OAK STREET HEALTH, INC. FILES (8-K) Disclosing Other Events

Item 8.01 Other Events.


Supplemental Disclosures

As previously disclosed, on February 7, 2023, Oak Street Health, Inc., a
Delaware corporation ("Oak Street Health" or the "Company"), entered into an
Agreement and Plan of Merger (the "Merger Agreement") with CVS Pharmacy, Inc., a
Rhode Island corporation ("Parent"), Halo Merger Sub Corp., a Delaware
corporation and a wholly owned subsidiary of Parent ("Merger Sub"), and for the
limited purposes set forth therein, CVS Health Corporation, a Delaware
corporation and ultimate parent company of Parent ("CVS Health"), pursuant to
which Merger Sub will be merged with and into the Company, with the Company
surviving as a wholly owned subsidiary of Parent (the "Merger"). On March 30,
2023, the Company filed a definitive proxy statement on Schedule DEFM14A (the
"Definitive Proxy Statement"), as such may be supplemented from time to time,
with the U.S. Securities and Exchange Commission (the "SEC") with respect to the
special meeting of the Company's stockholders to vote to adopt the Merger
Agreement scheduled to be held on April 28, 2023 (the "Oak Street Health Special
Meeting").

Explanatory Note

In connection with the Merger, seven complaints have been filed as individual
actions in United States District Courts. Five complaints have been filed in the
United States District Court for the Southern District of New York and are
captioned Ryan O'Dell v. Oak Street Health, Inc., et al., No. 23-cv-02029 (filed
March 9, 2023), Elaine Wang v. Oak Street Health, Inc., et al., No. 23-cv-02076
(filed March 10, 2023), Stephen Bushansky v. Oak Street Health, Inc., et al.,
No. 23-cv-02709 (filed March 31, 2023), John Thompson v. Oak Street Health,
Inc., et al., No. 23-cv-02766 (filed April 3, 2023), and Jeffrey Rubin v. Oak
Street Health, Inc., et al., No. 23-cv-2838 (filed April 4, 2023). One complaint
has been filed in the Circuit Court of Cook County's Chancery Division in
Illinois and is captioned Margie Elstein v. Regina Benjamin, MD, et al., No.
2023CH03133 (filed March 30, 2023) (the "Illinois Action"). One complaint has
been filed in the United States District Court for the District of Delaware and
is captioned Michael Kent v. Oak Street Health, Inc., et al., No. 23-cv-00371
(filed March 31, 2023). The foregoing complaints are referred to as the "Merger
Actions."

The Merger Actions each name Oak Street Health and its directors as defendants,
and in addition, the Illinois Action names CVS Health and Parent as defendants.
The Merger Actions allege, among other things, that the defendants filed or
caused to be filed a materially incomplete and misleading preliminary proxy
statement or Definitive Proxy Statement with the SEC relating to the Merger in
violation of Sections 14(a) and 20(a) of the Exchange Act, 15 U.S.C. §§ 78n(a),
78t(a), SEC Rule 14a-9, 17 C.F.R. 240.14a-9 and 17 C.F.R. § 244.100 and, in the
case of the Illinois Action, Illinois state law. The plaintiffs seek, among
other things, injunctive relief preventing the defendants from consummating the
Merger unless and until additional disclosures are made, and an award of costs
and disbursements, including reasonable attorneys' and experts' fees and
expenses.

Additionally, Oak Street Health has received demand letters from nine purported
stockholders of Oak Street Health seeking additional disclosures in the
preliminary proxy statement or the Definitive Proxy Statement.

Oak Street Health believes the claims asserted in the Merger Actions and the
demand letters are without merit but cannot predict the outcome of any such
claims. Additional lawsuits and demand letters arising out of the Merger may
also be filed or received in the future. If additional similar lawsuits and
demand letters are filed or received, absent new or significantly different
allegations, Oak Street Health will not necessarily disclose such additional
lawsuits or demand letters.

While Oak Street Health believes that the disclosures set forth in the
Definitive Proxy Statement comply fully with all applicable laws and denies the
allegations in the pending Merger Actions described above, in order to moot
plaintiffs' disclosure claims, and avoid nuisance and possible expense and
business delays, Oak Street Health has determined voluntarily to supplement
certain disclosures in the Definitive Proxy Statement related to plaintiffs'
claims with the supplemental disclosures set forth below (the "Supplemental
Disclosures"). Nothing in the Supplemental Disclosures shall be deemed an
admission of the legal merit, necessity or materiality under applicable laws of
any of the disclosures set forth herein. To the contrary, Oak Street Health
specifically denies all allegations in the Merger Actions and the demand letters
described above that any additional disclosure was or is required or material.

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All page references used herein refer to pages in the Definitive Proxy Statement
before any additions or deletions resulting from the Supplemental Disclosures,
and capitalized terms used below, unless otherwise defined, have the meanings
set forth in the Definitive Proxy Statement. Underlined and bolded text shows
text being added to a referenced disclosure in the Definitive Proxy Statement
and stricken-through text shows text being deleted from a referenced disclosure
in the Definitive Proxy Statement. This Current Report on Form 8-K is
incorporated into, and amends and/or supplements, the Definitive Proxy Statement
as provided herein. Except as specifically noted herein, the information set
forth in the Definitive Proxy Statement remains unchanged.

Supplemental Disclosures to Definitive Proxy Statement

The fourth paragraph on page 37 of the Definitive Proxy Statement is hereby
supplemented by amending and restating such paragraph as follows:

On February 4, 2023 and February 5, 2023, Mr. Pykosz and representatives of CVS
Health engaged in high-level discussions regarding the retention of Oak Street
Health's senior management following consummation of the transaction. During
such discussions, no proposals with respect to Oak Street Health's senior
management's post-closing employment, compensation or incentive or equity
arrangements were made by either Mr. Pykosz or representatives of CVS Health.

The table following the fourth paragraph under the sub-heading titled "Selected
Public Company Analysis," on page 47 of the Definitive Proxy Statement is hereby
supplemented by amending and restating the table on such page as follows:

                                Enterprise Value   EV / 2023E
Selected Company                     ($bn)          Revenue
Agilon Health, Inc.                   $8.4            2.1x
Apollo Medical Holdings, Inc.         $2.1            0.9x
Cano Health, Inc.                     $1.7            0.5x
CareMax, Inc.                         $0.6            0.8x
Privia Health Group, Inc.             $3.0            1.1x
Mean                                                  1.1x
Median                                                0.9x


The table following the second paragraph under the sub-heading titled "Selected
Transaction Analysis," on page 48 of the Definitive Proxy Statement is hereby
supplemented by amending and restating the table on such pages as follows:

Date Announced                           Acquiror                                         Target                              Enterprise Value ($bn)         EV/LTM Revenue Multiple
November 2022                 Walgreens Boots Alliance, Inc.                       Summit Health-CityMD                                $8.9                           3.1x
July 2022                            Amazon.com, Inc.                             1Life Healthcare, Inc.                               $3.7                           4.1x
February 2022                   Kinderhook Industries, LLC           Better Health Group (f.k.a.) Physicians Partners                  $2.6                           3.1x
October 2021                  Walgreens Boots Alliance, Inc.             Village Practice Management Company, LLC                     $12.9                           9.9x
July 2021                           Cano Health, Inc.                             Doctors Medical Center                               $0.3                           1.5x
June 2021                           Cano Health, Inc.                             University Health Care                               $0.6                           1.7x
June 2021                         1Life Healthcare, Inc.                            Iora Health, Inc.                                  $2.1                           9.5x
December 2017                          Optum, Inc.                                 DaVita Medical Group                                $4.3                           0.8x
May 2012                               DaVita, Inc.                      Health Care Partners Medical Group, P.C.                      $4.4                           1.3x
Mean                                                                                                                                                                  3.9x
Median                                                                                                                                                                3.1x

The second and third paragraphs under the sub-heading titled "Discounted Cash
Flow Analysis," on pages 49-50 of the Definitive Proxy Statement are hereby
supplemented by amending and restating such paragraphs as follows:

In performing this analysis, Centerview calculated implied enterprise values for
Oak Street Health by discounting to present value as of December 31, 2022 using
discount rates ranging from 11.25% to 13.50% (reflecting Centerview's analysis
of the Oak Street Health's weighted average cost of capital based on
considerations that Centerview deemed relevant in its professional judgment and
experience), the forecasted unlevered free cash flows of the Company based on
Forecasts during the period beginning the first quarter of 2023, and ending in
December 2028 and extrapolation beginning the first quarter of 2029, and ending
in December 2037, and forecasted use of federal and state net operating loss
("NOL")

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carryforwards through 2032. The implied terminal value of Oak Street Health at
the end of the forecast period was estimated by using perpetuity growth rates
ranging from 2.5% to 3.5% (which were determined based on considerations that
Centerview deemed relevant in its professional judgment and experience). For
purposes of this analysis, stock-based compensation was treated as a cash
expense. Centerview then subtracted from the range of implied enterprise values
Oak Street Health's estimated net debt of $569 million (calculated as debt less
cash and investments) as of December 31, 2022 as set forth in the Internal Data,
to derive a range of implied equity values for Oak Street Health.

Centerview then divided this range of implied equity values by the number of
fully-diluted outstanding shares of Oak Street Health common stock (which
included approximately 243,022,452 shares of issued and outstanding Company
Common Stock and the impact, determined using the treasury stock method, of
approximately 19,753,087 total outstanding Company Options (including
performance-based Company Options) and approximately 3,709,972 total outstanding
Company RSUs (including performance-based Company RSUs)determined using the
treasury stock method and taking into account outstanding in-the-money options
and restricted stock units (including performance-based restricted stock units))
as set forth in the Internal Data (calculated as of February 3, 2023), to derive
a range of implied values of Oak Street Health common stock of $29.50 to $48.30
(rounded to the nearest $0.10) per share, inclusive of the NOLs. Centerview then
compared this range to the $39.00 per share in cash, without interest, proposed
to be paid to the holders of the shares of Oak Street Health common stock (other
than the Excluded Shares) pursuant to the Merger Agreement.

The sub-section titled "General" on pages 51-52 of the Definitive Proxy
Statement is hereby supplemented by adding the following paragraph as the last
paragraph of such sub-section:

In addition, David Dorman, who was the Chairman of the Board of Directors of CVS
Health from May 2011 until May 2022, is a partner in the ultimate general
partner and the manager of Centerview Capital Technology Fund (Delaware), L.P.,
and Centerview Capital Technology Fund-A (Delaware), L.P., together with a
related employee fund (collectively, "Centerview Capital Technology"), which are
growth equity investment funds focused on the technology sector. Certain
partners of Centerview Partners LLC are partners in Centerview Capital
Technology, and, along with Mr. Dorman, serve on Centerview Capital Technology's
investment committee. Centerview Partners LLC provides certain back-office
support to Centerview Capital Technology. Mr. Dorman has no ownership interest
in, and is not an employee of, Centerview Partners LLC.

The section of the Definitive Proxy Statement titled "Certain Financial
Projections" on pages 52 to 54 of the Definitive Proxy Statement is hereby
supplemented by amending and restating such section as follows:

In our press releases announcing quarterly and annual results, Oak Street Health
has historically prepared and provided certain public guidance as to its
projected financial and operational results for its then-current fiscal quarter
and fiscal year. Oak Street Health does not otherwise, as a matter of course,
make long-term projections as to future performance available to the public
(other than in certain limited circumstances), given, among other things, the
inherent difficulty of predicting financial performance for future periods and
the likelihood that the underlying assumptions and estimates may not be
realized.

However, in connection with the evaluation of potential strategic alternatives,
as described further in the section of this proxy statement titled "The Merger -
Background of the Merger", Oak Street Health's management team prepared certain
unaudited prospective financial information for Oak Street Health for the
remainder of fiscal year 2022 and fiscal years 2023 through 2028 (the
"Projections"). The Company's senior management also prepared extrapolations of
the Projections for fiscal years 2029 through 2037 (the "Extrapolations") and
certain analyses related to the expected utilization of federal and state NOL
carryforwards through 2032 (the "NOL Forecasts", and together with the
Projections and the Extrapolations, the "Financial Information"), which were
provided to Centerview for purposes of its financial analyses summarized in the
section above titled "- Opinion of Centerview".

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The Projections Financial Information were was not prepared with a view toward
public disclosure, and accordingly, does not necessarily comply with published
guidelines of the SEC or the guidelines established by the American Institute of
Certified Public Accountants for preparation and presentation of prospective
financial information or generally accepted accounting principles ("GAAP"). The
Company's independent registered public accounting firm has not compiled,
examined, audited or performed any procedures with respect to the Projections
Financial Information, and has not expressed any opinion or any other form of
assurance regarding this information or its achievability.

The Projections Financial Information summarized below are is included solely to
provide Oak Street Health stockholders access to financial projections that were
made available to the Oak Street Health Board, the Transaction Committee,
Centerview and, solely with respect to the Projections, CVS Health in connection
with the proposed Merger, and are not included in this proxy statement to
influence an Oak Street Health stockholder's decision as to whether to vote to
adopt the Merger Agreement or for any other purpose.

None of the Company, the Oak Street Health Board, Centerview, CVS Health or any
of their respective affiliates, advisors or other representatives makes any
representation to any stockholder regarding the validity, reasonableness,
accuracy or completeness of the Projections Financial Information or the
ultimate performance of the Company relative to the Projections Financial
Information. The inclusion of the summary of the Projections Financial
Information in this proxy statement does not constitute an admission or
representation of the Company, the Oak Street Health Board, Centerview, CVS
Health or any of their respective affiliates, advisors or other representatives
that the Projections Financial Information or the information contained therein
are material. The inclusion of the summary of the Projections Financial
Information in this proxy statement should not be regarded as an indication that
Oak Street Health or anyone who receives the Projections Financial Information
then considered, or now considers, the Projections Financial Information to be
necessarily predictive of actual future events, and this information should not
be relied upon as such. In the view of Oak Street Health's management, the
Projections Financial Information were was prepared on a reasonable basis,
reflected the best estimates and judgments available to Oak Street Health's
management at the time and presented, to the best of Oak Street Health's
management's knowledge and belief, the expected course of action and Oak Street
Health's expected future financial performance as of the date such information
was prepared.

The Projections Financial Information summarized below, while presented with
numerical specificity, were based on numerous variables and assumptions that
necessarily involve judgments with respect to, among other things, future
economic, competitive, regulatory and financial market conditions, all of which
are difficult or impossible to predict and many of which are beyond Oak Street
Health's control. In addition, the Projections Financial Information reflects
assumptions that are subject to change and are susceptible to multiple
interpretations based on actual results, revised prospects for Oak Street
Health's business, changes in general business or economic conditions, or any
other transaction or event that has occurred or that may occur and that was not
anticipated when the Projections Financial Information were was prepared.
Accordingly, actual results will differ, and may differ materially, from those
contained in the Projections Financial Information, and therefore, the
Projections Financial Information cannot be considered a guarantee of future
operating results and should not be relied upon as such.

The Projections Financial Information reflects the assumption that the Company
will open 35 new primary care centers per year for fiscal years 2023 and 2024,
and 40 new primary care centers per year for fiscal years 2022 and 2025 through
20282037. The Projections Financial Information also reflects other assumptions
that are subject to change, including, but not limited to, assumptions
regarding: primary care center membership mix; market share; market size and
conditions; revenue; medical costs; operating expenses; capital expenditures;
and net working capital. The Projections Financial Information covers multiple
years, and thus, by their its nature, they becomes subject to greater
uncertainty with each successive year.

The Projections Financial Information assumes organic company growth without
business expansions from mergers and acquisitions or alternative business
models. In addition, the Projections Financial Information does not take into
account any circumstances, transactions or events occurring after the date on
which the Projections Financial Information were was prepared and do not give
effect to any changes or expenses incurred after the date on which they were
made, including as a result of the Merger or any effects of the Merger
(including any failure of the Merger to be completed).

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Except as required by applicable securities laws, Oak Street Health does not
intend to update or otherwise revise the Projections Financial Information to
reflect circumstances existing after the date on which the Projections Financial
Information were was prepared or to reflect the occurrence of future events,
even in the event that any or all of the underlying assumptions are shown to be
in error. There can be no assurance that the financial results in the
Projections Financial Information will be realized, or that future actual
financial results will not materially vary from those estimated in the
Projections Financial Information. In light of the foregoing, and the
uncertainties inherent in the Projections Financial Information, stockholders
are cautioned not to place undue, if any, reliance on the Projections Financial
Information. The Projections Financial Information should be evaluated, if at
all, in conjunction with the historical financial statements and other
information regarding Oak Street Health in its public filings with the SEC.

Important factors that may affect actual results and the achievability of the
Projections Financial Information include, but are not limited to: regulatory
actions at the federal, state and local level, decisions of health network
providers, enterprise clients and existing and potential patients, changes in
the health insurance industry, general economic conditions, including COVID-19,
and disruptions in the financial, debt, capital, credit or securities markets;
industry and market dynamics; competition; and those risks and uncertainties
described in Oak Street Health's Annual Report on Form 10-K for the fiscal year
ended December 31, 2022 and subsequent quarterly reports on Form 10-Q and
current reports on Form 8-K. See also the section entitled "Cautionary Note
Regarding Forward-Looking Statements" in this proxy statement.

Certain of the measures included in the Projections Financial Information are
financial measures that are not calculated in accordance with GAAP. Such
non-GAAP financial measures should not be viewed as a substitute for GAAP
financial measures, and may be different from non-GAAP financial measures used
by other companies. Furthermore, there are limitations inherent in non-GAAP
financial measures, because they exclude charges and credits that are required
to be included in a GAAP presentation. Accordingly, non-GAAP financial measures
should be considered together with, and not as an alternative to, financial
measures prepared in accordance with GAAP. Financial measures provided to a
financial advisor are excluded from the SEC's rules concerning non-GAAP
financial measures and, therefore, are not subject to SEC rules regarding
disclosures of non-GAAP financial measures in disclosures relating to a proposed
business combination such as the Merger if the disclosure is included in a
document such as this proxy statement, which would otherwise require a
reconciliation of a non-GAAP financial measure to a GAAP financial measure.
Reconciliations of non-GAAP financial measures were not prepared or relied upon
by the Oak Street Health Board in connection with its consideration of the
Merger Agreement or by Centerview for purposes of its financial analyses.
Accordingly, the Company has not provided a reconciliation of any financial
measures included in the Projections Financial Information.

The following table is a summary of the Projections:

                                     2022E         2023E         2024E         2025E         2026E       2027E        2028E
                                                                         ($ in millions)
Revenue                             $  2,165      $  3,289      $  4,768      $  6,377      $ 8,207     $ 10,164     $ 12,256
Platform Contribution(1)            $     82      $    194      $    379      $    610      $   890     $  1,212     $  1,541
Adj. EBITDA(2)                      ($   285 )    ($   233 )    ($   123 )    $     35      $   249     $    486     $    729
Unlevered Free Cash Flow(3)         ($   378 )    ($   247 )    ($   173 )    ($    35 )    $   182     $    409     $    640

(1) Platform Contribution is a non-GAAP financial measure which represents total

revenues less the sum of medical claims expense and cost of care, excluding

depreciation and amortization and equity-based compensation.

(2) Adjusted EBITDA is a non-GAAP financial measure which represents net loss

excluding interest expense; net, other income/ expense; income taxes; fair

value adjustments related to assets and liabilities recorded in purchase

accounting, such as earn-out liabilities and equity-method investments'

activity, including any impairment of such investments; depreciation and

amortization; transaction/ offering related costs; one-time in nature

litigation costs and stock and equity-based compensation.

(3) Unlevered Free Cash Flow is a non-GAAP financial measure which represents

Adjusted EBITDA less capital expenditures, less changes in net working

capital, less certain transaction costs, less the contingent payments due in

    connection with the acquisition of RubiconMD Holdings, Inc. in 2022.



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The following table is a summary of the Extrapolations:

                                      2029E        2030E        2031E       

2032E 2033E 2034E 2035E 2036E 2037E

                                                                                     ($ in millions)
Revenue                              $ 14,500     $ 16,914     $ 19,394     

$ 22,004 $ 24,729 $ 27,564 $ 30,507 $ 33,557 $ 36,786
Platform Contribution(1)

             $  1,925     $  2,340     $  2,758     

$ 3,196 $ 3,656 $ 4,135 $ 4,631 $ 5,143 $ 5,684
Adj. EBITDA(2)

                       $  1,006     $  1,317     $  1,642     

$ 1,995 $ 2,378 $ 2,791 $ 3,232 $ 3,703 $ 4,213
Unlevered Free Cash Flow(3) $ 611 $ 835 $ 1,069 $ 1,326 $ 1,601 $ 1,896 $ 2,211 $ 2,547 $ 2,910

The following table is a summary of the NOL Forecasts:

                                  2023E        2024E        2025E        2026E         2027E         2028E         2029E         2030E        2031E        2032E
                                                                                         ($ in millions)
Starting Available NOLs(1)       $ 1,604      $ 1,980      $ 2,210      $  2,303      $  2,261      $  2,046      $  1,641      $  1,020      $  157           -
NOLs Used(2)                          -            -            -       ($    42 )    ($   215 )    ($   404 )    ($   621 )    ($   864 )    ($ 157 )         -
Ending NOLs                      $ 1,980      $ 2,210      $ 2,303      $  2,261      $  2,046      $  1,641      $  1,020      $    157          -            -
NOLs Used(2)                          -            -            -       ($    42 )    ($   215 )    ($   404 )    ($   621 )    ($   864 )    ($ 157 )         -
Tax Rate(3)                           25 %         25 %         25 %          25 %          25 %          25 %          25 %          25 %        25 %         25 %
Future Value of Tax Shield
from NOLs                             -            -            -       $     11      $     54      $    101      $    155      $    216      $   39           -

(1) Estimated 2023 federal and post-apportionment state beginning NOL balances

based on 2022 estimate provided by Oak Street Health management.

(2) NOLs used to off-set pre-tax income.

(3) Reflects combined state and federal tax.

The paragraph under the sub-heading "Other Interests" on page 65 of the
Definitive Proxy Statement is hereby supplemented by amending and restating such
paragraph as follows:

As of the date of this proxy statement, although it is expected that Mr. Pykosz
will continue as the Chief Executive Officer of Oak Street Health following the
Merger, none of our directors or executive officers, including Mr. Pykosz, has
entered into any agreement, arrangement or understanding with CVS Health or any
of its affiliates regarding employment or service with, or compensation
following the Merger to be paid by, CVS Health or any of its affiliates, and no
employment agreements, offer letters or term sheets have been proposed by our
directors or executive officers, or by CVS Health or its affiliates, with
respect to the foregoing. However, prior to the closing of the Merger, our
directors or executive officers may discuss or enter into agreements,
arrangements or understandings with CVS Health or any of its affiliates
. . .