PACS Group, Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended December 31, 2024

OR

For the transition period from _______ to _______

Commission file number 001-42011

PACS Group, Inc.

(Exact name of registrant as specified in its charter)

(801)447-9829

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

o

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

o

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

o

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yeso Nox

As of June 30, 2024, the aggregate market value of the common stock held by non-affiliates of the registrant was approximately $757.4 million based upon the closing price reported for such date on the New York Stock Exchange.

As of November 17, 2025, there were 156,615,144 shares of the registrant's common stock outstanding.

EXPLANATORY NOTE

Introduction

PACS Group, Inc. (“we,” “us,” our,” the “Company” and “PACS”) is filing this Annual Report on Form 10-K for the fiscal year ended December 31, 2024 concurrently with its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2024 and Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, June 30 and September 30, 2025. This Annual Report contains the restatement (“Restatement”) of the Company’s (i) condensed combined/consolidated financial statements as of March 31, 2024, and for the three months then ended, included in our Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission (the “SEC”) on May 13, 2024 (as amended on May 21, 2024) and (ii) condensed combined/consolidated financial statements as of June 30, 2024 and for the three and six months then ended, included in our Quarterly Report on Form 10-Q filed with the SEC on August 12, 2024 (collectively, the “Prior Financial Statements,” and each such quarterly period in the six months ended June 30, 2024, the “Impacted Periods”). The impact of the Restatement is reflected in the audited financial statements as of and for the period ended December 31, 2024 in this Form 10-K.

Audit Committee Investigation

As previously disclosed in the Company’s Form 8-K filed November 6, 2024, the Company’s independent Audit Committee, assisted by external counsel and forensic accountants retained by the Audit Committee, initiated an independent investigation concerning allegations made in a short seller report. The investigation’s scope ultimately included additional matters identified during the course of the investigation. The Audit Committee has now completed its investigation.

On June 16, 2025, the Company announced that, in connection with additional facts learned, including as a result of the Audit Committee’s independent investigation, and due to regulatory, compliance and Medicare Part B billing uncertainties, management determined that it is appropriate to reconsider the Company’s judgmental assessments of the compliance of its respiratory and certain other therapy services. Management also determined that it is appropriate to reconsider the application of certain aspects of revenue recognition guidance under Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts With Customers (“ASC 606”), including with respect to estimating variable consideration and constraining estimated variable consideration related to revenue from billings for such services. As a result, the Company determined that the revenue associated with the provision of respiratory services and certain other therapy services billed under Medicare Part B should not have been recognized as revenue in accordance with ASC 606 in the periods discussed below.

Accordingly, the Company determined that it would restate previously issued financial statements as of March 31, 2024, and for the three months then ended, included in the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 13, 2024 (as amended on May 21, 2024) and as of June 30, 2024, and for the three and six months then ended, included in the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 12, 2024.

Among the additional matters that came within the scope of the Audit Committee investigation were allegations that the Company’s Chief Financial Officer Derick Apt had accepted high-value items from individuals associated with a group of related entities with which the Company does business. As disclosed on Form 8-K filed September 8, 2025, the Audit Committee found that Mr. Apt’s receipt of these items violated company policies, including the Company’s Code of Conduct & Ethics. The Board asked for Mr. Apt’s resignation, and he then resigned and entered into a separation agreement with the Company. At that time, Mark Hancock replaced Mr. Apt as interim Chief Financial Officer.

In its investigation, the Audit Committee identified certain conduct that was determined to be inconsistent with the Company’s Code of Conduct & Ethics, related policies, and expectations involving certain Company personnel. The Audit Committee recommended, and the Board of Directors, including the Company’s founders, determined to take appropriate action and remedial measures as to these individuals. Beyond the restatement of certain financial statements referenced above, the Audit Committee did not identify any additional material financial misstatements or financial irregularities.

The Audit Committee also recommended remedial measures and enhancements, among other things, to further reinforce a culture of compliance, a care first mentality, the principles set forth in the Company’s Code of Business Conduct & Ethics, and the expectations of the Company’s founders and the Board of Directors. The Board of Directors adopted those recommendations, and management has been implementing them, with Board oversight. Also, in connection with the Audit Committee’s independent investigation, management, together with external counsel and outside advisors, undertook an intense review of its regulatory compliance program, retained a new interim Chief Compliance Officer to oversee the ongoing review and the implementation of updates to the Company’s compliance program, and implemented additional measures designed to enhance processes and controls surrounding regulatory compliance.

Items Included in this Filing

All restated financial information for the Impacted Periods is included in this Annual Report on Form 10-K, and we have not filed, and do not intend to file, amendments to the Forms 10-Q containing the Prior Financial Statements for the Impacted Periods. Refer to Note 22, “Restatement of Previously Issued Quarterly Financial Statements (Unaudited),” in the notes to the combined/consolidated financial statements in this Annual Report on Form 10-K for additional information, including a summary of the impacts of these adjustments.

In connection with the preparation of our combined/consolidated financial statements for the year ended December 31, 2024, together with facts learned during the course of the Audit Committee’s independent investigation, our management identified control deficiencies that, individually or in the aggregate, constitute material weaknesses in our internal control over financial reporting. The material weaknesses identified by management were that we did not design and maintain an effective internal control environment commensurate with the financial reporting requirements of a public company. Specifically, we did not design and maintain sufficient processes to identify, assess, and communicate relevant risks to appropriate levels of the organization, including potential compliance issues received through the hotline process. In addition, we did not design and maintain adequate controls within the revenue process to appropriately recognize revenue for new services in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 606, Revenue from Contracts With Customers. These material weaknesses resulted in the restatement of our previously issued interim condensed combined/consolidated financial statements for the Impacted Periods. In addition, our Chief Executive Officer and our Interim Chief Financial Officer have concluded that, due to the material weaknesses, our disclosure controls and procedures were not effective, as such term is defined under Rules 13a-15(e) and 15(d)-15(e) under the Exchange Act, as of December 31, 2024. Management is committed to maintaining a strong internal control environment. In response to the identified material weaknesses above, management, with the oversight of the Audit Committee, is taking comprehensive actions to remediate the above material weaknesses. For additional information regarding the material weaknesses and our steps for remediation, please see “Part II, Item 9A, Controls and Procedures.”

Considering the material weaknesses described above, management performed additional analysis and other procedures to ensure that our combined/consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). Accordingly, management believes that the combined/consolidated financial statements included in this Annual Report on Form 10-K fairly present, in all material respects, our financial position, results of operations, and cash flows as of and for the periods presented, in accordance with U.S. GAAP.