Mezzanine and Stockholders' Equity

9 Months Ended

Sep. 30, 2023

Stockholders' Equity Note [Abstract]

Mezzanine and Stockholders' Equity

Mezzanine and Stockholders’ Equity

Mezzanine Equity

APC

As the redemption feature of the APC shares is not solely within the control of APC, the equity of APC does not qualify as permanent equity and has been classified as non-controlling interests in APC as mezzanine or temporary equity. APC’s shares were not redeemable, and it was not probable that the shares would become redeemable, as of September 30, 2023 and December 31, 2022.

Stockholders’ Equity

As of September 30, 2023, 41,048 holdback shares have not been issued to certain former NMM shareholders who were NMM shareholders at the time of closing of the 2017 Merger, as they have yet to submit properly completed letters of transmittal to ApolloMed in order to receive their pro rata portion of ApolloMed common stock and warrants as contemplated under the 2017 merger agreement. Pending such receipt, such former NMM shareholders have the right to receive, without interest, their pro rata share of dividends or distributions with a record date after the effectiveness of the 2017 Merger. The consolidated financial statements have treated such shares of common stock as outstanding, given the receipt of the letter of transmittal is considered perfunctory and the Company is legally obligated to issue these shares in connection with the 2017 Merger.

Treasury Stock

APC owned 10,299,259 shares of ApolloMed’s common stock as of September 30, 2023 and December 31, 2022. While such shares of ApolloMed’s common stock are legally issued and outstanding, they are treated as treasury shares for accounting purposes and excluded from shares of common stock outstanding in the consolidated financial statements.

During the nine months ended September 30, 2023 the Company bought back 270,081 shares of its common stock. These are included as treasury stock.

As of September 30, 2023 and December 31, 2022, the total treasury stock was 10,569,340 and 10,299,259, respectively.

Dividends

During the three months ended September 30, 2023 and 2022, APC did not pay dividends. During the nine months ended September 30, 2023 and 2022, APC paid dividends of $0 and $10.0 million, respectively. These dividends are deemed Excluded Assets that are solely for the benefit of APC and its shareholders. As such, they have no impact on the Series A Dividend payable by APC to AP-AMH Medical Corporation, and consequently will not affect net income attributable to ApolloMed.

During the three months ended September 30, 2023 and 2022, CDSC paid dividends of $1.3 million and $0, respectively. During the nine months ended September 30, 2023 and 2022, CDSC paid dividends of $1.3 million and $2.9 million, respectively.