, based on the closing price per share of our Class A common stock of $3.72 on December 31, 2021, and where relevant, that a change in control occurred on December 31, 2021. It also summarizes the approximate value of benefits that would be received by Mr. Toy if he resigned on December 31, 2021, for “good reason” due to the failure to promote him to Chief Executive Officer immediately following the resignation or termination of Mr. Garipalli as our Chief Executive Officer. Finally, it summarizes the value of benefits that were received in connection with Mr. Wagner’s termination of employment. 153 Name Benefit Qualifying Termination ($) Change in Control with Qualifying Termination ($) Vivek Garipalli Cash Payment — — Vesting of Equity Awards (1) 109,551,158 Value of Benefits — — Total — 109,551,158 Mark C. Herbers Cash Payment N/A N/A Vesting of Equity Awards N/A N/A Value of Benefits N/A N/A Total N/A N/A Andrew Toy (3) Cash Payment 450,000 675,000 Vesting of Equity Awards (1) – / 102,355,584 102,355,584 Value of Benefits (2) 28,883 43,324 Total 478,883/102,834,467 103,073,908 Jamie L. Reynoso Cash Payment 425,000 425,000 Vesting of Equity Awards (1) — 2,744,754 Value of Benefits (2) 28,883 28,883 Total 453,883 3,198,637 Prabhdeep Singh Cash Payment 400,000 400,000 Vesting of Equity Awards — 982,047 Value of Benefits (2) 28,883 28,883 Total 428,883 1,410,930 Joseph Wagner Cash Payment — — Vesting of Equity Awards — — Value of Benefits (4) 3,607 — Total 3,607 — (1) The value for stock options is calculated by multiplying the number of unvested shares that would be subject to an acceleration of vesting by the difference between the closing price per share of $3.72 on December 31, 2021, and the applicable exercise price of the stock option. (2) For Mr. Toy, Ms. Reynoso, and Mr. Singh, the COBRA premium reimbursement cost is estimated to be $2,400 per month. (3) For Mr. Toy, the numbers on the left in the “Qualifying Termination ($)” column represent the value of what he would receive upon his qualifying termination and the numbers on the right represent what he would receive upon the specific qualifying termination or his resignation for “good reason” due to the failure to promote him to CEO immediately following the termination or resignation of Mr. Garipalli as our Chief Executive Officer. (4) For Mr. Wagner, this represents (i) $2,407, the cost of one month of COBRA premium reimbursement and (ii) $1,200, the estimated value of his Corporation issued laptop. For the purposes of the table above, because the per share value in the assumed change in control is $3.72, the closing price per share of our Class A common stock on December 31, 2021, none of Mr. Garapalli’s or Mr. Toy’s hybrid PRSU awards would be deemed to have vested upon a change in control that is not in connection with a qualifying termination of Mr. Garipalli’s or Mr. Toy’s employment. Indemnification Agreements Our amended and restated certificate of incorporation includes provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for the following: • for any breach of their duty of loyalty to us or our stockholders; • for any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; • unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or • for any transaction from which they derived an improper personal benefit. Our amended and restated bylaws provide that we shall indemnify, to the fullest extent permitted by law, any person who is or was a party or is threatened to be made a party to any action, suit or proceeding, by reason of the fact that he or she is or was one of our 154 directors or officers or is or was serving at our request as a director or officer of another corporation, partnership, joint venture, trust or other enterprise. Our amended and restated bylaws provide that we may indemnify our employees or agents. Our amended and restated bylaws also provide that we must advance expenses incurred by or on behalf of a director or officer in advance of the final disposition of any action or proceeding, subject to limited exceptions. We maintain insurance policies under which, subject to the limitations of the policies, coverage is provided to our directors and officers against loss arising from claims made by reason of breach of fiduciary duty or other wrongful acts as a director or officer, including claims relating to public securities matters, and to us with respect to payments that may be made by us to these officers and directors pursuant to our indemnification obligations or otherwise as a matter of law. We entered into indemnification agreements with each of our directors and executive officers that are broader than the specific indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements require us, among other things, to indemnify our directors and executive officers against liabilities that may arise by reason of their status or service. These indemnification agreements also require us to advance all expenses incurred by the directors and executive officers in investigating or defending any such action, suit or proceeding. We believe that these agreements are necessary to attract and retain qualified individuals to serve as directors and executive officers. Compensation Committee Interlocks and Insider Participation In fiscal year 2021, the members of our Talent and Compensation Committee were Chelsea Clinton, Nathaniel S. Turner (from January 1, 2021, to April 13, 2021), and William G. Robinson, Jr. (from April 13, 2021 through the end of the year). None of the members of our Talent and Compensation Committee in fiscal year 2021 was at any time during fiscal year 2021 or at any other time an officer or employee of the Corporation or any of its subsidiaries, and none had or have any relationships with the Corporation that are required to be disclosed under Item 404 of Regulation S-K. None of our executive officers has served as a member of the board of directors or compensation committee (or similar committee) of any entity, other than Clover, that has one or more executive officers who have served as a member of our Board of Directors or Talent and Compensation Committee during fiscal year 2021. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Equity Compensation Plan Information The following table provides information as of December 31, 2021, with respect to shares of our common stock that may be issued under our existing equity compensation plans. Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights Weighted-Average Exercise Price of Outstanding Options, Warrants, and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a) ) (a) (b) (2) (c) Equity compensation plans approved by security holders 40,117,031 (1) $ 8.88 26,227,905 (3) Equity compensation plans not approved by security holders N/A N/A N/A Total 40,117,031 $8.88 26,227,905 (1) Amount includes 1,753,799 stock options, 4,578,089 RSUs and 358,160 PRSUs covering shares of Class A common stock granted under the 2020 Equity Incentive Plan (“2020 Plan”) and 16,713,492 PRSUs and 16,713,491 RSUs covering shares of Class B common stock granted under the 2020 Management Incentive Plan. Legacy Clover’s 2014 Equity Incentive Plan (“2014 Plan”) terminated in connection with the January 7, 2021 closing of the Business Combination and no further awards may be granted under it. The Corporation assumed the outstanding awards under the 2014 Plan, which consist of 31,155,472 stock options to purchase shares of Class A common stock, which have a weighted average exercise price of $2.35, and 10,750,133 covering shares of Class B common stock (which were converted from Class A common pursuant to the Business Combination upon assumption). (2) The calculation of the weighted average exercised price does not take into account shares to be issued under outstanding RSU and PRSU awards, which have no exercise price. (3) Includes 23,442,323 shares remaining for issuance under the 2020 Plan and 2,785,582 shares remaining for issuance or subject to outstanding purchase rights under the Employee Stock Purchase Plan (“ESPP”). The number of shares available for issuance under the 2020 Plan increases on the first day of each fiscal year beginning with the 2022 fiscal year to an amount equal to the lesser of (i) seven percent (7%) of the number of shares of Class A common stock outstanding on the last day of 155 the immediately preceding fiscal year, and (ii) such number of shares determined by the Board of Directors; provided that for each fiscal year beginning with the 2025 fiscal year through the expiration of the 2020 Plan, each such increase shall be reduced to the lesser of five percent (5%) of the number of shares of Class A common stock on the last day of the immediately preceding fiscal year or such number of shares determined by the Board of Directors. On the first day of each fiscal year, beginning with the 2022 fiscal year and ending on (and including) the first day of the 2030 fiscal year, the calculation of the maximum number of shares available for issuance under the ESPP shall include automatic increases in an amount equal to the lesser of (x) 1.0% of the total number of shares of Class A common stock outstanding on the last day of the calendar month prior to the date of such automatic increase, and (y) such number of shares of Class A common stock as determined by the administrator of the ESPP; provided that the maximum number of shares of Class A common stock reserved under the ESPP shall not exceed 10.0% of the total outstanding capital stock of the Corporation (inclusive of the shares reserved under the ESPP) as of January 7, 2021, on an as-converted basis. A description of the 2014 Equity Incentive Plan is included in Note 18 (Employee Benefit Plans) to the Consolidated Financial Statements in this Annual Report on Form 10-K. Security Ownership of Certain Beneficial Owners and Management The following table sets forth information known to us regarding the beneficial ownership of our common stock as of February 7, 2022, by: • each person who is known by us to be the beneficial owner of more than five percent (5%) of the outstanding shares of any class of our common stock; • each of our named executive officers; • each of our directors ; and • all of our executive officers and directors, as a group. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all shares beneficially owned by them, subject to community property laws where applicable. Shares of our common stock subject to stock options that are currently exercisable or exercisable within 60 days of February 7, 2022, and all shares of our common stock issuable pursuant to restricted stock units that will vest within 60 days of February 7, 2022, are deemed to be outstanding and to be beneficially owned by the person holding the stock options or restricted stock units for the purpose of computing the percentage ownership of that person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. The percentage ownership of the common stock is based on 378,521,950 shares of Class A Common Stock and 94,746,806 shares of Class B Common Stock outstanding as of February 7, 2022. Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o Clover Health Investments, Corp., 3401 Mallory Lane, Suite 210, Franklin, Tennessee 37067. 156 Name and Address of Beneficial Owner Number of Shares of Class A Common Stock % of Class A Common Stock Number of Shares of Class B Common Stock % of Class B Common Stock % of Total Voting Power ** 5% Holders Entities affiliated with Vivek Garipalli (1) — — 83,584,543 88.2 63.0 Greenoaks Capital and affiliated entities (2) 24,847,610 6.6 — — 1.9 Entities affiliated with Chamath Palihapitiya (3) 30,147,610 8.0 284,891 * 2.5 The Vanguard Group, Inc. (4) 25,887,351 6.8 — — 2.0 Executive Officers and Directors Vivek Garipalli (5) — — 85,262,416 90.0 64.3 Andrew Toy (6) — — 12,790,323 11.9 8.8 Joseph Wagner — — 158,605 * * Mark C. Herbers — — — — — Jamie L. Reynoso (7) 60,462 * 517,017 * * Prabhdeep Singh — — — — — Chelsea Clinton (8) — — 499,390 * * Lee A. Shapiro 27,100 * — — — Nathaniel S. Turner (9) — — 1,324,728 1.4 1.0 Demetrios L. Kouzoukas — — — — — William G. Robinson, Jr. 27,100 * — — — All executive officers and directors as a group (11 persons) (10) 114,662 * 100,552,479 92.5 68.6 * Less than one percent. ** Percentage of total voting power represents voting power with respect to all shares of Class A common stock and Class B common stock, as a single class. Each share of Class B common stock is entitled to ten votes per share and each share of Class A common stock is entitled to one vote per share. (1) Consists of (i) 5,645,934 shares of Class B common stock held by Caesar Ventures, LLC (Caesar Ventures), (ii) 2,062,265 shares of Class B common stock held by Caesar Clover, LLC (Caesar Clover), (iii) 75,694,143 shares of Class B common stock held by NJ Healthcare Investments, LLC (NJ Healthcare), and (iv) 182,201 shares of Class B common stock held by Titus Ventures, LLC (Titus Ventures). Mr. Garipalli serves as the sole manager of Caesar Ventures, Caesar Clover, NJ Healthcare and Titus Ventures, respectively. Therefore, Mr. Garipalli may be deemed to share voting power and dispositive power over the shares held by these entities. (2) Based on information contained in a Schedule 13G/A filed with the Securities and Exchange Commission on December 10, 2021, consists of (i) 1,004,577 shares of Class A common stock held of record by Greenoaks Capital MS LP – Banting Series, (ii) 771,331 shares of Class A common stock held of record by Greenoaks Capital MS LP – Blackwell Series, (iii) 2,169,635 shares of Class A common stock held of record by Greenoaks Capital MS LP – Joslin Series, (iv) 679,056 shares of Class A common stock held of record by Greenoaks Capital MS LP – Osler Series, (v) 3,009,089 shares of Class A common stock held of record Greenoaks Capital Opportunities Fund, L.P., (vi) 6,514,694 shares of Class A common stock held of record by Greenoaks Capital MS LP – Lister Series, (vii) 8,024,421 shares of Class A common stock held of record by Greenoaks Magnolia Fund LP, (viii) 2,674,807 shares of Class A common stock held of record by Greenoaks Magnolia MS Fund LP – Pasteur Series, (ix) 157,158 shares of Class A common stock held of record by Neil Mehta, (x) 440,655 shares of Class A common stock held of record by Neil Mehta Separate Property Trust and (xi) 309,133 shares of Class A common stock held by the Peretz Family Trust. Greenoaks Capital Partners LLC is the investment adviser to these entities and related persons or entities. Each of Neil Mehta and Benjamin Peretz is a managing member of Greenoaks Capital Partners LLC. Therefore, Mr. Peretz and Mr. Mehta may be deemed to share voting power and dispositive power over the shares held by these entities and related persons or related entities. The principal business address of each of these entities and related persons or entities is 535 Pacific Avenue, 4th Floor, San Francisco, California 94133. (3) Based on information contained in a Schedule 13D/A filed with the Securities and Exchange Commission on January 14, 2022, consists of (i) 28,408,480 shares of Class A common stock held by ChaChaCha SPAC C LLC, (ii) 1,739,130 shares of Class A common stock held by SC Master Holdings, LLC. and (iii) 284,891 shares of Class B common stock held by Social + Capital Partnership III. Mr. Palihapitiya beneficially owns shares held by ChaChaCha SPAC C LLC, SC Master Holdings, LLC and Social + Capital Partnership III by virtue of his voting and investment control over these entities. All the shares held by ChaChaCha SPAC C LLC are subject to a pledge in favor of Credit Suisse AG, New York Branch as collateral with respect to a loan agreement. The address of these entities is 317 University Ave, Suite 200, Palo Alto, CA 94301. Includes 2,245,980 shares of Class A common stock received upon exercise of warrants. (4) Based on information contained in a Schedule 13G/A filed with the Securities and Exchange Commission on February 9, 2022, The Vanguard Group, Inc. (Vanguard), an independent advisor, has sole voting power over 0 shares of Class A common stock, shared voting power over 94,531 shares of Class A common stock, sole dispositive power over 25,566,805 shares of Class A common stock and shared dispositive power over 320,546 shares of Class A common stock. The Schedule 13G/A filed by Vanguard provides information only as of December 31, 2021 and, consequently, the beneficial ownership of Vanguard may have changed between December 31, 2021 and February 7, 2022. The principal business address of Vanguard is 100 Vanguard Blvd., Malvern, PA 19355. (5) Consists of (i) the shares listed in footnote (1) of which Mr. Garipalli may be deemed to share voting and dispositive power, and (ii) 1,677,873 shares of Class B common stock held directly by Mr. Garipalli. (6) Consists of 12,790,323 shares of Class B common stock issuable upon exercise of options exercisable on or within 60 days of February 7, 2022. (7) Consists of (i) 517,017 shares of Class B common stock issuable upon exercise of options exercisable on or within 60 days of February 7, 2022, and (ii) 60,462 shares of Class A common stock. 157 (8) Consists of 499,390 shares of Class B common stock issuable upon exercise of options exercisable on or within 60 days of February 7, 2022. (9) Consists of 1,324,728 shares of Class B common stock held by Multiple Holdings, LLC. Nathaniel S. Turner is a partner in Multiple Holdings, LLC and may be deemed to share voting power and dispositive power over these shares. The address of Multiple Holdings, LLC is 180 Varick Street, Suite 1220 New York, NY 10014. (10) Consists of (i) 114,662 shares of Class A common stock, (ii) 86,587,144 shares of Class B common stock and (iii) 13,965,335 shares of Class B common stock issuable upon exercise of options exercisable within 60 days of February 7, 2022. Item 13. Certain Relationships and Related Person Transactions, and Director Independence Related Person Transactions Policy In connection with the Closing, our Board of Directors adopted a written related person transactions policy that our executive officers, directors, nominees for election as a director, beneficial owners of more than 5% of our common stock and any members of the immediate family of and any entity affiliated with any of the foregoing persons are not permitted to enter into a material related person transaction with us without the review and approval of our Audit Committee or a committee composed solely of independent directors in the event it is inappropriate for our Audit Committee to review such transaction due to a conflict of interest. The policy provides that any request for us to enter into a transaction with an executive officer, director, nominee for election as a director, beneficial owner of more than 5% of our common stock or with any of their immediate family members or affiliates, in which the amount involved exceeds $120,000 will be presented to our Audit Committee for review, consideration and approval. In approving or rejecting any such proposal, we expect that our Audit Committee will consider the relevant facts and circumstances available and deemed relevant to the Audit Committee, including, but not limited to, whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related person’s interest in the transaction. Although, prior to the Closing, we did not have a written policy for the review and approval of transactions with related persons, our Board of Directors historically reviewed and approved any transaction where a director or officer had a financial interest, including all of the transactions described above. Prior to approving such a transaction, the material facts as to a director’s or officer’s relationship or interest as to the agreement or transaction were disclosed to our Board of Directors. Our Board of Directors would take this information into account when evaluating the transaction and in determining whether such transaction was fair to our company and in the best interest of all of our stockholders. Other than compensation arrangements for our directors and executive officers, which are described elsewhere in this report, the following describes transactions since January 1, 2021, and each currently proposed transaction in which: • we or SCH have been or are to be a participant; • the amounts involved exceeded or will exceed $120,000; and • any of our directors, executive officers, or holders of more than 5% of our outstanding capital stock, or any immediate family member of, or person sharing the household with, any of these individuals or entities, had or will have a direct or indirect material interest. Registration Rights Agreement In connection with the Closing, we, the Sponsor, SCH’s independent directors, certain stockholders of Clover, including entities affiliated with Mr. Garipalli, our Chief Executive Officer, entities affiliated with Greenoaks Capital, which was a holder of more than 5% of our outstanding capital stock, and entities affiliated with our director, Nathaniel S. Turner, and the other parties thereto entered into an Amended and Restated Registration Rights Agreement dated as of January 7, 2021 (the “Registration Rights Agreement”). Under the Registration Rights Agreement, we are obligated to file a registration statement to register the resale of shares of our Class A common stock held by the parties thereto and the private placement warrants held by the Sponsor and shares of our Class A common stock issuable upon the exercise of the private placement warrants. The Registration Rights Agreement will terminate on the earlier of (i) the tenth anniversary of the date of the Registration Rights Agreement or (ii) with respect to any party thereto, on the date that such party no longer holds any registrable securities. Pre-Business Combination Related Party Transactions of Clover Hospital Contracts We have various contracts with IJKG Opco LLC (d/b/a CarePoint Health—Bayonne Medical Center), Hudson Hospital Opco LLC (d/b/a CarePoint Health—Christ Hospital) and Hoboken University Medical Center Opco LLC (d/b/a CarePoint Health—Hoboken University Medical Center), which collectively do business as CarePoint Health System. CarePoint Health System is ultimately held and controlled by Mr. Garipalli, our Chief Executive Officer, and who, through his affiliated entities, owns greater than 5% of our 158 capital stock. The Corporation contracts with CarePoint Health for the provision of inpatient and hospital-based outpatient services. Expenses and fees incurred related to these contracts, recorded in MA net medical claims incurred, were $12.7 million for the year ended December 31, 2021. Service contracts We have a contract with Medical Records Exchange, LLC (d/b/a ChartFast) pursuant to which we receive administrative services related to medical records via ChartFast’s electronic applications and web portal platform. ChartFast is ultimately owned and controlled by Mr. Garipalli. Expenses and fees related to this agreement were $0.2 million for the year ended December 31, 2021. The Corporation has contracted with Rogue Trading, LLC (Rogue), a marketing services provider. The Corporation’s President and Chief Technology Officer, Andrew Toy, is related to the Chief Executive Officer of Rogue. Expenses and fees related to these contracts were $0.3 million for the years ended December 31, 2021. On July 2, 2021, the Corporation signed a contract with Thyme Care, Inc. (Thyme Care), an oncology benefit management company, through which Thyme Care will provide concierge cancer coordination services to the Corporation’s Medicare Advantage members in New Jersey and develop a provider network to help ensure member access to high-value oncology care. Mr. Garipalli is a member of Thyme Care’s Board of Directors. Expenses and fees incurred related to this agreement were $0.3 million for the year ended December 31, 2021. Executive Compensation and Employment Arrangements See the “Executive Compensation” section in this report for information on compensation arrangements with our executive officers and directors, which include, among other things, stock awards, agreements with executive officers and certain other benefits, and for information on termination arrangements with executive officers. Limitation of Liability and Indemnification of Directors and Officers Our amended and restated certificate of incorporation contain provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for the following: • for any breach of their duty of loyalty to us or our stockholders; • for any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; • unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or • for any transaction from which they derived an improper personal benefit. Our amended and restated bylaws provide that we shall indemnify, to the fullest extent permitted by law, any person who is or was a party or is threatened to be made a party to any action, suit or proceeding, by reason of the fact that he or she is or was one of our directors or officers or is or was serving at our request as a director or officer of another corporation, partnership, joint venture, trust or other enterprise. Our amended and restated bylaws provide that we may indemnify our employees or agents. Our amended and restated bylaws also provide that we must advance expenses incurred by or on behalf of a director or officer in advance of the final disposition of any action or proceeding, subject to limited exceptions. We maintain insurance policies under which, subject to the limitations of the policies, coverage is provided to our directors and officers against loss arising from claims made by reason of breach of fiduciary duty or other wrongful acts as a director or officer, including claims relating to public securities matters, and to us with respect to payments that may be made by us to these officers and directors pursuant to our indemnification obligations or otherwise as a matter of law. We entered into indemnification agreements with each of our directors and executive officers that are broader than the specific indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements require us, among other things, to indemnify our directors and executive officers against liabilities that may arise by reason of their status or service. These indemnification agreements also require us to advance all expenses incurred by the directors and executive officers in investigating or defending any such action, suit or proceeding. We believe that these agreements are necessary to attract and retain qualified individuals to serve as directors and executive officers. 159 Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling our company pursuant to the foregoing provisions, we have been informed that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. Pre-Business Combination Related Party Transactions of SCH Private Placement Warrants Simultaneously with the consummation of the initial public offering of SCH, the Sponsor purchased 10,933,333 private placement warrants to purchase one SCH Class A ordinary share at an exercise price of $11.50 at a price of $1.50 per warrant, or 16.4 million in the aggregate, in a private placement. A portion of the proceeds from the sale of the private placement warrants was placed in the trust account of SCH. In connection with the Business Combination, upon the Domestication, each of the 10,933,333 private placement warrants automatically converted into a warrant to acquire one share of our Class A common stock. In the third quarter of 2021, we announced that we were redeeming all of the outstanding private placement warrants. Prior to the redemption date, all private placement warrants were exercised on a cashless basis in exchange for an aggregate of 2,722,399 shares of our Class A common stock. Subscription Agreements Concurrently with the execution of the Merger Agreement, we entered into subscription agreements with the PIPE investors that are existing directors, officers or equity holders of the Sponsor and its affiliates (together with their permitted transferees) (collectively, the “Sponsor Related PIPE Investors”), pursuant to which the Sponsor Related PIPE Investors have subscribed for shares of our Class A common stock in connection with the PIPE Investment. Certain of the Sponsor Related PIPE Investors are expected to fund $152,000,000 of the PIPE Investment, for which they will receive 15,200,000 shares of our Class A common stock. Specifically, (i) ChaChaCha SPAC C LLC, an entity affiliated with Chamath Palihapitiya (SCH’s Chairman and Chief Executive Officer), subscribed for 10,000,000 shares of our Class A common stock, (ii) Hedosophia Group Limited, an entity affiliated with Ian Osborne (SCH’s President and director), subscribed for 5,000,000 shares of our Class A common stock and (iii) Jacqueline D. Reses subscribed for 200,000 shares of our Class A common stock. The PIPE Investment was consummated concurrently with the Closing. Director Independence In evaluating the independence of our board members and the composition of the committees of our board, we utilize the definition of “independence” as that term is defined by the Nasdaq Listing Rules. The Nasdaq listing rules generally require that a majority of the members of a listed company’s Board of Directors be independent within specified periods following the completion of an initial public offering. In addition, the listing rules generally require that, subject to specified exceptions, each member of a listed company’s audit, compensation and governance committees be independent. Audit Committee members must also satisfy the independence criteria set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended, or Exchange Act. In order to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries, or be an affiliated person of the listed company or any of its subsidiaries. Compensation committee members must also satisfy the independence criteria as required by Rule 10C-1 under the Exchange Act. Our Board of Directors has determined that none of the members of our Board of Directors other than Messrs. Garipalli and Toy has a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of the members of our Board of Directors other than Messrs. Garipalli and Toy, and each of the members of the Audit Committee, Talent and Compensation Committee, and Nominating and Corporate Governance Committee, is “independent” as that term is defined under the Nasdaq rules. 160 Item 14. Principal Accounting Fees and Services The table below sets forth the aggregate fees billed by Ernst & Young LLP in 2021 and 2020. 2021 2020 Audit Fees (1) $ 1,358,375 $ 935,100 Audit Related Fees (2) 46,125 45,000 Tax Fees (3) 211,595 313,800 All Other Fees (4) 125,000 1,116,487 Total $ 1,741,095 $ 2,410,387 (1) Audit fees principally related to the audit of our annual financial statements, the review of our quarterly financial statements included in our Quarterly Reports on Form 10-Q, and the audit of our internal control over financial reporting. Audit fees also relate to services such as subsidiary and statutory audits. (2) Audit Related Fees principally relate to audits of employee benefit plans, review of internal controls for selected information systems, and due diligence work. (3) Tax Fees principally relate to the preparation of tax returns and compliance services and tax planning and consultation services. (4) All Other Fees relate to non-tax related advisory and consulting services, including fees billed for services involving due diligence performed in connection with directors’ and officers’ insurance under SCH’s engagement entered into prior to the Clover Health Business Combination, a Section 382(g) analysis, registration work in connection with a potential initial public offering, and special purpose acquisition vehicle advisory work. Pre-Approval Policy The Corporation’s Audit Committee was formed in connection with the Business Combination. As a result, the Audit Committee did not pre-approve all of the foregoing services, although any services rendered prior to the formation of our Audit Committee were approved by our Board of Directors. Since the formation of our Audit Committee, and on a going-forward basis, the Audit Committee has pre-approved and will continue to pre-approve all auditing services and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis exceptions for non-audit services described in the Exchange Act which are approved by the Audit Committee prior to the completion of the audit). Part IV 161 Item 15. Exhibits and Financial Statement Schedules. (a) The Financial Statements, Financial Statement Schedules, and exhibits set forth below are filed as part of this report. (1) Financial Statements - The response to this portion of Item 15 is submitted as Item 8 of Part II of this report. (2) Financial Statement Schedules - The response to this portion of Item 15 is submitted as Item 8 of Part II of this report. (3) A list of exhibits to this Form 10-K is set forth below: Incorporated by reference Exhibit No. Exhibit title Form File No. Exhibit No. Filing date Filed or furnished herewith 2.1 Agreement and Plan of Merger, dated as of October 5, 2020, by and among the Registrant, Asclepius Merger Sub Inc. and Clover Health Investments, Corp. 8-K 001-39252 2.1 10/6/2020 2.1(a) Amendment to the Agreement and Plan of Merger, dated as of December 8, 2020 8-K 001-39252 2.1 12/10/2020 3.1 Amended and Restated Certificate of Incorporation of the Registrant 8-K 001-39252 3.1 1/12/2021 3.2 Amended and Restated Bylaws of the Registrant 8-K 001-39252 3.2 1/12/2021 4.1 Specimen Class A Common Stock Certificate of the Registrant S-4/A 333-249558 4.5 11/20/2020 4.2 Specimen Class B Common Stock Certificate of the Registrant S-4/A 333-249558 4.6 11/20/2020 4.3 Description of Securities X 10.1 Form of Indemnification Agreement 8-K 001-39252 10.2 1/12/2021 10.2 Amended and Restated 2014 Equity Incentive Plan, and forms of agreement thereunder S-4 333-249558 10.15 10/20/2020 10.3 2020 Equity Incentive Plan and forms of agreement thereunder 8-K 001-39252 10.4 1/12/2021 10.4 2020 Employee Stock Purchase Plan 8-K 001-39252 10.5 1/12/2021 10.5 Management Incentive Plan 8-K 001-39252 10.6 1/12/2021 10.6 Executive Incentive Bonus Plan 8-K 001-39252 10.7 1/12/2021 10.7 Non-Employee Director Compensation Policy 8-K 001-39252 10.8 1/12/2021 10.8 Employment Agreement dated as of December 31, 2020, by and between the Registrant and Vivek Garipalli 8-K 001-39252 10.9 1/12/2021 10.9 Employment Agreement dated as of December 31, 2020, by and between the Registrant and Andrew Toy 8-K 001-39252 10.10 1/12/2021 10.10 Letter Agreement dated as of August 13, 2021, by and between the Registrant and Joseph Wagner 10-Q 001-39252 10.1 11/09/2021 10.11 Agreement for the Provision of Interim Management Services between the Registrant and AP Services, LLC 8-K 001-39252 10.2 11/09/2021 10.12 Employment Agreement, effective as of December 31, 2021, between the Registrant and Jamie L. Reynoso X 10.13 Employment Agreement, effective as of July 6, 2021, between the Registrant and Prabhdeep Singh X 10.14 Letter Agreement, dated January 19, 2022, between the Registrant and Gia Lee X 21.1 List of Subsidiaries 8-K 001-39252 21.1 1/12/2021 23.1 Consent of Independent Registered Public Accounting Firm X 24.1 Power of Attorney (included on signature page) X 31.1 Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 162 31.2 Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 32.1 † Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 32.2 † Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 101.INS Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) _____________ † Furnished and not filed. Item 16. Form 10-K Summary None. 163 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Clover Health Investments, Corp. Date: February 28, 2022 By: /s/ Vivek Garipalli Vivek Garipalli Chief Executive Officer POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Vivek Garipalli as his or her attorney-in-fact, with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorney-in-fact, or his substitute, may do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Vivek Garipalli Chief Executive Officer and Chairman of the Board (Principal Executive Officer) Date: February 28, 2022 Vivek Garipalli /s/ Andrew Toy President, Chief Technology Officer and Director Date: February 28, 2022 Andrew Toy /s/ Mark C. Herbers Interim Chief Financial Officer (Principal Financial Officer, and Principal Accounting Officer) Date: February 28, 2022 Mark C. Herbers /s/ Chelsea Clinton Director Date: February 28, 2022 Chelsea Clinton /s/ Demetrios L. Kouzoukas Director Date: February 28, 2022 Demetrios L. Kouzoukas /s/ Lee A. Shapiro Director Date: February 28, 2022 Lee A. Shapiro /s/ Nathaniel S. Turner Director Date: February 28, 2022 Nathaniel S. Turner /s/ William G. Robinson, Jr. Director Date: February 28, 2022 William G. Robinson, Jr.