On April 1, 2025, the Company, Thrive Skilled Pediatric Care, LLC, a Delaware limited liability company (“Thrive”), and other parties thereto entered into an Agreement and Plan of Merger (the "Merger Agreement"), pursuant to which, following a series of mergers, Thrive would become a wholly-owned subsidiary of the Company (collectively, the "Merger"). Thrive is an independent provider of pediatric home care with 23 locations in seven states including Arizona, Georgia, Kansas, New Mexico, North Carolina, Virginia, and Texas. Thrive primarily provides skilled Private Duty Nursing services, but also provides Pediatric Therapy, Licensed Health Aide Services, and Certified Nurse Assistant Services.

On June 2, 2025, the Company paid approximately $75.7 million as consideration upon consummation of the Merger, including the issuance of 11.2 million shares of common stock, equating to $59.8 million based on the opening market price of the Company’s common stock on the closing date. This issuance of the shares of common stock did not involve a public offering and was exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to Section 4(a)(2) of the Securities Act, which exempts transactions by an issuer not involving any public offering.

The Merger Agreement provides for customary purchase price adjustments, and approximately 1.3 million shares of the Company’s common stock is being held in escrow for a period of up to 12 months following the closing to support obligations under the Merger Agreement.


Entity	Thrive
Acquisition Date	June 2, 2025
Cash consideration	$	15,855
Share-based consideration		59,838
Total	$	75,693

Cash and cash equivalents	$	1,002
Patient accounts receivable		20,050
Receivables under insured programs		306
Prepaid expenses		494
Other current assets		308
Property and equipment		131
Operating lease right of use assets		1,835
Intangible assets - licenses		5,000
Intangible assets - trade names		540
Receivables under insured programs - long term		1,439
Other long-term assets		1,095

Accounts payable and other accrued liabilities		1,754
Accrued payroll and employee benefits		4,322
Current portion of insurance reserves		679
Current portion of operating lease liabilities		741
Other current liabilities		9,935
Long-term insurance reserves		2,160
Operating lease liabilities, less current portion		1,094

Total identifiable net assets		11,515
Goodwill		64,178
Total	$	75,693

The purchase price allocation is preliminary pending a final analysis of the impact of income taxes and finalization of the fair value of intangible assets and net working capital. The preliminary goodwill recognized is attributable to the excess of the particular purchase price of the acquisition over the fair value of identifiable net assets acquired, including other identified intangible assets. Goodwill is primarily attributable to expected synergies resulting from the acquisition. Preliminary goodwill from the Merger was allocated to segments as follows (amounts in thousands):


	PDS		HHH		MS		Total
Balance at December 28, 2024 and March 29, 2025, net (1)	$	897,728	$	46,188	$	110,636	$	1,054,552
Acquisition		64,178		-		-		64,178
Balance at June 28, 2025, net (1)		961,906		46,188		110,636		1,118,730

(1) Goodwill balance is net of accumulated impairment losses of $608.0 million for PDS, $119.8 million for MS, and $487.4 million for HHH.

The Company incurred transaction costs of $3.4 million and $3.5 million during the three and six-month periods ended June 28, 2025, respectively. No such cost was recognized during either the three or six-month period ended June 29, 2024. These costs are included in acquisition-related costs in the accompanying consolidated statement of operations.

Pro forma financial information related to the above acquisitions has not been provided as it is not material to the Company’s consolidated results of operations. The results of operations of the above acquisition are included in the Company’s consolidated results of operations from the date of acquisition and were not significant for the six-month period ended June 28, 2025.