What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2024-02-27 compared with 2023-03-01 · 320 added, 245 removed, 893 unchanged (39% of the section changed)

16 unchanged sentences

Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

We intend to continue to monitor and

upgrade our internal controls as necessary or appropriate for our business but cannot assure you that such improvements will be sufficient to provide us with effective internal control over financial reporting.

We intend to continue to monitor and upgrade our internal controls as necessary or appropriate for our business but cannot assure you that such improvements will be sufficient to provide us with effective internal control over financial reporting.

OTHER INFORMATION

No officers or directors of the Company adopted , modified or terminated any trading plan during the fourth quarter of 2023.

DISCLOSURE REGARDING FOREIGN JURISDICTION THAT PREVENT INSPECTIONS.

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Financial Statement Schedules

See Schedule II—Valuation and Qualifying Accounts for each of the three years ended December 31, 2022, 2021, and 2020 appearing on page F-25 of this report.

The exhibits listed in the following “Exhibit Index” are filed, furnished or incorporated by reference as part of this Annual Report on Form 10-K

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S-1 3.1 333-255086 04/07/2021

3.2+ Second Amended and Restated Bylaws of Privia Health Group, Inc., adopted and in effect as November 9, 2022

3.2+ Third Amended and Restated Bylaws of Privia Health Group, Inc., adopted and in effect as of August 1, 2023 (incorporated herein by reference to Exhibit 3.1 to the registrant's Current Report on Form 8-K (File No.

001-40365), filed with the SEC on July 31, 2023

8-K 3.1 001-40365 07/31/2023

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10-K 10.23 227-68304 03/25/2022

10.31+ Strategic Alignment Agreement, dated as of March 2, 2023, by and between Privia Health Group, Inc.

and ChoiceHealth, Inc.

10.2 001-40365 05/04/2023

Form of PSU Award Agreement under the 2021 Omnibus Incentive Plan

10.1 001-40365 05/04/2023

M ehrotra Fourth Amendment to Employment Agreement , dated June 23, 2023

10.1 001-40365 06/29/2023

R elative TS R PSU Agreement, effective July 1, 2023

10.2 001-40365 06/29/2023

M orris Transition Agreement, dated June 23, 2023

10.3 001-40365 06/29/2023

C redit Agreement dated as of November 16, 2023 among Privia Health Group, Inc., PH Group Holdings Corp., and Privia Healt h, LLC, as borr ower, with Wells Fargo Bank, National Association, as issuing lender, and certain other lenders

10.1 001-40365 11/21/2023

T ransition Letter Agreement , dated as of January 25, 2024, between the Company and Thomas Bartrum

10.1 001-40365 01/29/2024

E mployment Agreement between Privia Health Group, Inc.

and Edward Fargis dated January 29, 2024

21.1 Subsidiaries of the registrant

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Section 1350, filed herewith.

P olicy Relating to Recovery of Erroneously Awarded Compensation

101.INS XBRL Instance Document ** X

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Privia Health Group, Inc.

March 1, 2023 By:

/s/ Shawn Morris

February 27, 2024 By:

/s/ Parth Mehrotra

Parth Mehrotra

Chief Executive Officer

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Signature Title Date

/s/ Shawn Morris Chief Executive Officer and Director

/s/ Parth Mehrotra Chief Executive Officer and Director

(principal executive officer)

March 1, 2023

February 27, 2024

Parth Mehrotra

/s/ David Mountcastle Executive Vice President and Chief Financial Officer

(principal financial and accounting officer)

March 1, 2023

February 27, 2024

David Mountcastle

/s/ Jeff Bernstein Director March 1, 2023

Jeff Bernstein

/s/ Nancy Cocozza Director March 1, 2023

/s/ Adam Boehler Director February 27, 2024

/s/ Nancy Cocozza Director February 27, 2024

Nancy Cocozza

/s/ David King Director March 1, 2023

/s/ Patricia Maryland Director March 1, 2023

/s/ Pamela Kimmet Director February 27, 2024

Pamela Kimmet

/s/ David King Director February 27, 2024

/s/ Patricia Maryland Director February 27, 2024

Patricia Maryland

/s/ Thomas McCarthy Director March 1, 2023

/s/ Thomas McCarthy Director February 27, 2024

Thomas McCarthy

/s/ Jaewon Ryu Director March 1, 2023

/s/ Shawn Morris Director February 27, 2024

/s/ Jaewon Ryu Director February 27, 2024

Jaewon Ryu, M.D.

/s/ William M.

Sullivan Director March 1, 2023

/s/ Will Sherrill Director March 1, 2023

Will Sherrill

Sullivan Director February 27, 2024

/s/ David Wichmann Director February 27, 2024

David Wichmann

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

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Notes to the Consolidated Financial Statements

Financial Statements Schedule II—Valuation and Qualifying Accounts

Report of Independent Registered Public Accounting Firm

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We have audited the accompanying consolidated balance sheets of Privia Health Group, Inc.

and its subsidiaries (the “Company”) as of December 31, 2022 and 2021, and the related consolidated statements of operations, of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2022, including the related notes and financial statement schedule listed in the index appearing under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”).

and its subsidiaries (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of operations, of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2023, including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

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As described in Notes 1 and 2 to the consolidated financial statements, substantially all of the Company’s accounts receivable relate to providing healthcare services to patients whose costs are primarily paid by federal and state governmental authorities or commercial insurance companies.

The fee for service patient care (FFS patient care) receivable makes up a significant portion of the Company’s consolidated net account receivable balance of $189.6 million as of December 31, 2022.

The fee for service patient care (FFS patient care) accounts receivable makes up a portion of the Company’s consolidated net accounts receivable balance of $290.8 million as of December 31, 2023.

FFS patient care revenue is primarily generated from third-party payers with which management has established contractual billing arrangements and is reported net of provisions for contractual allowances from third-party payers and patients.

Management reports accounts receivable at an amount equal to the consideration the Company expects to receive in exchange for providing healthcare services to patients, which is estimated using historical reimbursement rates and an analysis of past experience to estimate potential adjustments.

The principal considerations for our determination that performing procedures relating to the valuation of FFS patient care accounts receivable is a critical audit matter are (i) the significant judgment by management in developing the estimated value of FFS patient care accounts receivable and (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating audit evidence related to adjustments based on historical reimbursement rates and analysis of past experience.

The principal considerations for our determination that performing procedures relating to the valuation of FFS patient care accounts receivable is a critical audit matter are (i) the significant judgment by management when developing the estimated value of FFS patient care accounts receivable and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence related to adjustments based on historical reimbursement rates and analysis of past experience.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the valuation of FFS patient care accounts receivable, including controls over management’s valuation method, assumptions and data used to develop the estimated value of FFS patient care accounts receivable.

These procedures included, among others, (i) evaluating management’s process for developing the estimated value of FFS patient care accounts receivable, (ii) evaluating the appropriateness of management’s historical reimbursement rates and analysis of past experience to estimate potential adjustments, (iii) testing the completeness and accuracy of the underlying billing and reimbursement data used by management to estimate potential adjustments, and (iv) evaluating the historical accuracy of management’s process for developing the estimate of the value FFS patient care accounts receivable by (a) testing, on a sample basis, the accuracy of revenue transactions and cash collections from the historical billing and reimbursement data used in management’s analysis and (b) comparing actual cash collections to the previously recorded FFS patient care accounts receivable balance as of the prior quarter balance sheet date.

Provider Liability for Unpaid Medical Claims Under At-Risk Capitation Arrangements

As described in Note 7 to the consolidated financial statements, the Company’s provider liability for unpaid medical claims under at-risk capitation arrangements was $28.6 million as of December 31, 2022.

Provider liability estimates are developed using actuarial models commonly used by health insurance actuaries that include a number of factors and assumptions including medical service utilization trends, changes in membership, observed medical cost trends, historical claim payment patterns and other factors.

These procedures included testing the effectiveness of controls relating to management’s valuation of FFS patient care accounts receivable.

These procedures also included, among others (i) testing management’s process for developing the estimated value of FFS patient care accounts receivable, (ii) evaluating the appropriateness of management’s historical reimbursement rates and analysis of past experience to estimate potential adjustments, (iii) testing the completeness and accuracy of the underlying billing and reimbursement data used by management to estimate potential adjustments, and (iv) evaluating the historical accuracy of management’s process for developing the estimated value of FFS patient care accounts receivable by (a) testing, on a sample basis, the accuracy of revenue transactions and cash collections from the historical billing and reimbursement data used in management’s analysis and (b) comparing actual cash collections to the previously recorded estimated FFS patient care accounts receivable balance as of the prior year balance sheet date.

Valuation of Medicare Shared Savings Program Revenue

As described in Notes 1 and 2 to the consolidated financial statements, under the shared savings basis, the Company is offered financial incentives to increase their accountability for the cost, quality and efficiency of the care provided to the population of attributed members.

Revenue from the Medicare Shared Savings Program (MSSP) makes up the majority of the Company’s consolidated shared savings revenue of $170.1 million for the year ended December 31, 2023.

The Company is paid the financial incentives when, for a given twelve-month measurement period, their performance on quality of care and utilization meets or exceeds the standards set by the payers as outlined in the contracts and when savings are achieved for medical costs associated with the population of attributed members.

The payers analyze the activities during the measurement period using the agreed upon benchmarks, metrics and performance criteria to determine the appropriate payments to the Company.

Management estimates the transaction price by analyzing the activities during the relevant time period in contemplation of the agreed upon benchmarks, metrics, performance criteria, inflation trend factors, risk ratio adjustments, and attribution criteria based on those and any other contractually defined factors.

Revenue is not recorded until the price can be estimated by management and to the extent that it is probable that a significant reversal will not occur once any uncertainty associated with the variable consideration is subsequently resolved.

Revenue is recorded during the period when the services were provided during a pre-set twelve-month annual measurement period.

The principal considerations for our determination that performing procedures relating to the valuation of MSSP revenue is a critical audit matter are (i) the significant judgment by management when developing the estimate of MSSP revenue, (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to inflation trend factors and risk ratio adjustments, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s valuation of MSSP revenue.

These procedures also included, among others (i) testing the completeness and accuracy of the underlying data used by management and (ii) the involvement of professionals with specialized skill and knowledge to assist in evaluating the reasonableness of management’s estimate of MSSP revenue, on a sample basis, by (a) developing an independent range of estimated MSSP revenue using independently developed assumptions related to inflation trend factors and risk ratio adjustments and (b) comparing the independent range of estimated MSSP revenue to management’s estimate.

Valuation of the Provider Liability for Unpaid Medical Claims Under At-Risk Capitation Arrangements

As described in Note 8 to the consolidated financial statements, the Company’s consolidated provider liability for unpaid medical claims under at-risk capitation arrangements was $67.1 million as of December 31, 2023.

Provider liability estimates are developed using actuarial methods commonly used by health insurance actuaries that include a number of factors and assumptions including

medical service utilization trends, changes in membership, observed medical cost trends, historical claim payment patterns and other factors.

Each period, management re-examines previously established provider liability estimates based on actual claim submissions and other changes in facts and circumstances.

As more complete claims information becomes available, management adjusts its estimates and recognizes those changes in estimates in the period in which the change is identified.

The estimated liability for unpaid medical claims is included in provider liability on the consolidated balance sheet.

The principal considerations for our determination that performing procedures relating to the provider liability for unpaid medical claims liability under at-risk capitation arrangements is a critical audit matter are (i) the significant judgment by management when developing the estimate of provider liability for unpaid medical claims under at-risk capitation arrangements, (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumptions related to changes in membership and observed medical cost trends, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

As more complete claims information becomes available, management adjusts the estimates and recognizes changes in estimates in the period in which the change is identified.

The estimated liability for unpaid medical claims under at-risk capitation arrangements is included in provider liability on the consolidated balance sheet.

The principal considerations for our determination that performing procedures relating to the valuation of the provider liability for unpaid medical claims liability under at-risk capitation arrangements is a critical audit matter are (i) the significant judgment by management when developing the estimate of the provider liability for unpaid medical claims under at-risk capitation arrangements, (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumptions related to changes in membership and observed medical cost trends, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s valuation of the provider liability for unpaid medical claims under at-risk capitation arrangements.

These procedures also included, among others, (i) testing the completeness and accuracy of the underlying data used by management and (ii) the involvement of professionals with specialized skill and knowledge to assist in (a) testing management’s process for developing the estimate of the unpaid medical claims liability, (b) evaluating the appropriateness of management’s actuarial methodologies, and (c) evaluating the reasonableness of management’s significant assumptions related to changes in membership and observed medical cost trends.

These procedures also included, among others (i) testing the completeness and accuracy of the underlying data used by management and (ii) the involvement of professionals with specialized skill and knowledge to assist in (a) testing management’s process for developing the estimate of the provider liability for unpaid medical claims under at-risk capitation arrangements, (b) evaluating the appropriateness of management’s actuarial methodologies, and (c) evaluating the reasonableness of management’s significant assumptions related to changes in membership and observed medical cost trends.

/s/ PricewaterhouseCoopers LLP

Baltimore, Maryland

March 1, 2023

February 27, 2024

We have served as the Company’s auditor since 2020, which includes periods before the Company became subject to SEC reporting requirements.

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Provider liability 326,078 208,424

Current portion of note payable — 875

Operating lease liabilities, current 3,043 3,013

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Non-current liabilities:

Note payable, net of current portion — 31,688

Operating lease liabilities, non-current 5,246 8,490

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Total operating expenses 1,637,088 1,375,782 1,183,656

Operating (loss) income ( 19,122 ) ( 217,436 ) 25,380

Operating income (loss)

20,649 ( 19,122 ) ( 217,436 )

Interest (income) expense, net ( 8,372 ) ( 542 ) 1,070

(Loss) income before benefit from income taxes ( 18,580 ) ( 218,506 ) 23,463

Benefit from income taxes ( 6,516 ) ( 27,857 ) ( 7,441 )

Net (loss) income ( 12,064 ) ( 190,649 ) 30,904

Income (loss) before provision for (benefit from) income taxes

29,021 ( 18,580 ) ( 218,506 )

Provision for (benefit from) income taxes

7,993 ( 6,516 ) ( 27,857 )

Net income (loss)

21,028 ( 12,064 ) ( 190,649 )

Loss attributable to non-controlling interests ( 2,051 ) ( 3,479 ) ( 2,419 )

Net (loss) income attributable to Privia Health Group, Inc.

Net income (loss) income attributable to Privia Health Group, Inc.

$ 23,079 $ ( 8,585 ) $ ( 188,230 )

Net (loss) income per share attributable to Privia Health Group, Inc.

stockholders – basic and diluted $ ( 0.08 ) $ ( 1.83 ) $ 0.33

Weighted average common shares outstanding – basic and diluted 110,695,266 102,952,370 95,950,062

Net income (loss) income per share attributable to Privia Health Group, Inc.

stockholders – basic

$ 0.20 $ ( 0.08 ) $ ( 1.83 )

Net income (loss) income per share attributable to Privia Health Group, Inc.

stockholders – diluted

$ 0.19 $ ( 0.08 ) $ ( 1.83 )

Weighted average common shares outstanding – basic 116,731,406 110,695,266 102,952,370

Weighted average common shares outstanding – diluted 124,686,067 110,695,266 102,952,370

The accompanying notes are an integral part of these consolidated financial statements.

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Balance at January 1, 2021 95,985,817 $ 960 $ 165,666 $ ( 19,878 ) $ 146,748 $ ( 3,096 ) $ 143,652

Capital contribution — — 4,700 — 4,700 — 4,700

Stock option exercise 54,268 1 107 — 108 — 108

Share-based compensation expense — — 484 — 484 — 484

Net income — — — 31,244 31,244 ( 340 ) 30,904

Balance at December 31, 2020 95,985,817 960 165,666 ( 19,878 ) 146,748 ( 3,096 ) 143,652

Issuance of common stock upon closing of initial public offering 9,725,000 97 210,897 — 210,994 — 210,994

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Balance at December 31, 2022 114,690,808 1,148 714,639 ( 216,693 ) 499,094 19,955 519,049

Issuance of common stock upon exercise of stock options and vesting of restricted stock units 3,526,171 34 8,706 — 8,740 — 8,740

Stock-based compensation expense — — 37,098 — 37,098 — 37,098

Repurchase of non-controlling interest — — ( 8,871 ) — ( 8,871 ) 3,177 ( 5,694 )

Contributed non-controlling interest — — — — — 24,871 24,871

Tax effect related to purchase of non-controlling interest — — 2,297 — 2,297 — 2,297

Net income (loss) — — — 23,079 23,079 ( 2,051 ) 21,028

Balance at December 31, 2023 118,216,979 $ 1,182 $ 753,869 $ ( 193,614 ) $ 561,437 $ 45,952 $ 607,389

The accompanying notes are an integral part of these consolidated financial statements.

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Cash flows from operating activities

Net (loss) income $ ( 12,064 ) $ ( 190,649 ) $ 30,904

Net income (loss)

$ 21,028 $ ( 12,064 ) $ ( 190,649 )

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

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Stock-based compensation 37,098 67,359 253,531

Deferred tax benefit ( 7,004 ) ( 28,411 ) ( 7,834 )

Debt Issuance costs Amortization — — —

Deferred tax expense (benefit)

7,465 ( 7,004 ) ( 28,411 )

Changes in asset and liabilities:

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Payments of underwriting fees, net of discounts and offering costs — — ( 12,691 )

Repurchase of non-controlling interest

( 5,694 ) — —

Proceeds from non-controlling interest 659 125 —

Repayment of note payable

— ( 33,250 ) ( 875 )

Proceeds from exercised stock options 8,740 13,448 3,829

Debt issuance costs — — ( 287 )

Proceeds from line of credit — — 10,000

Line of credit payments — — ( 10,000 )

Net cash (used in) provided by financing activities ( 19,677 ) 213,661 ( 767 )

Net cash provided by (used in) financing activities

3,705 ( 19,677 ) 213,661

Net increase in cash and cash equivalents 41,519 27,415 235,944

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Income taxes paid $ 1,040 $ 307 $ 504

Conversion of notes payable to related parties to capital contribution $ — $ — $ 4,700

The accompanying notes are an integral part of these consolidated financial statements.

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Privia Health Group, Inc.

(the “Company” “Privia”), became the sole shareholder of PH Group Holdings Corp.

(“PH Holdings”) (formerly Brighton Health Services Holding Corporation) effective August 11, 2016.

At the time, the Company was a wholly owned subsidiary of Brighton Health Group Holdings, LLC (“BHG Holdings”) (formerly MC Acquisition Holdings I, LLC, HoldCo).

The Company uses the same operational and financial model in each market.

As of December 31, 2022, Privia operates in ten markets:

(“Privia Health”, “Privia”, or the “Company”) is a technology-driven, national physician-enablement company that collaborates with medical groups, health plans, and health systems to optimize physician practices, improve patient experiences, and reward doctors for delivering high-value care in both in-person and virtual care settings (the “Privia Platform”).

As of December 31, 2023, Privia operated in fifteen markets:

1) the Mid-Atlantic Region (states of Virginia, Maryland and the District of Columbia);

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6) Central Florida;

7) Tennessee 8) California, 9) Montana and 10) North Carolina.

Medical groups are formed in each market with the primary purpose to operate as a physician group practice with healthcare services being furnished through physician members (“Privia Physicians”) and non-physician clinicians (together, “Privia Providers”) supervised by Privia Physicians.

7) Tennessee 8) California;

11) North Carolina;

12) Delaware;

13) Connecticut;

14) Washington state;

and 15) South Carolina.

In our standard Privia Medical Group model, medical groups are formed in a market with the primary purpose to operate as a physician group practice with healthcare services being furnished through physician members (“Privia Physicians”) and non-physician clinicians (together, “Privia Providers”) supervised by Privia Physicians.

Privia Physicians typically enter into a PMSA with a medical group, which requires the Privia Physician to provide healthcare services through and on behalf of the medical group.

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In other markets where state regulations do not allow the Company to own the medical group, the Companies “Non-Owned Medical Groups” are either (a) 100 % owned by the Privia Physicians or (b) majority owned, indirectly through a professional entity (“Nominee PC”), by a licensed physician holding a Privia leadership position (such physician leader, a “Nominee Physician” and each such Non-Owned Medical Group owned in this manner, a “Friendly Medical Group”).

Currently, the Company has Friendly Medical Groups only in the Tennessee and West Texas.

Currently, the Company has Friendly Medical Groups in Tennessee, West Texas, Washington state and South Carolina.

The Company has entered into a restriction agreement with each of its Nominee Physicians and their respective Nominee PCs, which provides the Company the right to direct the transfer of each Nominee PC’s ownership in the Friendly Medical Groups to other licensed physicians, among other matters.

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a) Capitated revenue, b) shared savings and c) care management fees (“PMPM”) all of which are primarily earned through Company-owned Accountable Care Organizations (“ACOs”) in each market ;

and 3) Other revenue which is earned from services provided to patients of both Owned and Non-Owned Medical Groups and CARES Act funds received.

Initial Public Offering

On May 3, 2021, the Company closed its initial public offering (“IPO”) of 22,425,000 shares of the Company’s common stock, $ 0.01 par value per share, at an offering price of $ 23.00 per share.

On May 3, 2021, the Company also sold 4,000,000 shares to an affiliate of Anthem, Inc.

(“Anthem”) in a private placement.

In aggregate, the shares issued in the offering and Anthem private placement generated gross proceeds of $ 223.7 million and $ 211.0 million in net proceeds, which is net of underwriters’ discounts and commissions, and other offering costs.

and 3) Other revenue which is earned from services provided to patients of both Owned and Non-Owned Medical Groups.

Basis of Presentation

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The primary beneficiary of a VIE is the party that meets both of the following criteria:

(i) has the power to make decisions that most significantly affect the economic performance of the VIE;

(i) has the power to make

decisions that most significantly affect the economic performance of the VIE;

and (ii) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE.

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The Company, however, does meet the criteria for consolidation of the Nominee PCs and the Friendly Medical Groups based on the discussion above.

In February 2022, the Company announced a partnership with Surgery Partners, Inc.

for Privia Health to enter the State of Montana with Great Falls Clinic, a multi-specialty practice with approximately 65 providers spanning 24 specialties.

Privia is the majority owner of Privia Management Company Montana, LLC (“PMC-MT”), which provides performance operations services and technology capabilities to Great Falls Clinic as well as to new providers in Montana who join the Privia Platform.

The Company performed the analysis as noted above and determined that PMC-MT does not represent a VIE as it does not meet the criteria in ASC 810 but given that Privia owns 75 % of the voting interest in the entity, the entity is consolidated as a result.

On November 3, 2022, the Company announced a joint venture and strategic partnership with Novant Health Enterprises, a division of

Novant Health, to launch Privia Medical Group – North Carolina for independent providers throughout North Carolina.

Privia is the majority owner of Privia Management Company North Carolina, LLC (“PMC-NC”), which provides performance operation services and technology capabilities to Great Falls Clinic as well as to new providers in Montana who join the Privia Platform.

performed an analysis as noted above and determined that PMC-NC does not represent a VIE as it does not meet the criteria in ASC 810 but given that Privia owns 51 % of the voting interest in the entity, the entity is consolidated as a result.

In February 2023, the Company announced a partnership with Community Medical Group, the largest Clinically Integrated Network (“CIN”) in Connecticut with approximately 1,100 multi-specialty providers, to launch Privia Quality Network Connecticut (“PQN-CT”).

The Company performed an analysis as noted above and determined that PQN- CT does not represent a VIE as it does not meet the criteria in ASC 810, but the entity is consolidated because Privia owns a majority of the voting interest in the entity.

Privia Medical Group – West Texas, PLLC, (“PMG West Texas”) is a physician-owned Medical Group, with PMG West Texas Holdings, PLLC (“Friendly WTX PC”), a Texas professional limited liability company entirely owned by a licensed physician with a leadership role in the Company, owning majority membership interests and having governance and control rights via the governing documents of PMG West Texas.

The Company has a contractual relationship with Friendly WTX PC through a Restriction Agreement.

The VIE analysis was performed, and the Company determined that characteristic (b) exists as a result of meeting (ii) and (iv) and as such, PMG West Texas and Friendly WTX PC do represent VIEs and are consolidated as they do meet the criteria in ASC 810.

Privia Medical Group Tennessee, PLLC (“PMG-TN”) is a physician-owned Medical Group, with PMG-TN Physicians, PLLC, a Tennessee professional limited liability company entirely owned by a licensed physician with a leadership role in the Company (“Friendly TN PC”), owning majority membership interests therein and having governance and control rights via the governing documents of PMG-TN.

Again, the same analysis was performed, and the Company determined that characteristic (b) exists as a result of meeting (ii) and (iv) and as such, PMG-TN and Friendly TN PC do represent VIEs as they do meet the criteria in ASC 810.

Privia Medical Group Washington, PLLC, (“PMG WA”) is a physician-owned Medical Group, with PMG Washington Holdings, PLLC (“Friendly WA PC”), a Washington professional limited liability company entirely owned by a licensed physician with a leadership role in the Company, owning majority membership interests and having governance and control rights via the governing documents of PMG WA.

The Company has a contractual relationship with Friendly WA PC through a Restriction Agreement.

The VIE analysis was performed, and the Company determined that characteristic (b) exists as a result of meeting (i), (ii) and (iv) and as such, PMG WA and Friendly WA PC do represent VIEs and are consolidated as they do meet the criteria in ASC 810.

Privia Medical Group South Carolina, LLC, (“PMG SC”) is a physician-owned Medical Group, with PMG South Carolina Holdings, PLLC (“Friendly SC PC”), a South Carolina professional limited liability company entirely owned by a licensed physician with a leadership role in the Company, owning majority membership interests and having governance and control rights via the governing documents of PMG SC.

The Company has a contractual relationship with Friendly SC PC through a Restriction Agreement.

The VIE analysis was performed, and the Company determined that characteristic (b) exists as a result of meeting (i), (ii) and (iv) and as such PMG SC and Friendly SC PC represent VIEs and are consolidated as they meet the criteria in ASC 810.

The aggregated carrying value of the current VIE assets and liabilities included in the consolidated balance sheets after elimination of intercompany transactions and balances were $ 6.2 million and $ 6.2 million, respectively, as of December 31, 2023 and $ 1.4 million and $ 1.4 million respectively, as of December 31, 2022.

Total revenues and operating expenses were $ 34.9 million and $ 34.9 million, respectively, as of December 31, 2022, and $ 5.8 million and $ 5.8 million, respectively, as of December 31, 2021.

Emerging Growth Company Status

Based on the aggregate worldwide market value of the Company shares of common stock held by the Company’s non-affiliate stockholders on June 30, 2022, as of December 31, 2022, the Company has become a“large-accelerated filer” and have lost emerging growth status for the year ended December 31, 2022.

Total revenues and operating expenses were $ 61.1 million and $ 61.1 million, respectively, as of December 31, 2023, $ 34.9 million and $ 34.9 million, respectively, as of December 31, 2022, and $ 5.8 million and $ 5.8 million, respectively, as of December 31, 2021.

Use of Estimates

9 unchanged sentences

Refer to Note 17 “Segment Financial Information” for additional information concerning the Company’s services.

Coronavirus Aid, Relief and Economic Stimulus Act (“CARES Act”)

As the COVID-19 pandemic evolves, disruptions caused by the pandemic and recurring COVID-19 outbreaks, including outbreaks caused by different virus variants, could potentially impact the Company and its future results of operations, cash flows and financial position.

On March 27, 2020, the CARES Act was passed.

It is intended to provide economic relief to individuals and businesses affected by the coronavirus pandemic.

It also contains provisions related to healthcare providers’ operations and the issues caused by the coronavirus pandemic.

The following are significant economic impacts for the Company and its subsidiaries as a result of specific provisions of the CARES Act for the year ended December 31, 2022 and 2021:

• The Company elected to defer its portion of Social Security taxes in 2020, which was repaid over two years as follows:

50 % at the end of 2021 and 50 % at the end of 2022;

• The Company received $ 0.8 million and $ 13.3 million in grant funds from the Provider Relief Fund under the CARES Act during the year ended December 31, 2021 and 2020.

The Company did no t receive Provider Relief Fund under the CARES Act during the year ended December 31, 2022.

Cash and Cash Equivalents

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Capitalized internal-use software costs are amortized on a straight-line basis over the software’s estimated useful life.

Business Combination

Business Combinations

Accounting for business combinations requires us to allocate the fair value of purchase considerations to the tangible assets acquired, liabilities assumed, and intangible assets acquired based on their estimated fair values, which were determined primarily using the income method.

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Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.

During the year ended December 31, 2021, Company completed several acquisitions to strengthen its current market share in existing markets or to expand into new markets.

During the years ended December 31, 2023 and 2021, the Company completed several acquisitions to strengthen its current market share in existing markets or to expand into new markets.

The consideration paid for each of the acquisitions was derived through arm’s length negotiations.

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If it is determined in the qualitative assessment that the fair value of a reporting unit is more likely than not below its carrying amount, then the Company will perform a quantitative impairment test.

The quantitative goodwill impairment test is performed by comparing the fair value of a

reporting unit with its carrying amount.

The quantitative goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount.

Any excess in the carrying value of a reporting unit’s goodwill over its fair value is recognized as an impairment loss, limited to the total amount of goodwill allocated to that reporting unit.

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Consumer customer relationships 10 - 24 years

FFS customer relationships 24 years

Management Service Agreement (Complete MD) 16 years

Management Service Agreement

Physician network 15 years

Payer contracts 17 - 22 years

Management Service Agreement (BPMC) 21 years

MSO Service Agreement

The Company reviews the carrying value of its finite-lived intangible assets for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition.

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Providing medical services to patients represents the Company’s performance obligation under these third-party payer agreements, and accordingly, the transaction price is allocated entirely to that one performance obligation.

The Company recognize revenue as services are rendered and approved by the Privia Providers, which is typically a single day for each service.

The Company recognizes revenue as services are rendered and approved by the Privia Providers, which is typically a single day for each service.

The Company receives payment for services from third-party payers, as well as from patients who have health insurance, but are also financially responsible for some or all of the service in the form of co-pays, coinsurance or deductibles.

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The differences between the estimated reimbursement rates and the standard billing rates are accounted for as contractual adjustments, which are deducted from gross revenue to arrive at FFS-patient care revenue.

The Company determines the Company’s

estimate of implicit price concessions based on the Company’s historical collection experience with classes of patients using a portfolio approach as a practical expedient to account for patient contracts as collective groups rather than individually.

The Company determines the Company’s estimate of implicit price concessions based on the Company’s historical collection experience with classes of patients using a portfolio approach as a practical expedient to account for patient contracts as collective groups rather than individually.

The financial statement effects of using this practical expedient are not materially different from an individual contract approach.

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For the years ended December 31, 2023, 2022 and 2021, changes in the Company’s estimates of implicit price concessions, contractual adjustments, and expected payments for performance obligations satisfied in prior periods were not significant.

With respect to the Company’s treatment of revenue from Owned Medical Groups, it is necessary to assess whether the Company is the principal or the agent with respect to FFS-patient care revenue in light of the fact that healthcare services are furnished by Privia Providers rather than employees of the Owned Medical Groups.

With respect to the Company’s treatment of revenue from Owned Medical Groups and Friendly Medical Groups, it is necessary to assess whether the Company is the principal or the agent with respect to FFS-patient care revenue in light of the fact that healthcare services are furnished by Privia Providers rather than employees of the Owned Medical Groups.

ASC 606-10-55-37A indicates that an entity is a principal if it obtains control of a right to a service to be performed by another party, which gives the entity the ability to direct that party to perform the services to the customer on the entity’s behalf.

The Owned Medical Groups, which are each majority-owned and controlled by us, own the contractual relationships with the patients and the third-party payers, and they direct Privia Providers to perform healthcare services on the Company’s behalf.

Although the Company is prohibited by law from interfering in the physician-patient relationship or making clinical care decisions, the Company Owned Medical Groups are responsible for the fulfillment of healthcare services to patients.

Although the Company is prohibited by law from interfering in the physician-patient relationship or making clinical care decisions, the Company’s Owned Medical Groups are responsible for the fulfillment of healthcare services to patients.

Further, the Company employs Chief Medical Officers and Medical Directors who provide clinical oversight and direction over the clinical affairs of the Owned Medical Groups.

In addition, the Owned Medical Group provides the care coordination activities, patient outreach and education activities, and sets quality standards for the Company’s Privia Providers.

The Company also verifies that Privia Providers have the proper qualifications (e.g., correct licenses, certificates, etc.) for the Company Owned Medical Groups, for the Company and as a delegate on behalf of certain third-party payers.

In addition, the Owned Medical Group provides the care coordination activities, patient outreach and education activities, and sets quality standards for Privia Providers.

The Company also verifies that Privia Providers have the proper qualifications (e.g., correct licenses, certificates, etc.) for the Company’s Owned Medical Groups, for the Company and as a delegate on behalf of certain third-party payers.

In addition to oversight of health care services, the Owned Medical Group is also the party primarily responsible for providing the services to patients and maintains discretion in establishing pricing for all services through agreements with patients and their insurance payers.

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The Company reduces the amount of FFS – administrative services revenue by the amount of any rebates earned by its customers.

Rebates $ 2.8 million have been recorded as of December 31, 2022.

No rebates were recorded for years ended December 31, 2021 and 2020.

Rebates of $ 2.7 million have been recorded for the years ended December 31, 2023 and 2022, respectively.

No rebates were recorded for the year ended December 31, 2021.

The Company’s VBC business consists of its clinically integrated network and ACOs which bring together independent physician practices within the Company medical groups to focus on sharing data, improving care coordination, and collaborating on initiatives to improve outcomes and lower healthcare spending.

The Company has contracts with the U.S.

federal government and large payer organizations that are multi-year in nature typically ranging from three to five years and is paid as follows:

federal government and large payer organizations that are multi-year in nature typically ranging from three to five years and are paid as follows:

(1) Capitated revenue (2) on a shared savings basis and (3) Care management fees on a per member per month basis.

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Capitated revenue consists of capitation fees earned under contracts with various Medicare Advantage payers (“Payers”) in at-risk capitation arrangements.

The Company is entitled to monthly fees to provide a defined range of healthcare services for Medicare Advantage health plan members (“attributed beneficiaries” or “attributed lives”) attributed to the Company’s contracted physicians (typically primary care).

The Company is entitled to monthly fees to provide a defined range of healthcare services for Medicare

Advantage health plan members (“attributed beneficiaries” or “attributed lives”) attributed to the Company’s contracted physicians (typically primary care).

Monthly fees are determined as a percentage of the premium payers receive from the Centers for Medicare & Medicaid Services (“CMS”) for these attributed beneficiaries.

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The Company recognizes revenue in the month in which the eligible beneficiary is entitled to receive healthcare benefits during the contract term.

The transaction price for the Company’s capitation contracts is a fixed percentage of premium per attributed life with periodic adjustment, as the monthly fees to which the Company are entitled are subject to periodic adjustments under CMS’s risk adjustment payment methodology.

The transaction price for the Company’s capitation contracts is a fixed percentage of premium per attributed life with periodic adjustment, as the monthly fees to which the Company is entitled are subject to periodic adjustments under CMS’s risk adjustment payment methodology.

CMS deploys a risk adjustment model that determines premiums paid to all payers according to each attributed life’s health status and certain demographic factors.

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Capitated revenue fees are also subject to adjustment for incentives or penalties based on the achievement of certain quality metrics defined in the Company’s contracts with payers.

The Company recognizes incentive revenue as earned using the most likely amount methodology and only to the extent that it is probable that a significant reversal of cumulative revenue will not occur once any uncertainty is resolved.

Neither the Company nor any of its affiliates are a registered insurance company as state law in the states in which the Company operate do not require such registration for risk bearing providers.

The Company recognizes incentive revenue as earned using the most likely amount methodology and only to the extent it is probable that a significant reversal of cumulative revenue will not occur once any uncertainty is resolved.

Neither the Company nor any of its affiliates are a registered insurance company as state law in the states in which the Company operates do not require such registration for risk bearing providers.

Shared Savings

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The payers analyze the activities during the measurement period using the agreed upon benchmarks, metrics and performance criteria to determine the appropriate payments to the Company.

The Company estimates the transaction price by analyzing the activities during the relevant time period in contemplation of the agreed upon benchmarks, metrics, performance criteria, and attribution criteria based on those and any other contractually defined factors.

The Company estimates the transaction price by analyzing the activities during the relevant time period in contemplation of the agreed upon benchmarks, metrics, performance criteria, inflation trend factors, risks ratio adjustments, and attribution criteria based on those and any other contractually defined factors.

Revenue is not recorded until the price can be estimated by the Company and to the extent that it is probable that a significant reversal will not occur once any uncertainty associated with the variable consideration is subsequently resolved.

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Revenue is reported at the amount that reflects the consideration to which the Company expects to be entitled in exchange for the provision of care coordination services to its population of attributed members.

The Company’s contracts with payers have a single

performance obligation that consists of a series of services for the provision of care coordination services for the population of attributed members for the duration of the contract.

The Company’s contracts with payers have a single performance obligation that consists of a series of services for the provision of care coordination services for the population of attributed members for the duration of the contract.

The transaction price for the contracts is entirely variable, as it is primarily based on a PMPM rate on monthly attributed membership, which can fluctuate during the life of the contract.

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The remainder of the Company’s revenue is derived from leveraging the Company’s existing base of providers and patients to deliver value-oriented services such as concierge services, virtual visits, virtual scribes and coding, clinical trials, behavioral health management, and partnerships with self-insured employers to offer direct primary care to their employees.

CARES Act funds received have been recorded within other revenue on the statement of operation for the years ended December 31, 2021 and 2020.

The Company received $ 0.8 million and $ 13.3 million in grant funds from the Provider Relief Fund under the CARES Act during the year ended December 31, 2021 and 2020.

The Company did no t receive Provider Relief Fund under the CARES Act during the year ended December 31, 2022.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, other receivables, accounts payable, and note payable.

The Company considers the carrying values of cash and cash equivalents, accounts receivable, other receivables, accounts payable, notes payable to related parties and note payable to be indicative of their respective fair values.

The carrying amount for notes payable is deemed to approximate fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, other receivables, accounts payable, and debt.

The Company considers the carrying values of cash and cash equivalents, accounts receivable, other receivables, accounts payable, debt to related parties and debt to be indicative of their respective fair values.

The carrying amount for debt is deemed to approximate fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

A three level hierarchy for fair value measurements exists based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date.

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Non-Controlling Interest

The non-controlling interest represents the equity interest of the non-controlling equity holders in results of operations of Complete MD Solutions LLC, Privia Management Services Organization (“PMSO”) and the Company’s Owned Medical Groups.

The non-controlling interest represents the equity interest of the non-controlling equity holders in results of operations of Privia Management Services Organization, LLC, Privia Management Company Montana, LLC, BASS Privia Management Company of California, LLC, Privia Management Company West Texas, LLC, Privia Management Company North Carolina, LLC, Privia Management Company of Ohio, LLC, Privia Services Company Connecticut, LLC, Privia Quality Network Connecticut, LLC, Privia Quality Network Delaware, LLC and our Owned Medical Groups.

The consolidated financial statements include all assets, liabilities, revenues, and expenses of less-than-100%-owned affiliates where the Company has a controlling financial interest.

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ASC 740 requires an entity to recognize the financial statement impact of a tax position when it is more likely than not that the position will be sustained upon examination.

If the tax position meets the more likely than not recognition threshold, the tax effect is recognized at the largest amount of the benefit that has greater than a fifty percent likelihood of being realized upon ultimate

ASC 740 also provides guidance for classification, interest and penalties, accounting in interim periods, disclosure, and transition.

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To the extent the Company prevails in matters for which a liability for an unrecognized tax benefit is established or is required to pay amounts in excess of the liability, the Company’s effective tax rate in a given financial statement period may be affected.

The Company does not have any accrued interest or penalties associated with any unrecognized tax benefits.

As there are no uncertain tax positions, the Company does not have any accrued interest or penalties associated with any unrecognized tax benefits.

The Company and its subsidiaries file income tax returns in the U.S.

federal jurisdiction and in various state jurisdictions.

As of December 31, 2022, the periods subject to examination by the Company’s major jurisdictions (federal and various states) are generally for the years December 31, 2019 through December 31, 2022.

December 31, 2023, the periods subject to examination by the Company’s major jurisdictions (federal and various states) are generally for the years December 31, 2020 through December 31, 2023.

Provider Liability

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Those costs include amounts that have not yet been paid for physician guaranteed payments and other required distributions pursuant to the service agreements as well as medical claims costs for services provided to attributed beneficiaries for which the Company is financially responsible under at-risk capitated revenue arrangements whether paid directly by the Company or indirectly by payers with whom the Company has contracted .

The Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) , as of January 1, 2021 using the modified retrospective transition approach for leases which existed on that date.

The Company elected the package of practical expedients that permitted the Company not to reassess the Company’s prior conclusions about lease identification, lease classification and initial direct costs.

The Company did not elect the use-of-hindsight practical expedient.

The adoption of the standard resulted in the recognition of operating right-of-use assets of approximately $ 6.0 million and operating lease liabilities of approximately $ 11.3 million.

Beginning January 1, 2021, the Company accounts for its leases in accordance with ASU 2016-2, Leases (Topic 842).

The Company accounts for its leases in accordance with ASU 2016-2, Leases (Topic 842).

The Company evaluates whether a contract is or contains a lease at the inception of the contract.

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Cost of platform represents the direct costs the Company incurs to provide services to Privia Physicians and their practices.

It includes third-party electronic medical records and practice management software expenses, employee-related expenses, including salaries and

employee benefits costs, stock-based compensation, as well as consulting expenses, travel-related expenses and technology related expenses for the team.

It includes third-party electronic medical records and practice management software expenses, employee-related expenses, including salaries and employee benefits costs, stock-based compensation, as well as consulting expenses, travel-related expenses and technology related expenses for the team.

Cost of platform excludes depreciation and amortization expense.

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These employee-related expenses capture all costs for both the Company’s field-based and corporate sales and marketing teams.

Sales and marketing expenses also include central and community-based advertising to generate greater awareness, engagement, and retention among the Company’s current and prospective patients as well as the infrastructure required to support all of the Company’s marketing efforts.

Sales and marketing expenses also include central and community-based advertising to generate greater awareness, engagement, and

retention among the Company’s current and prospective patients as well as the infrastructure required to support all of the Company’s marketing efforts.

General and Administrative

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For additional details refer to Note 11 “Stockholder Equity.”

Net (Loss) Income per Share Attributable to Common Stockholders

Basic net (loss) income per share attributable to common stockholders is calculated by dividing the net (loss) income attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period.

The Company issued certain performance stock units ("PSUs") during the second quarter of 2023.

The awards will vest based on the satisfaction of certain service conditions, performance-based conditions, and/or market conditions.

The Company has identified certain performance metrics associated with some of these awards and certain targets will be fully established at a future date.

For the awards with performance-based conditions where the target will be fully established at a future date, the Company has determined that the service inception date precedes the grant date for these awards as (a) the awards were authorized prior to establishing an accounting grant date, (b) the recipients began providing services prior to the grant date, and (c) there are performance conditions that, if not met by the accounting grant date, will result in the forfeiture of the awards.

As the service inception date precedes the accounting grant date, the Company recognizes stock-based compensation expense over the requisite service period based on the estimated fair value at each reporting date.

For the awards that are solely based on employment and the achievement of certain market performance metric targets, which have already been determined, the fair value of the PSUs are determined using a Monte Carlo valuation model as of the grant date and recognize stock-based compensation on a straight-line basis over the requisite service period.

Net Income (Loss) per Share Attributable to Common Stockholders

Basic net income (loss) per share attributable to common stockholders is calculated by dividing the net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period.

The treasury stock method is used to consider the effect of the potentially dilutive stock options.

Diluted net (loss) income attributable to common stockholders is computed by adjusting (loss) income attributable to common stockholders to allocate undistributed earnings based on the potential impact of dilutive securities, including outstanding stock options.

Diluted net (loss) income per share attributable to common stockholders is computed by dividing the diluted net (loss) income attributable to common stockholders by the weighted average number of common shares outstanding for the period, including common stock equivalents.

Diluted net income (loss) attributable to common stockholders is computed by adjusting (loss) income attributable to common stockholders to allocate undistributed earnings based on the potential impact of dilutive securities, including outstanding stock options.

Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period, including common stock equivalents.

In periods when the Company has incurred a net loss, options to purchase common stock are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is antidilutive.

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Recently Issued Accounting Pronouncements Pending Adoption

In November 2023, the FASB issued Accounting Standards Update No.

2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures .

The amendments require disclosure of incremental segment information on an annual and interim basis.

The amendments also require companies with a single reportable segment to provide all disclosures required by this amendment and all existing segment disclosures in Accounting Standards Codification 280, Segment Reporting .

The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024.

The Company does not expect the adoption of the amendments to have a significant impact on its financial statements.

In December 2023, the FASB issued Accounting Standards Update No.

2023-09, Income Taxes - Improvements to Income Tax Disclosures .

The amendments require (i) enhanced disclosures in connection with an entity's effective tax rate reconciliation and (ii)

income taxes paid disaggregated by jurisdiction.

The amendments are effective for annual periods beginning after December 15, 2024.

The Company does not expect the adoption of the amendments to have a significant impact on its financial statements.

Revenue Recognition

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Business Combinations

During the fourth quarter of 2021, the Company completed several acquisitions to expand operations into new markets.

The consideration paid for each of the acquisitions was derived through arm’s length negotiations.

Each of the Company’s acquisitions was accounted for using the acquisition method pursuant to the requirements of ASC 805.

The results of operations of the acquisitions have been included in the Company’s consolidated financial statements since their respective date of acquisition.

Unaudited proforma consolidated financial information for the acquisitions in 2021 have not been included as the results are immaterial individually and in the aggregate.

On October 1, 2021, the Company launched WTX Friendly Medical Group, a physician-owned Medical Group, with WTX Nominee PC, an entity entirely owned by Physician Nominee, owning majority membership interests and having governance and control rights via the governing documents of WTX Friendly Medical Group.

Refer to Note 1 “Organization and Summary of Significant Accounting Policies” for additional details regarding governance and controls rights.

The Company has a contractual relationship with WTX Nominee PC and its Physician Nominee owner through a Restriction Agreement.

WTX Nominee PC owns 67 % of interest in WTX Friendly Medical Group.

On October 13, 2021,the Company entered the California market through an affiliation with BASS Medical Group, one of the Greater San Francisco Bay Area’s leading healthcare multi-specialty groups with more than 400 providers spanning 42 specialties caring for patients at over 125 locations.

Privia acquired a majority interest in BASS Management Services Organization, LLC, now BASS Privia Management Company of California, LLC (“BPMC”), which is the exclusive provider of management services to BASS Medical Group.

BPMC provides management and other administrative services, as well as various other services to medical practices and others.

The Company acquired a 51 % interest in BPMC.

The purchase price for the 2021 acquisitions were allocated as follows:

During February 2023, the Company entered into the Connecticut market through the acquisition of Privia Quality Network Connecticut (“PQN-CT”), whereby Privia acquired a 51 % ownership interest in PQN-CT.

The acquisition was accounted for using the acquisition method pursuant to the requirements of ASC 805.

The results of operations of the acquisition have been included in the Company’s consolidated financial statements since the date of acquisition.

During August 2023, the Company launched Washington Friendly Medical Group, a physician-owned Medical Group, with Washington Nominee PC, an entity entirely owned by a Nominee Physician, owning majority membership interest and having

governance and control rights via the governing documents of Washington Friendly Medical Group.

The Company has a contractual relationship with the Washington Nominee PC and its Nominee Physician owner through a Restriction Agreement.

Washington Nominee PC owns 51 % interest in Washington Friendly Medical Group.

The results of operations of the acquisition have been included in the Company’s consolidated financial statements since the date of acquisition.

During October 2023, the Company acquired Privia Medical Group South Carolina, LLC, (“PMG SC”).

PMG SC is a physician-owned Medical Group, with PMG South Carolina Holdings, PLLC (“Friendly SC PC”), a South Carolina professional limited liability company entirely owned by a licensed physician with a leadership role in the Company, owning majority membership interests and having governance and control rights via the governing documents of PMG SC.

The Company has a contractual relationship with Friendly SC PC through a Restriction Agreement.

PMG SC owns 51 % interest in Friendly SC PC.

The results of operations of the acquisition have been included in the Company’s consolidated financial statements since the date of acquisition.

The purchase price for the acquisitions noted above was allocated as follows:

(Dollars in thousands) Total Acquisitions for the Year Ended December 31, 2023

Total Acquisitions for the Year Ended December 31, 2021

Cash paid, net of cash acquired $ 42,858 $ 32,228

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Accounts payable and other current liabilities assumed — ( 5,378 )

Payer contract intangible 2,750

Physician network intangible 1,520

Payer contract and physician network intangibles 55,603 4,270

Management services agreement intangible — 51,800

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Total acquired net assets $ 43,202 $ 35,170

The goodwill relating to these acquisitions are primarily attributable to synergies related to assembled workforce and operational and administrative synergies.

The goodwill relating to these acquisitions is not deductible for tax purposes and is primarily attributable to synergies related to the assembled workforce.

Goodwill is measured as the excess of the consideration transferred over the fair value of assets acquired and liabilities assumed on the acquisition date.

There were no acquisitions during the year ended December 31, 2022.

For the 2023 transactions related to Washington and South Carolina, the Company is in the process of completing its formal valuation analysis to identify and determine the fair value of tangible and identifiable intangible assets acquired and the liabilities assumed.

Thus, the final allocation of the purchase price may differ from the preliminary estimates used at December 31, 2023 based on additional information obtained and completion of the valuation of the identifiable intangible assets.

The Company does not expect any adjustments, if necessary, to be material.

Goodwill and Intangible Assets, Net

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No indicators of impairment were identified during the years ended December 31, 2023, 2022, and 2021.

During the fourth quarter of 2021, Privia entered into two new markets resulting in the recording of goodwill.

The Company launched PMG West Texas (“WTX Friendly Medical Group”).

Additionally, during the fourth quarter of 2021, the Company entered the

California market through the acquisition of BASS Privia Management Company of California, LLC (“BPMC”), the exclusive provider of management services to BASS Medical Group, Privia acquired 51 % ownership in BPMC, which provides management and other administrative services to BASS Medical Group.

During the year ended December 31, 2022 the Company recorded a measurement period adjustment to goodwill of $ 1.0 million in connection with these acquisitions.

Goodwill of $ 8.3 million (net of the $ 1.0 million measurement period adjustment), which represented the excess of the purchase price over the fair value of the net assets acquired, was recognized in connection with the acquisitions during the year end December 31, 2021.

During the year ended December 31, 2023, Privia entered into three new markets resulting in the recording of goodwill.

During February 2023, the Company entered into the Connecticut market through the acquisition of Privia Quality Network Connecticut (“PQN-CT”), whereby Privia acquired majority ownership in PQN-CT.

During August 2023, the Company entered into the Washington market through the launch of Washington Friendly Medical Group in affiliation with Walla Walla Clinic, a multi-specialty group practice with more than 50 providers and 3 care center locations.

During October 2023, the Company entered into the South Carolina market through the acquisition of Privia Medical Group South Carolina, LLC (“PMG SC”), whereby Privia acquired majority ownership in PMG SC.

During the year ended December 31, 2023, the Company recorded Goodwill of $ 11.8 million in connection with PQN-CT, Washington Friendly Medical Group and PMG SC, which represents the excess of the purchase price over the fair value of the net assets acquired.

A summary of the Company’s intangible assets is as follows:

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Consumer customer relationships 3,100 2,566 3,100 2,291

PMG customer relationships 600 208 600 184

Management Service Agreement (Complete MD) 2,200 997 2,200 860

Management Service Agreement

2,200 1,134 2,200 997

Physician network

7,446 362 1,520 127

Payer contracts

Management Service Agreement (BPMC) 51,800 3,087 50,800 605

52,427 2,184 2,750 164

MSO Service Agreement

51,800 5,550 51,800 3,087

121,573 $ 13,943 65,970 $ 8,583

Less accumulated amortization ( 13,943 ) ( 8,583 )

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The components of lease expense were as follows:

(Dollars in Thousands) For the Year Ended December 31, 2022 For the Year Ended December 31, 2021

(Dollars in Thousands) For the Years Ended December 31,

Operating lease cost $ 2,696 $ 2,669

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Property and equipment, net $ 2,325 $ 3,386

Depreciation and amortization expenses for property and equipment assets was approximately $ 1.2 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Account Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following:

(Dollars in Thousands) December 31, 2023 December 31, 2022

Accounts payable $ 7,882 $ 6,731

Accrued employee compensation and benefits 5,973 6,177

Bonuses payable 15,073 15,203

Other accrued expenses 28,903 24,726

Total accounts payable and accrued expenses $ 57,831 $ 52,837

Provider Liability

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The difference between the estimated liability and the actual settlements of claims is recognized in the period in which the claims are settled.

The Company’s physician and practice liability balance represents management’s best estimate of its liability for unpaid Provider expenses as of December 31, 2022.

The Company’s physician and practice

liability balance represents management’s best estimate of its liability for unpaid Provider expenses as of December 31, 2023.

The Company uses judgment to determine the appropriate assumptions for developing the required estimates.

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(Dollars in Thousands)

Balance at December 31, 2021

December 31, 2023 December 31, 2022

Balance, beginning of period

Incurred health care costs:

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Current year ( 270,810 ) ( 189,582 )

Prior year ( 27,488 ) —

Total claims paid ( 298,298 ) ( 189,582 )

Adjustments to other claims-related liabilities —

Balance at December 31, 2022

Account Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following:

(Dollars in Thousands) December 31, 2022 December 31, 2021

Accounts payable $ 6,731 $ 2,973

Accrued employee compensation and benefits 6,177 7,491

Bonuses payable 15,203 12,292

Other accrued expenses 24,726 23,229

Total accounts payable and accrued expenses $ 52,837 $ 45,985

The Company’s Credit Facilities consists of the following:

(Dollars in Thousands) December 31, 2022 December 31, 2021

Note payable $ — $ 33,250

Less debt issuance costs — ( 687 )

Less current portion — ( 875 )

Note payable, net $ — $ 31,688

On November 15, 2019, the Company entered into a Credit Agreement (the “Original Credit Agreement”) by and among Privia Health, LLC, as the borrower, PH Group Holdings Corp., as a guarantor, certain subsidiaries of Privia Health, LLC, as guarantors, Silicon Valley Bank, as administrative agent and collateral agent (the “Administrative Agent”), and the several lenders from time to time party thereto.

The Original Credit Agreement provided for up to $ 35.0 million in term loans (the “Term Loan Facility”) that mature on November 15, 2024 with interest payable monthly at the lesser of LIBOR plus 2.0 % or Alternate Base Rate (“ABR”) plus 1.0 % payable monthly, plus up to an additional $ 10.0 million of financing (which was increased to $ 15.0 million in connection with the first amendment) in the form of a revolving loan (the “Revolving Loan Facility” and together with the Term Loan Facility, the “Credit Facilities”).

The Revolving Loan Facility also includes a letter of credit sub-facility in the aggregate availability amount of $ 2.0 million and a swingline sub-facility in the aggregate availability amount of $ 2.0 million.

The Company borrowed $ 35.0 million in term loans on November 15, 2019.

Balance, end of period

$ 67,138 $ 28,617

On November 15, 2019, the Company entered into a Credit Agreement (the “Original Credit Agreement”) by and among Privia Health, LLC, as the borrower, PH Group Holdings Corp.

and certain subsidiaries of Privia Health, LLC, as guarantors, Silicon Valley Bank, as administrative agent and collateral agent (the “Administrative Agent”).

On August 27, 2021, the Company and certain of its subsidiaries entered into an assumption agreement and third amendment (the “Third Amendment”) to the Original Credit Agreement (as amended by the Third Amendment, the “Credit Agreement”).

Pursuant to the Third Amendment, the Company became the parent guarantor under the Credit Agreement and granted the Administrative Agent a first-priority security interest on substantially all of its real and personal property, subject to permitted liens.

The Third Amendment increased the size of the Revolving Loan Facility to $ 65.0 million, increased the letter of credit sub-facility to $ 5.0 million and extended the maturity date of the Credit Agreement to August 27, 2026.

As amended, borrowings under the Credit Agreement bear interest at a rate equal to (i) in the case of eurodollar loans, LIBOR plus an applicable margin, subject to a 0.5 % floor, and (ii) in the case of ABR loans, an ABR rate plus an applicable margin, subject to a floor of 1.5 %.

In addition, the Amendment, among other things, (i) changed the Term Loan Facility amortization schedule to 0.625 % of the original principal amount of term loans for the fiscal quarters ending September 30, 2021 through and including June 30, 2024 and 1.25 % of the original principal

amount of term loans for the fiscal quarters ending thereafter and (ii) added a 1.0 % prepayment premium for any term loans prepaid within six months of the effective date of the Third Amendment.

The Third Amendment converted the financial covenants in the Original Credit Agreement to “springing” financial covenants, so that at any time the Company’s cash is less than 125 % of the outstanding borrowings under the Credit Facilities, or at least $ 15.0 million of borrowings are outstanding under the Revolving Loan, the Company will be required to maintain (i) a consolidated fixed charge coverage ratio of not less than 1.25 to 1.0, and (ii) a consolidated leverage ratio of no more than 3.0 to 1.0.

On June 24, 2022, the Company voluntarily prepaid the outstanding indebtedness under the Term Loan Facility.

The Company’s prepayment to the lenders was approximately $ 33.1 million, including accrued interest.

The Company did not incur any prepayment penalties in connection with the repayment of the term loan, which had a scheduled maturity of August 27, 2026.

The prepayment was made with cash on hand.

Pursuant to this repayment, the Company accelerated recognition of $ 0.6 million of expense related to the remaining unamortized debt issuance costs.

Including this accelerated expense, amortization expense of approximately $ 0.7 million, $ 0.2 million and $ 0.1 million was recorded for the years ended December 31, 2022, 2021 and 2020, respectively.

The Revolving Loan Facility remains in place and available to the Company.

As of December 31, 2022 and 2021 there were no amounts outstanding under the Revolving Loan Facility.

Interest expense relating to the Credit Facilities was approximately $ 0.5 million, $ 1.1 million and $ 1.9 million for the years ended December 31, 2022, 2021 and 2020, respectively.

On March 16, 2023, the Company provided notice to terminate the Credit Agreement.

As of March 16, 2023, the Company had no borrowings and no letters of credit outstanding under the Credit Agreement.

The Company did not incur any early termination penalties in connection with the termination of the Credit Agreement.

On November 16, 2023, Privia Health Group, Inc., PH Group Holdings Corp., and Privia Health, LLC, as borrower, (collectively, the “Privia Parties”) entered into a credit agreement (the “Revolving Credit Agreement”) with Wells Fargo Bank, National Association, as issuing lender, and certain other lenders, pursuant to which the Privia Parties established a $ 125 million five-year senior secured revolving credit facility (the “Revolving Credit Facility”).

The Revolving Credit Agreement bears interest at a base rate plus applicable margin, with the base rate being the higher of the Prime Rate or the Federal Funds Rate plus 0.50 %.

In no event will the base rate be less than 1.0 %

The Revolving Credit Facility, which expires in November 2028, provides for revolving loans and the issuance of letters of credit in an aggregate amount of $ 125 million.

On a quarterly basis, the Company pays a commitment fee on the unused Revolving Credit Facility ( 0.20 % per annum).

The proceeds of these loans and the letters of credit issued under the Revolving Credit Facility may be used for capital expenditures, expenses related to transactions and general corporate purposes.

The Revolving Credit Agreement contains customary affirmative, negative and financial covenants, and customary events of default.

The occurrence of an event of default under the Revolving Credit Agreement may cause the unpaid principal and accrued interest, and all other obligations under the Revolving Credit Agreement to become immediately due and payable.

As of December 31, 2023, no amounts were outstanding under the Revolving Credit Facility.

Substantially all of the Company’s real and personal property serve as collateral under the above debt arrangements.

The benefit from income taxes for years ending December 31, 2022, 2021 and 2020 are as follows:

The provision for (benefit from) income taxes for years ending December 31, 2023, 2022 and 2021 are as follows:

(Dollars in Thousands) 2023 2022 2021

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Total deferred 7,465 ( 7,025 ) ( 28,202 )

Total benefit from incomes taxes $ ( 6,516 ) $ ( 27,857 ) $ ( 7,441 )

Total provision for (benefit from) incomes taxes $ 7,993 $ ( 6,516 ) $ ( 27,857 )

Deferred taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

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(Dollars in Thousands) 2023 2022 2021 2023 2022 2021

Tax (benefit) provision computed at Federal statutory income tax rate

Tax provision (benefit) computed at Federal statutory income tax rate

$ 6,094 $ ( 3,901 ) $ ( 45,806 ) 21.0 % 21.0 % 21.0 %

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2,140 ( 707 ) ( 4,280 ) 7.4 3.8 2.0

Change in valuation allowance

( 115 ) ( 538 ) 10 ( 0.4 ) 2.9 —

( 538 ) 10 ( 56 ) 2.9 — ( 0.2 )

Non-controlling interest 331 722 488 1.1 ( 3.9 ) ( 0.2 )

( 435 ) 149 332 ( 1.5 ) ( 0.8 ) ( 0.2 )

Benefit from income taxes

Provision for (benefit from) income taxes

$ 7,993 $ ( 6,516 ) $ ( 27,857 ) 27.5 % 35.1 % 12.8 %

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Stockholders’ Equity

Anthem Private Placement

On May 3, 2021, concurrent with the closing of its IPO, the Company issued and sold, 4,000,000 shares of common stock, par value $ 0.01 per share, of the Company for an aggregate purchase price of $ 92 million (the “Private Placement”), or $ 23.00 per share, in a private placement to an affiliate of Anthem.

The securities issued to the Investor in the Private Placement were issued pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933.

Stock option plan

Novant Health Private Placement

On March 2, 2023, the Company entered into a strategic alignment agreement (the “Equity Alignment Agreement”) with ChoiceHealth, Inc.

(“Novant Sub”), a subsidiary of Novant Health, Inc.

(“Novant Health”), in connection with the strategic partnership between the Company and Novant Health entered into in November 2022 to launch Privia Medical Group — North Carolina.

Pursuant to the Equity Alignment Agreement, Novant Sub will be entitled to receive, and the Company agreed to issue, shares of the Company’s common stock, par value $ 0.01 per share (the “Common Stock”), to Novant Sub any time each of the following events occurs, in the following amounts:

The Company will issue 745,712 shares of Common Stock to Novant Sub each time Privia Medical Group — North Carolina implements 1,000 providers in specified markets in North Carolina.

The Company will issue 372,856 shares of Common Stock to Novant Sub each time the Company and Novant Health enter a new state pursuant to a mutually agreed business plan developed for such state.

The Company will issue 745,712 shares of Common Stock to Novant Sub each time the partnership between the Company and Novant Health for each new state implements 1,000 providers in specified core markets in such state.

The Equity Alignment Agreement will renew every four years , subject to the delivery of a third-party valuation opinion.

The renewal will be required to use the same issuance triggers, but the number of shares may be adjusted to be consistent with the valuation opinion.

The number of shares of Common Stock issuable to Novant Sub under the Equity Alignment Agreement and all renewals of the Equity Alignment Agreement will be subject to a total cap equal to 19.9 % of the total number of shares of Common Stock outstanding as of the effective date of the Equity Alignment Agreement and as of the effective date of all renewals, whichever is lowest.

PH Group Holdings Corp Stock Option Plan

The PH Group Holdings Corp.

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Stock Option Plan of the vesting conditions of certain outstanding stock option grants to certain employees and consultants.

The modification accelerated by one year any time vested options that were not previously 100% vested and modified the vesting condition

of the performance based options to vest 60 % at IPO, 20 % 12 months after IPO and 20 % 18 months after the IPO.

The modification accelerated by one year any time vested options that were not previously 100% vested and modified the vesting condition of the performance based options to vest 60 % at IPO, 20 % 12 months after IPO and 20 % 18 months after the IPO.

The modification also accelerated the CEO’s time based options by an additional four months such that 100 % of his time based options are vested.

We recognized stock-based compensation of $ 195.1 million in the second quarter of 2021 related to these modifications.

2021 Omnibus Incentive Plan

On April 6, 2021, the Company approved the Privia Health Group, Inc.

2021 Omnibus Incentive Plan (the “Plan”) which permits awards up to 10,278,581 shares of the Company’s common stock.

The Plan also allows for an automatic increase on the first day of each fiscal year following the effective date of the Plan by an amount equal to the lesser of (i) 5 % of outstanding shares on December 31 of the immediately preceding fiscal year or (ii) such number of shares as determined by the Company’s Compensation Committee in its discretion.

The Plan also provides for an automatic increase on the first day of each fiscal year following the effective date of the Plan by an amount equal to the lesser of (i) 5 % of outstanding shares on December 31 of the immediately preceding fiscal year or (ii) such number of shares as determined by the Company’s Compensation Committee in its discretion.

The Plan provides for the granting of stock options at a price equal to at least 100 % of the fair market value of the Company’s common stock as of the date of grant.

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The 2021 ESPP became effective upon the execution of the underwriting agreement for the Company’s IPO in April 2021.

Per the Plan, shares may be newly issued shares, treasury shares or shares acquired on the open market.

The Compensation Committee may elect to increase the total number of Shares available for purchase under the Plan as of the first day of each Company fiscal year following the Effective Date in an amount equal to up to one percent ( 1 %) of the shares issued and outstanding on the immediately preceding December 31;

Per the 2021 ESPP, shares may be newly issued shares, treasury shares or shares acquired on the open market.

The Compensation Committee may elect to increase the total number of Shares available for purchase under the 2021 ESPP as of the first day of each Company fiscal year following the effective date of the 2021 ESPP in an amount equal to up to one percent ( 1 %) of the shares issued and outstanding on the immediately preceding December 31;

provided that the maximum number of shares that may be issued under the Plan in any event shall be 10,278,581 shares.

As of the IPO, the Company has reserved 1,027,858 shares of common stock for issuance under the 2021 ESPP.

As of December 31, 2022 and 2021, no shares of been issued under this plan.

As of December 31, 2023, no shares have been issued under this plan.

Stock option activity

For the Options granted under the 2021 Omnibus Incentive Plan, Privia used a Black-Scholes option pricing model to determine the fair value.

For the Options granted under the Plan, Privia used a Black-Scholes option pricing model to determine the fair value.

Option valuation models require several inputs, such as the expected stock price volatility, the fair value of the stock, the risk free rate, the expected term of the award and the dividend yield.

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• Expected term - The expected term represents the period that the Company’s stock-based awards are expected to be outstanding.

The expected term assumption is based on the simplified method in which the expected term is equal to the average of the stock-based award’s weighted-average vesting period and its contractual term.

The expected term assumption is based on the simplified method in which the expected term is equal to the

average of the stock-based award’s weighted-average vesting period and its contractual term.

The Company expects to continue using the simplified method until sufficient information about historical behavior is available.

• Dividend yield - The Company has not declared or paid any cash dividend and do not currently plan to pay a cash dividend in the foreseeable future.

• Dividend yield - The Company has not declared or paid any cash dividend and does not currently plan to pay a cash dividend in the foreseeable future.

Consequently, the Company used an expected dividend yield of zero.

The Company estimated the fair value of stock option grants using a Black-Scholes option pricing model with the following assumptions presented on a weighted-average basis:

For the Years Ended December 31,

Expected term in years 6.25 years 6.50 Years

The Company estimated the fair value of stock option grants using a Black-Scholes option pricing model with the following assumptions presented on a weighted-average basis (no stock options granted for the year ended December 31, 2023):

For the Year Ended December 31,

Expected term in years 6.25 Years

Expected stock price volatility 44.0 %

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Forfeited ( 157,464 ) 19.42

Outstanding at December 31, 2022 13,176,721 $ 7.86 9.02 $ 197,695

Exercised ( 3,104,257 ) 2.82

Forfeited ( 251,710 ) 22.78

Balance at December 31, 2023 9,820,754 $ 9.06 7.90 $ 138,028

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Unvested and outstanding at December 31, 2022 2,404,664 $ 23.81

Granted 1,161,301 27.50

Vested ( 425,076 ) 24.11

Forfeited ( 193,787 ) 24.43

Unvested and outstanding at December 31, 2023 2,947,102 $ 25.18

The following table summarizes the PSU activity under the Plan:

Number of Shares Grant Date Fair Value

Unvested and outstanding at January 1, 2023 — $ —

Granted (1)(2)

781,132 31.91

Forfeited ( 5,103 ) 27.61

Unvested and outstanding at December 31, 2023 776,029 $ 31.94

(1) During the twelve months ended December 31, 2023, Privia awarded RSUs in the form of PSUs to certain executive officers, market leaders and employees which vest after three years , subject to continued employment of the recipients and the achievement of certain performance metric targets.

The Company has identified certain performance metrics associated with these awards and certain targets will be fully established at a future date.

The Company has determined that the service inception date precedes the grant date for these awards as (a) the awards were authorized prior to establishing an accounting grant date, (b) the recipients began providing services prior to the grant date, and (c) there are performance conditions that, if not met by the accounting grant date, will result in the forfeiture of the awards.

As the service inception date precedes the accounting grant date, the Company recognizes stock-based compensation expense over the requisite service period based on the fair value at each reporting date.

(2) During the twelve months ended December 31, 2023, Privia awarded RSUs in the form of PSUs which vest after four years , subject to continued employment and the achievement of certain market performance metric targets.

The fair value of the PSUs are determined using a Monte Carlo valuation model as of the grant date and the stock-based compensation is recognized on a straight-line basis over the requisite service period.

Stock-based compensation expense

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A tax benefit of approximately $ 2.4 million and $ 11.2 million for the years ended December 31, 2023 and 2022, respectively, was included in the Company’s net operating loss carry-forward that could potentially reduce future tax liabilities.

At December 31, 2022, there was approximately $ 67.1 million of unrecognized stock-based compensation expense related to unvested options and RSUs, net of forfeitures, that is expected to be recognized over a weighted-average period of 1.3 years.

At December 31, 2023, there was approximately $ 79.4 million of unrecognized stock-based compensation expense related to unvested options, RSUs and PSUs, net of forfeitures, that is expected to be recognized over a weighted-average period of 1.2 years.

As of December 31, 2023, the total intrinsic value of options exercised and the total fair value of shares vested for the 2023 period was approximately $ 74.7 million and $ 14.6 million, respectively.

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The profit-sharing contribution was approximately 1.4 % in 2023, 2022 and 2021.

The Company made contributions of approximately $ 4.1 million, $ 2.3 million and $ 2.4 million for the years ended December 31, 2022, 2021 and 2020, respectively, recorded within cost of platform, sales and marketing and general and administrative expenses in the accompanying consolidated statements of operations.

The Company made contributions of approximately $ 4.7 million, $ 4.1 million and $ 2.3 million for the

years ended December 31, 2023, 2022 and 2021, respectively, recorded within cost of platform, sales and marketing and general and administrative expenses in the accompanying consolidated statements of operations.

Related-Party Transactions

1 unchanged sentence

A member of our board of directors is a member of the board of trustees of Novant Health.

No revenue or expense was recognized related to Novant Health for the year ended December 31, 2022.

No revenue or expense was recognized related to Novant Health for the years ended December 31, 2023 and 2022.

Commitments and Contingencies

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At December 31, 2023, substantially all of the Company’s cash and cash equivalents were held at two financial institutions.

The Company believes these financial institutions are financially sound and that minimal credit risk exists.

The Company receives payment for medical services provided to patients by its physicians through contracts with payers.

Six payers within the network accounted for approximately 75 % for each of the twelve month periods ended December 31, 2022, 2021, and 2020, respectively.

The Company evaluates accounts receivable to determine if they will ultimately be collected.

In performing this evaluation, significant judgments and estimates are involved, such as past experience, credit quality, age of the receivable balance and current economic conditions that may affect ability to pay.

As of December 31, 2022 and 2021, the Company had six payers within the network that made up approximately 67 % and 68 % of accounts receivable, respectively.

Net (Loss) Income Per Share

A reconciliation of net (loss) income available to common shareholders and the number of shares in the calculation of basic and diluted earnings (loss) income per share was calculated as follows:

The following table provides the Company’s revenue concentrations with respect to major payers as a percentage of the Company’s total revenues:

For the Years Ended December 31,

(Dollars in Thousands) 2023 2022 2021

30 % 32 % 31 %

15 % 16 % 17 %

11 % 10 % 10 %

The following table provides the Company’s concentrations of credit risk with respect to major payers as a percentage of receivables, net:

For the Years Ended December 31,

(Dollars in Thousands) 2023 2022

Net Income (Loss) Per Share

A reconciliation of net income (loss) available to common shareholders and the number of shares in the calculation of basic and diluted earnings (loss) income per share was calculated as follows:

For the Years Ended December 31,

(in thousands, except for share and per share amounts) 2023 2022 2021

Net (loss) income attributable to Privia Health Group, Inc.

Net income (loss) attributable to Privia Health Group, Inc.

common stockholders

Weighted average common shares outstanding - basic and diluted 110,695,266 102,952,370 95,950,062

Earnings per share attributable to Privia Health Group, Inc.

common stockholders – basic and diluted $ ( 0.08 ) $ ( 1.83 ) $ 0.33

$ 23,079 $ ( 8,585 ) $ ( 188,230 )

Weighted average common shares outstanding - basic 116,731,406 110,695,266 102,952,370

Weighted average common share outstanding - diluted 124,686,067 110,695,266 102,952,370

Earnings (loss) per share attributable to Privia Health Group, Inc.

common stockholders – basic

$ 0.20 $ ( 0.08 ) $ ( 1.83 )

Earnings (loss) per share attributable to Privia Health Group, Inc.

common stockholders – diluted

$ 0.19 $ ( 0.08 ) $ ( 1.83 )

The treasury stock method is used to consider the effect of the potentially dilutive stock options.

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2023 2022 2021

Potentially dilutive stock options and RSUs to purchase common shares 15,581,385 20,901,103 18,300,959

Potentially dilutive stock options to purchase common stock, RSUs and PSUs

5,589,224 15,581,385 20,901,103

Total potentially dilutive shares 5,589,224 15,581,385 20,901,103

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As of December 31, 2023 and 2022, all of the Company’s long-lived assets were located in the United States.

Schedule II - Valuation and Qualifying Accounts For Each of The Three Years Ended December 31, 2022, 2021, and 2020

The following Financial Statement Schedule along with the report thereon of PricewaterhouseCoopers LLP dated February 28, 2023, should be read in conjunction with the consolidated financial statements.

Financial Statement Schedules not included in this filing have been omitted because they are not applicable or the required information is shown in the consolidated financial statements or notes thereto.

Income Tax Valuation Allowance Balance at Beginning of Year Charged to costs and expenses Acquisitions Deductions Balance at End of Year

Year ended December 31, 2022 $ — $ — $ — $ — $ —

Year ended December 31, 2021 $ — $ — $ — $ — $ —

Year ended December 31, 2020 $ 13,710 $ — $ — $ ( 13,710 ) $ —

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures