U S PHYSICAL THERAPY INC NV

The Company added the following risk factor in addition to our previously disclosed risk factors in Item 1A contained in Part I of our Annual Report on Form 10-K for the year ended December 31, 2023, and filed with the SEC on February 29, 2024.

If our noncompetition covenants with employed therapists are nullified, we may lose staff to competitors.

Many of our employed therapists have contractual non-competition agreements and covenants with the Company which, under certain circumstances, limit the employee’s ability to terminate their employment with the Company to perform similar services for competing organizations within a defined geography for a specified period time after such termination. The Federal Trade Commission recently passed a Rule which purports to prohibit many forms of non-competition agreements with employees and would require the Company, subject to certain exceptions, to nullify certain existing noncompetition agreements with employees. While a federal court recently ruled that the Rule is invalid and may not be enforced, if that decision is appealed successfully and the Rule in its current form or in a substantially similar form becomes effective, the Company could suffer a loss of staff which could have a material adverse effect on operations.