Nutex Health Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Note 1 –Organization and Operations

Nutex Health Inc. (“Nutex Health” or the “Company”), is a physician-led, healthcare services and operations company with 28 hospital facilities in 12 states (hospital division), and a primary care-centric, risk-bearing population health management division. The Company's hospital division implements and operates different innovative health care models, including micro-hospitals, specialty hospitals and hospital outpatient departments. The population health management division owns and operates provider networks such as independent physician associations (“IPAs”).

The Company employs approximately 1,093 full-time employees, contracts over 280 doctors at our facilities and partners with over 3,600 physicians within our networks as of September 30, 2026. The Company's corporate headquarters is based in Houston, Texas and we were incorporated on April 13, 2000 in the state of Delaware.

Merger of Nutex Health Holdco LLC and Clinigence Holdings, Inc. On April 1, 2022, Nutex Health Holdco LLC merged with Clinigence Holdings, Inc. (“Clinigence”), a publicly traded Delaware corporation, which was renamed Nutex Health Inc. after the merger (the “Merger”). Immediately prior to the Merger, holders of 84% of the aggregate equity interests in subsidiaries and affiliates of Nutex Health Holdco LLC contributed these ownership interests to Nutex Health Holdco LLC in exchange for Nutex Health Holdco LLC equity interests (“Contribution Agreements”). Immediately thereafter, in the Merger, each unit representing an equity interest in Nutex Health Holdco LLC was converted into the right to receive shares of common stock of Clinigence (n/k/a Nutex Health Inc.). Refer to Note 11 – Stock-based Compensationfor discussion of additional issuances of stock for Under Construction Hospitals, an obligation within the Contribution Agreements. The Merger was accounted for as a reverse business combination under U.S. GAAP, and Nutex Health Holdco LLC was treated as the accounting acquirer in the Merger. After completing the merger, Clinigence was renamed Nutex Health Inc.

Note 2 -Summary of Significant Accounting Policies

Basis of presentation. These unaudited condensed consolidated financial statements present the Company’s consolidated financial condition and results of operations including those of majority-owned subsidiaries and variable interest entities (“VIEs”) for which the Company is the primary beneficiary.

The hospital division includes the Company’s hospital entities. In addition, the Company has financial and operating relationships with multiple professional entities (the “Physician LLCs”) and real estate entities, which are a part of the real estate division.

The Physician LLCs employ the physicians who provide services at the Company’s hospitals. These Physician LLCs are consolidated by the Company as VIEs because they do not have sufficient equity at risk to finance their activities independently. The Company is considered the primary beneficiary of these entities because (i) it has the power to direct the activities that most significantly affect their economic performance through its contractual and operational oversight, and (ii) it has the obligation to absorb losses and the right to receive benefits that could be significant, as evidenced by the Company’s historical practice of providing financial support during periods of cash shortfall and receiving the benefit of services. While the Company does not hold any direct equity ownership in the Physician LLCs, it is deemed to have an indirect economic interest through its contractual relationships with intermediary entities such as ER LLCs, which provide operational and functional support to the VIEs. As a result,100% of the equity in these VIEs is reflected as noncontrolling interest in the Company’s unaudited condensed consolidated balance sheets and statements of operations. Certain of the Physician LLCs are owned in part and, in some cases, controlled by related parties, including members of the Company’s executive management team.

The real estate division comprises of real estate entities and the activities related to the development and construction of hospital facilities. The real estate entities own the land and buildings used by the Company’s hospital entities and lease these facilities to hospital entities. The real estate entities also include the Company's headquarters. These entities have mortgage loans payable to third parties which are collateralized by the land and buildings. The Company consolidates two real estate entities as VIEs (the "Real Estate VIEs") as the Company’s hospital entities are guarantors or co-borrowers under the related mortgage loans. The Company is considered the primary beneficiary because it has the power to direct the entities’ most significant activities and has the obligation to absorb losses and the right to receive benefits that could be significant to the Real Estate VIEs. As a result, 100% of the equity in the Real Estate VIEs is reflected as noncontrolling interest in the Company’s unaudited condensed consolidated balance sheets and statements of operations. The Real Estate VIEs in some cases are controlled by related parties, including members of the Company’s executive management team.

The population health management division includes our management services organization. Additionally, Atlas Healthcare Physicians ("Atlas", formerly known as "Associated Hispanic Physicians of So. California"), an independent physician association (“IPA”) entity not owned by the Company, is consolidated as a VIE of the Company’s wholly-owned subsidiary AHP Health Management Services (“AHP”). AHP is deemed the primary beneficiary of Atlas because it has the power to direct the significant activities of Atlas through a comprehensive management services agreement and has the right to receive substantially all of the economic benefits from its operations.

All significant intercompany balances and transactions have been eliminated in consolidation.

Interim financial statements. These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). The unaudited condensed consolidated financial statements include all material adjustments of a normal recurring nature that, in the opinion of management, are necessary for a fair presentation of the results of operations for the interim periods presented. These interim financial statements should be read together with the consolidated financial statements and notes thereto included in our audited financial statements for the year ended December 31, 2025.

Use of estimates. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include (i) estimates of net revenue and accounts receivable, (ii) fair value of acquired assets and liabilities in business combinations, (iii) impairment of long-lived assets and goodwill,(iv) estimate of valuation allowance against deferred taxes and (v) fair value of non-employee stock-based compensation. Management's estimates also include the effects of the June 30, 2026 amendment to the Payment Dispute Resolution Services Agreement, as defined in Note 3 — Revenue, with HaloMD and the related federal independent dispute resolution ("IDR") fee changes, which were accounted for as a prospective change in estimate affecting contract services expense, accrued arbitration expenses and accounts payable. Actual results could differ from those estimates.

Cash and cash equivalents and restricted cash and short-term investments. The Company considers all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. The Companyhas cash amounts, that were at times material, held in covered banking institutions in excess of the insured amounts, but does not deem the risk of loss to be likely. Restricted cash and short-term investment consists of cash and cash-equivalent balances that are subject to contractual restrictions, are not available for general corporate purposes, and are expected to be utilized within one year. As of September 30, 2026 and December 31, 2025, restricted cash and short-term investments primarily included cash required to be maintained in a segregated account in connection with a loan agreement and cash restricted for a standby letter of credit. Restricted cash and short-term investments had a balance of $3.6 million and $0.3 million as of September 30, 2026 and December 31, 2025, respectively.

The following table provides a reconciliation of cash and cash equivalents and restricted cash and short-term investment balances to the total amounts shown within the unaudited condensed consolidated statements of cash flows for the end of the periods (in thousands):

Segment reporting. A public company is required to report descriptive information about its reportable operating segments. Operating segments, as defined, are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Aggregation of similar operating segments into a single reportable operating segment is permitted if the businesses have similar economic characteristics and meet established criteria. The Company operates three reportable segments – the hospital division, the population health management division and the real estate division. The real estate division is comprised of real estate entities along with activity related to the development and construction of hospital facilities. Refer to Note 16 – Segment Information for information on the Company’s segments.

Reclassifications. During the three months ended March 31, 2026, the Company identified an immaterial revision in the purchase price allocation for a real estate asset acquisition completed on December 15, 2025. The original allocation overstated the amount assigned to building and understated the amounts assigned to land. The Company has revised the comparative prior‑period financial statements, specifically Note 5 – Property and Equipment, net, presented herein. The revisions resulted in reclassifications within property and equipment in the consolidated balance sheet as of December 31, 2025. The impact of this revision was not material to any previously issued financial statements.

Recent accounting pronouncements – issued, not yet adopted

In November 2024, the FASB issued Accounting Standards Update ("ASU") 2024-03 – Income Statement – Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027. The Company is currently evaluating the impact of this update.

In May 2025, the FASB issued ASU 2025-03 -Business Combinations (Topic 805) and Consolidation (Topic 810) - Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, which revises the current guidance for determining the accounting acquirer for a transaction effected primarily by exchanging equity interests in which the legal acquiree is a VIE that meets the definition of a business. The amendments require that an entity consider the same factors that are currently required for determining which entity is the accounting acquirer in other acquisition transactions. ASU 2025-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual periods. The Company is currently evaluating the impact of this update.

Note 3 –Revenue

The Company disaggregates revenue from contracts with customers into types of services or products, consistent with the Company's reportable segments, as follows (in thousands):

Hospital division revenue. We receive payment for facility services rendered by us from federal agencies, private insurance carriers, and patients. The Physician LLCs receive payment for doctor services from these same sources. On average, greater than 99% of our net patient service revenue is paid by insurers and other non-patient third parties. The remaining revenue is paid by our patients in the form of copays, deductibles and self-payment. We generally operate as an out-of-network provider and, as such, do not have negotiated reimbursement rates with insurance companies.

The following tables present the allocation of the estimated transaction price with the patient among the primary patient classification of insurance coverage:

The No Surprises Act (“NSA”) is a federal law that took effect January 1, 2022, to protect consumers from most instances of “surprise” balance billing. With respect to the Company, the NSA limits the amount an insured patient will pay for emergency services furnished by an out-of-network provider. The NSA addresses the payment of these out-of-network providers by group health plans or health insurance issuers (collectively, “insurers”). In particular, the NSA requires insurers to reimburse out-of-network providers at a statutorily calculated “out-of-network rate.” In states without an all-payor model agreement or specified state law, the out-of-network rate is either the amount agreed to by the insurer and the out-of-network provider or an amount determined through an IDR process.

Under the NSA, insurers must issue an initial payment or notice of denial of payment to a provider within thirty days after the provider submits a bill for an out-of-network service. If the provider disagrees with the insurer’s determination, the provider may initiate a thirty-business day period of open negotiation with the insurer over the claim. If the parties cannot resolve the dispute through negotiation, the parties may then proceed to the IDR process.

Effective May 1, 2024, we engaged with a third-party IDR vendor, HaloMD, to further support all our out of network claims and determine which claims would be beneficial to arbitrate (see Management's Arbitration process discussion under Part I. Item 2). The IDR process can take up tothree tofive months to receive payments. To facilitate the dispute arbitration process, the Company incurred fees payable to the Centers for Medicare and Medicaid Services (“CMS”), the organizations that arbitrate the payment amount between the plan and providers known as independent dispute resolution entities (“IDRE”), and commission and fees to the third-party IDR vendor. IDRE fee payments represent refundable payments if arbitrations are successful. Therefore, these payments are reported as prepaid and other current assets in the unaudited condensed consolidated balance sheets. The unsuccessful portion of the IDRE fee payments is written off to contract services expense in the unaudited condensed consolidated statements of operations. Prepaid expenses related to IDRE fees were $7.8 million and $20.9 million as of September 30, 2026 and December 31, 2025, respectively. Accounts payable to the third-party IDR vendor waszero and $37.7 million as of September 30, 2026 and December 31, 2025, respectively. Total accrued arbitration expenses were $51.3 million and $49.7 million as of September 30, 2026 and December 31, 2025, respectively.

HaloMD contract amendment, CMS fee reduction and resulting change in estimate. Effective June 30, 2026, the Company amended its Payment Dispute Resolution Services Agreement with HaloMD, L.L.C. (the “Agreement”), dated as of May 1, 2024, which supports the Company’s IDR process for certain out-of-network claims. Among other changes, the amendment transitioned the applicable fee payment structure to a pay-on-collected basis, rather than payment due upon award determination, retroactive to the effective date of the original Agreement, and amended the service fee structure applicable to various federal and state net settlement amounts obtained on or after July 1, 2026. Pursuant to the Agreement, the Company may perform dispute resolution services in-house or through the engagement of another third-party vendor or service provider with respect to certain future facilities. In addition, on June 4, 2026, CMS and other federal agencies reduced the non-refundable administrative fee for the federal IDR process from $115 to $15 per party per dispute, effective June 11, 2026. The Company accounted for these impacts as a change in estimate in accordance with ASC 250 and recognized the effects prospectively in the period of change and future periods. The effect of these changes for the three and nine months ended September 30, 2026 is reflected as a reduction to contract services expense ofzero and $52.3 million, respectively, in the unaudited condensed consolidated statements of operations. Additionally, as of June 30, 2026, this amount resulted in a corresponding reduction to accounts payable and a reduction to accrued arbitration expenses in the unaudited condensed consolidated balance sheets. This change increased net income and net income attributable to Nutex Health Inc. byzero and $25.0 million for the three and nine months ended September 30, 2026, respectively. Net income attributable to noncontrolling interest increased byzero and $18.0 million for the three and nine months ended September 30, 2026, respectively. From a per-basic and per-diluted share basis, there wasno change for the three months ended September 30, 2026, and $4.96 and $4.83, respectively, for the nine months ended September 30, 2026.

Note 4 -Acquisitions

There were no business combinations, asset acquisitions or asset divestitures during the three or nine months ended September 30, 2026, and there were no material changes to the terms or accounting for any of these completed in prior years. For a description of the Company's business combinations, asset acquisitions or asset divestitures, including the nature of the acquired interests and the related accounting policies, refer to the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025.

Note 5 -Property and Equipment, net

The principal categories of property and equipment, net are summarized as follows (in thousands):

We consolidatetwo Real Estate VIEs. Refer to Note 18 – Variable Interest Entities.

Depreciation and amortization of property and equipment for the three months ended September 30, 2026 and 2025 totaled $1.9 million and $1.7 million, respectively, and for the nine months ended September 30, 2026 and 2025 totaled $5.5 million and $5.1 million, respectively.

Note 6 –Intangible Assets and Goodwill

Intangible Assets. The following tables provide detail of the Company’s intangible assets (in thousands):

Amortization of intangible assets for the three months ended September 30, 2026 and 2025 totaled $0.4 million and $0.3 million, respectively, and for the nine months ended September 30, 2026 and 2025 totaled $1.0 million for both periods. As of

September 30, 2026, expected amortization of intangible assets for each of the five succeeding fiscal years and thereafter is as follows (in thousands):

There have been no significant changes to goodwill from what was disclosed in Note 6 to the financial statements presented in the 2025 Form 10-K.

Note 7 –Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

Note 8 –Debt

The Company’s outstanding debt is shown in the following table (dollars in thousands):

Term loans and lines of credit. We have entered into private debt arrangements with banking institutions for the purchase of equipment and to provide working capital and liquidity through cash and lines of credit. Unless otherwise delineated above, these debt arrangements are obligations of Nutex and/or its wholly-owned subsidiaries. Consolidated real estate entities have entered into private debt arrangements with banking institutions for purposes of purchasing land, constructing new emergency room facilities and building out leasehold improvements which are leased to our hospital entities. Nutex is a guarantor or, in limited cases, a co-borrower on the debt arrangements of the Real Estate VIEs for the periods shown.

Certain outstanding debt arrangements require minimum debt service coverage ratios and other financial covenants. At September 30, 2026, we were in compliance with these debt arrangements; we had remaining availability of $6.8 million under outstanding lines of credit. On June 30, 2026, we were issued an irrevocable standby letter of credit in the amount of $1.7 million to support certain lease obligations. In August 2026, we were issued another standby letter of credit in the amount of $1.7 million to support certain lease obligations. As of September 30, 2026, no amounts had been drawn under either letter of credit, and no liability has been recorded for the undrawn amount. During the nine months ended September 30, 2026, the Company reclassified $3.4 million from cash and cash equivalents to restricted cash and short-term investments to account for certificates of deposit required under the terms of the contractual agreement.

There have been no significant changes to the terms of the Company's debt and covenants from those disclosed in Note 8 to the financial statements presented in the 2025 Form 10-K.

Note 9 –Leases

As Lessee

We have entered into hospital property, office and equipment rental agreements with various lessors including related parties. The following tables disclose information about our leases of property and equipment (in thousands):

As Lessor

We lease space to tenants under operating leases in an office building purchased in December 2025. The leases provide for the payment of fixed base rents payable monthly. For the three and nine months ended September 30, 2026, lease income was $0.3 million and $1.0 million, respectively, and was included in Hospital division revenue in the unaudited condensed consolidated statements of operations.

Note 10 –Commitments and Contingencies

Litigation. The Company, its consolidated subsidiaries or VIEs may be named in various claims and legal actions in the normal course of business and the matters listed under Part II, Item 1, Legal Proceedings. The outcome of these matters is currently not considered probable or reasonably estimable; accordingly, no provision or accrual has been recorded. Based upon counsel and management’s opinion, the ultimate resolution of such matters is not expected to have a material adverse effect on the unaudited condensed consolidated financial statements, except as stated in Part II, Item 1, Legal Proceedings.

Note 11 –Stock-based Compensation

Total stock-based compensation for thethree months ended September 30, 2026 and 2025 was $7.4 million and $13.2 million, respectively, and for the nine months ended September 30, 2026 and 2025 was $6.4 million and $119.6 million, respectively. Stock-based compensation expense includes amounts recognized primarily fornon-employee arrangements forthe obligations for under-construction and ramping hospitals, as well as amounts granted to employees and board members for services rendered. The decreased balance for the three and nine months ended September 30, 2026 is due to the decrease of accrued stock-based compensation related to the obligations for under-construction and ramping hospitals. There have been no significant changes to options from those disclosed in Note 12 to the 2025 Form 10-K.

Obligations for under-construction and ramping hospitals. Under the terms of the Contribution Agreements, former doctor owners of the Ramping and Under Construction Hospitals (as determined on April 1, 2022) are eligible to receive a one-time additional issuance of Company common stock.

•With respect to ramping hospitals that were acquired before the Merger,24 months after the opening date (the “Determination Date”) of the applicable ramping hospital, such owner is eligible to receive such owner’s pro rata share of a number of shares of Company common stock equal to (i) the trailing twelve months earnings before interest, taxes, depreciation and amortization on the respective Determination Date, multiplied by (ii)10, (iii) minus the initial equity value received at the closing of the Merger, and (iv) minus such owner’s pro rata share of the aggregate debt of the applicable ramping hospital outstanding as of the closing of the Merger. The number of additional shares to be issued will be determined based on the greater of (a) the price of the Company’s common stock at the time of determination or (b) $420.00, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Company’s common stock.

•With respect to under construction hospitals that were acquired before the Merger, contributing owners of under construction hospitals will be eligible to receive, on the Determination Date, such owner’s pro rata share of a number of shares of Company common stock equal to (a)(i) the trailing twelve months earnings before interest, taxes, depreciation and amortization as of the Determination Date multiplied by (ii)10, minus (iii) the aggregate amount of such owner’s capital contribution to the under construction hospital, minus (iv) such owner’s pro rata share of the aggregate debt of the applicable under construction hospital outstanding as of the closing of the Merger, divided by (b) the greater of (i) the price of the Company common stock at the time of determination or (ii) $420.00, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Company’s common stock.

Ramping Hospitals are hospitals that at the time of the Merger had less than two years of operating results and as such were not considered mature hospitals. Under Construction Hospitals are hospitals that at the time of the Merger had not started accepting patients and as such did not have any operating results to serve as a basis for a valuation. At the time of the Merger, the parties agreed to additional issuances of common stock once these Ramping and Under Construction Hospitals had operated for at least 24 months, with the valuation to be based on trailing twelve months operating results determined at the end of such 24-month period (“Measurement Period”).

Pursuant to the Merger Agreement, and based on a valuation of $420.00 per share of Clinigence common stock, each member interest in Nutex Holdco issued and outstanding immediately prior to the effective time of the Merger was converted into the right to receive 0.23809523833 shares of Clinigence common stock.

With respect to the Under Construction Hospitals, the aggregate number of shares of Clinigence common stock issued in the Merger to such former doctor owners was equal to the aggregate capital contribution amounts received from the contributing former doctor owners of the Under Construction Hospitals divided by $420.00. In addition, Nutex Health assumed all the debt of such Under Construction Hospitals outstanding at the closing of the Merger.

Under the Contribution Agreements, the Ramping and Under Construction Hospitals are entitled to additional shares of Company Common Stock. The number of additional shares depends on two main factors: the trailing twelve-month operating results of the particular hospital and the trading price of Nutex Health common stock, with both factors determined at the end of the applicable Measurement Period. There is no threshold of certain operating results to be achieved; however, there is a floor price of common stock to be applied to the calculation. The exact amount a former doctor owner of a particular hospital will receive will accordingly depend on (i) the trailing twelve months of operating results of that particular hospital, minus the initial capital contribution and debt assumption, (ii) the current Nutex common stock trading price, and (iii) the ownership percentage in the hospital such former doctor owner held prior to the Contribution Transaction and the Merger.

At the closing of the Merger, four hospitals were identified as Ramping Hospitals and 17 hospitals were identified as Under Construction Hospitals. Related to the four Ramping Hospitals, no additional issuances of common stock were made due to operating results for three Ramping Hospitals and the closure of one Ramping Hospital in February 2023. Of the 17 Under Construction Hospitals,

•Eight hospitals with Measurement Periods ended on or before September 30, 2026.

•Four hospitals with no Measurement Period as these hospitals' development plans have been abandoned.

•Two hospitals with Measurement Periods that end after September 30, 2026.

•Three hospitals with no defined Measurement Periods as these hospitals have not opened as of September 30, 2026.

In the tables below, we show the number of shares issuable, the number of shares issued to date, and compensation expense recognized with respect to hospitals with Measurement Periods that ended prior to the end of September 30, 2026.

Measurement Periods ending on or prior to September 30, 2026 (dollars in thousands):

In the table below, we show the estimated number of shares issuable to two hospitals with Measurement Periods that end after September 30, 2026 and are operating, but showing a pro forma calculation as if the respective Measurement Periods had ended on September 30, 2026. Since we cannot predict the future operating results of a particular hospital or the Nutex Health trading price at the end of such particular Measurement Period, the actual number of shares issuable to the former doctor owners of such Hospital cannot be determined.

Measurement Periods ending after September 30, 2026 (dollars in thousands):

The Company measures these obligations as liability-classified stock-based compensation at fair value (level 3) on each reporting date until settlement, with changes in fair value recognized in the consolidated statement of operations. The fair value of these awards is determined using Monte Carlo simulation, which incorporates inputs such as expected term, volatility, risk-free interest rate, dividend yield and the probability of achieving performance conditions. At September 30, 2026, the aggregate liability recorded for these obligations was$11.5 million as compared to $8.3 million at December 31, 2025. The change in fair value recognized in the consolidated statements of operations forthree months ended September 30, 2026 and 2025 was $6.7 million and $13.2 million, respectively, and for the nine months ended September 30, 2026 and 2025 totaled $4.5 million and $119.6 million.

Restricted Stock Units. The following is an inception-to-date summary of the restricted stock units (RSUs) granted to certain employees and board members participating in the Company's long-term incentive program (shares and dollars in thousands):

The following table summarizes activity in restricted stock units:

As of September 30, 2026 and 2025, we estimate $4.5 million and $2.4 million, respectively, of unrecognized compensation cost related to restricted stock units issued to our employees to be recognized over the weighted-average vesting period of 1.5 years and 1.6 years, respectively.

Employee Stock Purchase Plan. In May 2023, the Board adopted the 2023 Employee Stock Purchase Plan (“2023 ESPP”), which was subsequently approved by the Company’s stockholders and became effective in June 2023. The 2023 ESPP authorizes the initial issuance of up to 33,333 shares of the Company’s common stock to eligible employees, who are entitled to purchase shares of common stock equal to 85% of the closing price on the purchase date with accumulated payroll deductions. During the three months ended September 30, 2026 and 2025, the Company issued 943 shares and 351 shares, respectively, and for the nine months ended September 30, 2026 and 2025 issued 3,452 shares and 2,378 shares, respectively.

Note 12 –Equity

Share Repurchases and Retirements.

Activity related to the repurchase and retirement of shares is as follows:

August 2025 Repurchase Program. On August 14, 2025, the Board authorized a stock repurchase program (the “August 2025 Repurchase Program”) of up to $25.0 million of the Company’s common stock over the subsequent six months. No repurchases for this program occurred during the three months ended September 30, 2026. During the nine months ended September 30, 2026, the Company repurchased 118,867 shares of common stock under the August 2025 Repurchase Program in open market transactions at a weighted-average price of $168.65, for an aggregate price of $20.0 million, inclusive of transaction costs. The repurchases completed the August 2025 Repurchase Program.

March 2026 Repurchase Program. On March 4, 2026, the Board authorized a second stock repurchase program (the “March 2026 Repurchase Program”) of up to $25.0 million of the Company’s common stock over the subsequent six months. Pursuant to the March 2026 Repurchase Program, the Company may repurchase, from time to time, up to an aggregate of $25.0 million of its outstanding shares of common stock, exclusive of any fees, commissions or other expenses related to such repurchases. The March 2026 Repurchase Program permits the Company to repurchase shares of common stock at any time or from time to time at management’s discretion in open market transactions made in accordance with the provisions of Rule 10b-18 and/or Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, privately negotiated transactions or by other means in accordance with applicable securities laws. The March 2026 Repurchase Program authorization does not obligate the Company to acquire any shares of its common stock and may be amended, suspended or discontinued at any time.

No repurchases for this program occurred during the three months ended September 30, 2026. During the nine months ended September 30, 2026, the Company repurchased 46,524 shares of common stock under the March 2026 Repurchase Program in open market transactions at a weighted-average price of $110.88 for an aggregate price of $5.2 million inclusive of transaction costs. The March 2026 Repurchase Program expired on September 4, 2026.

Settlement Agreements with certain Former Doctor Owners of Under Construction Hospitals. During the three and nine months ended September 30, 2026, the Company entered into agreements with certain former doctor owners to settle existing disputes and, in connection with the settlements, retire a portion of the shares issuable to satisfy obligations for under-construction and ramping hospitals. See Note 11 – Stock-based Compensationfor discussion of additional issuances of stock for Under Construction Hospitals, an obligation within the Contribution Agreements. During the three and nine months ended September 30, 2026, the Company retired zero and 147,352 shares of common stock, respectively, at an aggregate value ofzero and $25.3 million, respectively.

Common Stock Warrants. Warrant activity is as follows:

Warrants outstanding as of September 30, 2026 consisted of:

Note 13 –Income Taxes

Income tax provisions for interim quarterly periods are generally based on an estimated annual effective income tax rate calculated separately from the effect of significant, infrequent or unusual items related specifically to interim periods. The income tax impact of discrete items is recognized in the period these occur.

Our effective tax rate was 21.0% and 21.9% for the three months ended September 30, 2026 and 2025, respectively, and for the nine months ended September 30, 2026 and 2025 was 18.7% and 25.2%. The primary difference from the federal statutory rate of 21% is related to state taxes, income of noncontrolling interests in flow-through entities and permanent differences for non-deductible expenses.

Note 14 –Earnings per Share

The following is the computation of earnings per basic and diluted share (dollars in thousands):

Note 15 -Supplemental Cash Flows Information

The below supplemental cash flows information is presented in thousands:

Adjustments to reconcile net income to net cash from operating activities for the nine months ended September 30, 2026 include the non-cash effect of change in estimate of $52.3 million related to the HaloMD contract amendment and CMS fee reduction. See Note 3 — Revenue.

Note 16 –Segment Information

We report the results of our operations asthree segments in our unaudited condensed consolidated financial statements: (i) the hospital division, (ii) the population health management division and (iii) the real estate division. Reportable segment information, including intercompany transactions, is presented below (in thousands):

Note 17 –Related Party Transactions

The Company enters into transactions with entities owned or controlled by related parties, including its CEO, as well as with noncontrolling interest owners of consolidated entities. These related party transactions primarily include physician services arrangements, facility leases, construction-related obligations, and distributable cash arrangements. The Company believes the terms of these transactions are generally comparable to those that would be obtained in arm's-length transactions.

Summary quantitative information related to related party balances and transactions is presented below (in millions):

Balances with related parties in the condensed consolidated balance sheets:

Transactions with related parties in the condensed consolidated statements of operations and cash flows:

Additional qualitative information:

•Physician LLCs: The physicians who work in the Company’s hospitals are employed by separate limited liability companies (“Physician LLCs”). The Company has no direct ownership interest in these entities; they are owned and, in some instances, controlled by related parties, including the CEO. The Physician LLCs are consolidated as variable interest entities because they do not have sufficient equity at risk and the Company has historically provided support in the event of cash shortages and is the primary beneficiary of their services.

•Real estate entities: Most hospital division facilities are leased from real estate entities owned by related parties. These leases are typically triple‑net, with the hospital division responsible for operating costs, repairs, and taxes. The Company consolidates certain real estate entities as variable interest entities when they do not have sufficient equity at risk and the Company’s hospital entities are guarantors or co‑borrowers under their mortgage loans. Real Estate VIEs with third‑party mortgage loans collateralized by land and buildings remain consolidated as of September 30, 2026; the Company has no direct ownership interest intwo of these entities, which are owned and controlled by related parties including the CEO.

•Distributable cash arrangement with CEO: In connection with the closing of the Merger Agreement, the CEO, as an original owner, is entitled, for the first two years following closing and solely with respect to the two locations that repaid a specified short‑term loan, to receive his pro‑rata share (approximately 38%) of aggregate distributable cash flow, as determined by the Company after satisfaction of debt and tax obligations. Total distributable cash paid under this arrangement is presented in the table above.

Note 18 –Variable Interest Entities

The following tables provide the balance sheet amounts for consolidated VIEs (in thousands):

Note 19 -Subsequent Events

The Company has evaluated subsequent events through the filing of this report and determined that there have been no events that have occurred that would require disclosure in the unaudited condensed consolidated financial statements.