美國
證券交易委員會 及交易所
華盛頓，DC 20549
表單
（馬克 一）
| 根據1934年證券交易法的第13或15(d)條款，季報。 |
截至年度季度結束
或
| 根據1934年證券交易法第13或15(d)條的過渡報告 |
過渡期從_____________到_____________。
委員會
檔案號碼：
(根據其章程所規定的註冊人的正確名稱)
（州或其他管轄區 註冊或組織） |
（美國國稅局雇主識別號碼） 識別號碼） | |
| （總執行辦公室地址） | （郵政編碼） |
（申報人的電話號碼，包括區號）
(如有更改，請填寫更改前的名稱、地址和財政年度)
根據該法案第12(b)條紀錄的證券：
| 每個類別的標題 | 交易標誌 | 在哪個交易所上市的名字 | ||
請勾選表示公司是否在過去12個月內（或公司被要求提交這些報告的短期）根據1934年證券交易法的第13條或第15(d)條的規定提交了所有要求提交的報告。公司是否在過去90天內也需要提交這些報告？是 ☐
標示
勾選該項，表示申報人於過去12個月（或更短期間，申報人必須申報此類檔案的期間）內已按照法規S-t第405條（本章節第232.405條）要求遞交每一個互動式資料檔案。
勾選是否屬於大型加速檔案提交者、加速檔案提交者、非加速檔案提交者、較小型報告公司或新興成長公司。請參見交易所法案第1202條中“大型加速檔案提交者”、“加速檔案提交者”、“較小型報告公司”和“新興成長公司”的定義。
| 大型及加速提交者 | ☐ | 加速提交者 | ☐ | |
| ☒ | 較小的報告公司 | |||
| 新興成長型公司 |
如為新興成長企業，則應打勾選項表示申報人已選擇不使用交易所法第13(a)條所提供的任何新或修訂財務會計準則延長過渡期遵守。
請勾選是否為外殼公司（根據交易所法規第120億2條的定義）。是 ☐ 否
截至2024年10月28日，登記人類A類普通股的流通股數為 .
| 頁 號碼。 | |||
| 第一部分 財務資訊 | |||
| 項目 1 | 基本報表 | F-1 | |
| 2024年9月30日壓縮資產負債表（未經審核）及2023年12月31日 | F-1 | ||
| 2024年9月30日結束的三個月和九個月簡明營運報表（未經審核） | F-2 | ||
| 2024年9月30日結束的九個月股東權益（赤字）變動報表（未經審核） | F-3 | ||
| 2024年9月30日結束的九個月現金流量簡明報表（未經審核） | F-4 | ||
| 簡明財務報表附註（未經審計） | F-5 | ||
| 項目 2 | 管理層對財務狀況和業績的討論與分析 | 4 | |
| 項目 3. | 市場風險的定量和定性披露。 | 11 | |
| 事項4。 | 內部控制及程序 | 11 | |
| 第二部分。其他資訊 | 12 | ||
| 項目 1 | 法律訴訟 | 12 | |
| 項目 1A | 風險因素 | 12 | |
| 項目 2 | 未註冊股權銷售、款項使用和發行人購買股權 | 12 | |
| 項目 3. | 優先證券違約 | 12 | |
| 項目 5. | 其他信息 | 12 | |
| 項目 6. | 展品 | 13 | |
| 簽名 | 14 | ||
| -2- |
關於前瞻性聲明和行業數據的注意事項
本季度報告，根據1933年修訂版《證券法》（以下簡稱「證券法」）第27A條和1934年修訂版《證券交易法》（以下簡稱「交易法」）第21E條的安全港規定，包含前瞻性聲明。這些聲明可以通過「可能」、「應當」、「預計」、「打算」、「計劃」、「預期」、「相信」、「估計」、「預測」、「潛在」、「繼續」或其他類似用語識別爲前瞻性術語。我們的前瞻性聲明基於對公司的期望、假設、估計和投影序列，不保證未來結果或績效，並涉及重大風險和不確定性。我們可能無法實際達到這些前瞻性聲明中披露的計劃、意圖或期望，實際結果或事件可能與這些前瞻性聲明中披露的計劃、意圖和期望存在重大差異。我們的業務和前瞻性聲明涉及重大已知風險和不確定性，包括有關我們陳述的風險和不確定性：
| ● | 我們的預期財務狀況和估計的現金燃燒率； | |
| ● | 我們關於費用、未來收入和資本需求的估計； | |
| ● | 我們作爲持續經營的能力； | |
| ● | 我們需要籌集大量資金來資助我們的業務； | |
| ● | 我們在醫療保健行業的競爭能力； | |
| ● | 新產品和服務的推出、開發和產品升級發佈的時間、成本以及成功或失敗的情況； | |
| ● | 市場競爭壓力，包括產品和價格； | |
| ● | 我們的能力； 建立並維護戰略關係； | |
| ● | 軟件產品中未被發現的錯誤或類似問題； | |
| ● | 遵守醫療行業現有法規、法律和行業倡議以及未來法規或法律的變化； | |
| ● | 可能發生的與服務相關的責任； | |
| ● | 我們獲取、保持和保護知識產權的能力、以及我們可能因維護或保護知識產權而產生巨額訴訟費用的潛在風險； | |
| ● | 我們對第三方內容提供商的依賴； | |
| ● | 競爭產品或服務的成功，即將推出或已經推出的競爭產品或服務的成功； | |
| ● | 我們擴大組織規模以適應潛在增長的能力，以及保留和吸引關鍵人才的能力； | |
| ● | 我們銷售和市場營銷能力的成功發展。 |
所有板塊的前瞻性陳述僅限於本第10-Q表格的提交日期。在每種情況下，實際結果可能與這些前瞻性資訊有所不同。我們不能保證這些期望或前瞻性陳述將被證明正確。在本第10-Q表格中提及的一個或多個風險因素或風險和不確定性發生或出現任何重大不利變化，或包含在我們的其他公開披露或其他定期報告或其他文件或提交給美國證券交易委員會（“SEC”）的文件可能會對我們的業務，前景，財務狀況和經營成果產生重大不利影響。除非法律要求，否則我們不打算更新或修訂任何此類前瞻性陳述，以反映實際結果，計劃變更，假設，估計或投資組合的變化，或發生在本第10-Q提交日之後影響此類前瞻性陳述的其他情況，即使這些結果，變化或情況清楚表明任何前瞻性資訊也不會實現。我們在本第10-Q提交後公開的任何聲明或披露，如果對本第10-Q中包含的任何前瞻性陳述進行修改或影響，將被視為修改或取代此類陳述在本第10-Q中的陳述。
本季度10-Q表格的內容可能包括市場數據和某些行業數據和預測，我們可能從內部公司調查、市場調研、顧問調查、公開可得信息、政府機構的報告和行業出版物、文章和調查中獲得。行業調查、出版物、顧問調查和預測通常聲明所包含的信息來源認為是可靠的，但不保證此類信息的準確性和完整性。雖然我們相信這樣的研究和出版物是可靠的，但我們沒有獨立驗證來自第三方來源的市場和行業數據。
| -3- |
項目 1. 基本報表
SYRA 健康公司。
總賬表
| 九月三十日， | 12月31日， | |||||||
| 2024 | 2023 | |||||||
| (未經查核) | ||||||||
| 資產 | ||||||||
| 流動資產: | ||||||||
| 現金 | $ | $ | ||||||
| 應收帳款淨額 | ||||||||
| 相關方應收帳款 | ||||||||
| 其他流動資產 | ||||||||
| 全部流動資產 | ||||||||
| 物業及設備，扣除折舊後淨值 | ||||||||
| 使用權資產 | ||||||||
| 資產總額 | $ | $ | ||||||
| 負債及股東權益（赤字） | ||||||||
| 流動負債： | ||||||||
| 應付賬款 | $ | $ | ||||||
| 應計費用 | ||||||||
| 逐步認列的收入 | ||||||||
| 與關聯方的營運租賃負債當前部分 | ||||||||
| 應付票據 | ||||||||
| 流動負債合計 | ||||||||
| 與關聯方的營運租賃負債非當前部分 | ||||||||
| 總負債 | ||||||||
| 合約和可能負債 | ||||||||
| 已發行股票数目为2024年6月30日和2023年12月31日各162,587,526股，已全部流通. | ||||||||
| 優先股，面額$0.01，授權股數為5,000,000股，發行且流通股數為截至2024年6月30日和2023年12月31日之184,668,188股和181,364,180股。 每股面額為 股份已授權 股份指定、發行和流通 | ||||||||
| A類普通股，$ 每股面額為 18,973,146 及 截至2024年9月30日和2023年12月31日，股份分别發行和流通。 | ||||||||
| 可轉換B類普通股，$面值， 18,973,146 股份發行及流通 | ||||||||
| 資本公積額額外增資 | ||||||||
| 累積虧損 | ( | ) | ( | ) | ||||
| 股東權益（赤字）總計 | ||||||||
| 負債和股東權益（赤字）總計 | $ | $ | ||||||
請參閱簡明未經查核的基本報表附註。
| F-1 |
SYRA 健康公司。
簡明的營運報表
(未經查核)
| 在結束的三個月內 | 已結束的九個月 | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| 淨收入 | $ | $ | $ | $ | ||||||||||||
| 服務費用 | ||||||||||||||||
| 毛利 | ||||||||||||||||
| 營運費用： | ||||||||||||||||
| 薪酬及福利 | ||||||||||||||||
| 專業服務 | ||||||||||||||||
| 研究開發費用 | ||||||||||||||||
| 銷售、一般及行政費用 | ||||||||||||||||
| 折舊 | ||||||||||||||||
| 營運開支總額 | ||||||||||||||||
| 營運損失 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 其他收入（費用）： | ||||||||||||||||
| 利息收入 | ||||||||||||||||
| 利息支出 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 其他收入總額（費用） | ( | ) | ( | ) | ||||||||||||
| 淨虧損 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| 持倉普通股加權平均-基本及稀釋 | ||||||||||||||||
| 每股淨虧損-基本及稀釋 | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
See accompanying notes to condensed unaudited financial statements.
| F-2 |
SYRA HEALTH CORP.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
(Unaudited)
For the Nine Months Ended September 30, 2024 and 2023
| A級 | 可轉換B類股票 | 額外的 | 股東總數 | |||||||||||||||||||||||||||||||||
| 優先股 | 普通股 | 普通股 | 實收資本 | 累計 | 股權 | |||||||||||||||||||||||||||||||
| 股份 | 金額 | 股份 | 金額 | 股份 | 金額 | 資本 | 赤字累計 | （赤字） | ||||||||||||||||||||||||||||
| 2023年12月31日結餘 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||||||
| 為服務發行的A類普通股 | - | - | ||||||||||||||||||||||||||||||||||
| 現金行使權證 | - | - | ||||||||||||||||||||||||||||||||||
| 為服務發行的A類普通股期權 | - | - | - | |||||||||||||||||||||||||||||||||
| 淨損失 | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| 2024年3月31日結存 | $ | ( | ) | |||||||||||||||||||||||||||||||||
| 以服務換發的A類普通股 | ||||||||||||||||||||||||||||||||||||
| 以服務換發的A類普通股期權 | - | - | - | |||||||||||||||||||||||||||||||||
| 淨損失 | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| 2024年6月30日資產負債表 | $ | ( | ) | |||||||||||||||||||||||||||||||||
| 以現金換發的A類普通股和權證 | - | - | ||||||||||||||||||||||||||||||||||
| 以服務換發的A類普通股 | ||||||||||||||||||||||||||||||||||||
| 以期權形式發行用於服務的A類普通股 | - | - | - | |||||||||||||||||||||||||||||||||
| 淨損失 | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| 2024年9月30日結餘 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||||||
| A級 | 可轉換的B類 | 額外的 | 股東總數 | |||||||||||||||||||||||||||||||||
| 優先股 | 普通股 | 普通股 | 實收資本 | 累計 | 股權 | |||||||||||||||||||||||||||||||
| 股份 | 金額 | 股份 | 金額 | 股份 | 金額 | 資本 | 赤字累計 | （赤字） | ||||||||||||||||||||||||||||
| 2022年12月31日的結存 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||||||
| 為服務而發行的A類普通股期權 | ||||||||||||||||||||||||||||||||||||
| 淨損失 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| 2023年3月31日結餘 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| A類普通股的取消 | - | ( | ) | ( | ) | - | ||||||||||||||||||||||||||||||
| 為服務發行的A類普通股期權 | - | - | - | |||||||||||||||||||||||||||||||||
| 淨損失 | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| 2023年6月30日結餘 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| 為服務發行的A類普通股期權 | - | - | - | |||||||||||||||||||||||||||||||||
| 淨損失 | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| 2023年9月30日的餘額 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
參見簡明未經審計基本報表附註.
| F-3 |
SYRA 健康公司。
現金流量表摘要
(未經查核)
| 已結束的九個月 | ||||||||
| 九月三十日 | ||||||||
| 2024 | 2023 | |||||||
| 營運活動現金流量 | ||||||||
| 淨虧損 | $ | ( | ) | $ | ( | ) | ||
| 調整淨虧損與經營活動所使用的淨現金： | ||||||||
| 折舊 | ||||||||
| 欠債支出 | ||||||||
| 為服務而發行的普通股 | ||||||||
| 非現金租賃費用 | ||||||||
| 基於股票的補償，股票期權 | ||||||||
| 營運資產及負債變動： | ||||||||
| 應收帳款 | ||||||||
| 應收帳款，關聯方 | ||||||||
| 其他流動資產 | ||||||||
| 應付帳款 | ( | ) | ||||||
| 應付帳款、相關人士 | ||||||||
| 延期收入 | ||||||||
| 累計費用 | ||||||||
| 營運租賃責任 | ( | ) | ( | ) | ||||
| 經營活動使用的現金淨額 | ( | ) | ( | ) | ||||
| 投資活動現金流 | ||||||||
| 購買物業和設備 | ( | ) | ( | ) | ||||
| 投資活動使用的現金淨額 | ( | ) | ( | ) | ||||
| 融資活動現金流 | ||||||||
| 出售普通股及行使認股權證所得的收益 | ||||||||
| 支付延期發售費用 | ( | ) | ||||||
| 信用額度收到的收益 | ||||||||
| 按信用額度的還款 | ( | ) | ||||||
| 從預付款收到的收益，相關人士 | ||||||||
| 按金還款，相關人士 | ( | ) | ||||||
| 應付票據的還款 | ( | ) | ||||||
| 應付可換股票據所得的收益 | ||||||||
| 融資活動所提供的現金淨額 | ||||||||
| 現金及現金等值淨變動 | ( | ) | ||||||
| 期初現金及現金等值 | ||||||||
| 期末現金及現金等值 | $ | $ | ||||||
| 補充資料： | ||||||||
| 已支付利息 | $ | $ | ||||||
| 已繳納的所得稅 | $ | $ | ||||||
| 非現金投資及融資活動： | ||||||||
| 使用權資產及租賃負債的初始認可 | $ | $ | ||||||
| 以應付票據融資的預付資產 | $ | $ | ||||||
請參閱簡明未經查核的基本報表附註。
| F-4 |
SYRA 健康公司。
基本報表附註
(未經查核)
注意 1 – 業務性質和重大會計政策
業務性質
Syra Health Corp.（“Syra”或“公司”）於2020年11月20日在印第安納州成立，旨在為精神健康醫院和組織，包括政府機構、整合醫療網絡、管理保健實體和藥品製造商提供勞動力人員配備解決方案、健康教育和醫療研究諮詢服務。2022年3月11日，公司重組為特拉華州公司。公司的總部位於印第安納州卡麥爾。
報表說明基礎
附帶的中期綜合基本報表已按照美國公認會計原則（"U.S. GAAP"）編製，應與我們於2023年12月31日結束的年度報告Form 10-k中包含的基本報表及附註一起閱讀，該報告已於2024年3月25日提交給證券交易委員會（"SEC"）。 根據SEC的規則和法規，根據U.S. GAAP編製的財務報表通常包括的某些信息和附錄披露已在本10-Q表格中省略。
本報告中的中期期間結果並不一定能反映未來的財務結果，並且尚未由我們獨立的註冊會計師事務所進行審核。在管理層看來，隨附的未經審計的綜合財務報表包括截至2024年9月30日以及截至2024年和2023年9月30日的三個和九個月份的中期財務報表所需的所有調整，這些調整屬於正常循環性質並與編製截至2023年12月31日年度經審計財務報表的調整是一致的。
使用估計值
根據美國的GAAP準則，財務報表的準備需要管理層對可能影響資產和負債的報告金額及財務報表日期時的潛在資產和負債的披露，以及報告期間內的收入和支出金額進行估計和假設。實際結果可能會與這些估計值有所不同。
信用風險的集中
公司在銀行存款帳戶中保持現金，其餘額有時可能超過聯邦保險限額。根據當前法規，這些帳戶由聯邦存款保險公司（FDIC）保證，最高可達$
金融工具公允價值
會計 標準法典（“ASC”）820定義了公平價值，為公平 價值衡量的披露建立了三層估值層次結構，並加強了有關公平價值衡量的披露要求。這三個層次定義如下：
| - | 水準 估值方法論的一級輸入是在活躍市場中對於相同資產或負債的報價(未調整)。 | |
| - | 水準 估值方法論的二級輸入包括活躍市場中類似資產和負債的報價，以及對於該資產或負債，在金融工具的整個期限內，是可觀察的，直接或間接地。 | |
| - | 水準 估值方法論的三級輸入是不可觀察且對於公平計量具有重大意義。 |
| F-5 |
公司的金融資產和負債的攜帶價值，如現金、應收帳款和應付帳款，管理層估計主要因工具的短期性質而接近公平價值。公司對相關方的提前支付近似於這些工具的公平價值，基於管理層對將可用於公司類似金融安排的利率期貨的最佳估計，截至2024年9月30日和2023年12月31日。
現金及現金等價物
現金等價物包括截至購入時點擁有三個月或更短到期日的貨幣市場帳戶。對於現金流量表的目的，所有原始到期日為三個月或更短的高度流動投資均被認為是現金等價物。現金等價物以成本加應計利息列示，這與市值接近。在2024年9月30日和2023年12月31日，"所有板塊"現金等價物均在手上。
應收帳款
應收帳款按預估收回金額計提。 應收帳款定期依據與客戶過往信用記錄和現行財務狀況評估可收回性。 公司於2024年9月30日和2023年12月31日採取了一筆$
資產 和設備
財產和設備列示為成本減累積折舊。辦公設備的成本採用直線法折舊依據一 年壽命預期。
維修和保養支出在發生時計入營運成本。對資產進行重大改進和更換，並延長其使用壽命的情況下，會在資產的剩餘預估使用壽命內加以資本化並折舊。當資產被報廢或出售時，相應的成本和相關的累計折舊會被取消，而任何由此產生的收益或虧損將反映在營運中。
長壽資產的減值
根據ASC 360標題的規定，所有長期資產，如公司擁有和使用的房產和設備，在表明該資產的帳面金額可能無法收回時，都會進行減損審核。將持有和使用的資產的可收回性，通過比較資產的帳面金額與預計由該資產產生的未來無折現現金流量來評估。如果這些資產被認為受損，則應該認知的減值金額是資產的帳面金額超過資產的公允價值的數額。根據ASC第360主題的規定，資產耐用性或處置，該公司持有並使用的設施和設備，以及無形資產等所有長期資產，均將在事件或情況發生變化並指示該資產攜帶金額可能無法收回時，進行減損審核。將持有並使用的資產的可收回性，通過比較資產的攜帶金額與預期由該資產產生的未折現未來預期現金流量來評估。如果認為這些資產已遭受減損，則應該認列的減損金額是資產的攜帶金額超過資產的公平價值的金額。在提出年度中，並未有任何減損費用。根據ASC 360標題的規定，所有長期資產，如公司擁有和使用的房產和設備，在表明該資產的帳面金額可能無法收回時，都會進行減損審核。將持有和使用的資產的可收回性，通過比較資產的帳面金額與預計由該資產產生的未來無折現現金流量來評估。如果這些資產被認為受損，則應該認知的減值金額是資產的帳面金額超過資產的公允價值的數額。
租賃
公司根據ASC 842處理其租賃。 租賃公司在租賃開始時確定安排是否屬於租賃。營運租賃包括在營運租賃使用權（ROU）資產、當前期履約租賃負債和公司資產負債表上的非流動租賃負債。
| F-6 |
根據未來最低租金支付的現值，在承租日期認識營運租賃權資產和營運租賃負債，通過採納日期的逾期租金負債進行調整。由於公司的租約未設定隱含利率，公司在承租日期根據所掌握的資訊，使用其增量借款利率確定未來支付的現值。營運租賃權資產還包括任何支付的租金，但不包括租賃獎勵和初始直接成本。公司的條款可能包括期權以延長或終止租約，當公司合理確定會行使該期權時。營運租賃費用在租約期間以直線方式認列。
分部報告
阿斯克 主題 280，」區段報告，」要求企業的營運部門的年度和中期報告 以及有關其產品、服務、地理區域和主要客戶的相關披露。作業區段定義為元件 企業從事可能從中獲得收入和開支的業務活動，以及其分開財務 首席營運決策者定期評估資訊，以決定如何分配資源。本公司營運 作為單一區段，並將在擴展其營運時評估其他區段披露需求。
營業收入 認列
公司根據ASC 606確認營業收入，其核心原則是實體應該認定營收以展現將承諾之商品或服務轉讓予客戶的過程，並反映實體預期將獲得的對換該商品或服務的考慮金額。為實現這一核心原則，必須在確認營收前滿足五個基本標準：(1)識別與客戶的合同；(2)識別合同中的履行義務；(3)判斷交易價格；(4)將交易價格分配給合同中的履行義務；以及(5)在公司滿足履行義務時或按照公司的慣例認列營業收入。
公司在雙方都批准合約、確定雙方的權利和義務、確定支付條件、以及收款的概率已確定後，才會計入收入。支付條件因客戶和提供的服務而異。
公司的主要營業收入形式如下：
| – | 醫療 勞動力; | |
| – | 人口 健康 | |
| – | 數位 健康 | |
| – | 行為 與心理健康服務 | |
| – | 健康 教育 |
公司主要向州衛生和社會服務機構以及高校提供服務。醫療人員、健康教育和行為心理健康服務合同主要作為一個單一履行義務，因為顧客同時以按小時或按日的方式獲得並消費我們醫療人員的好處。人口健康和互聯網醫療合同通常包含多個獨立的履行義務，例如提供數據分析和報告、培訓，或與客戶開發技術進行實施和維護。公司根據估計的獨立履行義務的公平價值在各履行義務之間分配交易價格。根據履行義務的不同，營收在顧客獲得服務的好處並提供時點上承認，或者在互聯網醫療營收的情況下，當顧客同時獲取並消費合同好處時，如我們的技術產品持續提供服務的過程中逐步承認。
| F-7 |
合同通常條款規定每兩週或每月結算一次，公司已選擇「按開票」的便利措施來認定營業收入，根據以合約價格計的時間為基礎，因為公司有權根據迄今為止完成的價值來支付金額。公司可能也會因違反某些倫理標準和未達到績效指標而在這些州政府合同中遭受罰款。公司在扣除罰款後確認營業收入。
分解後的 營業收入數據
該公司的營業收入包括其所在行業板塊內的以下營業收入服務：
| 九個月結束了 | ||||||||
| 2024年9月30日 | 2023年9月30日 | |||||||
| 凈收益： | ||||||||
| 醫療保健人力資源 | $ | $ | ||||||
| 人群健康 | ||||||||
| 互聯網醫療 | ||||||||
| 行為和心理服務 | ||||||||
| 健康教育 | ||||||||
| 淨收入 | $ | $ | ||||||
服務費用
服務成本包括公司承包服務員工的工資及相關的薪資稅、員工福利以及員工在合同工作期間所需的某些其他相關成本。
重要 濃度
公司與印第安納州家庭和社會服務局（"FSSA"）之間的大部分應收帳款和營業收入合同是與不同部門之間進行的。大多數合同要求隨著項目進展而進行月付。公司通常不要求抵押品或預付款。截至2024年9月30日和2023年9月30日為止的九個月內，FSSA佔了營業收入的大約
公司根據ASC 718股份報酬標準對發放給員工和非員工的股權工具進行會計處理。所有交易中，當提供的考慮以發行股權工具購買商品或服務時，根據所收到的考慮的公允價值或發行的股權工具的公允價值來進行核算，以較可靠的計算方式為準。
| F-8 |
基本每股收益（EPS）是通過將凈利潤（分子）除以期間內普通股加權平均未來數量（分母）計算而得。基本EPS的加權平均股份是根據加權平均的A類股和B類股份計算的。攤薄後每股收益是通過將凈利潤除以每個期間內普通股和潛在普通股的加權平均數量（如果具有稀釋性）計算而得。潛在普通股包括期權、warrants、B類股份轉換和受限股票。與期權、warrants、B類股份轉換和受限股票相關的潛在普通股數量是使用庫藏股份法來計算的。在呈現的期間內，潛在的稀釋證券具有防稀釋效果，並未納入攤薄後每股凈損失的計算。
收入 稅收
公司根據財務會計準則委員會（"FASB"）ASC 740所得稅（"ASC740"）進行所得稅核算，該準則要求使用負債法。FASB ASC 740-10-25規定了對現有資產負債的財務報表帳面金額與其相應稅基之間差異的未來稅務後果應該予以認列。根據預期適用於預計在這些暫時差異預計恢復或清算的年份中的應納稅收入的頒布稅率衡量這些递延稅資產和負債。當重要递延稅資產預計通過未來運營不被回收時，應提供估值准備。
不確定 稅務處理方式
根據ASC 740，公司只有在對繳稅機構進行審查後，認為稅務處境可能經得起考試機會時，才確認不確定的稅務處境能獲得稅務利益。這些標準規定了財務報表認識和衡量稅務處境的認知閾值和測量屬性，這些處境是根據技術地位採取或預期在納稅申報中採取的。這些標準還提供了有關去除認知、分類、利息和處罰、揭露和轉型的指導。
各種徵稅機關可能會定期審計公司的所得稅申報。這些審計包括有關公司的申報立場，包括扣除項目的時間和金額以及將收入分配給各稅務司法管轄區的問題。在評估與各種稅務申報立場相關的風險時，包括州和地方稅收在內，公司會記錄可能面臨的風險的準備金。在建立準備金的特定事項經過審計並得到完全解決之前，可能會過去幾年。公司尚未接受任何徵稅機關的審查。 公司會將與不確定稅務立場有關的利息和罰款（如有）視為所得稅支出。
公司稅務狀況的評估依賴管理層的判斷，以估計與公司各種申報立場相關的風險。
最近的 會計準則
公司會定期根據指定的生效日期，採納由FASB發布的新會計準則。
管理層認為，任何最近發布但尚未生效的會計準則，如果目前採納，對公司的基本報表不會產生實質影響。
| F-9 |
備註 2 - 經營概念
如同附帶的基本報表所顯示，截至2024年9月30日，公司現金餘額為$
公司持續通過債務和融資交易或安排來尋求額外資本來源，包括股權融資或其他方式。公司可能無法在足夠的時間內或根本找到合適的融資交易，也可能無法通過其他方式獲得所需資本。如果公司無法成功籌集額外資本，資源可能不足以支持其業務。公司擴大生產和分銷能力以及進一步增加其品牌價值的能力，在很大程度上取決於其成功籌集額外資本。從2023年1月至4月，公司總共籌集了
財務報表並不包括任何可能因公司是否能繼續作為持續營業狀態而產生調整的情況。這些財務報表也不包括任何與資產金額或負債金額及分類的回收性和分類相關的調整，如果公司無法繼續作為持續營業狀態，則可能是必要的。
備註 3 - 相關方交易
公司支付薪資和相關成本給為Sahasra Technologies corp提供服務的員工，理事業務名稱是STLogics，對STLogic的服務合同，該公司受惠擁有Syra的主要所有者和管理團隊。在2024年9月30日結束的九個月內，公司支付了$
辦公室 租賃
公司向STVentures, LLC（“STVentures”）租借其目前的企業總部。 ，一家由Syra的主要所有者和管理團隊及其子公司受益所有的實體。
這份租約始於2021年7月1日，並於2022年5月1日修改，規定租期內每月基本租金為$。截至2024年9月30日和2023年分別納入運營、總務和管理費用的總金額為$
資訊科技（IT）服務
公司在截至2024年9月30日和2023年9月30日結束的九個月中，從RAD CUBE LLC的有益所有人，即Syra的主要所有人和管理團隊以及其聯屬公司處外包的IT服務中，共計支出$
| F-10 |
招聘 及人力資源服務
公司向NLogix支付了總共$
During the three and nine months ended September 30, 2024, the Company used the two-class method to compute net loss per common share because it had issued securities, other than a single class of common stock, that contractually entitled the holders to participate in dividends and earnings. These participating securities included the Company’s Class A common stock, which was authorized pursuant to the Company’s amendment to its Certificate of Incorporation on May 2, 2022, and convertible Class B common stock which are entitled to share equally, on a per share basis, in all assets of the Company of whatever kind available for distribution to the holders of common stock. The two-class method requires earnings for the period to be allocated between common stock and participating securities based upon their respective rights to receive distributed and undistributed earnings.
Under the two-class method, for periods with net income, basic net income per common share is computed by dividing the net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Net income attributable to common stockholders is computed by subtracting from net income the portion of current period earnings that the participating securities would have been entitled to receive pursuant to their dividend rights had all of the period’s earnings been distributed. No such adjustment to earnings is made during periods with a net loss, as the holders of the participating securities have no obligation to fund losses.
The Company reports the more dilutive of the approaches (two-class or “if-converted”) as its diluted net income per share during the period. For the periods presented, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.
September 30, 2024 | September 30, 2023 | |||||||
| Warrants | ||||||||
| Stock options | ||||||||
| Total | ||||||||
| F-11 |
Note 5 – Other Current Assets
Other current assets included the following as of September 30, 2024 and December 31, 2023:
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Federal and state income tax receivable (1) | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Total other current assets | $ | $ | ||||||
| (1) |
Note 6 – Property and Equipment
Property and equipment at September 30, 2024 and December 31, 2023, consisted of the following:
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Office equipment | $ | $ | ||||||
| Less: Accumulated depreciation | ( | ) | ( | ) | ||||
| Total property and equipment, net | $ | $ | ||||||
Depreciation
of property and equipment was $
Note 7 – Accrued Expenses
Accrued expenses at September 30, 2024 and December 31, 2023, consisted of the following:
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Accrued payroll and taxes | $ | $ | ||||||
| Accrued expenses | ||||||||
| Total accrued expenses | $ | $ | ||||||
The
Company provides postretirement benefits pursuant to IRS code section 401(k) for employees meeting specified criteria. The Company matches
| F-12 |
Note 8 – Lease
The
Company leases its current corporate headquarters under a lease from STVentures, a related party. The lease, as amended on
May 1, 2022, to expand its office space from
The components of lease expense were as follows:
| For the Nine Months Ended | ||||||||
| September 30, | ||||||||
| 2024 | 2023 | |||||||
| Operating lease cost: | ||||||||
| Amortization of ROU asset | $ | $ | ||||||
| Interest on lease liability | ||||||||
| Total operating lease cost | $ | $ | ||||||
Supplemental balance sheet information related to leases was as follows:
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Operating lease: | ||||||||
| Operating lease assets | $ | $ | ||||||
| Current portion of operating lease liability, related party | $ | |||||||
| Noncurrent operating lease liability, related party | ||||||||
| Total operating lease liability | $ | $ | ||||||
| Weighted average remaining lease term: | ||||||||
| Operating leases | ||||||||
| Weighted average discount rate: | ||||||||
| Operating lease | % | % | ||||||
The following payments are required under leases as of September 30, 2024:
| Remaining | ||||||||
| Term in | ||||||||
| Operating Lease | Years | |||||||
| 2025 | ||||||||
| 2026 | ||||||||
| 2027 | ||||||||
| Total lease payments | ||||||||
| Less: imputed interest | ( | ) | ||||||
| Present value of lease liability | ||||||||
| F-13 |
Note 9 – Notes Payable
In
2023, the Company entered into three insurance policy financing arrangements to purchase various insurance policies. The total principal
of these arrangements was $
In
2024, the Company entered into two insurance policy financing arrangements to purchase various insurance policies. The total principal
of these arrangements was $
Note 10 – Commitments and Contingencies
Legal Contingencies
From time to time, we may be involved in various disputes and litigation matters that arise in the ordinary course of business. The Company is currently not a party to any material legal proceedings.
In January 2024, a former employee filed a wrongful termination lawsuit against the Company in the U.S. District Court, Southern District of Indiana. The Company plans to vigorously defend itself against the claims, which it believes are without merit.
Note 11 – Changes in Stockholders’ Equity (Deficit)
Class A Common Stock
The Company has authorized shares of $ par value Class A common stock, and shares were issued and outstanding as of September 30, 2024.
During
the nine months ended September 30, 2024, two investors exercised
On
September 11, 2024, the Company completed a public offering of an aggregate of (i) shares of Class A common stock of the Company,
par value $ per share (the “Common Stock”), (ii) warrants (the “Series A Warrants”) to purchase
up to an aggregate of
The
estimated fair value of the warrants issued in connection with the public offering was estimated using a Black-Scholes option pricing
model and the following assumptions: 1) dividend yield of %; 2) risk-free rate of % to %; 3) volatility of % to %; 4)
a common stock price of $, and 5) an expected term of to years. The fair value of the Class A Warrants was $
During
the nine months ended September 30, 2024, the Company issued shares pursuant to a restricted stock award from November 2023.
These shares vest quarterly over a period. The Company recognized expense of $ for these awards and expects to recognize
an additional $
| F-14 |
During
the nine months ended September 30, 2024, the Company issued shares for services to a consultant with a fair
value of $
On August 13, 2024, 2023, the Company received written notification (the “Notice”) from the Listing Qualifications Department of the Nasdaq Stock Market LLC (“Nasdaq”) indicating that, for the last thirty consecutive business days, the market value of its Class A common stock, had closed below the minimum $35 million requirement for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2) (the “Minimum Market Value Requirement”).
On October 18, 2024, the Company received a Notice from Nasdaq indicating that the bid price for its Class A common stock, for the last 30 consecutive business days for the last thirty consecutive business days, had closed below the minimum $ per share and, as a result, the Company was not in compliance with the $ minimum bid price requirement (the “Minimum Bid Price Requirement”) for the continued listing on the Nasdaq Capital Market, as set forth in Nasdaq Listing Rule 5550(a)(2).
If the Company fails to comply with Nasdaq’s continued listing standards, the Company may be delisted and its Class A common stock will trade, if at all, only on the over-the-counter market, such as the OTC Bulletin Board or OTCQX market, and then only if one or more registered broker-dealer market makers comply with quotation requirements. In addition, delisting of the Company’s Class A common stock could depress our stock price, substantially limit liquidity of our Class A common stock and materially adversely affect our ability to raise capital on terms acceptable to us, or at all. Finally, delisting of the Class A common stock could result in the Class A common stock becoming a “penny stock” under the Exchange Act.
Convertible Class B Common Stock
The Company has authorized shares of $ par value convertible Class B common stock, and had shares issued and outstanding as of September 30, 2024, as retrospectively applied, pursuant to the Company’s subsequent recapitalization in 2022 and effective as of May 3, 2022, whereby the founders exchanged their Founders Shares for shares of convertible Class B common stock.
Omnibus Equity Incentive Plan
On
April 11, 2022, the Company’s board of directors adopted, and the Company’s stockholders approved, the Syra Health Corp.
2022 Omnibus Equity Incentive Plan, as amended on April 19, 2023 (as amended, the “2022 Plan”). No more than
Class A Common Stock Option Awards
During
the nine months ended September 30, 2024, the Company granted options to purchase an aggregate shares of the Company’s Class
A common stock at an exercise price ranging from $
| Weighted | ||||||||
| Average | ||||||||
| Number | Exercise | |||||||
| of Shares | Prices | |||||||
| Balance, December 31, 2023 | $ | |||||||
| Options granted | ||||||||
| Options cancelled | ( | ) | ||||||
| Balance, September 30, 2024 | $ | |||||||
| Exercisable, September 30, 2024 | $ | |||||||
The options had a weighted average remaining life of years and no intrinsic value as of September 30, 2024.
Note 13 – Subsequent Events
The Company evaluates events that have occurred after the balance sheet date through the date these financial statements were issued.
| F-15 |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited interim condensed financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section titled “Risk Factors” included in this Quarterly Report on Form 10-Q, as may be amended, supplemented or superseded from time to time by other reports we file with the SEC. All amounts in this report are in U.S. dollars, unless otherwise noted.
Throughout this Quarterly Report on Form 10-Q, references to “we,” “our,” “us,” the “Company,” or “Syra,” refer to Syra Health Corp.
Overview
We are a healthcare services company promoting preventative health, holistic wellness, health education, and equitable healthcare for all patient demographics. We leverage deep scientific and healthcare expertise to create strategic frameworks and develop patient-centric solutions for the betterment of patient lives and health outcome linked to developing a healthier population. We are developing comprehensive end-to-end solutions in health education services, population health, behavioral and mental health, healthcare workforce and digital health.
Results of Operations for the Three Months Ended September 30, 2024 and 2023
The following table summarizes selected items from the statements of operations for the three months ended September 30, 2024 and 2023.
| For the Three Months | ||||||||||||
| Ended | ||||||||||||
| September 30, | September 30, | Increase / | ||||||||||
| 2024 | 2023 | (Decrease) | ||||||||||
| Net revenues | ||||||||||||
| Healthcare workforce | $ | 1,577,788 | $ | 1,023,557 | $ | 554,231 | ||||||
| Population health | 560,048 | 412,763 | 147,285 | |||||||||
| Digital health | 92,250 | 131,356 | (39,106 | ) | ||||||||
| Behavioral and mental health | 13,250 | 3,668 | 9,582 | |||||||||
| Health education | 10,000 | 10,000 | - | |||||||||
| Net revenues | 2,253,336 | 1,581,344 | 671,992 | |||||||||
| Cost of services | 1,585,038 | 1,026,803 | 558,235 | |||||||||
| Gross profit | 668,298 | 554,541 | 113,757 | |||||||||
| Operating expenses: | ||||||||||||
| Salaries and benefits | 594,738 | 592,241 | 2,497 | |||||||||
| Professional fees | 153,803 | 58,875 | 94,928 | |||||||||
| Research and development expenses | 34,821 | - | 34,821 | |||||||||
| Selling, general and administrative expenses | 288,305 | 234,084 | 54,221 | |||||||||
| Depreciation | 25,541 | 12,357 | 13,184 | |||||||||
| Total operating expenses: | 1,097,208 | 897,557 | 199,651 | |||||||||
| Operating loss | (428,910 | ) | (343,016 | ) | (85,894 | ) | ||||||
| Total other income (expense) | 11,375 | (11,360 | ) | 22,735 | ||||||||
| Net loss | $ | (417,535 | ) | $ | (354,376 | ) | $ | (63,159 | ) | |||
| -4- |
Net Revenues
Net revenue during the three months ended September 30, 2024 was comprised of $1,577,788 of healthcare workforce revenue, $560,048 of population health revenue, $13,250 of behavioral and mental health revenue, $10,000 of health education, $92,250 of digital health services revenue and $10,000 of health education revenue, compared to net revenue during the three months ended September 30, 2023 of $1,023,557 of healthcare workforce revenue, $412,763 of population health revenue, $3,668 of behavioral and mental health revenue and $10,000 of health education revenue, an overall revenue increase of $671,992, or 42%. The increase in healthcare workforce revenue was driven by new customer acquisitions and additions to existing contracts. Population health revenues increased in 2024 due to additional services provided to state departments and other customers. The slight decline in digital health revenues was due to the slight decline in digital health revenues was due to phased transition from implementation to maintenance and operational support.
Cost of Services
Our cost of services included wages and related payroll taxes, employee benefits and certain other employee-related costs of our contract service employees while they worked on contract assignments.
We incurred $1,585,038 of cost of services for the three months ended September 30, 2024, compared to $1,026,803 for the three months ended September 30, 2023, an increase of $558,235, or 54%. Our gross profit was approximately 30% for the three months ended September 30, 2024, compared to approximately 35% for the three months ended September 30, 2023, a decrease of approximately 5%. Our cost of services increased primarily due to an increase in labor costs, and increased consulting costs associated with a slight change in service mix.
Operating Expenses
Salaries and Benefits
Our salaries and benefits include wages and related payroll taxes, employee benefits and certain other employee-related costs of our management and office personnel.
We incurred $594,738 of salaries and benefits during the three months ended September 30, 2024, compared to $592,241 for the three months ended September 30, 2023, an increase of $2,497, or 0.4%. Salaries and benefits increased in 2024 as we supported our increased operations and added office personnel following our IPO process, which was offset by management’s decision, in an effort to reduce its operating costs, by instituting a 25% payroll reduction for its executive officers effective August 1, 2024.
Professional Fees
Professional fees primarily consisted of expenses incurred from business development, accounting, legal fees, and consulting activities.
We incurred $153,803 of professional fees for the three months ended September 30, 2024, compared to $58,875 for the three months ended September 30, 2023, an increase of $94,928, or 161%. Professional fees increased in 2024 due to increased legal and other professional costs related to the Company’s regulatory filings.
Research and Development Expenses
Research and development expenses primarily consist of consulting expenses incurred to develop our technology-based solutions. We incurred $34,821 and $0 of research and development expenses for the three months ended September 30, 2024 and 2023, respectively.
| -5- |
Selling, General and Administrative Expenses
SG&A primarily consisted of marketing, rent, office, insurance, travel and repair and maintenance expenses incurred.
We incurred $288,305 of SG&A expenses during the three months ended September 30, 2024, compared to $234,084 for the three months ended September 30, 2023, an increase of $54,221, or 23%. Our SG&A expenses increased primarily due to our increased operations in 2024. SG&A included $33,627 and $32,132 of rent incurred in both periods from STVentures, LLC, an entity beneficially owned by our principal owners, our management team and their affiliates, $28,639 and $6,250 of investor relations, $112,248 and $33,723 of insurance, $41,699 and $65,561 of software expense, and $19,281 and $6,737 of subscription and membership fees for the three months ended September 30, 2024 and 2023, respectively.
Depreciation
We incurred $25,541 of depreciation expense for the three months ended September 30, 2024, compared to $12,357 of depreciation expense for the three months ended September 30, 2023, an increase of $13,184, or 107%. Depreciation expense increased as we expanded our office space and placed additional office equipment into service during 2023.
Other Income (Expense)
Other expense, on a net basis, consisted of $2,266 of interest incurred on insurance finance charges, partially offset by $13,641 of interest income, for the three months ended September 30, 2024. Other expense, on a net basis, consisted of $14,180 of interest incurred on a line of credit and convertible notes, as partially offset by $2,820 of interest income, for the three months ended September 30, 2023. Other expense, on a net basis, decreased by $22,735, or 200%, primarily due to decreased debt financing compared to the prior period.
Net Loss
Our net loss for the three months ended September 30, 2024 was $417,535, compared to a net loss of $354,376 for the three months ended September 30, 2023, an increase of $63,159.
Results of Operations for the Nine Months Ended September 30, 2024 and 2023
| For the Nine Months | ||||||||||||
| Ended | ||||||||||||
| September 30, | September 30, | Increase / | ||||||||||
| 2024 | 2023 | (Decrease) | ||||||||||
| Net revenues | ||||||||||||
| Healthcare workforce | $ | 4,411,683 | $ | 2,989,962 | $ | 867,490 | ||||||
| Population health | 1,241,579 | 606,789 | 487,505 | |||||||||
| Digital health | 276,750 | 131,356 | 184,500 | |||||||||
| Behavioral and mental health | 15,345 | 9,055 | (3,292 | ) | ||||||||
| Health education | 30,000 | 11,781 | 18,219 | |||||||||
| Net revenues | 5,975,357 | 3,748,943 | 1,554,422 | |||||||||
| Cost of services | 4,777,765 | 2,919,087 | 1,300,443 | |||||||||
| Gross profit | 1,197,592 | 829,856 | 253,979 | |||||||||
| Operating expenses: | ||||||||||||
| Salaries and benefits | 2,178,105 | 1,612,605 | 563,003 | |||||||||
| Professional fees | 489,839 | 424,379 | (29,468 | ) | ||||||||
| Research and development expenses | 590,263 | - | 555,442 | |||||||||
| Selling, general and administrative expenses | 1,147,142 | 657,904 | 435,017 | |||||||||
| Depreciation | 55,460 | 36,413 | 5,863 | |||||||||
| Total operating expenses: | 4,460,809 | 2,731,301 | 1,529,857 | |||||||||
| Operating loss | (3,263,217 | ) | (1,901,445 | ) | (1,275,878 | ) | ||||||
| Total other income (expense) | 8,376 | (41,623 | ) | 27,264 | ||||||||
| Net loss | $ | (3,254,841 | ) | $ | (1,943,068 | ) | $ | (1,248,614 | ) | |||
| -6- |
Net Revenues
Net revenue during the nine months ended September 30, 2024 was comprised of $4,411,683 of healthcare workforce revenue, $1,241,579 of population health revenue, $15,345 of behavioral and mental health revenue and $276,750 of digital health services revenue and $30,000 of health education revenue, compared to net revenue during the nine months ended September 30, 2023 of $2,989,962 of healthcare workforce revenue, $606,789 of population health revenue, $9,055 of behavioral and mental health revenue and $11,781 of health education revenue, an overall revenue increase of $2,226,414, or 59%. The increase in healthcare workforce revenue was driven by new customer acquisitions and additions to existing contracts. Population health revenues and digital health services increased in 2024 due to additional services provided to state departments and other customers.
Cost of Services
We incurred $4,777,765 of cost of services for the nine months ended September 30, 2024, compared to $2,919,087 for the nine months ended September 30, 2023, an increase of $1,858,678, or 64%. Our gross profit was approximately 20% for the nine months ended September 30, 2024, compared to approximately 22% for the nine months ended September 30, 2023, a decrease of approximately 2%. Our cost of services increased primarily due to an increase in labor costs, and increased consulting costs associated with a slight change in service mix from healthcare workforce services to project-based population health and digital health services that carry better margins.
Operating Expenses
Salaries and Benefits
We incurred $2,178,105 of salaries and benefits during the nine months ended September 30, 2024, compared to $1,612,605 for the nine months ended September 30, 2023, an increase of $565,500, or 35%. Salaries and benefits increased in 2024 as we supported our increased operations and added office personnel following our IPO process.
In an effort to reduce its operating costs, the Company, effective August 1, 2024, instituted a 25% payroll reduction for its executive officers.
Professional Fees
We incurred $489,839 of professional fees for the nine months ended September 30, 2024, compared to $424,379 for the nine months ended September 30, 2023, an increase of $65,460, or 15%. Professional fees increased in 2024 due increased legal and other professional costs related to the Company’s regulatory filings.
Research and Development Expenses
We incurred $590,263 and $0 of research and development expenses for the nine months ended September 30, 2024 and 2023, respectively
Selling, General and Administrative Expenses
We incurred $1,147,142 of SG&A expenses during the nine months ended September 30, 2024, compared to $657,904 for the nine months ended September 30, 2023, an increase of $489,238, or 74%. Our SG&A expenses increased primarily due to our increased operations in 2024. SG&A included $97,890 and $96,395 of rent incurred in both periods from STVentures, LLC, an entity beneficially owned by our principal owners, our management team and their affiliates, $119,322 and $22,850 of investor relations expense, $339,291 and $80,185 of insurance, $136,007 and $124,552 of software expense, and $64,208 and $36,972 of subscription and membership fees for the nine months ended September 30, 2024 and 2023, respectively.
Depreciation
We incurred $55,460 of depreciation expense for the nine months ended September 30, 2024, compared to $36,413 of depreciation expense for the nine months ended September 30, 2023, an increase of $19,047, or 52%. Depreciation expense increased as we expanded our office space and placed additional office equipment into service during 2023.
| -7- |
Other Income (Expense)
Other expense, on a net basis, consisted of $10,072 of interest incurred on insurance finance charges, as partially offset by $18,448 of interest income, for the nine months ended September 30, 2024. Other expense, on a net basis, consisted of $44,449 of interest incurred on a line of credit and convertible notes, as partially offset by $2,826 of interest income, for the nine months ended September 30, 2023. Other expense, on a net basis, decreased by $49,999, or 120%, primarily due to decreased debt financing compared to the prior period.
Net Loss
Our net loss for the nine months ended September 30, 2024 was $3,254,841, compared to a net loss of $1,943,068 for the nine months ended September 30, 2023, an increase of $1,311,773.
Liquidity and Capital Resources
We believe that our existing sources of liquidity, along with cash expected to be generated from sales and services, will not be sufficient to fund our operations, anticipated capital expenditures, working capital and other financing requirements for at least the next twelve months from the issuance of the financial statements included elsewhere in this annual report. In the event we are unable to achieve profitable operations in the near term, we may require additional equity and/or debt financing; however, we cannot provide assurance that such financing will be available to us on favorable terms, or at all. We will continue to monitor our expenditures and cash flow position.
The following table summarizes total current assets, liabilities, accumulated deficit and working capital (deficit) at September 30, 2024 and December 31, 2023.
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Current Assets | $ | 4,064,894 | $ | 4,781,110 | ||||
| Current Liabilities | $ | 877,805 | $ | 910,072 | ||||
| Accumulated Deficit | $ | (8,319,796 | ) | $ | (5,064,955 | ) | ||
| Working Capital | $ | 3,187,089 | $ | 3,871,038 | ||||
Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. To date, we have funded our operations through equity and debt financings. Our primary uses of cash have been for the development of operations, compensation, and professional fees. All funds received have been expended in the furtherance of growing our business and establishing our services and solutions. The following trends are reasonably likely to result in a material decrease in our liquidity over the near to long term:
| ● | A substantial increase in working capital requirements to finance our operations; | |
| ● | Addition of administrative and professional personnel as our business continues to grow; | |
| ● | The cost of being a public company; and | |
| ● | Payments for seeking and securing quality staffing personnel. |
Cash Flow Activities for the Nine Months Ended September 30, 2024 and 2023
Net Cash Used in Operating Activities
Cash used in operating activities for the nine months ended September 30, 2024 and 2023 was $2,717,313 and $1,002,026, respectively, which was primarily attributable to our net loss for the periods.
| -8- |
Net Cash Used in Investing Activities
Cash used in investing activities for the nine months ended September 30, 2024 and 2023 was $11,111 and $15,251, respectively, which related entirely to the purchase of property and equipment during both periods.
Net Cash Provided by Financing Activities
Cash provided by financing activities for the nine months ended September 30, 2024 was $2,145,808, which consisted of $2,469,150 of proceeds received from the sale of Class A common stock and warrants, and exercise of Class A common stock warrants, partially offset by $323,342 of repayments on notes payable. Cash provided by financing activities for the nine months ended September 30, 2023 was $1,031,943, which consisted of $300,000 of proceeds received from a line of credit, and $1,455,000 of proceeds received from the sale of convertible notes payable, $1,295,010 of proceeds received from advances from related party, and partially offset by $678,611 of repayments on advances from related party, $750,397 of repayments on the line of credit and payment off deferred financing costs of $589,059.
Critical Accounting Policies and Estimates
The preparation of the financial statements included elsewhere in this Quarterly Report on Form 10-Q requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates.
The critical accounting estimates, assumptions and judgments that we believe have the most significant impact on our financial statements are described below.
Reverse Stock Split
On August 28, 2023, we effectuated a 1-for-1.2 reverse stock split of our issued and outstanding common stock and common stock equivalents. All issued and outstanding shares of common stock and common stock equivalents and per share data have been adjusted in this Quarterly Report on Form 10-Q, on a retrospective basis, to reflect the reverse stock split for all periods presented. Neither the authorized shares of common stock, nor the par value of the common stock were adjusted as a result of the reverse stock split.
Accounts Receivable
Accounts receivable is carried at their estimated collectible amounts. Accounts receivable is periodically evaluated for collectability based on past credit history with customers and their current financial condition. We had an allowance of $5,520 at September 30, 2024 and December 31, 2023, respectively.
Impairment of Long-Lived Assets
In accordance with the provisions of Accounting Standards Codification (“ASC”) Topic 360, “Impairment or Disposal of Long-Lived Assets,” all long-lived assets such as property and equipment held and used by us are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.
Leases
We account for our leases under ASC 842 - Leases. We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of obligations under operating leases, and obligations under operating leases, non-current on our balance sheets.
Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date, adjusted by the deferred rent liabilities at the adoption date. As our lease does not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term.
| -9- |
Revenue Recognition
We recognize revenue in accordance with ASC 606, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. To achieve this core principle, five basic criteria must be met before revenue can be recognized: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when or as we satisfy a performance obligation.
We account for revenues when both parties to the contract have approved the contract, the rights and obligations of the parties are identified, payment terms are identified, and collectability of consideration is probable. Payment terms vary by client and the services offered.
We have the following main forms of revenue:
| – | Healthcare Workforce Services | |
| – | Behavioral and Mental Health Services | |
| – | Digital Health | |
| – | Population Health | |
| – | Health Education |
We primarily provide our services to state and local government health agencies, payers, and other private health organizations. Healthcare Workforce, Behavioral and Mental Health and Health Education contracts are accounted for as a single performance obligation satisfied over time because the customer simultaneously receives and consumes the benefits of our medical staffing on an hourly or daily basis. Population Health and Digital Health contracts generally consist of multiple performance obligations that are distinct, such as to provide data analytics and reporting, training, or develop technology for implementation and maintenance with the customer. We allocate the transaction price across the performance obligations based on the estimated fair value of the distinct performance obligations. Depending on the performance obligation, revenue is recognized at a point in time when the customer obtains the benefit of the services are provide, or over time in the case of digital health revenue where the customer simultaneously receives and consumes benefits of the contract, such as ongoing performance of our technology product.
The contracts generally stipulate bi-weekly or monthly billing, and we have elected the “as invoiced” practical expedient to recognize revenue based on the hours incurred at the contractual rate as we have the right to payment in an amount that corresponds directly with the value of performance completed to date. We may also be subject to penalties for violations of certain ethical standards and non-performance measures within these state contracts. We recognize revenue net of penalties.
JOBS Act
On April 5, 2012, the Jumpstart Our Business Startups Act (the “JOBS Act”) was enacted. Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
We have chosen to take advantage of the extended transition periods available to emerging growth companies under the JOBS Act for complying with new or revised accounting standards until those standards would otherwise apply to private companies provided under the JOBS Act. As a result, our financial statements may not be comparable to those of companies that comply with public company effective dates for complying with new or revised accounting standards.
Subject to certain conditions set forth in the JOBS Act, as an “emerging growth company,” we intend to rely on certain of these exemptions, including, without limitation, (i) providing an auditor’s attestation report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended, and (ii) complying with the requirement adopted by the Public Company Accounting Oversight Board regarding the communication of critical audit matters in the auditor’s report on financial statements. We will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.235 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of our IPO; (iii) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined in Rule 12b-2 of the Exchange Act.
ITEM 4. CONTROLS AND PROCEDURES.
Our principal executive officer and principal financial officer evaluated the effectiveness of our “disclosure controls and procedures” as of September 30, 2024 the end of the period covered by this Quarterly Report on Form 10-Q. The term “disclosure controls and procedures” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is accumulated and communicated to a company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Based on the evaluation of our disclosure controls and procedures as of September 30, 2024, our Chief Executive Officer and our Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective. Effective internal control contemplates an appropriate level of review to ensure timely preparation and completeness and accuracy of the financial statements and disclosures.
Changes in Internal Control
Except as set forth above, there were no changes in our internal control over financial reporting that occurred during the three months ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. Litigation is subject to inherent uncertainties and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.
In January 2024, a former employee filed a wrongful termination lawsuit against the Company in the U.S. District Court, Southern District of Indiana. The Company plans to vigorously defend itself against the claims, which it believes are without merit.
ITEM 1A. RISK FACTORS.
There have been no material changes from the risk factors disclosed in our Form 10-K for the year ended December 31, 2023, except the following:
Our Class A common stock may be delisted from The Nasdaq Capital Market if we fail to comply with continued listing standards.
If we fail to meet any of the continued listing standards of The Nasdaq Capital Market, our Class A common stock could be delisted from The Nasdaq Capital Market. These continued listing standards include specifically enumerated criteria, such as:
| ● | a $1.00 minimum closing bid price; | |
| ● | stockholders’ equity of $2.5 million; | |
| ● | 500,000 shares of publicly-held common stock with a market value of at least $1 million; | |
| ● | 300 round-lot stockholders; and | |
| ● | compliance with Nasdaq’s corporate governance requirements, as well as additional or more stringent criteria that may be applied in the exercise of Nasdaq’s discretionary authority. |
On August 13, 2024, 2023, we received written notification (the “Notice”) from the Listing Qualifications Department of the Nasdaq Stock Market LLC (“Nasdaq”) indicating that, for the last thirty consecutive business days, the market value of our Class A common stock, had closed below the minimum $35 million requirement for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2) (the “Minimum Market Value Requirement”).
On October 18, 2024, we received a Notice from Nasdaq indicating that the bid price for our Class A common stock, for the last 30 consecutive business days for the last thirty consecutive business days, had closed below the minimum $1.00 per share and, as a result, we were not in compliance with the $1.00 minimum bid price requirement (the “Minimum Bid Price Requirement”) for the continued listing on the Nasdaq Capital Market, as set forth in Nasdaq Listing Rule 5550(a)(2).
If we fail to comply with Nasdaq’s continued listing standards, we may be delisted and our Class A common stock will trade, if at all, only on the over-the-counter market, such as the OTC Bulletin Board or OTCQX market, and then only if one or more registered broker-dealer market makers comply with quotation requirements. In addition, delisting of our Class A common stock could depress our stock price, substantially limit liquidity of our Class A common stock and materially adversely affect our ability to raise capital on terms acceptable to us, or at all. Finally, delisting of our Class A common stock could result in our Class A common stock becoming a “penny stock” under the Exchange Act.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION.
Our Executive Chairman, Sandeep Allam, is currently on a long-term medical leave. Our CEO, Deepika Vuppalanchi, has taken over Mr. Allam’s responsibilities while he is on medical leave.
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ITEM 6. EXHIBITS.
| * | Filed herewith. |
| ** | Furnished herewith. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| SYRA HEALTH CORP. | ||
| Date: October 29, 2024 | By: | /s/ Deepika Vuppalanchi |
| Deepika Vuppalanchi | ||
| Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Date: October 29, 2024 | By: | /s/ Priya Prasad |
| Priya Prasad | ||
| Chief Financial Officer | ||
| (Principal Financial and Accounting Officer) | ||
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