P3 Health Partners Inc.

Previous wording

We operate in the $1,118 billion Medicare market, which covers more than 70 million eligible lives as of July 2026. Our core focus is the Medicare Advantage (“MA”) market, which covers approximately 36 million Medicare eligible lives as of July 2026. Medicare beneficiaries may enroll in an MA plan, under which payors contract with the Centers for Medicare and Medicaid Services (“CMS”) to provide a defined range of healthcare services that are comparable to Medicare FFS (which is also referred to as “traditional Medicare”).

Current wording

We operate in the $1,118 billion Medicare market, which covers more than 71 million eligible lives as of July 2026. Our core focus is the Medicare Advantage (“MA”) market, which covers approximately 36 million Medicare eligible lives as of July 2026. Medicare beneficiaries may enroll in an MA plan, under which payors contract with the Centers for Medicare and Medicaid Services (“CMS”) to provide a defined range of healthcare services that are comparable to Medicare FFS (which is also referred to as “traditional Medicare”).

Previous wording

Our company was formed in 2017 and our first at-risk contract became effective on January 1, 2018. We have demonstrated an ability to rapidly scale, primarily entering markets with our affiliate physician model, and expanding to a PCP network of approximately 2,100 physicians, in 26 markets (counties) across five states in over nine full years of operations as of June 30, 2026. As of June 30, 2026, our PCP network served approximately 104,400 at-risk members.

Current wording

Our company was formed in 2017 and our first at-risk contract became effective on January 1, 2018. We have demonstrated an ability to rapidly scale, primarily entering markets with our affiliate physician model, and expanding to a PCP network of approximately 2,000 physicians, in 26 markets (counties) across five states in over nine full years of operations as of September 30, 2026. As of September 30, 2026, our PCP network served approximately 104,800 at-risk members.

Previous wording

Our medical expense is our largest expense category, representing 88% of our total operating expense for the six months ended June 30, 2026. We manage our medical costs by improving our members’ access to healthcare. Our care model focuses on maintaining health and leveraging the primary care setting as a means of avoiding costly downstream healthcare costs, such as emergency department visits and acute hospital inpatient admissions.

Current wording

Our medical expense is our largest expense category, representing 90% of our total operating expense for the nine months ended September 30, 2026. We manage our medical costs by improving our members’ access to healthcare. Our care model focuses on maintaining health and leveraging the primary care setting as a means of avoiding costly downstream healthcare costs, such as emergency department visits and acute hospital inpatient admissions.

Previous wording

(1)Other during the three and six months ended June 30, 2026 consisted of interest income partially offset by valuation allowance on our notes receivable. Other during the three and six months ended June 30, 2025 consisted of interest income partially offset by severance expense in connection with reorganization of workforce.

Current wording

(1)Other during the three and nine months ended September 30, 2026 consisted of interest income partially offset by valuation allowance on our notes receivable. Other during the three and nine months ended September 30, 2025 consisted of interest income partially offset by severance expense in connection with reorganization of workforce and legal settlements and valuation allowance on our notes receivable.

Previous wording

At-risk membership represents the approximate number of Medicare members for whom we receive a fixed percentage of premium under capitation arrangements as of the end of the reporting period. We had 104,800 and 115,900 average at-risk members for the three months ended June 30, 2026 and 2025, respectively.

Current wording

At-risk membership represents the approximate number of Medicare members for whom we receive a fixed percentage of premium under capitation arrangements as of the end of the reporting period. We had 105,000 and 115,900 average at-risk members for the three months ended September 30, 2026 and 2025, respectively.

Previous wording

Affiliate primary care physicians represent the approximate number of primary care physicians included in our affiliate network, with whom members may be attributed under our capitation arrangements, as of the end of the reporting period. We had 2,100 and 2,800 primary care physicians as of June 30, 2026 and 2025, respectively.

Current wording

Affiliate primary care physicians represent the approximate number of primary care physicians included in our affiliate network, with whom members may be attributed under our capitation arrangements, as of the end of the reporting period. We had 2,000 and 2,700 primary care physicians as of September 30, 2026 and 2025, respectively.

Previous wording

Mark-to-market of stock warrants and purchased put option. Mark-to-market of stock warrants consists of the change in the fair value on the revaluation of warrant liabilities associated with our public and private placement Class A common stock warrants. Mark-to-market of purchased put option consists of the change in the fair value on the revaluation of unissued Units consisting of (i) shares of the Company’s Series D Preferred Stock, and (ii) warrants to purchase Class A Common Stock, pursuant to the Purchase Agreement described in Note 12 “Preferred Stock and Stockholders' Equity”.

Current wording

Mark-to-market of stock warrants and purchased put option. Mark-to-market of stock warrants consists of the change in the fair value on the revaluation of warrant liabilities associated with our public and private placement Class A common stock warrants. Mark-to-market of purchased put option consists of the change in the fair value on the revaluation of unissued Series D Units and Series D-1 Units as described in Note 12 “Preferred Stock and Stockholders' Equity”.

Previous wording

Additionally, starting January 1, 2026, we consolidate the financial results of CPC ACO and report a non-controlling interest on our condensed consolidation statements of operations, representing the 20% of net income attributable to the non-controlling interest.

Current wording

Additionally, starting January 1, 2026, we consolidate the financial results of CPC ACO and report a non-controlling interest on our condensed consolidated statements of operations, representing the 20% of net income attributable to the non-controlling interest.

Previous wording

This increase in capitated revenue was primarily driven by an increase in the average rate resulting from ongoing strategic contractual restructuring, as well as from rate progression and burden of illness performance. The increase was partially offset by an 10% decrease in the average number of at-risk members from 115,900 for the three months ended June 30, 2025 to 104,800 for the three months ended June 30, 2026, resulting from previously disclosed intentional network and payer rationalization. Capitated revenue was approximately 95% and 99% of total operating revenue for the three months ended June 30, 2026 and 2025, respectively.

Current wording

This increase in capitated revenue was primarily driven by an increase in the average rate resulting from ongoing strategic contractual restructuring, as well as from rate progression and burden of illness performance. The increase was partially offset by a 9% decrease in the average number of at-risk members from 115,900 for the three months ended September 30, 2025 to 105,000 for the three months ended September 30, 2026, resulting from previously disclosed intentional network and payer rationalization. Capitated revenue was approximately 92% and 99% of total operating revenue for the three months ended September 30, 2026 and 2025, respectively.

Previous wording

Other revenue was approximately 5% of total operating revenue for the three months ended June 30, 2026 and approximately 1% of total operating revenue for the three months ended June 30, 2025. The increase was attributable to management fees for new delegated service contracts and an increase in revenue from incentive‑sharing arrangements related to Part D program incentive initiatives.

Current wording

Other revenue was approximately 8% of total operating revenue for the three months ended September 30, 2026 and approximately 1% of total operating revenue for the three months ended September 30, 2025. The increase was attributable to management fees for new delegated service contracts and an increase in revenue from incentive‑sharing arrangements related to Part D program incentive initiatives. Of the total increase, $12.7 million was attributable to a change in estimate related to revenue recognized for such incentive-sharing arrangements, as further described in Note 3, “Significant Accounting Policies”.

Previous wording

The decrease in medical expense was driven primarily by a decrease in the total number of at-risk members year-over-year as well as favorable reserve development and claims true-up activity. Additionally, medical expense for the three months ended June 30, 2026 included a $36.2 million reduction of prior period medical claims expense.

Current wording

The decrease in medical expense was driven primarily by a decrease in the total number of at-risk members year-over-year as well as favorable reserve development and claims true-up activity.

Previous wording

The increase in corporate, general and administrative expense was primarily driven by an increase in consulting expenses, as well as an increase in accrued performance bonuses.

Current wording

The increase in corporate, general and administrative expense was primarily driven by an increase in consulting and legal expenses, as well as an increase in payroll expenses, including an increase in accrued performance bonuses and higher expenses for employee health insurance.

Previous wording

The Company recorded a loss of $7.9 million related to its liability-classified stock warrants during the six months ended June 30, 2026, compared to a gain of $5.3 million for six months ended June 30, 2025. The Company recorded a loss of $8.1 million related to its purchased put option during the six months ended June 30, 2026, compared to no activity for six months ended June 30, 2025.

Current wording

The Company recorded a gain of $4.7 million related to its liability-classified stock warrants during the three months ended September 30, 2026, compared to a loss of $2.5 million for three months ended September 30, 2025. The

Previous wording

Comparison of the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025

Current wording

Comparison of the Nine Months Ended September 30, 2026 to the Nine Months Ended September 30, 2025

Previous wording

The increase in capitated revenue was primarily driven by an increase in the average rate resulting from ongoing strategic contractual restructuring, as well as from rate progression and burden of illness performance. The increase was partially offset by a 10% decrease in the average number of at-risk members of 105,500 for the six months ended June 30, 2026 compared to 116,800 for the six months ended June 30, 2025, which was primarily due to the strategic termination of underperforming payor contracts and affiliate providers in the current year. Capitated revenue was approximately 97% and 99% of total operating revenue for the six months ended June 30, 2026 and 2025, respectively.

Current wording

The increase in capitated revenue was primarily driven by an increase in the average rate resulting from ongoing strategic contractual restructuring, as well as from rate progression and burden of illness performance. The increase was partially offset by a 9% decrease in the average number of at-risk members of 105,700 for the nine months ended September 30, 2026 compared to 115,700 for the nine months ended September 30, 2025, resulting from previously disclosed intentional network and payer rationalization. Capitated revenue was approximately 95% and 99% of total operating revenue for the nine months ended September 30, 2026 and 2025, respectively.

Previous wording

Other revenue was approximately 3% and 1% of total operating revenue for the six months ended June 30, 2026 and 2025, respectively. The increase was attributable to management fees for new delegated service contracts and an increase in revenue from incentive‑sharing arrangements related to Part D program incentive initiatives.

Current wording

Other revenue was approximately 5% and 1% of total operating revenue for the nine months ended September 30, 2026 and 2025, respectively. The increase was attributable to management fees for new delegated service contracts and an increase in revenue from incentive‑sharing arrangements related to Part D program incentive initiatives. Of the total increase, $12.7 million was attributable to a change in estimate related to revenue recognized for such incentive-sharing arrangements, as further described in Note 3, “Significant Accounting Policies”.

Previous wording

The decrease in medical expense was driven by a decrease in the total number of at-risk members year-over-year as well as favorable reserve development and claims true-up activity. Additionally, medical expense for the six months ended June 30, 2026 included a $56.0 million reduction of prior period medical claims expense.

Current wording

The decrease in medical expense was driven by a decrease in the total number of at-risk members year-over-year as well as favorable reserve development and claims true-up activity. Additionally, medical expense for the nine months ended September 30, 2026 included a $56.0 million reduction of prior period medical claims expense.

Previous wording

The increase in interest expense, net was due to the increase in principal amounts outstanding for the Company’s unsecured promissory notes prior to the conversion of certain of the Company’s unsecured promissory notes to preferred stock that was effected on April 27, 2026. Refer to Note 8 "Debt" for further discussion of the related Exchange Agreement.

Current wording

The decrease in interest expense, net was due to the conversion of certain of the Company’s unsecured promissory notes to preferred stock that was effected on April 27, 2026. Refer to Note 8 "Debt" for further discussion of the related Exchange Agreement.

Previous wording

The Company recorded a loss of $8.3 million related to its liability-classified stock warrants during the three months ended June 30, 2026, compared to a gain of $2.0 million for three months ended June 30, 2025. The Company recorded a loss of $8.1 million related to its purchased put option during the three months ended June 30, 2026, compared to no activity for three months ended June 30, 2025.

Current wording

The Company recorded a loss of $3.3 million related to its liability-classified stock warrants during the nine months ended September 30, 2026, compared to a gain of $2.8 million for nine months ended September 30, 2025. The Company recorded a net loss of $5.2 million related to its purchased put options during the nine months ended September 30, 2026, compared to no activity for nine months ended September 30, 2025.

Previous wording

P3 Health Partners Inc. is a holding company and has no material assets other than its ownership of equity interests in P3 LLC. As such, we have no independent means of generating revenue or cash flow, and our ability to pay taxes, make payments under the Tax Receivable Agreement (“TRA”), and to pay dividends will depend on the financial results and cash flows of P3 LLC and the distributions received from P3 LLC. Deterioration in the financial condition, earnings or cash flow of P3 LLC for any reason could limit or impair P3 LLC’s ability to pay such distributions. Additionally, to the extent that we need funds and P3 LLC is restricted from making such distributions under applicable law or regulation or under the terms of any financing arrangements, or P3 LLC is otherwise unable to provide such funds, it could materially adversely affect our liquidity and financial condition. It is anticipated that the distributions we will receive from P3 LLC may, in certain periods, exceed the actual tax liabilities and obligations to make payments under the TRA.

Current wording

P3 Health Partners Inc. is a holding company and has no material assets other than its ownership of equity interests in P3 LLC. As such, we have no independent means of generating revenue or cash flow, and our ability to pay taxes, make payments under the Tax Receivable Agreement (“TRA”), and to pay dividends will depend on the financial results and cash flows of P3 LLC and the distributions received from P3 LLC. Deterioration in the financial condition, earnings or cash flow of P3 LLC for any reason could limit or impair P3 LLC’s ability to pay such distributions.

Previous wording

To date, we have financed our operations principally through the cash we obtained upon the consummation of a series of business combinations in December 2021 with Foresight Acquisition Corp. (the “Business Combinations”), private placements of our equity securities, payments from our payors, issuances of promissory notes, and borrowings under the Term Loan Facility. We generate cash from our operations, generally from our contracts with payors. As of June 30, 2026, we had $21.3 million of unrestricted cash available to fund future operations.

Current wording

To date, we have financed our operations principally through the cash we obtained upon the consummation of a series of business combinations in December 2021 with Foresight Acquisition Corp. (the “Business Combinations”), private placements of our equity securities, payments from our payors, issuances of promissory notes, and borrowings under the Term Loan Facility. We generate cash from our operations, generally from our contracts with payors. As of September 30, 2026, we had $43.9 million of unrestricted cash available to fund future operations.

Previous wording

As of June 30, 2026, we were in compliance with the covenants under our Term Loan Facility; however, there can be no assurance that we will be able to maintain compliance with these covenants in the future or that the lender under the Term Loan Facility or the lenders of any future indebtedness we may incur will grant any waiver or forbearance with respect to such covenants that we may request in the future.

Current wording

As of September 30, 2026, we were in compliance with the covenants under our Term Loan Facility; however, there can be no assurance that we will be able to maintain compliance with these covenants in the future or that the lender under the Term Loan Facility or the lenders of any future indebtedness we may incur will grant any waiver or forbearance with respect to such covenants that we may request in the future. The Term Loan Facility matures in September 2027.

Previous wording

On April 27, 2026, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with affiliates of CPF, pursuant to which the Company agreed to issue up to $70.0 million of units (the “Units”) in multiple tranches. The Units consist of (i) shares of the Company’s Series D 19.5% Cumulative Preferred Stock (the “Series D Preferred Stock”), and (ii) warrants to purchase Class A Common Stock (the “Common Stock”), exercisable for a number of shares of Common Stock equal to 0.66333% of the outstanding Class A and Class V Common Stock per $1.0 million of amount funded, with an exercise price equal to the Nasdaq Minimum Price on the date of issuance of the applicable warrant and a term of seven years from the date of issuance. The Company sold $10.0 million of Units in the initial closing of the Purchase Agreement, $20.0 million of Units on April 30, 2026, and $21.3 million of Units on May 28, 2026. As of June 30, 2026, $18.7 million of Units remained available for issuance under the Purchase Agreement. On July 1, 2026, the Company sold an additional $16 million of Units. The Series D Preferred Stock has terms that are identical to the other series of preferred stock, other than the dividend rate.

Current wording

On September 8, 2026, the Company entered into a Securities Purchase Agreement (the “Series D-1 Purchase Agreement”) with affiliates of CPF pursuant to which the Company agreed to issue up to $70 million of units (the “Series D-1 Units”) in multiple tranches. The Series D-1 Units consist of (i) shares of the Company’s Series D-1 19.5% Cumulative Preferred Stock (the “Series D-1 Preferred Stock”), and (ii) warrants to purchase Class A Common Stock (the “Common Stock”), exercisable for a number of shares of Common Stock equal to 0.66333% of the outstanding Class A and Class V Common Stock of the Company per $1,000,000 of amount funded, with an exercise price equal to the Nasdaq Minimum Price on the date of issuance of the applicable warrant and a term of seven (7) years from the date of issuance. The Company sold $14 million of Series D-1 Units on September 9, 2026. The Company issued equity-classified warrants to purchase 0.7 million shares of Class A common stock at an exercise price of $8.98 per share in connection with the Series D-1 Purchase Agreement during the nine months ended September 30, 2026. Such warrants had a fair value of $4.7 million and were classified within additional paid-in capital on the Company’s condensed consolidated balance sheets. As of September 30, 2026, there were $56.0 million units available for issuance under the Series D-1 Purchase Agreement.

Previous wording

The estimation of a liability under the TRA is, by its nature, imprecise and subject to significant assumptions regarding a number of factors, including (but not limited to) the amount and timing of taxable income generated by the Company each year as well as the tax rate then applicable. The TRA liability is estimated to be $29.7 million as of June 30, 2026. Due to the Company’s history of losses, the Company has not recorded tax benefits associated with the increase in tax basis as a result of the Business Combinations. As a result, the Company determined that payments to TRA holders are not probable and no TRA liability has been recorded as of June 30, 2026.

Current wording

The estimation of a liability under the TRA is, by its nature, imprecise and subject to significant assumptions regarding a number of factors, including (but not limited to) the amount and timing of taxable income generated by the Company each year as well as the tax rate then applicable. The TRA liability is estimated to be $32.2 million as of September 30, 2026. Due to the Company’s history of losses, the Company has not recorded tax benefits associated with the increase in tax basis as a result of the Business Combinations. As a result, the Company determined that payments to TRA holders are not probable and no TRA liability has been recorded as of September 30, 2026.

Previous wording

Net cash used in operating activities was $89.4 million for the six months ended June 30, 2026, compared to net cash used in operating activities of $50.1 million for the six months ended June 30, 2025. Significant changes impacting net cash used in operating activities during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 were decreases in claims payable and health plan settlements payable and an increase in health plan receivables.

Current wording

Net cash used in operating activities was $90.1 million for the nine months ended September 30, 2026, compared to net cash used in operating activities of $65.5 million for the nine months ended September 30, 2025. Significant changes impacting net cash used in operating activities during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 were decreases in claims payable and health plan settlements payable and an increase in health plan receivables.

Previous wording

Net cash used in investing activities was $0.3 million for the six months ended June 30, 2026 compared to net cash provided by investing activities of $0.1 million for the six months ended June 30, 2025.

Current wording

Net cash used in investing activities was $0.3 million for the nine months ended September 30, 2026 compared to net cash used in investing activities of $0.1 million for the nine months ended September 30, 2025.

Previous wording

Net cash provided by financing activities was $86.0 million for the six months ended June 30, 2026, primarily consisting of proceeds from the borrowings on the VGS 5 Promissory Note and issuance of Series D Preferred Stock and related warrants, and short-term financing agreements for the funding of certain insurance policies. Net cash provided by financing activities was $45.3 million for the six months ended June 30, 2025, consisting of proceeds from the borrowings on the VGS 4 Promissory Note, VGS 5 Promissory Note, and short-term financing agreements for the funding of certain insurance policies.

Current wording

Net cash provided by financing activities was $110.3 million for the nine months ended September 30, 2026, primarily consisting of proceeds from the borrowings on the VGS 5 Promissory Note and issuance of Series D and Series D-1 Preferred Stock and related warrants, and short-term financing agreements for the funding of certain insurance policies. Net cash provided by financing activities was $59.9 million for the nine months ended September 30, 2025, consisting of proceeds from the borrowings on the VGS 4 Promissory Note, VGS 5 Promissory Note, and short-term financing agreements for the funding of certain insurance policies.

Previous wording

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these condensed consolidated financial statements requires management to use judgment in the application of accounting policies, including making estimates and assumptions that could affect assets and liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. Management bases its estimates on the best information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows will be affected. On an ongoing basis, we evaluate the continued appropriateness of our accounting estimates to make adjustments we consider appropriate under the facts and circumstances. There have been no significant changes to our critical accounting estimates as disclosed in our 2025 Form 10-K.

Current wording

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these condensed consolidated financial statements requires management to use judgment in the application of accounting policies, including making estimates and assumptions that could affect assets and liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. Management bases its estimates on the best information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows will be affected. On an ongoing basis, we evaluate the continued appropriateness of our accounting estimates to make adjustments we consider appropriate under the facts and circumstances. Refer to Note 3 “Significant Accounting Policies” for further disclosure.