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Item 1A. Risk Factors.
The risks described under the caption Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2023 (the Annual Report) could materially and adversely affect our business, financial condition, and results of operations, and could cause the trading price of our common stock to decline. The discussion of the risks included under that caption in our Annual Report remains current in all material respects, and there have been no material changes from the risk factors disclosed in the Annual Report. The risk factors , except as otherwise set forth below:
Substantial doubt exists about our ability to meet our obligations as they come due within one year from the date of issuance of the financial statements included within this report, the existence of which may have a material adverse effect on our stock price, our ability to raise capital or enter into strategic transactions, and our relationships with key stakeholders.
As discussed in Note 1, Management's Liquidity Plans and Going Concern Considerations, to the unaudited financial statements included in this report, and under the caption Managements Discussion and Analysis of Financial Condition and Results of Operations Liquidity in this report, the Company has faced a lengthened time interval between earning revenue and collecting receivables under outstanding contracts with some of its customers due to complexities in Medicare, Medicaid, and nongovernmental payor arrangements. This prolonged interval between the Company fulfilling its performance obligations and collecting the cash owed for its services from its customers has lengthened collection periods and increased the uncertainty concerning the timing of the collection of these corresponding outstanding contract receivables. The extended collection periods and uncertainty concerning the timing of the collection of outstanding contract receivables has changed the Companys forecasts of, among other things, its ability to meet the Companys Total Net Leverage Ratio financial covenant in its amended Credit Agreement. Any failure to maintain compliance with such financial or other covenant could cause the Companys obligations under the Credit Agreement and the Companys Notes due 2029 to become immediately due and payable, and the Company may not have sufficient liquidity to satisfy such obligations. As a result, it has been determined that substantial doubt exists about the Companys ability to meet its obligations as they come due within one year from the date of issuance of the financial statements included in this report.
The Company is analyzing various alternatives to support ongoing compliance with financial covenants and the continued funding of operations and to improve liquidity, including continuing discussions with the Companys bank group on a collaborative long-term relief amendment with respect to the Companys financial covenants. There can be no assurance, however, that we haany long-term relief amendment, additional funds or strategic transactions will be available when needed on terms acceptable to the Company, or at all, or in an amount sufficient to enable the Company to satisfy its obligations or sustain operations in the future. In addition, if the Company issues equity to raise funds, these securities may have discussed do not identify all risrights, preferences, or privileges senior to those of the Companys common stock, and the Companys current stockholders may experience dilution.
Furthermore, as a result of the determination itself that substantial doubt exists about the Companys ability to meet its obligations as they come due within one year from the date of issuance of the financial statements included in this report, there may be material adverse impacts to the Companys stock price, the Companys ability to raise capital or enter into strategic transactions on terms acceptable to the Company or at all, or the Companys relationships with its key stakeholders. If the Company is unable to obtain sufficient, timely financial resources and improve liquidity, its business, results of operations, financial condition, and cash flows could be materially and adversely affected. Any of these adverse impacts could result in a significant or complete loss of your investment.
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The risks t factors discussed by us do not identify all risks that we face; our operations could also be affected by factors that are not presently known to us or that we currently consider to be immaterial to our operations. Due to risks and uncertainties, known and unknown, our past financial results may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods.
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