LEASES

3 Months Ended

Mar. 31, 2025

NOTE 5 – LEASES

The Company’s operating leases are primarily for real estate, including medical office suites and corporate offices. For the three months ended March 31, 2025 and 2024, the Company incurred rent expense of $1.8 million and $1.5 million, respectively, for its medical office suites. The Company’s rent expense related to its medical office suites is classified in cost of services within the Company’s condensed consolidated statements of operations. The Company incurred rent expense of $0.1 million and $0.1 million for the three months ended March 31, 2025 and 2024, respectively, related to the corporate offices which is classified in selling, general and administrative expenses. The Company currently does not have any finance leases.

Real estate lease agreements typically have initial terms of five to ten years and may include one or more options to renew. The useful life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. The Company’s lease agreements do not contain any material residual value guarantees, restrictions or covenants.

The following table presents supplemental cash flow information for the three months ended March 31, 2025 and 2024 (in 000’s):


	March 31, 2025		March 31, 2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	$	1,681	$	1,469
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	—	$	930

Future minimum rental payments under all non-cancellable operating lease agreements for the succeeding five years are as follows, excluding common area maintenance charges that may be required by the agreements (in 000’s):


Year ending December 31,

2025 (excluding the three months ended March 31, 2025)	$	5,607
2026	7,315
2027	6,743
2028	5,926
2029	4,521
Thereafter	12,124
Total lease payments	42,236
Less: imputed interest	(13,323)
Total lease obligations	$	28,913