UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended ~~September~~June 30, ~~2021~~2022
OR
☐		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-40785

ASSURE HOLDINGS CORP.

(Exact Name of Registrant as Specified in its Charter)


Nevada		82-2726719
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

~~4600 South Ulster Street,~~7887 E. Belleview Ave., Suite ~~1225~~500 ~~Denver~~Englewood, Colorado		~~80237~~80111
(Address of Principal Executive Offices)		(Zip Code)

(720) 287-3093

(Registrant’s Telephone Number, including Area Code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value per share	IONM	Nasdaq Stock Market LLC (Nasdaq Capital Market)

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☐ Accelerated Filer ☐ Non-Accelerated Filer ☒ Smaller Reporting Company ☒ Emerging Growth Company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised ﬁnancial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The number of the registrant’s shares of common stock outstanding as of ~~November 8, 2021~~August 12, 2022 was ~~11,839,304.~~12,919,666.

Table of Contents

ASSURE HOLDINGS CORP.

FORM 10Q

FOR THE QUARTER ENDED ~~SEPTEMBER~~JUNE 30, ~~2021~~2022

TABLE OF CONTENTS


	PAGE
Part I – Financial Information	2
Item 1. Financial Statements (unaudited)	2
Condensed Consolidated Balance Sheets ~~as of September 30, 2021 and December 31 2020~~	2
Condensed Consolidated Statements of Operations ~~for the Three and Nine Months Ended September 30, 2021 and 2020~~	3
Condensed Consolidated Statements of Cash Flows ~~for the Nine Months Ended September 30, 2021 and 2020~~	4
Condensed Consolidated Statements of Changes in Shareholders’ Equity ~~for the Three and Nine Months Ended September 30, 2021 and 2020~~	5
Notes to Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	1917
Item 3. Quantitative and Qualitative Disclosures About Market Risk	2826
Item 4. Controls and Procedures	2826

Part II – Other Information	2927
Item 1. Legal Proceedings	2927
Item 1A. Risk Factors	2927
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	2927
Item 3. Defaults Upon Senior Securities	2927
Item 4. Mine Safety Disclosures	2928
Item 5. Other Information	3028
Item 6. Exhibits	3128

Signatures	3229

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ASSURE HOLDINGS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and par amounts)

(unaudited)


	September 30,		December 31,		June 30,		December 31,
	2021		2020		2022		2021
ASSETS
Current assets
Cash	$	918	$	4,386	$	792	$	4,020
Accounts receivable, net		22,683		14,965		20,989		27,810
Income tax receivable		150		150		157		136
Other current assets		104		618		357		151
Due from PEs		5,734		4,856
Due from MSAs						6,591		5,886
Total current assets		29,589		24,975		28,886		38,003
Equity method investments		638		608		484		525
Fixed assets		109		356		55		85
Operating lease right of use asset		—		124
Finance lease right of use asset		877		608
Operating lease right of use asset, net						779		956
Finance lease right of use asset, net						579		743
Deferred tax asset, net		144		—		2,039		—
Intangibles, net		3,763		4,115		3,424		3,649
Goodwill		4,448		2,857		4,448		4,448
Total assets	$	39,568	$	33,643	$	40,694	$	48,409
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities	$	2,069	$	2,871	$	3,376	$	2,194
Current portion of debt		—		4,100		—		515
Current portion of lease liability		579		521		679		702
Current portion of acquisition liability		306		—		306		306
Other current liabilities		10		96
Total current liabilities		2,964		7,588		4,361		3,717
Lease liability, net of current portion		750		772		1,236		1,482
Debt, net of current portion		10,451		2,251		12,418		13,169
Acquisition liability		561		—		332		459
Acquisition share issuance liability		540		540
Fair value of stock option liability		40		16		—		25
Performance share issuance liability		—		2,668
Deferred tax liability, net		—		599		—		601
Total liabilities		15,306		14,434		18,347		19,453
Commitments and contingencies (Note 8)
SHAREHOLDERS’ EQUITY
Common stock: $0.001 par value; 180,000,000 shares authorized; 11,839,304 and 11,275,788 shares issued and outstanding, as of September 30, 2021 and December 31, 2020, respectively		12		11
Common stock: $0.001 par value; 180,000,000 shares authorized; 12,919,666 and 12,918,866 shares issued and outstanding, as of June 30, 2022 and December 31, 2021, respectively						13		13
Additional paid-in capital		38,385		30,886		43,963		43,387
Accumulated deficit		(14,135)		(11,688)		(21,629)		(14,444)
Total shareholders’ equity		24,262		19,209		22,347		28,956
Total liabilities and shareholders’ equity	$	39,568	$	33,643	$	40,694	$	48,409

See accompanying notes to condensed consolidated financial statements.

Table of Contents

ASSURE HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

(unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020
Revenue








Patient service fees, net
$
6,443

$
2,965

$
13,087

$
(6,342)
Hospital, management and other

2,103

998

6,446

3,902
Total revenue

8,546

3,963

19,533

(2,440)
Cost of revenues

4,254

2,232

9,956

5,062
Gross margin

4,292

1,731

9,577

(7,502)
Operating expenses

General and administrative

3,180

1,957

10,275

5,853
Sales and marketing

247

349

748

801
Depreciation and amortization

293

249

965

769
Total operating expenses

3,720

2,555

11,988

7,423
Income (loss) from operations

572

(824)

(2,411)

(14,925)
Other income (expenses)

Income (loss) from equity method investments

139

(232)

136

(1,449)
Other income (expense), net

(27)

(3)

(29)

50
Accretion expense

(171)

(227)

(386)

(619)
Interest expense, net

(264)

(58)

(500)

(164)
Total other expense

(323)

(520)

(779)

(2,182)
Income (loss) before income taxes

249

(1,344)

(3,190)

(17,107)
Income tax benefit (expense)

(158)

367

743

2,396
Net income (loss)
$
91

$
(977)

$
(2,447)

$
(14,711)
Income (loss) per share

Basic
$
0.01

$
(0.14)

$
(0.21)

$
(2.11)
Diluted
$
0.01

$
(0.14)

$
(0.21)

$
(2.11)
Weighted average number of shares used in per share calculation – basic

11,838,032

6,988,058

11,528,371

6,968,728
Weighted average number of shares used in per share calculation – diluted

15,724,103

6,988,058

11,528,371

6,968,728


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Revenue
Technical services	$	67	$	4,095	$	1,463	$	7,228
Professional services		854		652		3,327		966
Other		724		1,473		1,556		2,791
Total revenue		1,645		6,220		6,346		10,985
Cost of revenues, excluding depreciation and amortization		4,002		3,170		7,879		5,702
Gross margin		(2,357)		3,050		(1,533)		5,283
Operating expenses
General and administrative		3,596		3,963		7,837		7,095
Sales and marketing		238		166		490		501
Depreciation and amortization		260		387		518		672
Total operating expenses		4,094		4,516		8,845		8,268
Loss from operations		(6,451)		(1,466)		(10,378)		(2,985)
Other income (expenses)
Income (loss) from equity method investments		4		20		9		(3)
Gain on Paycheck Protection Program loan forgiveness		—		—		1,665		—
Other income (expense), net		28		1		66		(2)
Accretion expense		(171)		(120)		(341)		(215)
Interest expense, net		(439)		(218)		(846)		(236)
Total other expense		(578)		(317)		553		(456)
Loss before income taxes		(7,029)		(1,783)		(9,825)		(3,441)
Income tax benefit		2,303		474		2,640		901
Net loss	$	(4,726)	$	(1,309)	$	(7,185)	$	(2,540)
Loss per share
Basic	$	(0.37)	$	(0.11)	$	(0.56)	$	(0.22)
Diluted	$	(0.37)	$	(0.11)	$	(0.56)	$	(0.22)
Weighted average number of shares used in per share calculation – basic		12,919,666		11,589,857		12,919,546		11,400,471
Weighted average number of shares used in per share calculation – diluted		12,919,666		11,589,857		12,919,546		11,400,471

See accompanying notes to condensed consolidated financial statements.

Table of Contents

ASSURE HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)


	Nine Months Ended September 30,				Six Months Ended June 30,
	2021		2020		2022		2021
Cash flows from operating activities
Net loss	$	(2,447)	$	(14,711)	$	(7,185)	$	(2,540)
Adjustments to reconcile net loss to net cash used in operating activities
(Income) loss from equity method investments		(136)		1,449		(9)		3
Stock-based compensation		818		456		572		607
Depreciation and amortization		599		769		275		407
Amortization of debt issuance costs		53		—		80		13
Provision for stock option fair value		24		(50)		(25)		(1)
Gain on Paycheck Protection Program loan						(1,665)		—
Accretion expense		386		619		341		215
Tax impact of equity component of convertible debt issuance		—		(288)
Change in operating assets and liabilities
Accounts receivable, net		(5,723)		16,243		6,821		(1,675)
Prepaid expenses		177		—		(206)		(420)
Right of use assets		291		—		421		205
Accounts payable and accrued liabilities		(1,045)		(3,126)		1,182		(712)
Due from related parties		(1,121)		(1,113)
Due from MSAs						(705)		(1,063)
Lease liability		(399)		(172)		(349)		(343)
Income taxes		(743)		(1,715)		(2,661)		(901)
Other assets and liabilities		(86)		(209)		(16)		(58)
Net cash used in operating activities		(9,352)		(1,848)		(3,129)		(6,263)
Cash flows from investing activities
Purchase of fixed assets		—		(33)		(26)		—
Net cash paid for acquisitions		(204)		(3,934)		(127)		(156)
Distributions received from equity method investments		312		424		50		234
Net cash provided by (used in) investing activities		108		(3,543)		(103)		78
Cash flows from financing activities
Proceeds from exercise of stock options		19		—		4		832
Proceeds from share issuance, net		832		102
Proceeds from promissory note		—		1,978
Repayment of promissory note		—		(1,418)
Proceeds from Paycheck Protection Program loan		1,665		1,211		—		1,665
Proceeds from line of credit		—		2,122
Repayment of line of credit		—		(1,000)
Proceeds from debenture		7,360		—		—		7,360
Repayment of short term debt		(4,100)		—		—		(4,100)
Proceeds from convertible debenture		—		2,485
Net cash provided by financing activities		5,776		5,480		4		5,757
Increase (decrease) in cash		(3,468)		89
Decrease in cash						(3,228)		(428)
Cash at beginning of period		4,386		59		4,020		4,386
Cash at end of period	$	918	$	148	$	792	$	3,958
Supplemental cash flow information
Interest paid	$	301	$	145	$	769	$	127
Income taxes paid	$	—	$	62	$	—	$	—
Supplemental non-cash flow information
Purchase of equipment with finance leases	$	431	$	269	$	79	$	305

See accompanying notes to condensed consolidated financial statements.

Table of Contents

ASSURE HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(in thousands, except share amounts)

(unaudited)


				Additional		Retained		Total					Additional				Total
	Common Stock			paid-in		earnings		shareholders'		Common Stock			paid-in		Accumulated		shareholders'
	Shares	Amount		Capital		(deficit)		equity		Shares	Amount		Capital		deficit		equity
Balances, June 30, 2020	6,959,063	$	7	$	8,056	$	(10,386)	$	(2,323)
Balances, March 31, 2021										11,319,756	$	11	$	31,752	$	(12,919)	$	18,844
Share issuance, net	25,184		—		102		—		102	403,785		2		2,455		—		2,457
Stock-based compensation	—		—		88		—		88	—		—		327		—		327
Settlement of payables	10,000		—		40		—		40
Equity component of debenture issuance										—		—		1,204		—		1,204
Settlement of performance share liability										15,000		—		1,707		—		1,707
Net loss	—		—		—		(977)		(977)	—		—		—		(1,309)		(1,309)
Balances, September 30, 2020	6,994,247	$	7	$	8,286	$	(11,363)	$	(3,070)
Balances, June 30, 2021										11,738,541	$	13	$	37,445	$	(14,228)	$	23,230

Balances, June 30, 2021	11,833,431	$	12	$	38,136	$	(14,226)	$	23,922
Exercise of stock options	3,000		—		19		—		19
Share issuance, net	—		—		—		—		—
Balances, March 31, 2022										12,919,666	$	13	$	43,714	$	(16,903)	$	26,824
Stock-based compensation	—		—		210		—		210	—		—		249		—		249
Convertible debt converted into shares	2,858		—		20		—		20
Other	15		—		—		—		—
Net income	—		—		—		91		91	—		—		—		(4,726)		(4,726)
Balances, September 30, 2021	11,839,304	$	12	$	38,385	$	(14,135)	$	24,262
Balances, June 30, 2022										12,919,666	$	13	$	43,963	$	(21,629)	$	22,347


				Additional		Retained		Total					Additional				Total
	Common Stock			paid-in		earnings		shareholders'		Common Stock			paid-in		Accumulated		shareholders'
	Shares	Amount		Capital		(deficit)		equity		Shares	Amount		Capital		deficit		equity
Balances, December 31, 2019	6,959,063	$	7	$	6,710	$	3,348	$	10,065
Balances, December 31, 2020										11,275,788	$	11	$	30,886	$	(11,688)	$	19,209
Share issuance, net	25,184		—		102		—		102	403,785		2		2,455		—		2,457
Stock-based compensation	—		—		456		—		456	—		—		607		—		607
Expected tax loss of future stock compensation option exercises	—		—		(288)		—		(288)
Equity component of convertible debt issuance	—		—		1,220		—		1,220
Fair value of finders’ warrants	—		—		46		—		46
Settlement of payables	10,000		—		40		—		40
Net loss	—		—		—		(14,711)		(14,711)
Balances, September 30, 2020	6,994,247	$	7	$	8,286	$	(11,363)	$	(3,070)

Balances, December 31, 2020	11,275,788	$	11	$	30,886	$	(11,688)	$	19,209
Exercise of stock options	3,000		—		19		—		19
Share issuance, net	171,032		—		832		—		832
Share issuance, acquisition related	332,117		1		2,274		—		2,275
Stock-based compensation	—		—		818		—		818
Convertible debt converted into shares	13,384				60				60
Equity component of debenture issuance	—		—		1,203		—		1,203	—		—		1,204		—		1,204
Settlement of performance share liability	43,968		—		2,293		—		2,293	58,968		—		2,293		—		2,293
Other	15		—		—		—		—
Net loss	—		—		—		(2,447)		(2,447)	—		—		—		(2,540)		(2,540)
Balances, September 30, 2021	11,839,304	$	12	$	38,385	$	(14,135)	$	24,262
Balances, June 30, 2021										11,738,541	$	13	$	37,445	$	(14,228)	$	23,230

Balances, December 31, 2021										12,918,866	$	13	$	43,387	$	(14,444)	$	28,956
Exercise of stock options										800		—		4		—		4
Stock-based compensation										—		—		572		—		572
Net loss										—		—		—		(7,185)		(7,185)
Balances, June 30, 2022										12,919,666	$	13	$	43,963	$	(21,629)	$	22,347

See accompanying notes to condensed consolidated financial statements.

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1.NATURE OF OPERATIONS

Assure Holdings Corp. (the “Company” or “Assure”), through its 2 wholly-owned subsidiaries, Assure Neuromonitoring, LLC (“Assure Neuromonitoring”) and Assure Networks, LLC (“Assure Networks”), provides ~~outsourced~~technical and professional intraoperative ~~neurophysiological monitoring~~neuromonitoring (“IONM”) ~~and is an emerging provider of remote neurology services. The Company delivers a turnkey suite of clinical and operational~~surgical support services ~~to support surgeons and medical facilities during invasive procedures including~~for neurosurgery, spine, ~~neurosurgery,~~cardiovascular, orthopedic, ear, nose, and throat, ~~cardiovascular~~ and ~~orthopedic. Accredited by The Joint Commission, Assure’s mission is to provide exceptional~~other surgical ~~care and a positive patient experience.~~

~~IONM identifies real-time changes in spinal cord, brain, and peripheral nerve functions during high-risk surgeries to prevent injuries or accidental damage to patients~~procedures that ~~could lead to strokes, heart attacks, paralysis or other serious medical issues. IONM is well established and is regarded~~place the nervous system at risk. These services have been recognized as the standard of care ~~in U.S healthcare.~~

by hospitals and surgeons for risk mitigation. Assure Holdings, Inc., a wholly-owned subsidiary, employs ~~highly trained IONM technologists,~~most of the corporate employees and performs various corporate services on behalf of the consolidated Company. Assure Neuromonitoring employs interoperative neurophysiologists(“INP”) who ~~provide a direct point~~utilize technical equipment and their technical training to monitor evoked potentials (”Eps”), electroencephalographic (“EEG”) and electromyography (“EMG”) signals during surgical procedures and to pre-emptively notify the underlying surgeon of ~~contact~~any nervous related issues that are identified. The INPs perform their services in the operating room ~~to relay critical information to~~during the ~~surgical team while Company physicians deliver remote neurology~~surgeries. The INPs are certified by a third-party accreditation agency.

Assure Networks performs similar support services inas Assure Neuromonitoring except that these services are provided by employed or third party contracted neurologists or certified readers. The support ofservice provided by the ~~surgical team. In addition, Assure offers surgeons~~neurologist occurs at an offsite location at the same time and ~~medical facilities a value-added platform that manages patient scheduling, billing and collections, physician relationship management and patient advocacy services. The high quality IONM~~for the same surgery as the support ~~that Assure provides results in decreased hospital and surgeon liability, abbreviated patient stays, fewer readmissions, reduced hospital costs, enhanced overall patient satisfaction and~~services provided by the ~~efficient achievement of better clinical outcomes.~~

The Company maintains operations in twelve U.S. states. Assure believes that continued geographic expansion initiatives, facility-wide outsourcing agreements with medical facilities, the acceleration of its remote neurology services platform, and selective acquisitions will combine to generate substantial growth opportunities going forward.interoperative neurophysiologist.

The Company was originally incorporated in Colorado on November 7, 2016. In conjunction with a reverse merger, ~~with Montreux Capital Corp., a British Columbia corporation,~~ the Company was ~~redomesticated from British Columbia to~~redomiciled in Nevada on May 16, 2017.

Neuromonitoring was formed on August 25, 2015 in Colorado and it currently has multiple wholly-owned subsidiaries. The Company’s services are sold in the United States, directly through the Company.

Networks was formed on November 7, 2016, in Colorado and holds varying ownerships interests in numerous Provider Network Entities (“PEs”), which are professional IONM entities. These entities are accounted for under the equity method of accounting.

Additionally, Networks ~~also~~ manages other PEs that Networks does not have an ownership interest and charges those PEs a management ~~fee which is accounted for as service revenue.~~fee.

COVID-19

The ~~Company operates in~~Company’s commitment to the ~~United States in 1 segment.~~

~~COVID-19~~

~~Our business~~health, well-being and ~~results~~peace of ~~operations have been,~~mind of our employees and ~~continues to be, adversely affected by~~ the ~~global COVID-19~~people we serve remains our focus as the pandemic and related events and we expect its impact to continue. The impact to date has included periods of significant volatility in various markets and industries, including the healthcare industry. The volatility has had, and we anticipate it willenvironment evolves. We continue to ~~have, an adverse effect on~~leverage our resources, expertise, data and actionable intelligence to assist customers, clients and ~~on our business, financial condition~~care providers throughout this time.

The situation surrounding COVID-19 remains fluid with continued uncertainty and ~~results~~a wide range of operations, and may result in an impairment of our long-lived assets, including goodwill, increased credit losses and impairments of investments in other companies. In particular, the healthcare industry, hospitals and providers of elective procedures have been and maypotential outcomes. We continue to ~~be impacted by the pandemic and/or other events beyond~~actively manage our ~~control,~~response and ~~further volatility could have an additional negative impact on these industries, customers,~~assess impacts to our financial position and ~~our business. In addition, the COVID-19 pandemic and, to a lesser extent, the impact on other industries, including automotive, electronics and real estate,~~

~~Table of Contents~~

~~ASSURE HOLDINGS CORP.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~increased fuel costs, U.S. restrictions on trade, and transitory inflation have impacted and may continue to impact the financial conditions of our customers and the patients they serve.~~

In addition, actions by United States federal, state and foreign governments to address the COVID-19 pandemic, including travel bans, stay-at-home orders and school, business and entertainment venue closures, also had and may continue to have a significant adverse effect on the markets in which we conduct our businesses. COVID-19 poses the risk that our workforce, suppliers, and other partners may be prevented from conducting normal business activities for an extended period of time, including due to shutdowns or stay-at-home orders that may be requested or mandated by governmental authorities. We have implemented policies to allow our employees to work remotely as a result of the pandemic as we reviewed processes related to workplace safety, including social distancing and sanitation practices recommended by the Centers for Disease Control and Prevention (CDC). The COVID-19 pandemic could also cause delays in acquiring new customers and executing renewals and could also impact our business as consumer behavior changes in response to the pandemic.

~~Since the start of the second quarter of 2021, there has been increased availability and administration of vaccines against COVID-19,~~operating results, as well as an easing of restrictions on social, business, travel, and government activities and functions, including healthcare and elective surgeries, and we have experienced a gradual resumption of economic activitiesmitigate adverse developments in our industries. On the other hand, infection rates continue to fluctuate in various regions and new strains of the virus, including the Delta variant, remain a risk, which may give rise to implementation of restrictions in the geographic areas that we serve. In addition, there are ongoing global impacts resulting from the pandemic, including disruption of the supply chains, product shortages, increased delivery costs, increased governmental regulation, strains on healthcare systems, and delays in shipments, product development, technology launches and facility access.

We have been closely monitoring the COVID-19 pandemic and its impact on our business, including legislation to mitigate the impact of COVID-19 such as the Coronavirus Aid, Relief, and Economic Security (CARES) Act which was enacted in March 2020, and the American Rescue Plan Act of 2021 which was enacted in March 2021. Although a significant portion of our anticipated revenue for 2021 is derived from fixed-fee and minimum-guarantee arrangements, primarily from large, well-capitalized customers which we believe somewhat mitigates the risks to our business, our per-unit and variable-fee based revenue will continue to be susceptible to the volatility, supply chain disruptions, microchip shortages and potential market downturns induced by the COVID-19 pandemic.

The full extent of the future impact of the COVID-19 pandemic on the Company’s operational and financial performance is uncertain and will depend on many factors outside the Company’s control, including, without limitation, the timing, extent, trajectory and duration of the pandemic; the availability, distribution and effectiveness of vaccines; the spread of new variants of COVID-19; the continued and renewed imposition of protective public safety measures; the impact of COVID-19 on integration of acquisitions, expansion plans, implementation of telemedicine, restrictions on elective procedures, delays in payor remittance and increased regulations; and the impact of the pandemic on the global economy and demand for consumer products. Although we are unable to predict the full impact and duration of the COVID-19 pandemic on our business, we are actively managing our financial expenditures in response to continued uncertainty.business. Further discussion of the potential impacts on our business from the COVID-19 pandemic is provided under Part I, Item 1A – Risk Factors of the Form 10-K.

2.BASISOFPRESENTATION

Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, and majority-owned entities. The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), which contemplates continuation of the Company as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The accompanying consolidated financial statements do not include any adjustments that might become necessary should the Company be unable to continue as a going concern. All significant intercompany balances and transactions have been eliminated in consolidation.

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

For entities in which management has determined the Company does not have a controlling financial interest but has varying degrees of influence regarding operating policies of that entity, the Company’s investment is accounted for using the equity method of accounting.

Accounting Policies

There have been no changes to the Company’s significant accounting policies or recent accounting pronouncements during the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 as compared to the significant accounting policies disclosed in the 10-K for the year ended December 31, ~~2020~~2021 as filed on March ~~30, 2021.~~14, 2022.

Common Stock Reverse Split

During September 2021, the Company effectuated a five-for-one reverse stock split. All share, stock option and warrant information has been retroactively adjusted to reflect the stock split. See Note 56 for additional discussion.

Reclassifications

Certain amounts for the three and six months ended June 30, 2021 have been reclassified to conform to the 2022 presentation.

3. REVENUE

The Company disaggregates revenue from contracts with customers by revenue stream as this depicts the nature, amount, timing and uncertainty of its revenue and cash flows as affected by economic factors. Commercial insurance consists of neuromonitoring cases whereby a patient has healthcare insurance. Facility billing consists of neuromonitoring cases whereby the company has an agreement with the facility for services. In these cases, the hospital’s patient may be uninsured or have government insurance.

The Company’s revenue disaggregated by payor is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021

Commercial insurance	$	(306)	$	3,679	$	2,518	$	6,343
Facility billing		1,227		1,068		2,272		1,851
Managed service agreements		428		1,287		847		2,059
Other		296		186		709		732
Total	$	1,645	$	6,220	$	6,346	$	10,985

Accounts Receivable

A summary of the accounts receivable, net, by revenue stream is as follows (in thousands):


	June 30,			December 31,
	2022		2021

Technical service	$	11,278	$	18,904
Professional service		9,315		8,209
Other		396		697
Total accounts receivable, net	$	20,989	$	27,810

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

The concentration of accounts receivable, net, by payor as a percentage of total accounts receivable is as follows:


	As of June 30,		As of December 31,
	2022		2021

Commercial insurance	91	%	91	%
Facility billing	6	%	2	%
Managed service arrangements	2	%	3	%
Other	1	%	4	%
Total	100	%	100	%

3.4. LEASES

Under ASC 842, Leases, a contract is a lease, or contains a lease, if the contract conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. To determine whether a contract conveys the right to control the use of an identified asset for a period of time, an entity shall assess whether, throughout the period of use, the entity has both of the following: (a) the right to obtain substantially all of the economic benefits from the use of the identified asset; and (b) the right to direct the use of the identified asset. The Company does not assume renewals in the determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement. Lease agreements generally do not contain material residual value guarantees or material restrictive ~~covenants.~~covenants

Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. As a practical expedient, the Company elected not to separate non-lease components for the corporate office facility (e.g., common-area maintenance costs) from lease components (e.g., fixed payments including rent) and instead to account for each separate lease component and its associated non-lease components as a single lease ~~component.~~component

Operating leases

The Company leases corporate office facilities under 2an operating ~~sub-leases~~lease which ~~expired June 30, 2021.~~expires October 31, 2025. The ~~Company is negotiating~~incremental borrowing rate for this lease ~~renewal terms and is currently under a month-to-month lease arrangement.~~was 10%.

Finance leases

The Company leases medical equipment under various financing leases with stated interest rates ranging from ~~6.5%~~5.2% — ~~12.2%~~13.4% per annum which expire at various dates through 2026.

The condensed consolidated balance sheets include the following amounts for right of use (“ROU”) assets as of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020 (stated in~~2021 (in thousands):


	September 30,		December 31,		June 30,			December 31,
	2021		2020		2022		2021
Operating	$	—	$	124	$	779	$	956
Finance		877		608		579		743
Total	$	877	$	732	$	1,358	$	1,699

Finance lease assets are reported net of accumulated amortization of $2.2 million and $2.0 million as of June 30, 2022 and December 31, 2021, respectively.

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

~~Finance lease assets are reported net of accumulated amortization of $1.8 million and $1.3 million as of September 30, 2021 and December 31, 2020, respectively.~~

The following are the components of lease cost for operating and finance leases ~~(stated in~~(in thousands):


	Nine Months Ended September 30,				Six Months Ended June 30,
	2021		2020		2022		2021
Lease cost:
Operating leases	$	227	$	159
Operating leases:
Amortization of ROU assets					$	154	$	127
Interest on lease liabilities						46		—
Total operating lease cost						200		127
Finance leases:
Amortization of ROU assets		372		398		291		249
Interest on lease liabilities		69		60		46		42
Total finance lease cost		441		458		337		291
Total lease cost	$	668	$	617	$	537	$	418

The following are the weighted average lease terms and discount rates for operating and finance leases:


	As of	As of	As of	As of
	September 30, 2021	December 31, 2020	June 30, 2022	June 30, 2021
Weighted average remaining lease term (years):
Operating leases	—	0.5	3.3	—
Finance leases	3.1	3.3	2.7	3.3
Weighted average discount rate:
Weighted average discount rate (%):
Operating leases	—	6.9	10.0	—
Finance leases	8.1	7.9	7.8	8.0

The Company acquired ROU assets in exchange for lease liabilities of ~~$431~~$79 thousand upon commencement of finance leases during the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022.

Future minimum lease payments and related lease liabilities as of ~~September~~June 30, ~~2021~~2022 were as follows ~~(stated in~~(in thousands):


					Total						Total
	Operating		Finance		Lease		Operating		Finance		Lease
	Leases		Leases		Liabilities		Leases		Leases		Liabilities
Remainder 2021	$	—	$	167	$	167
2022		—		620		620
Remainder of 2022							$	144	$	336	$	480
2023		—		306		306		303		360		663
2024		—		239		239		327		268		595
2025		—		148		148		279		152		431
Thereafter		—		23		23
2026								—		23		23
Total lease payments		—		1,503		1,503		1,053		1,139		2,192
Less: imputed interest		—		(174)		(174)		(166)		(111)		(277)
Present value of lease liabilities		—		1,329		1,329		887		1,028		1,915
Less: current portion of lease liabilities		—		579		579		206		473		679
Noncurrent lease liabilities	$	—	$	750	$	750	$	681	$	555	$	1,236

Note: Future minimum lease payments exclude short-term leases as well as payments to landlords for variable common area maintenance, insurance and real estate taxes.

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

4.5. DEBT

The Company’s debt obligations are summarized as follows:


	June 30,		December 31,
	2022		2021
Paycheck Protection Program loan	$	—	$	1,687

Face value of convertible debenture		3,450		3,450
Less: principal converted to common shares		(60)		(60)
Less: deemed fair value ascribed to conversion feature and warrants		(1,523)		(1,523)
Plus: accretion of implied interest		896		705
Total convertible debt		2,763		2,572

Face value of Centurion debenture		11,000		11,000
Less: deemed fair value ascribed to warrants		(1,204)		(1,204)
Plus: accretion of implied interest		326		176
Less: net debt issuance costs		(467)		(547)
Total Centurion debt		9,655		9,425
Total debt		12,418		13,684
Less: current portion of debt		—		(515)
Long-term debt	$	12,418	$	13,169

During the six months ended June 30, 2022, the Company recognized a gain of $1.7 million related to the January 2022 forgiveness of the balance of the Paycheck Protection Program loan.

The following table depicts accretion expense and interest expense (excluding debt issuance cost amortization) related to the Company’s debt obligations for the three and six months ended June 30, 2022 and 2021 (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Accretion expense
Convertible debenture	$	95	$	95	$	191	$	190
Centurion debenture		76		25		150		25
	$	171	$	120	$	341	$	215

Interest expense
Convertible debenture	$	77	$	77	$	221	$	154
Centurion debenture		284		46		548		46
	$	361	$	123	$	769	$	200

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

As of June 30, 2022, future minimum principal payments are summarized as follows (in thousands):


	Convertible		Bank
		Debt	Indebtedness
Remainder of 2022	$	—	$	—
2023		965		—
2024		2,425		—
2025		—		11,000
Total		3,390		11,000
Less: fair value ascribed to conversion feature and warrants		(1,523)		(1,204)
Plus: accretion and implied interest		896		326
Less: net debt issuance costs		—		(467)
	$	2,763	$	9,655

Paycheck Protection Program

During March 2021, the Company received an unsecured loan under the United States Small Business Administration Paycheck Protection Program (“PPP”) in the amount of $1.7 million. Assure executed a PPP promissory note, ~~which matures on~~with an original maturity date of February 25, ~~2026.~~2026 (the “PPP Loan”). The PPP Loan ~~carries~~carried an interest rate of 1.0% per annum, with principal and interest payments due on the first day of each month, with payments commencing on the earlier of: (i) the day the amount of loan forgiveness granted to Assure iswas remitted by the Small Business Administration to the Bank of Oklahoma; or (ii) 10 months after the end of the 24-week period following the grant of the Loan. ~~All~~Under the terms of the PPP Loan, all or a portion of the PPP Loan may be forgiven if the Company maintains its employment and compensation within certain parameters during the 24-week period following the loan origination date and the proceeds of the PPP Loan ~~are~~were spent on payroll costs, rent or lease agreements dated before February 15, 2020 and utility payments arising under service agreements dated before February 15, 2020. The Company ~~intends to submit~~submitted its application for forgiveness of the PPP ~~promissory note~~Loan during the fourth quarter of ~~2021.~~

~~Debenture~~

~~On June 10,~~ 2021 and in January 2022, the Company entered into definitive agreements to secure a credit facility under the terms of a commitment letter dated March 8, 2021 (the “Commitment Letter”) with Centurion Financial Trust, an investment trust formed by Centurion Asset Management Inc. (“Centurion”). Under the termsreceived forgiveness of the ~~Commitment Letter,~~$1.7 million PPP Loan resulting in no balance due.

Convertible Debt

From November 2019 through May 2020, the Company closed multiple non-brokered private placements of convertible debenture units (“CD Unit”) for gross proceeds of $3.5 million. Each CD Unit was offered at a price of $1. Each CD Unit included, among other things, one common share purchase warrant that allows the holder to purchase shares of the Company’s common stock at prices ranging from $5.00 to $9.50 per share for a period of three years and the right to convert the CD Unit into shares of the Company’s common stock at a conversion prices ranging from $3.35 to $7.00 per share for a period of four years. The CD Units carry a 9% coupon rate.

The fair value of the convertible debt was determined to be $1.7 million, the conversion feature $1.2 million and the warrants $600 thousand. The difference between the fair value of the debt of $1.7 million and the face value of convertible debt of $3.5 million will be accreted over the four-year life of the CD Units.

Centurion Debt

During June 2021, Assure issued a debenture to Centurion ~~dated June 9, 2021~~ (the “Debenture”), with a maturity date of June 9, 2025 (the “Maturity Date”), in the principal amount of $11 million related to a credit facility comprised of a $6 million senior term loan (the “Senior Term Loan”), a $2 million senior revolving loan (the “Senior Revolving Loan”) and a $3 million senior term acquisition line (the “Senior Term Acquisition Line” and together with the Senior Term Loan and the Senior Revolving Loan, the “Credit Facility”). ~~The~~During November 2021, the Company and Centurion entered into an amendment to allow the Senior Short Term Acquisition Line ~~will~~to be ~~made available to~~utilized for organic growth and general working capital purposes. Under the ~~Company to fund future acquisitions, subject to certain~~terms and conditions ~~and approvals of Centurion. The Credit Facility matures in June 2025.~~

~~The principal amount~~ of the Debenture drawn and outstanding from time to time shall bear interest both before and after maturity, default and judgment from the date hereof to the date of repayment in full at the rate of the greater of 9.50% or the Royal Bank of Canada Prime Rate plus 7.05% per annum calculated and compounded monthly in arrears and payable on the first business day of each month during which any obligations are outstanding, the first of such payments being due July 2, 2021 for the period from the Advance to the date of payment, and thereafter monthly. The difference between the commitment and the amount of the Loan outstanding from time to time shall bear a standby charge, for the period between June 2021 and the end of the availability period, in the amount of 1.50% per annum calculated and compounded monthly in arrears and payable on the first business day of each month during which any amount of the commitment remains available and undrawn, the first of such payments being due July 2, 2021. Interest on overdue interest shall be calculated and payable at the same rate plus 3% per annum.

With respect to the Senior Revolving Loan, Assure may prepay advances outstanding thereunder from time to time, with not less than 10 business days prior written notice of the prepayment date and the amount, in the minimum amount of $250 thousand. Any amount of the Senior Revolving Loan prepaid may be re-advanced. With respect to the Senior Term Loan and Senior Term Acquisition Line, Assure may prepay the advances outstanding thereunder, without penalty or bonus, in an amount not to exceed 25% of the aggregate of all Advances then outstanding under the Term Loans, on each anniversary date of the first advance made hereunder, provided in each case with not less than 30 days written notice of the Company's intention to prepay on such anniversary date and the proposed prepayment amount. Any prepayments to the Term Loans other than those permitted in the immediately preceding sentence may only be made on 30 days prior written notice of the prepayment date and the amount, and are subject to the Company paying on such prepayment date a prepayment charge equal to the lesser of (i) ~~twelve~~ (12) months interest and (ii) interest for the months remaining from the prepayment date to the Maturity Date, on the amount prepaid at the interest rate in effect on the applicable Term Loan as of the date of prepayment. Any amount of the Term Loan prepaid may not be re-advanced.

The Credit Facility is guaranteed by the subsidiaries under the terms of the guarantee and secured by a first ranking security interest in all of the present and future assets of Assure and the Subsidiaries under the terms of the security agreement.

~~Table of Contents~~

~~ASSURE HOLDINGS CORP.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~Assure paid~~debt arrangement, Centurion ~~on first Advance of the Loan a commitment fee of 2.25%, being $248 thousand, made by withholding from the first advance.~~

~~A portion of the proceeds from the Debenture were utilized to repay the Central Bank line of credit and the Central Bank promissory note.~~

~~Warrant Fee~~

In addition, Assure issued Centurion an aggregate of 275,000 non-transferrable common stock purchase warrants. Each warrant entitles Centurion to acquire 1 share in the capital of Assure, at an exercise price equal to US$7.55 (representing the closing price of Assure’s shares of common stock as of the close of business on June 9, 2021 and multiplied by the Bank of Canada’s daily exchange rate on June 9, 2021) for a term of 48 months. The warrants and underlying shares of common stock are subject to applicable hold periods under U.S. securities laws.

~~The Company’s~~modified their debt ~~obligations are summarized as follows:~~

September 30,

December 31,

2021

2020
Central Bank line of credit

$
—

$
1,978
Central Bank promissory note

—

2,122
PPP promissory note

1,665

—
Total

1,665

4,100

Face value of convertible debenture

3,450

3,450
Less: principal converted to common shares

(60)

—
Less: deemed fair value ascribed to conversion feature and warrants

(1,523)

(1,523)
Plus: accretion of implied interest

610

324
Total convertible debt

2,477

2,251

Face value of Centurion debenture

8,000

—
Less: deemed fair value ascribed to warrants

(1,204)

—
Plus: accretion of implied interest

100

—
Less: net debt issuance costs

(587)

—
Total Centurion debt

6,309

—
Total debt

10,451

6,351
Less: current portion of debt

—

(4,100)
Long-term debt

$
10,451

$
2,251

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

covenant calculations regarding bad debt expense. As a result, the Company’s was in compliance with the debt covenants as of ~~September~~June 30, ~~2021, future minimum principal payments are summarized as follows (stated~~2022.

The Credit Facility matures in ~~thousands):~~June 2025 and bears interest at the rate of the greater of 9.50% or the Royal Bank of Canada Prime Rate plus 7.05% per annum.

The fair value of the Debenture was determined to be $6.8 million and the warrants $1.2 million. The difference between the fair value of the debt of $6.8 million and the face value of the Debenture of $8.0 million will be accreted over the four-year term of the Debenture.

PPP

Convertible

Bank

Loan

Debt

Indebtedness
Remainder 2021

$
—

$
—

$
—
2022

—

—

—
2023

—

965

—
2024

—

2,425

—
2025

—

—

8,000
2026

1,665

—

—
Total

1,665

3,390

8,000
Less: fair value ascribed to conversion feature and warrants

—

(1,523)

(1,204)
Plus: accretion and implied interest

—

610

100
Less: net debt issuance costs

—

—

(587)

$
1,665

$
2,477

$
6,309

5.6. SHARE CAPITAL

Common stock

Common stock: 180,000,000 authorized; $0.001 par value. As of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, there were ~~11,839,304~~12,919,666 and ~~11,275,788~~12,918,866 shares of common stock issued and outstanding, respectively.

Reverse Share Split

During September 2021, the total number of shares of common stock authorized by the Company was reduced from 900,000,000 shares of common stock, par $0.001, to 180,000,000 shares of common stock, par $0.001, and the number of shares of common stock held by each stockholder of the Company were consolidated automatically into the number of shares of common stock equal to the number of issued and outstanding shares of common stock held by each such stockholder immediately prior to the reverse split divided by five (5): effecting a five (5) old for one (1) new reverse stock split.

NaN fractional shares were issued in connection with the reverse split and all fractional shares were rounded up to the next whole share.

Additionally, all options, warrants and other convertible securities of the Company outstanding immediately prior to the reverse split were adjusted by dividing the number of shares of common stock into which the options, warrants and other convertible securities are exercisable or convertible by five (5) and multiplying the exercise or conversion price thereof by five (5), all in accordance with the terms of the plans, agreements or arrangements governing such options, warrants and other convertible securities and subject to rounding to the nearest whole share.

All shares of common stock, options, warrants and other convertible securities and the corresponding price per share amounts have been presented to reflect the reverse split in all periods presented within this Form 10-Q.

~~Acquisition shares~~Stock options

~~In connection with~~During November 2021, the ~~acquisition~~Company has adopted and approved the 2021 Stock Incentive Plan and the 2021 Employee Stock Purchase Plan. The intent of the ~~Sentry Neuromonitoring, LLC (the “Seller”) assets, we issued~~Company and the Board is that while the Amended 2020 Stock Option Plan and the 2020 Equity Incentive Plan will continue in existence in relation to ~~Seller~~the options and awards previously granted thereunder, the Board will not grant future options or awards thereunder. Instead, only the ~~Principals, as elected by Seller,~~2021 Stock Incentive Plan will be used for the grant of options and awards to eligible participants thereunder.

As of June 30, 2022, an aggregate of 1,870,000 shares of common stock of the Company with a value of $1,625,000, determined on the effective date, as quoted on the TSX Venture Exchange (237,226 shares of common stock). In addition, the Company placed into escrow 94,891 shares of the

~~Table of Contents~~

~~ASSURE HOLDINGS CORP.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~Company’s common stock with a value of $650,000. The common stock is subject to a~~ ~~12-month~~ ~~lock up beginning on the date of delivery. See Note 7 for additional discussion.~~

~~Share issuance~~

In June 2020, in connection with common stock purchase agreements, the Company issued 156,032 shares of common stock at a deemed value of $4.00 per share to certain employees, directors and third parties.

~~Convertible debt~~

During the nine months ended September 30, 2021, certain holders of the convertible debenture exercised their right to convert $60,000 of outstanding principal into shares of common stock, resulting in the issuance of 13,384 common stock.

~~Stock options~~

On December 10, 2020, our shareholders approved amendments to the Company’s stock option plan, which amended the plan previously approved on November 20, 2019 (the “Amended Stock Option Plan”). As of September 30, 2021, an aggregate of 1,183,930 shares of common stock (10% of the issued and outstanding shares of common stock) were available for issuance under the ~~Amended~~2021 Stock Option Plan. ~~Of this amount, stock options in respect~~As of ~~1,014,100 shares are outstanding as of September~~June 30, ~~2021.~~2022, no transactions have occurred under the 2021 Employee Stock Purchase Plan.

Options under the Plan are granted from time to time at the discretion of the Board of Directors, with vesting periods and other terms as determined by the Board of Directors.

~~A summary of the stock option activity is presented below:~~

Options Outstanding




Weighted

Weighted


Average

Average

Number of

Exercise

Remaining

Aggregate

Shares Subject

Price Per

Contractual

Intrinsic Value

to Options

Share

Life (in years)

(in thousands)
Balance at December 31, 2020

748,600

$
5.25

4.00

Options granted

348,000

5.33

Options exercised

(3,000)

6.40

Options canceled / expired

(79,500)

5.96

Balance at September 30, 2021

1,014,100

5.16

3.62

$
2,670
Vested and exercisable at September 30, 2021

636,008

4.93

3.39

$
1,894

1312

Table of Contents

ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

A summary of the stock option activity is presented below:


	Options Outstanding
		Weighted		Weighted
		Average		Average
	Number of	Exercise		Remaining	Aggregate
	Shares Subject	Price Per		Contractual	Intrinsic Value
	to Options	Share		Life (in years)	(in thousands)
Balance at December 31, 2021	1,204,233	$	5.56	3.6
Options granted	130,000	$	5.16
Options exercised	(800)	$	5.04
Options canceled / expired	(27,933)	$	6.26
Balance at June 30, 2022	1,305,500	$	4.99	3.2	$	242
Vested and exercisable at June 30, 2022	859,206	$	5.20	2.7	$	242

The following table summarizes information about stock options outstanding and exercisable under the Company’s Stock Option Plan at ~~September~~June 30, ~~2021:~~2022:


Options Outstanding	Options Outstanding				Options Exercisable			Options Outstanding				Options Exercisable
		Weighted							Weighted
		Average	Weighted			Weighted			Average	Weighted			Weighted
		Remaining	Average			Average			Remaining	Average			Average
Number of		Contractual	Exercise Price		Number	Exercise Price			Contractual	Exercise Price		Number	Exercise Price
Outstanding		Life (in years)	Per Share		Exercisable	Per Share			Life (in years)	Per Share		Exercisable	Per Share
200,000		3.90	$	0.25	200,000	$	0.25		3.2	$	0.25	200,000	$	0.25
12,000		1.07	$	14.00	12,000	$	14.00		0.3	$	14.00	12,000	$	14.00
15,000		6.30	$	9.00	15,000	$	9.00		5.6	$	9.00	15,000	$	9.00
85,000		2.00	$	9.00	73,667	$	9.00		1.3	$	9.00	85,000	$	9.00
146,800		2.30	$	7.80	127,227	$	7.80
81,300		3.01	$	6.40	48,780	$	6.40
145,800									1.5	$	7.80	145,800	$	7.80
79,600									2.3	$	6.40	68,987	$	6.40
40,000		3.91	$	4.50	18,667	$	4.50		3.2	$	4.50	24,000	$	4.50
93,000		4.20	$	4.85	31,000	$	4.85
311,000		4.34	$	5.30	103,667	$	5.30
88,000									3.4	$	4.85	52,800	$	4.85
296,100									3.6	$	5.30	138,180	$	5.30
30,000		4.54	$	5.60	6,000	$	5.60		3.8	$	5.60	14,000	$	5.60
1,014,100		3.62	$	5.16	636,008	$	4.93
184,000									4.3	$	7.65	77,439	$	7.65
130,000									4.7	$	5.16	26,000	$	5.16
1,305,500									3.2	$	4.99	859,206	$	5.20

The Company uses the Black-Scholes option pricing model to determine the estimated fair value of options. The fair value of each option grant is determined on the date of grant and the expense is recorded on a straight-line basis and is included as a component of general and administrative expense in the consolidated statements of operations. The assumptions used in the model include expected life, volatility, risk-free interest rate, dividend yield and forfeiture rate. The Company’s determination of these assumptions ~~are~~is outlined below.

Expected life — The expected life assumption is based on an analysis of the Company’s historical employee exercise patterns.

Volatility — Volatility is calculated using the historical volatility of the Company’s common stock for a term consistent with the expected life.

Risk-free interest rate — The risk-free interest rate assumption is based on the U.S. Treasury rate for issues with remaining terms similar to the expected life of the options.

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ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Dividend yield — Expected dividend yield is calculated based on cash dividends declared by the Board for the previous four quarters and dividing that result by the average closing price of the Company’s common stock for the quarter. The Company has not declared a dividend to date.

Forfeiture rate — The Company does not estimate a forfeiture rate at the time of the grant due to the limited number of historical forfeitures. As a result, the forfeitures are recorded at the time the grant is forfeited.

The following assumptions were used to value the awards granted during the six months ended June 30, 2022 and 2021:


	Six Months Ended June 30,
	2022		2021
Expected life (in years)	5.0		5.0
Risk-free interest rate	1.7	%	0.4	%
Dividend yield	—	%	—	%
Expected volatility	132	%	91	%

Stock-based compensation expense for the three months ended June 30, 2022 and 2021 was $249 thousand and $327 thousand, respectively. Stock-based compensation expense for the six months ended June 30, 2022 and 2021 was $572 thousand and $607 thousand, respectively. As of June 30, 2022, there was approximately $1.3 million of total unrecognized compensation cost related to 510,859 unvested stock options that is expected to be recognized over a weighted-average remaining vesting period of 3.3 years.

Derivative Liability

Stock options granted to consultants that have an exercise price this is stated in a different currency than the Company’s functional currency are treated as a liability and are revalued at the end of each reporting period for the term of the vesting period. Any change in the fair value of the stock option after the initial recognition is recorded as a component of other income, net in the consolidated statements of operations.

Changes in the Company’s stock option liability for the six months ended June 30, 2022 was as follows (stated in thousands):


Balance at December 31, 2021	$	25
Gain on revaluation		25
Balance at June 30, 2022	$	—

The assumptions used for the Black-Scholes Option Pricing Model to revalue the stock options granted to consultants as of June 30, 2022 and December 31, 2021 were as follows:


	As of June 30,		As of December 31,
	2022		2021
Risk free rate of return	1.7	%	0.4	%
Expected life	0.3	years	1.8	years
Expected volatility	127	%	186	%
Expected dividend per share	nil		nil

There were 0 stock options granted to consultants during the six months ended June 30, 2022 and 2021 that required recurring fair value adjustments.

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ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

~~The following assumptions were used to value the awards granted during the nine months ended September 30, 2021:~~

Nine Months Ended September 30,

2021

2020

Expected life (in years)

5.0

5.0

Risk-free interest rate

0.4
%
3.0
%
Dividend yield

—
%
—
%
Expected volatility

91
%
107
%

Stock-based compensation expense for the three months ended September 30, 2021 and 2020 was $210 thousand and $88 thousand, respectively, and $818 thousand and $456 thousand for the nine months ended September 30, 2021 and 2020, respectively. As of September 30, 2021, there was approximately $925 thousand of total unrecognized compensation cost related to 378,092 unvested stock options that is expected to be recognized over a weighted-average remaining vesting period of 2.2 years.

Warrants

As of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, there were 3,940,006 ~~and 3,665,006~~ warrants ~~outstanding, respectively.~~outstanding.

The following table summarizes warrants issued by transaction type:


		Number of Warrants outstanding
~~Balance at December 31, 2020~~Convertible debt, warrants issued (Note 5)		~~3,665,006~~380,874
Debenture, warrants issued (Note 4)5)		275,000
July 2020 private placement, warrants issued ⁽¹⁾		12,592
December 2020 equity financing warrants issued ⁽¹⁾		3,271,540
~~Balance at September 30, 2021~~Total warrant outstanding		3,940,006

(1)

For a complete discussion of the warrants issued during July and December 2020, see Note 11 to the consolidated financial statement for the year ended December 31, 2021 as filed on Form 10-K on March 14, 2022.

6.7. LOSS PER SHARE

The following table sets forth the computation of basic and fully diluted loss per share for the three and six months ended ~~September~~June 30, 2022 and 2021 ~~and 2020 (stated in~~(in thousands, except per share amounts):

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020
Net income (loss)

$
91

$
(977)

$
(2,447)

$
(14,711)
Basic weighted average common stock outstanding

11,838,032

6,988,058

11,528,371

6,968,728
Basic income (loss) per share

$
0.01

$
(0.14)

$
(0.21)

$
(2.11)
Net income (loss)

$
91

$
(977)

$
(2,447)

$
(14,711)
Basic weighted average common shares outstanding

11,838,032

6,988,058

11,528,371

6,968,728
Dilutive effect of stock options and warrants

3,886,071

—

—

—
Dilutive weighted average common stock outstanding

15,724,103

6,988,058

11,528,371

6,968,728
Diluted income (loss) per share

$
0.01

$
(0.14)

$
(0.21)

$
(2.11)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Net loss	$	(4,726)	$	(1,309)	$	(7,185)	$	(2,540)
Basic weighted average common stock outstanding		12,919,666		11,589,857		12,919,546		11,400,471
Basic loss per share	$	(0.37)	$	(0.11)	$	(0.56)	$	(0.22)
Net loss	$	(4,726)	$	(1,309)	$	(7,185)	$	(2,540)
Dilutive weighted average common stock outstanding		12,919,666		11,589,857		12,919,546		11,400,471
Diluted loss per share	$	(0.37)	$	(0.11)	$	(0.56)	$	(0.22)

Basic net ~~income (loss)~~loss per share is computed using the weighted average number of ~~shares of~~ common ~~stock~~shares outstanding during the period. Diluted net ~~income (loss)~~loss per share is computed using the treasury stock method to calculate the weighted average number of ~~shares of~~ common ~~stock~~shares and, if dilutive, potential ~~shares of~~ common ~~stock~~shares outstanding during the period. Potential dilutive ~~shares of~~ common ~~stock~~shares include incremental ~~shares of~~ common ~~stock~~shares issuable upon the exercise of stock options, less shares from assumed

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~~ASSURE HOLDINGS CORP.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

proceeds. The assumed proceeds calculation includes actual proceeds to be received from the employee upon exercise and the average unrecognized stock compensation cost during the ~~period.~~period

Stock options ~~exercisable,~~ to purchase ~~227,893~~659,206 and 527,693 shares of common stock and warrants to purchase ~~462,068~~3,940,006 and 3,665,005 shares of common stock were outstanding at ~~September~~June 30, 2022 and 2021 that were not included in the computation of diluted weighted average common stock outstanding because their effect would have been anti-dilutive.

~~7. ACQUISITION~~

Effective on April 30, 2021 (the “Closing Date”), Assure Networks Texas Holdings II, LLC, a Colorado limited liability company and wholly-owned subsidiary of Assure Holdings (the “Purchaser”), entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Sentry Neuromonitoring, LLC (the “Seller”), and certain owners (collectively “Principals”).

Under the terms of the Purchase Agreement, Assure Texas Holdings agreed to purchase certain assets (“Acquired Assets”) related to the Seller’s interoperative neuromonitoring business (the “Business”) and assumed certain liabilities of the Seller. The Acquired Assets included, among other items, all assets used in the Business, certain tangible personal property, inventory, Seller’s records related to the Business, deposits and prepaid expenses, certain contracts related to the Business, licenses, intellectual property, goodwill and accounts receivables. The purchase qualified as a business combination for accounting purposes.

~~The purchase price for the assets consisted of cash and stock, payable as follows:~~

~~Cash Payment~~

Cash consideration of $1,125,000 in installment payments, payable (a) $153,125 at closing, (b) $153,125 within 30 days of Closing Date and (c) $818,750, together with interest at the applicable federal rate, shall be paid in cash in NaN equal monthly installments, with the first installment being due on or before the first business day of the first month following the sixtieth day from the Closing Date and the remaining installments being due on the first business day of each month thereafter.

~~Stock Payment~~

The Company issued 237,226 shares of common stock issued to the Seller or the Principals, as elected by Seller, with a value of $1,625,000, determined on the Closing Date, as quoted on the TSX Venture Exchange, on or about the Closing Date and 94,891 shares of common stock were placed in escrow with a value of $650,000 and are being held by the Escrow Agent pursuant to terms set forth in an escrow agreement to be mutually agreed to by Purchaser and Seller. The common stock is subject to regulatory restrictions and requirements and a 12 month lock up from the date of delivery, in addition to any additional lock up period imposed on the common stock under applicable law and/or regulation,

~~Reimbursements~~

Reimbursement to Seller for operational capital injected by Seller or its Principals since December 31, 2020, for verifiable and reasonable expenses, consistent with past business practices up to a cap of $50 thousand.

~~Receivable Bonus~~

Purchaser agreed to pay Seller or the Principals, as elected by Seller, a bonus in an amount equal to $250,000 (“Receivable Bonus”) upon collecting $3,000,001 in accounts receivable acquired by Purchaser for accounts receivable that was generated by Seller prior to the Closing. The Receivable Bonus, if earned, will be paid to Seller or the Principals, as elected by Seller, in 3 payments: (i) the first payment being in the amount of $100 thousand, payable on the thirtieth (30th) day following the date the Receivable Bonus is earned, (ii) the second payment being in the amount of $100 thousand, payable on the sixtieth (60th) day following the date the

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~~ASSURE HOLDINGS CORP.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~Receivable Bonus is earned, and (iii) the third payment in the amount of $50 thousand, payable on the ninetieth (90th) day following the date the Receivable Bonus is earned.~~

~~Founders’ Bonus~~

The Registrant agreed to pay a $50 thousand bonus (“Founders’ Bonus”) payment to certain owners in installments: (i) $25 thousand at Closing and (ii) $25 thousand within twelve (12) months of Closing. The Founders’ Bonus is additional consideration, which is independent, separate and apart from other consideration to be paid by Purchaser.

Under the Purchase Agreement, Purchaser agreed to enter into employment agreements with certain key personnel of Seller, as determined by Purchaser. The employment agreements, in standard form of employment agreement of Purchaser, include: (i) a minimum annual base salary of $175 thousand with full benefits and (ii) up to $50 thousand in annual variable compensation bonus to be memorialized in a mutually agreeable form of agreement that details the scope of services and compensation.

The initial accounting for the acquisition of Sentry is incomplete as we, with the support of our valuation specialist, are in the process of finalizing the fair market value calculations of the acquired net assets. In addition, the Company is in the process of reviewing the applicable future cash flows used in determining the purchase accounting. As a result, the amounts recorded in the consolidated financial statements related to the Sentry acquisition are preliminary and the measurement period remains open. The following table summarizes the preliminary allocation of the total consideration to the assets acquired and liabilities assumed as of the date of the acquisition (in thousands):

Purchase price consideration:

Cash

$
1,125
Common stock, at fair value

2,275
Total consideration

$
3,400

Assets acquired:

Cash

$
51
Accounts receivable

2,000
Right of use assets

131
Total assets acquired

2,182

Liabilities assumed:

Accounts payable and accrued liabilities

242
Lease liability

131
Total liabilities assumed

373

Preliminary Goodwill

$
1,591

8. COMMITMENTS AND CONTINGENCIES

Indemnifications

The Company is a party to a variety of agreements in the ordinary course of business under which it may be obligated to indemnify third parties with respect to certain matters. These obligations include, but are not limited to, contracts entered into with physicians where the Company agrees, under certain circumstances, to indemnify a third party, against losses arising from matters including but not limited

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ASSURE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

to medical malpractice and other liability. The impact of any such future claims, if made, on future financial results is not subject to reasonable estimation because considerable uncertainty exists as to final outcome of these potential claims.

As permitted under Nevada law, the Company has agreements whereby it indemnifies its officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company believes, given the absence of any such payments in the Company’s history, and the estimated low probability of such payments in the future, that the estimated fair value of these indemnification agreements is immaterial. In addition, the Company has directors’ and officers’ liability insurance coverage that is intended to reduce its financial exposure and may enable the Company to recover any payments, should they occur.

~~Performance share compensation~~

In April 2022, the U.S. Department of Justice (“DOJ)” issued Civil Investigative Demands which seek information with respect to a civil investigation under the Anti-kickback Statute and the False Claims Act. We voluntarily contacted the DOJ offering to provide any materials needed in the investigation and to answer any questions. While our policy during the relevant time was to not seek payments from federal health care programs, the third-party billing company we used at that time submitted some claims to Medicare Advantage plans administered by commercial insurance companies. We have worked diligently to ensure that payments from Medicare Advantage plans have been returned to the commercial insurance companies and we believe we have returned substantially all such payments that we have discovered to date, totaling approximately $450 thousand. The DOJ has not made any allegations in the investigation, and we are currently unable to predict the eventual scope, ultimate timing, or outcome of this investigation. As ~~part~~a result, we are unable to estimate the amount or range of a reverse takeover transaction (“RTO”) during 2016, the Company entered into a one-time stock grant agreement with 2 executives which defines a bonus share threshold as follows: should the Company meet or exceed a 2017 fiscal year EBITDA threshold of Cdn$7,500, the Company would issue 1,200,000 shares of common stock of the surviving issuer at the trailing 30-day average closing price. See the Company’s annual report for the year ended December 31, 2020 filed on March 30, 2021 for additional discussion. During the year ended December 31, 2020, the Company settled 1,000,000 performance shares resultingany potential loss, if any, arising from ~~the issuance of 1,000,000 shares of common stock. During the first half of 2021, the Company settled the remaining 200,000 performance shares.~~this investigation.

~~9. SUBSEQUENT EVENTS~~

~~On October 1, 2021, the Company granted 197,000 stock options to certain officers and employees.~~

On November 15, 2021, the Company announced that it has closed a brokered private placement of approximately 900,000 shares of the Company at an issue price of $5.25 per share, for gross proceeds of $4.75 million (the “Offering”). The proceeds of the Offering are expected to be used for expanding the Company’s remote neurology services offering for intraoperative neuromonitoring (“IONM”), extending the Company’s operational footprint into new states, supporting expected growth generated by the agreement with Premier, Inc. and general working capital purposes. Kestrel Merchant Partners LLC (the “Sponsor”) acted as the exclusive sponsor and The Benchmark Company, LLC (the “Agent”) acted as sole placement agent in connection with the Offering. Additionally, certain directors, officers and employees are expected to participated in a subsequent offering to settle approximately $700 thousand of compensation at a market price to be determined in accordance with Nasdaq listing requirements following the end of the Company’s trading blackout in accordance with the Company’s insider trading policy.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the attached unaudited condensed consolidated financial statements and notes thereto, and with our audited financial statements and notes thereto for the year ended December 31, ~~2020~~2021 found in the Form 10-K filed by Assure Holdings Corporation on March ~~30, 2021~~14, 2022 (the “Form 10-K”).

This Quarterly Report contains forward-looking statements, which are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” “could,” “would,” “may,” “intends,” “targets” and similar expressions or variations of such words are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements in this Quarterly Report. The identification of certain statements as “forward-looking” is not intended to mean that other statements not specifically identified are not forward-looking. All statements other than statements about historical facts are statements that could be deemed forward-looking statements, including, but not limited to, statements that relate to our future revenue, growth rate, competitiveness, gross margins, expenditures, tax expenses, cash flows, our management's plans and objectives for our current and future operations, general economic conditions, the impact of the COVID-19 pandemic and related events, the impact of acquisitions on our financial condition and results of operations, and the sufficiency of financial resources to support future operations and capital expenditures.

Although forward-looking statements in this Quarterly Report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by us. Consequently, forward-looking statements are inherently subject to risks, uncertainties, and changes in condition, significance, value, and effect, including those discussed under the heading “Risk Factors” in our annual report on Form 10-K and other documents we file from time to time with the Securities and Exchange Commission ~~(the~~( “SEC”), such as our quarterly reports on Form 10-Q and our current reports on Form 8-K. Such risks, uncertainties and changes in condition, significance, value, and effect could cause our actual results to differ materially from those expressed herein and in ways not readily foreseeable. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report and are based on information currently and reasonably known to us. We undertake no obligation to revise or update any forward-looking statements ~~in order~~ to reflect any event or circumstance that may arise after the date of this Quarterly Report, other than as required by law. Readers are urged to carefully review and consider the various disclosures made in this Quarterly Report, which attempt to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects.

OVERVIEW

Assure is a best-in-class provider of outsourced intraoperative neurophysiological monitoring (“IONM”) and an emerging provider of remote neurology ~~services.~~services that help make surgeries safer. The Company delivers a turnkey suite of clinical and operational services to support surgeons and medical facilities during invasive ~~procedures including~~procedures. IONM has been well established as a standard of care and risk mitigation tool for various surgical verticals such as neurosurgery, spine, ~~neurosurgery,~~cardiovascular, orthopedic, ear, nose, and throat ~~cardiovascular~~(“ENT”), and ~~orthopedic.~~other surgical procures that place the nervous system at risk. Accredited by The Joint Commission, Assure’s mission is to provide exceptional surgical care and help make invasive surgeries safer. Our strategy focuses on utilizing best of class personnel and partners to deliver outcomes that are beneficial to all stakeholders including patients, surgeons, hospitals, insurers, and shareholders.

During each procedure, Assure provides two services, the Technical Component and Professional Component of IONM. Our in-house Interoperative Neurophysiologists (“INP”) provide the Technical Component IONM services in the operating room throughout the surgical procedure, while the telehealth-oriented supervising practitioners provide a ~~positive~~level of redundancy and risk mitigation, the Professional Component, in support of the onsite INPs and surgical team. In addition, Assure offers a comprehensive suite of IONM services, including scheduling the INP and supervising practitioner, real time monitoring, patient ~~experience.~~advocacy and subsequent billing and collecting for services provided.

Historically, the foundation of Assure’s business has been providing the Technical Component of IONM identifies real-time changes in spinal cord, brain, and peripheral nerve functions during high-risk surgeries to prevent injuries or accidental damage to patients that could lead to strokes, heart attacks, paralysis or other serious medical issues. IONM is well established and regarded as the standard of care in U.S healthcare.

~~Assure employs~~via our INP staff.We employ highly trained ~~IONM technologists,~~INPs, which provide a direct point of contact in the operating room during the surgeries to relay critical information to the surgical team. In our one-to-one model, Assure pairs a surgeon with a team ~~while Company physicians deliver~~of INPs to promote a level of familiarity, comfort and efficiency between the surgeon and the INP. Each INP has the ability to handle approximately 200 cases annually. Our INPs monitor the surgical procedure using state of the art, commercially available, diagnostic medical equipment. Assure INP’s are certified by a

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third-party accreditation agency. The success of our service depends upon the timely and successful interpretation of the data signals by the monitoring team to quickly determine if there is a deficiency and the surgical intervention required to positively impact the patient and surgery. Employing this model, Assure has rapidly expanded its operational footprint from a home base in Colorado and increased its number of managed cases from approximately 1,600 in 2017 to approximately 17,400 in 2021.

Beginning in the second quarter of 2021, Assure began executing on its long-term vertical integration plan by expanding into remote neurology services. As a result, Assure began delivering remote neurology services in support of the surgical ~~team.~~team and INPs rather than exclusively relying on third-party supervising practitioners as it had previously. We currently have supervising practitioners employed and working with surgical teams and our INPs. They are utilizing equipment and training to monitor evoked potentials (“EPs”), electroencephalographic (“EEG”) and electromyography (“EMG”) and several complex modalities during surgical procedures to pre-emptively notify the surgeon of any nerve related issues that are identified.

Remote neurology services is a one-to-many business model, as one supervising practitioner is able to monitor multiple patients simultaneously. As a result, the Professional Component has a different financial profile than the Technical Component. Supervising practitioners provide remote neurology services from an off-site location and maintain the ability to manage multiple cases simultaneously. As a result, each supervising practitioner has the ability to handle approximately 2,000 or more cases annually. In ~~addition,~~2021, Assure ~~offers surgeons~~performed approximately 17,400 total managed cases including managing approximately 2,100 remote neurology cases with employed supervising practitioners. The number of remote neurology managed cases is expected to expand significantly as our supervising practitioners increase the volume of cases supervised and ~~medical facilities~~additional neurologists are added to the internal team.

Bringing the Professional Component of IONM in-house generates a ~~value-added~~number of positives for Assure. First, we will be able to oversee quality of service for providing remote neurology services. This commitment to quality supports our efforts to sign new in-network agreements with insurance payors and facility-wide agreements with hospitals. Second, by bringing the remote neurology function in-house, we are able to significantly reduce cost of delivery, allowing the Company to improve our profitability on every case we perform. Our objective is to significantly reduce the cost of delivery for remote neurology services going forward. Additional scale will serve as a catalyst for margin expansion in the future. Third, for most of the cases we perform, remote neurology services represent the creation of a new revenue stream. Fourth, providing remote neurology services for IONM creates opportunities in adjacent markets where similar remote neurology services are utilized. The shift to providing remote neurology services ourselves was a natural progression of the business. We have established the platform ~~including:~~and maintained patient ~~scheduling, billing~~volume, insourcing remote neurology was simply a matter of replacing contractors with Assure supervising practitioners to service this volume. The long-term result will be increased margins, a new revenue stream and ~~collections, physician relationship management~~improved cash receipts from commercial payors.

Collectively, support from Assure’s high quality Technical and ~~patient advocacy services. High quality Assure~~Professional IONM ~~support~~services results in decreased hospital and surgeon liability, abbreviated patient stays, fewer readmissions, reduced hospital costs, enhanced overall patient satisfaction and the efficient achievement of better clinical outcomes.

~~Assure’s integrated IONM offering, encompassing both the technologist in the operating room as well as off-site~~

As we transition to becoming a provider of remote neurology services, ~~help~~we believe our expertise in IONM will assist us in entering adjacent markets including EEG, epilepsy, sleep study and stroke in which Assure supervising practitioners can also provide patient services.

In 2022, Assure provided IONM services for approximately 185 surgeons in approximately 115 hospitals and surgery centers. The Company operates in: Arizona, Colorado, Kansas, Louisiana, Michigan, Missouri, Nebraska, Nevada, Texas, Minnesota and Utah. Our continued geographic expansion initiatives, including facility-wide outsourcing agreements with medical facilities and hospital networks, coupled with the ~~Company create an even higher standard~~surgical vertical expansion efforts, extending the Company’s reach into remote neurology services and selective acquisitions are expected to generate substantial growth opportunities going forward. In the future, it may be necessary for us to raise additional funds for the continuing development of ~~service for surgeons~~our business plan.

Clinical leadership, surgeon support and ~~patients alike.~~patient care are Assure’s cornerstones. We make substantial ongoing investments in our training and development of clinical staff and have created a fellowship program to rigorously train new INPs to cost-effectively join the Assure team. In addition, ~~it broadens~~we have partnered with the internationally renowned Texas Back Institute on clinical research relating to IONM safety and efficacy. Isador Lieberman, M.D., director of the scoliosis and spine tumor program at the Texas Back Institute, is a member of Assure’s platform and greatly expands the Company’s margin potential by significantly reducing cost of delivery. This allows Assure to improve profitability on every case performed. Expanded scale associated with physician-driven remote neurology services’ one-to-many model,Medical Advisory Committee.

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~~in contrast~~Our strategy is to the Company’s legacy on-site technologist-driven one-to-one model, is the most important catalyst for margin improvement. The top-line also benefits from Assure’s integrated offering, given that most remote neurology cases Assure performs itself establishbuild a ~~new revenue stream. Assure technologists have created substantial managed case volume for the business that the Company’s physicians performing~~telehealth remote neurology services company with exceptional capabilities in IONM and numerous adjacent markets while utilizing the same platform and employees. This will extend our reach and redefine our position in the industry. We are ~~simply consuming. Currently, driving~~thoughtfully deploying capital and focusing our investment in high potential growth ininitiatives including: organically expanding into new states, growing our remote neurology ~~services is a matter of scheduling and delivering Assure’s existing managed case volume. Further, providing remote neurology services for~~platform, signing new IONM ~~offers Assure new opportunities in adjacent markets such as electroencephalographic (EEG), epilepsy, sleep studies and stroke care, where similar services and expertise are utilized.~~

~~The Company maintains operations in twelve U.S. states. Assure believes that continued geographic expansion initiatives, facility-wide~~ outsourcing agreements with hospitals and medical facilities, as well as opportunistic M&A. In addition, we are investing to make our revenue cycle management function more automated, improving the ~~acceleration~~velocity of ~~its remote neurology services platform,~~our cash collections. The data and ~~selective acquisitions~~analytics-driven Company we are building will ~~combine~~play a bigger role in the success of our key stakeholder groups: surgeons, hospitals, insurance companies and patients, and in turn deliver attractive returns to ~~generate substantial growth opportunities going forward.~~our stockholders.

The Company has financed its cash requirements primarily from revenues generated from its services, by utilizing ~~a bank promissory note and line of credit, from the issuances of convertible debentures, other debentures, from government loan programs,~~debt facilities and from the sale of common stock.

Payment for services, revenue mix and seasonality

Over half of Assure’s patients commonly have commercial health insurance coverage (“Commercial Payor”) and we are compensated via their health insurance plan. Assure’s commercial insurance patients represent the significant majority of our revenue and profit margin. We produce separate bills for the Technical Component and the Professional Component of the IONM services we perform. The ~~Company’s ability to maintain~~majority of our commercial payors are billed out-of-network and we negotiate payment for each claim. The remainder of commercial payors utilize a contracted rate. The majority of contracted rates are via indirect agreements with third-party organizations or related entities of the ~~carrying value~~commercial payor with a smaller portion in direct agreements with contracted rates.

We bill, collect, and retain 100% of ~~its assets~~the revenue associated with the Technical Component of the services we provide. For the Professional Component, when the supervising practitioner is ~~dependent~~an Assure employee or where we own 100% of the entity managing the procedure, the Company bills, collects and retains 100% of the revenue. In instances in which the Professional Component is provided via Managed Service Agreements (“MSAs”) with surgeons or through agreements with Professional Entities (“PEs”), we engage in a revenue share based on ~~successfully marketing its services and maintaining future profitable operations,~~ the ~~outcome~~percentage outlined in the underlying agreement.

For the balance of ~~which cannot be predicted at this time. The Company has also stated its intention to grow its operations by developing additional PE relationships and directly contracting~~the patients we serve, billing is made under individual facility service agreements with ~~hospitals and surgery centers for services.~~hospitals. In these cases, the ~~future, it~~hospital’s patient may be ~~necessary for~~uninsured or have government insurance. Regardless, Assure provides the ~~Company to raise additional funds for~~same high level of service and quality of care.

The surgical segment of the ~~continuing development of its business plan. For further information about Assure, please visit www.assureneuromonitoring.com, www.sedar.com and www.sec.gov.~~

~~COVID-19~~

Our business and results of operations have been, and continues to be, adversely affected by the global COVID-19 pandemic and related events and we expect its impact to continue. The impact to date has included periods of significant volatility in various markets and industries, including the healthcare industry. The volatility has had, and we anticipate it will continue to have, an adverse effect on our customers and on our business, financial condition and results of operations, and may result in an impairment of our long-lived assets, including goodwill, increased credit losses and impairments of investments in other companies. In particular, the healthcarehealth care industry ~~hospitals and providers of elective procedures have been and may continue~~tends to be impacted by seasonality due to the nature of most benefit plans resetting on a calendar year basis. As patients utilize and reduce their remaining deductible throughout the year, Assure typically see an increase in volume throughout the year with the biggest impact coming during the fourth quarter. As a result, historically our annual revenues are overweighted in the fourth quarter.

Seasonality impacts our revenue mix for similar reasons. As patients with commercial insurance utilize and reduce their remaining deductible throughout the year, we typically see an increase in volume with the biggest impact coming in the fourth quarter. Historically, our revenue mix is relatively overweighted to patients with commercial insurance in the second half of the year and to patients with government insurance in the first half of the year.

COVID-19

Our commitment to the health, well-being and peace of mind of our employees and the people we serve remains our focus as the pandemic and/or other events beyond our control, and further volatility could have an additional negative impact on these industries, customers, and our business. In addition, the COVID-19 pandemic and, to a lesser extent, the impact on other industries, including automotive, electronics and real estate, increased fuel costs, U.S. restrictions on trade, and transitory inflation have impacted and mayenvironment evolves. We continue to ~~impact the~~leverage our resources, expertise, data and actionable intelligence to assist customers, clients and care providers throughout this time.

The situation surrounding COVID-19 remains fluid with continued uncertainty and a wide range of potential outcomes. We continue to actively manage our response and assess impacts to our financial ~~conditions of our customers~~position and the patients they serve. In addition, actions by United States federal, state and foreign governments to address the COVID-19 pandemic, including travel bans, stay-at-home orders and school, business and entertainment venue closures, also had a significant adverse effect on the markets in which we conduct our businesses. COVID-19 poses the risk that our workforce, suppliers, and other partners may be prevented from conducting normal business activities for an extended period of time, including due to shutdowns or stay-at-home orders that may be requested or mandated by governmental authorities. We have implemented policies to allow our employees to work remotely as a result of the pandemic as we reviewed processes related to workplace safety, including social distancing and sanitation practices recommended by the Centers for Disease Control and Prevention. The COVID-19 pandemic could also cause delays in acquiring new customers and executing renewals and could also impact our business as consumer behavior changes in response to the pandemic.

~~Since the start of the second quarter of 2021, there has been increased availability and administration of vaccines against COVID-19,~~operating results, as well as ~~an easing of restrictions on social, business, travel, and government activities and functions, and we have experienced a gradual resumption of economic activities~~mitigate adverse developments in our industries. On the other hand, infection rates continue to fluctuate in various regions and new strains of the virus, including the Delta variant, remain a risk, which may give rise to implementation of restrictions in the geographic areas that we serve. In addition, there are ongoing global impacts resulting from the pandemic, including disruption of the supply chains, product shortages, increased delivery costs, increased governmental regulation, strains on healthcare systems, and delays in shipments, product development, technology launches and facility access.

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believe somewhat mitigates the risks to our business, our per-unit and variable-fee based revenue will continue to be susceptible to the volatility, supply chain disruptions, microchip shortages and potential market downturns induced by the COVID-19 pandemic.

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RESULTS OF OPERATIONS

Three Months Ended ~~September~~June 30, ~~2021~~2022 Compared to the Three Months Ended ~~September~~June 30, ~~2020~~2021

The following table provides selected financial information from the condensed consolidated financial statements of income for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021. All dollar amounts set forth in the table below are expressed thousands of dollars, except share and per share amounts.


	Three Months Ended September 30,				Change		Change		Three Months Ended June 30,				Change		Change
	2021		2020		$		%		2022		2021		$		%
Revenue
Patient service fees, net	$	6,443	$	2,965	$	3,478	117.3	%
Hospital, management and other		2,103		998		1,105	110.7	%
Technical services									$	67	$	4,095	$	(4,028)	(98)	%
Professional services										854		652		202	31	%
Other										724		1,473		(749)	(51)	%
Total revenue		8,546		3,963		4,583	115.6	%		1,645		6,220		(4,575)	(74)	%
Cost of revenues		4,254		2,232		2,022	90.6	%		4,002		3,170		832	26	%
Gross margin		4,292		1,731		2,561	147.9	%		(2,357)		3,050		(5,407)	(177)	%
Operating expenses
General and administrative		3,180		1,957		1,223	62.5	%		3,596		3,963		(367)	(9)	%
Sales and marketing		247		349		(102)	(29.2)	%		238		166		72	43	%
Depreciation and amortization		293		249		44	17.7	%		260		387		(127)	(33)	%
Total operating expenses		3,720		2,555		1,165	45.6	%		4,094		4,516		(422)	(9)	%
Income (loss) from operations		572		(824)		1,396	(169.4)	%		(6,451)		(1,466)		(4,985)	340	%
Other income (expenses)
Income (loss) from equity method investments		139		(232)		371	(159.9)	%		4		20		(16)	(80)	%
Other income (expense), net		(27)		(3)		(24)	800.0	%		28		1		27	2,700	%
Accretion expense		(171)		(227)		56	(24.7)	%		(171)		(120)		(51)	43	%
Interest expense, net		(264)		(58)		(206)	355.2	%		(439)		(218)		(221)	101	%
Total other expense		(323)		(520)		197	(37.9)	%		(578)		(317)		(261)	82	%
Income (loss) before income taxes		249		(1,344)		1,593	(118.5)	%		(7,029)		(1,783)		(5,246)	294	%
Income tax benefit (expense)		(158)		367		(525)	(143.1)	%		2,303		474		1,829	386	%
Net income (loss)	$	91	$	(977)	$	1,068	(109.3)	%	$	(4,726)	$	(1,309)	$	(3,417)	261	%
Income (loss) per share
Basic	$	0.01	$	(0.14)	$	0.15	(105.5)	%	$	(0.37)	$	(0.11)	$	(0.25)	224	%
Diluted	$	0.01	$	(0.14)	$	0.16	(112.7)	%	$	(0.37)	$	(0.11)	$	(0.25)	224	%
Weighted average number shares – basic		11,838,032		6,988,058		4,849,974	69.4	%		12,919,666		11,589,857		1,329,809	11	%
Weighted average number shares – diluted		11,838,032		6,988,058		4,849,974	69.4	%		12,919,666		11,589,857		1,329,809	11	%

EBITDA
Net income (loss)									$	(4,726)	$	(1,309)	$	(3,417)	(261.0)	%
Interest expense, net										439		218		221	101.4	%
Accretion expense										171		120		51	42.5	%
Income tax benefit (expense)										(2,303)		(474)		(1,829)	385.9	%
Depreciation and amortization										260		387		(127)	(32.8)	%
EBITDA									$	(6,159)	$	(1,058)	$	(5,101)	(482.1)	%

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Revenue

Total revenues for the three months ended ~~September~~June 30, 2022 and 2021 ~~and 2020~~ were ~~$8.5~~$1.6 million and ~~$4.0~~$6.2 million, respectively, net of implicit price concessions. For the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, we recorded an allowance for implicit price concessions of ~~nil~~$7.6 million and ~~$4.6~~$1.1 million, respectively. Gross revenue for the three months ended June 30, 2022, and 2021, prior to the application of implicit price concessions, totaled $9.2 million and $7.3 million. The increase in gross revenue is primarily related to an increase in

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managed case volume of approximately 2,700 from nearly 3,200 in the second quarter 2021 to approximately 5,800 in the same period of 2022. The increase in managed cases is primarily related to the acquisition of Sentry, completed during the second quarter of 2021, and expansion into remote neurology. Gross revenue for the three months ended June 30, 2022, was negatively impacted by implicit price concessions related to aged claims. Based on the Company’s historical experience, claims generally become uncollectible once they are aged greater than 24 months; as such, included in the Company’s $8.1 million allowance for implicit price concessions for the three months ended June 30, 2022, is an estimate of the likelihood that a portion of the Company’s accounts receivable may become uncollectible due to age. Management has recently designated a tactical team to specifically pursue these reserved claims. We expect results from these efforts in the second half of the year as we continue collection efforts for claims aged past 24 months. As a result, we anticipate that there will also be a bad debt charge in the third quarter of 2022; smaller than what we reported in the second quarter, but still a material impact.

~~Patient~~Technical and professional service ~~fee~~ revenue is recognized in the period in which IONM services are rendered, at net realizable amounts due from third party payors when collections are reasonably assured and can be estimated. The majority of the Company’s services are rendered on an out-of-network basis and billed to ~~third party~~third-party insurers. We ~~record~~estimate out-of-network technical and professional revenue ~~(included in-Patient service fees, net)~~ per case based upon our historical cash collection rates from private health insurance carriers. Our revenue estimation process for out-of-network revenue is based on the collection experience from insurance cases that are ~~up to two years~~between 13-24 months old ~~and~~as management believes the more recent collection experience ~~of these receivables~~ is more indicative of future per case collection rates.

For the three months ended June 30, 2022, Assure managed approximately 5,800 cases compared to approximately 3,200 cases in the same period in the prior year, an 81% increase in managed case volume The ~~Company recognizes~~increase is primarily related to organic sales growth in new markets, the acquisition of Sentry during the second quarter of 2021, and the launch of remote neurology services during the second quarter of 2021.

Other revenue consists of revenue from ~~hospital and surgery center customers and certain PEs, for which the Company does not have an ownership interest in,~~managed service arrangements on a contractual basis. Revenue from services rendered is recorded after services are ~~rendered.~~rendered.

For the three months ended September 30, 2021, Assure managed 4,996 cases where it retained 100% of the professional revenue (from our wholly-owned subsidiaries) compared to 2,685 cases where it retained 100% of the professional revenue (from our wholly- owned subsidiaries) in the same period in the prior year, an 86% increase in case volume. The increase is primarily related to organic sales growth in new markets such as Nebraska and Nevada, the acquisition of Sentry on April 30, 2021, and the launch of tele neurologist services.

Cost of ~~Revenues~~revenues, excluding depreciation and amortization

Cost of revenues, excluding depreciation and amortization, for the three months ended ~~September~~June 30, ~~2021~~2022, were ~~$4.3~~$4.0 million compared to ~~$2.2~~$3.2 million for the same period in ~~2020.~~2021, an 26% increase. During the three months ended June 30, 2022, the number of neuromonitoring cases increased 81% compared to the three months ended June 30, 2021 which drove the costs of revenues increase. Cost of revenues consist primarily of ~~third-party billing fees,~~ the cost of our internal billing and collection department, internal and external collection costs, technologist and ~~reader~~supervising practitioner wages, third-party ~~reader and collection~~supervising practitioner fees, and medical supplies. Technologist and supervising practitioner wages and medical supplies vary with the number of neuromonitoring cases. The cost of our internal billing and collection department increased as we have ~~ramped up this department~~increased headcount to align with expected growth in volume and as the number of cases ~~they are responsible for invoicing increases. During the three months ended September 30, 2021, the number of neuromonitoring cases increased 86% compared~~ to ~~the three months ended September 30, 2020, which increased cost of revenues year over year.~~invoice has increased.

General and administrative

General and administrative expenses were ~~$3.2~~$3.6 million and ~~$2.0~~$4.0 million for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The ~~increase~~decrease period-to-period was primarily related to ~~an increase in information technology consulting costs as we continue to focus on automation and infrastructure to scale our business and an increase in stock based compensation expense.~~

~~Sales and marketing~~

~~Sales and marketing expenses was $247 thousand and $349 thousand for the three months ended September 30, 2021 and 2020. The decrease period-to-period was related to~~ cost ~~savings measures.~~cutting efforts.

~~Depreciation and amortization~~

Depreciation and amortization expense was $293 thousand and $249 thousand for the three months ended September 30, 2021 and 2020, respectively. The increase is primarily related to the increase in ROU lease assets compared to the prior year.

~~Income (loss) from equity method investments~~

Assure recognizes its pro-rata share of the net income (loss) generated by the non-wholly-owned PEs. During the three months ended September 30, 2021, the Company recognized $139 thousand of income from equity method investments compared to $232 thousand in losses for the three months ended September 30, 2020. The variance is primarily associated with recording of the previously mentioned implicit price concessions which were significantly larger in 2020 than 2021.

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Accretion expense

The Company recorded non-cash accretion expense of $171 thousand and ~~$227~~$120 thousand for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The Company accretes the difference between the fair value of the ~~warrants~~convertible debt and ~~conversion feature related to~~ the ~~Central Bank and Centurion debt, as applicable,~~debenture and the face value of ~~such~~the convertible debt and the debenture over the term of the ~~debt.~~convertible debt and the debenture. Specifically, accretion expense was $95 thousand for each period related to the convertible debt and $76 thousand and $25 thousand for the three months ended June 30, 2022 and 2021, respectively, for the Centurion debenture.

Interest expense, net

Interest expense, net was ~~$264~~$439 thousand for the three months ended ~~September~~June 30, ~~2021~~2022 compared to ~~$58~~$218 thousand for the three months ended ~~September~~June 30, ~~2020.~~2021. The increase year-over-year is primarily due to higher outstanding debt ~~balances~~balances. Specifically, interest expense

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was $77 thousand for each period related to the convertible debt and $284 thousand and $46 thousand for the ~~amortization of debt issuance costs. The Company capitalizes debt issuance costs~~three months ended June 30, 2022 and ~~then amortizes such costs over~~2021, respectively, for the ~~term of the debt.~~Centurion debenture.

Income tax benefit ~~(expense)~~

For the three months ended ~~September~~June 30, ~~2021 income tax expense was $158 thousand compared to an~~2022, income tax benefit ~~of $367~~was $2.3 million and compared $474 thousand for the three months ended ~~September~~June 30, ~~2020.~~2021. The Company’s estimated annual tax rate is impacted primarily by the amount of taxable income earned in each jurisdiction the Company operates in and permanent differences between financial statement carrying amounts and the tax basis.

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~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 Compared to the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2020~~2021

The following table provides selected financial information from the condensed consolidated financial statements of income for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021. All dollar amounts set forth in the table below are expressed thousands of dollars, except share and per share amounts.

Nine Months Ended September 30,

Change

Change

2021

2020

$

%

Revenue

Patient service fees, net

$
13,087

$
(6,342)

$
19,429

(306.4)
%
Hospital, management and other

6,446

3,902

2,544

65.2
%
Total revenue

19,533

(2,440)

21,973

(900.5)
%
Cost of revenues

9,956

5,062

4,894

96.7
%
Gross margin

9,577

(7,502)

17,079

(227.7)
%
Operating expenses

General and administrative

10,275

5,853

4,422

75.6
%
Sales and marketing

748

801

(53)

(6.6)
%
Depreciation and amortization

965

769

196

25.5
%
Total operating expenses

11,988

7,423

4,565

61.5
%
Loss from operations

(2,411)

(14,925)

12,514

(83.8)
%
Other income (expenses)

Income (loss) from equity method investments

136

(1,449)

1,585

(109.4)
%
Other income (expense), net

(29)

50

(79)

(158.0)
%
Accretion expense

(386)

(619)

233

(37.6)
%
Interest expense, net

(500)

(164)

(336)

204.9
%
Total other expense

(779)

(2,182)

1,403

(64.3)
%
Loss before income taxes

(3,190)

(17,107)

13,917

(81.4)
%
Income tax benefit

743

2,396

(1,653)

(69.0)
%
Net loss

$
(2,447)

$
(14,711)

$
12,264

(83.4)
%
Loss per share

Basic

$
(0.21)

$
(2.11)

$
1.90

(89.9)
%
Diluted

$
(0.21)

$
(2.11)

$
1.91

(90.4)
%
Weighted average number shares – basic

11,528,371

6,968,728

4,559,643

65.4
%
Weighted average number shares – diluted

11,528,371

6,968,728

4,559,643

65.4
%


	Six Months Ended June 30,				Change		Change
	2022		2021		$		%
Revenue
Technical services	$	1,463	$	7,228	$	(5,765)	(80)	%
Professional services		3,327		966		2,361	(244)	%
Other		1,556		2,791		(1,235)	(44)	%
Total revenue		6,346		10,985		(4,639)	(42)	%
Cost of revenues, excluding depreciation and amortization		7,879		5,702		2,177	38	%
Gross margin		(1,533)		5,283		(6,816)	(129)	%
Operating expenses
General and administrative		7,837		7,095		742	10	%
Sales and marketing		490		501		(11)	(2)	%
Depreciation and amortization		518		672		(154)	(23)	%
Total operating expenses		8,845		8,268		577	7	%
Loss from operations		(10,378)		(2,985)		(7,393)	(248)	%
Other income (expenses)
Income (loss) from equity method investments		9		(3)		12	400	%
Gain on Paycheck Protection Program loan		1,665		—		1,665	—	%
Other income (expense), net		66		(2)		68	(3,400)	%
Accretion expense		(341)		(215)		(126)	(59)	%
Interest expense, net		(846)		(236)		(610)	258	%
Total other expense		553		(456)		1,009	(221)	%
Loss before income taxes		(9,825)		(3,441)		(6,384)	(186)	%
Income tax benefit		2,640		901		1,739	193	%
Net loss	$	(7,185)	$	(2,540)	$	(4,645)	(183)	%
Loss per share
Basic	$	(0.56)	$	(0.22)	$	(0.33)	(150)	%
Diluted	$	(0.56)	$	(0.22)	$	(0.33)	(150)	%
Weighted average number shares – basic		12,919,546		11,400,471		1,519,075	13	%
Weighted average number shares – diluted		12,919,546		11,400,471		1,519,075	13	%

EBITDA
Net loss	$	(7,185)	$	(2,540)	$	(4,645)	(183)	%
Interest expense, net		846		236		610	258	%
Accretion expense		341		215		126	59	%
Income tax benefit		(2,640)		(901)		(1,739)	193	%
Depreciation and amortization		518		672		(154)	(23)	%
EBITDA	$	(8,120)	$	(2,318)	$	(5,802)	(250)	%

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Revenue

Total revenues for the ~~nine~~six months ended ~~September~~June 30, 2022 and 2021 ~~and 2020~~ were ~~$19.5~~$6.3 million and ~~$(2.4~~$11.0 million,) respectively, net of implicit price concessions. For the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, we recorded an allowance for implicit price concessions of $12.0 million and $1.2 million, respectively. Gross revenue for the six months ended June 30, 2022, and ~~$24.0~~2021, prior to the application of implicit price concessions, totaled $18.3 million ~~respectively.~~and $12.2 million. The increase in gross revenue is primarily related to an increase in managed case volume of approximately 4,900 from nearly 6,000 in the first half 2021 to nearly 10,900 in the same period of 2022. The increase in managed cases is primarily related to the acquisition of Sentry, completed during the second quarter of 2021, and expansion into remote neurology. Gross revenue for the six months ended June 30, 2022, was negatively impacted by implicit price concessions related to aged claims. Based on the Company’s historical experience, claims generally become uncollectible once they are aged greater than 24 months; as such, included in the Company’s $12.0 million allowance for implicit price concessions for the six months ended June 30, 2022, is an estimate of the likelihood that a portion of the Company’s accounts receivable may become uncollectible due to age. Management has recently designated a tactical team to specifically pursue these reserved claims. We expect results from these efforts in the second half of the year as we continue collection efforts for claims aged past 24 months. As a result, we anticipate that there will also be a bad debt charge in the third quarter of 2022; smaller than what we reported in the second quarter, but still a material impact.

~~Patient~~Technical and professional service ~~fee~~ revenue is recognized in the period in which IONM services are rendered, at net realizable amounts due from third party payors when collections are reasonably assured and can be estimated. The majority of the Company’s services are rendered on an out-of-network basis and billed to ~~third party~~third-party insurers. We ~~record~~estimate out-of-network technical and professional revenue ~~(included in-Patient service fees, net)~~ per case based upon our historical cash collection rates from private health insurance carriers. Our revenue estimation process for out-of-network revenue is based on the collection experience from insurance cases that are between ~~1-2 years~~1-24 months old ~~and~~as management believes the more recent collection experience is more indicative of future per case collection rates.

For the six months ended June 30, 2022, Assure managed approximately 10,900 cases compared to approximately 6,000 cases in the same period in the prior year, an 82% increase in managed case volume The ~~Company recognizes~~increase is primarily related to organic sales growth in new markets, the acquisition of Sentry during the second quarter of 2021, and the launch of remote neurology services during the second quarter of 2021.

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For the nine months ended September 30, 2021, Assure managed 10,979 where it retained 100% of the professional revenue (from our wholly-owned subsidiaries) compared to 6,763 cases where it retained 100% of the professional revenue (from our wholly- owned subsidiaries) in the same period in the prior year, a 62% increase in case volume. The increase is primarily related to organic sales growth in new markets such as Nebraska and Nevada, the acquisition of Sentry on April 30, 2021, and the launch of tele neurologist services.

Cost of ~~Revenues~~revenues, excluding depreciation and amortization

Cost of revenues, excluding depreciation and amortization, for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022, were ~~$10.0~~$7.9 million compared to ~~$5.1~~$5.7 million for the same period in ~~2020.~~2021, a 38% increase. During the six months ended June 30, 2022, the number of neuromonitoring cases increased 82% compared to the six months ended June 30, 2021 which drove the costs of revenues increase. Cost of revenues consist primarily of ~~third-party billing fees,~~ the cost of our internal billing and collection department, internal and external collection costs, technologist and ~~reader~~supervising practitioner wages, third-party ~~reader and collection~~supervising practitioner fees, and medical supplies. Technologist and supervising practitioner wages and medical supplies vary with the number of neuromonitoring cases. The cost of our internal billing and collection department increased as we have ~~ramped up this department~~increased headcount to align with expected growth in volume and as the number of cases ~~they are responsible for invoicing increases. During the nine months ended September 30, 2021, the number of neuromonitoring cases increased 62% compared~~ to ~~the nine months ended September 30, 2020 which increased costs of revenues year over year.~~invoice has increased.

General and administrative

General and administrative expenses were ~~$10.3~~$7.8 million and ~~$5.9~~$7.1 million for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The increase period-to-period was primarily related to ~~higher legal fees in relation to our Nasdaq listing, acquisition of Sentry and debt financing with Centurion, and~~ increased head count, ~~as we continued to build an inhouse billing~~via organic growth and collections function. During the nine months ended September 30, 2021, we incurred legal and audit expenses related to the filing of our registration statement on Form S-1 and our initial Form 10-K with the Securities and Exchange Commission which are nonrecurring expenses.integrated acquisitions, partially offset by cost cutting efforts.

~~Sales and marketing~~Gain on Paycheck Protection Program loan forgiveness

~~Sales and marketing expenses were relatively consistent at $748 thousand and $801 thousand for the nine months ended September 30, 2021 and 2020, respectively.~~

~~Depreciation and amortization~~

Depreciation and amortization expense was $965 thousand and $769 thousand for the nine months ended September 30, 2021 and 2020, respectively. The increase is primarily related to the increase in ROU lease assets compared to the prior year.

~~Income (loss) from equity method investments~~

~~Assure recognizes its pro-rata share of the net loss generated by the non-wholly-owned PEs.~~ During ~~the nine months ended September 30,~~March 2021, the Company ~~recognized $136 thousand~~received an unsecured loan under the United States Small Business Administration Paycheck Protection Program (“PPP”) pursuant to the recently adopted Coronavirus Aid, Relief, and Economic Security Act (the “PPP Loan”) in the amount of ~~income from equity method investments compared to $1.5 million~~$1.7 million. During January 2022, the Company was granted forgiveness of ~~losses for~~ the ~~nine~~PPP Loan. As of June 30, 2022, the

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Company recorded a gain on forgiveness of the PPP Loan of $1.7 million. There were no similar transactions during the six months ended ~~September~~June 30, ~~2020. The variance is primarily associated with recording of the previously mentioned implicit price concessions which were significantly larger in 2020 than~~ 2021.

Accretion expense

The Company recorded non-cash accretion expense of ~~$386~~$341 thousand and ~~$619~~$215 thousand for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The Company accretes the difference between the fair value of the ~~warrants~~convertible debt and ~~conversion feature related to~~ the ~~Central Bank and Centurion debt, as applicable,~~debenture and the face value of ~~such~~the convertible debt and the debenture over the term of the ~~debt.~~convertible debt and the debenture. Specifically, accretion expense was $190 for each period related to the convertible debt and $151 thousand and $25 for the six months ended June 30, 2022 and 2021, respectively, for the Centurion debenture.

Interest expense, net

Interest expense, net was ~~$500~~$846 thousand for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 compared to ~~$164~~$236 thousand for the ~~nine~~six months ended ~~September~~June 30, ~~2020.~~2021. The increase year-over-year is primarily due to higher outstanding debt balances. Specifically, interest expense was $220 thousand and $154 thousand for each period related to the convertible debt and $547 thousand and $46 thousand for the six months ended June 30, 2022 and 2021, respectively, for the Centurion debenture.

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Income tax benefit

For the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022, income tax benefit was ~~$743~~$2.6 million compared $901 thousand ~~compared to $2.4 million~~ for the ~~nine~~six months ended ~~September~~June 30, ~~2020.~~2021. The Company’s estimated annual tax rate is impacted primarily by the amount of taxable income earned in each jurisdiction the Company operates in and permanent differences between financial statement carrying amounts and the tax basis.

FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCES

Our cash position as of ~~September~~June 30, ~~2021~~2022 was ~~$918 thousand~~$0.8 million compared to the December 31, ~~2020~~2021 cash balance of ~~$4.4~~$4.0 million. Working capital was ~~$26.6~~$24.5 million as of ~~September~~June 30, ~~2021~~2022 compared to ~~$17.4~~$34.3 million at December 31, ~~2020.~~ 2021. We believe that our working capital balance and our estimated cash flows from operations during 2022 is expected support our operating activities and our obligations for the next 12 months. However, if we pursue our plan of continued growth our existing working capital will not be sufficient and we may need to seek equity or debt financing. Such financings may include the issuance of shares of common stock, warrants to purchase common stock, convertible debt or other instruments that may dilute our current stockholders. Financing may not be available to us on acceptable terms depending on market conditions at the time we seek financing.

We rely on payments from multiple private insurers and hospital systems that have payment policies and payment cycles that vary ~~widely.~~widely and are subject to change. Because we are primarily an out-of-network biller to private insurance companies, the collection times for our claims can last in excess of 24 months. ~~Accounts receivables outstanding greater than 24~~During the six months ~~are fully reserved.~~

~~For~~ended June 30, 2022, the ~~nine~~Company recorded an allowance for implicit price concessions of $12.5 million. We expect a lower allowance for the three months ended September 30, ~~2021,~~2022 for the same reason. As a result, we anticipate EBITDA to be positive for the second half of the year.

For the six months ended June 30, 2022, we collected approximately ~~$10.1~~$11.6 million of cash from operations compared to collecting approximately ~~$10.0~~$6.8 million in the same prior year period. As ~~at September~~of June 30, ~~2021,~~2022, accounts receivable, which are recorded net of implicit price concessions, was ~~$22.7~~$21.0 million compared to ~~$15.0~~$27.8 million at December 31, ~~2020.~~2021. The decrease in our accounts receivable balance during 2022 is primarily related to the increased velocity of cash receipts and implicit price concession charges. We received ~~$312~~$50 thousand in cash distributions from the PE entities for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 compared to ~~$424~~$234 thousand received for the same period in the prior ~~year period.~~year.

WeHistorically, we have financed our operations primarily from revenues generated from services rendered and through equity and debt financings. ~~We expect~~Our cash balance and projected cash flows from operations are expected to ~~meet~~fund our current obligations and planned operating activities for the next 12 ~~months, through cash earned through operating activities, debt financings, and equity offerings. During November 2021, we completed an equity financing. See~~ ~~Subsequent Event~~ ~~below for additional discussion.~~months.

Cash used in operating activities for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 was ~~$9.4~~$3.1 million compared to ~~$1.8 million~~$6.3million for the same period in the preceding year. Cash was used to fund operations and to fund our growth strategy.

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Cash used in investing activities of $103 thousand for the six months ended June 30, 2022 was related the PE distributions of $50 thousand, offset by payments related to acquisition liabilities of $127 thousand and fixed asset purchases of $26 thousand. Cash provided by investing activities of ~~$108~~$78 thousand for the ~~nine~~six months ended ~~September~~June 30, 2021 was related ~~the PE advances, offset by payments related~~ to ~~the Sentry acquisition. Cash used~~$234 thousand in ~~investing activities of $3.5 million for the nine months ended September 30, 2020 was primarily related to payments against the Neuro-Pro acquisition partially offset by the~~ distributions received from the ~~PEs.~~PEs, partially offset by $156 thousand of payments related to acquisition liabilities.

Cash provided by financing activities of $4 thousand for the six months ended June 30, 2022 was due to stock option exercises. Cash provided by financing activities of $5.8 million for the ~~nine~~six months ended ~~September~~June 30, 2021 was due to $7.4 million of net proceeds from the debenture, $1.7 million of proceeds from the Payroll Protection Program loan, and $832 thousand in proceeds from common ~~stock~~share issuances, offset by $4.1 million payments of bank debt. Cash provided by financing activities of $5.5 million for the nine months ended September 30, 2020 was primarily due to $2.5 million of proceeds from the issuance of convertible debentures, $1.2 million of proceeds from the payroll protection program, net proceeds of $560 thousand from the bank promissory note, and net proceeds of $1.1 million from the bank line of credit.debt.

Our near-term cash requirements relate primarily to payroll expenses, trade payables, debt payments, capital lease payments, and general corporate obligations. Approximately 50% - 55% of the trade and other payables at September 30, 2021 and December 31, 2020 consist of accrued billing fees. These fees will not be due and payable until the underlying accounts receivable is collected which may be in the longer term.

~~Debenture~~

On June 10, 2021, the Company entered into definitive agreements to secure a credit facility under the terms of a commitment letter dated March 8, 2021 (the “Commitment Letter”) with Centurion Financial Trust, an investment trust formed by Centurion Asset Management Inc. (“Centurion”). Under the terms of the Commitment Letter, Assure issued a debenture to Centurion, dated June 9, 2021 (the “Debenture”), with a maturity date of June 9, 2025 (the “Maturity Date”), in the principal amount of $11 million related to a credit facility comprised of a $6 million senior term loan (the “Senior Term Loan”), a $2 million senior revolving loan (the “Senior Revolving Loan”) and a $3 million senior term acquisition line (the “Senior Term Acquisition Line” and together with the Senior Term

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Loan and the Senior Revolving Loan, the “Credit Facility”). The Senior Term Acquisition Line will be made available to the Company to fund future acquisitions, subject to certain conditions and approvals of Centurion. The Credit Facility matures in June 2025.

The principal amount of the Debenture drawn and outstanding from time to time shall bear interest both before and after maturity, default and judgment from the date hereof to the date of repayment in full at the rate of the greater of 9.50% or the Royal Bank of Canada Prime Rate plus 7.05% per annum calculated and compounded monthly in arrears and payable on the first business day of each month during which any obligations are outstanding, the first of such payments being due July 2, 2021 for the period from the Advance to the date of payment, and thereafter monthly. The difference between the commitment and the amount of the Loan outstanding from time to time shall bear a standby charge, for the period between June 2021 and the end of the availability period, in the amount of 1.50% per annum calculated and compounded monthly in arrears and payable on the first business day of each month during which any amount of the commitment remains available and undrawn, the first of such payments being due July 2, 2021. Interest on overdue interest shall be calculated and payable at the same rate plus 3% per annum.

With respect to the Senior Revolving Loan, Assure may prepay advances outstanding thereunder from time to time, with not less than 10 business days prior written notice of the prepayment date and the amount, in the minimum amount of $250,000. Any amount of the Senior Revolving Loan prepaid may be re-advanced. With respect to the Senior Term Loan and Senior Term Acquisition Line, Assure may prepay the advances outstanding thereunder, without penalty or bonus, in an amount not to exceed 25% of the aggregate of all Advances then outstanding under the Term Loans, on each anniversary date of the first advance made hereunder, provided in each case with not less than 30 days written notice of the Company's intention to prepay on such anniversary date and the proposed prepayment amount. Any prepayments to the Term Loans other than those permitted in the immediately preceding sentence may only be made on 30 days prior written notice of the prepayment date and the amount, and are subject to the Company paying on such prepayment date a prepayment charge equal to the lesser of (i) twelve (12) months interest and (ii) interest for the months remaining from the prepayment date to the Maturity Date, on the amount prepaid at the interest rate in effect on the applicable Term Loan as of the date of prepayment. Any amount of the Term Loan prepaid may not be re-advanced.

~~Assure paid Centurion on first Advance of the Loan a commitment fee of 2.25%, being $248 thousand, made by withholding from the first advance.~~

~~A portion of the proceeds from the Debenture were utilized to repay the Central Bank line of credit and the Central Bank promissory note.~~

~~Off-Balance Sheet Arrangements~~

~~We have no material undisclosed off-balance sheet arrangements that have or are reasonably likely to have, a current or future effect on our results of operations or financial condition.~~

We have receivables from ~~related parties and~~ equity investments in PEs and other entities that are due and payable upon those entities collecting on their own accounts receivable. To the extent that these entities are unable to collect on their accounts receivable or there is an impairment in the valuation of those accounts receivable, the Company will need to reduce its related party receivables and/or its equity investments in the PEs.

~~Subsequent Event~~Off-Balance Sheet Arrangements

~~On November 15, 2021, the Company announced~~We have no material undisclosed off-balance sheet arrangements that ~~it has closed~~have or are reasonably likely to have, a ~~brokered private placement~~current or future effect on our results of approximately 900,000 shares of the Company at an issue price of $5.25 per share, for gross proceeds of $4.75 million (the “Offering”). The proceeds of the Offering are expected to be used for expanding the Company’s remote neurology services offering for intraoperative neuromonitoring (“IONM”), extending the Company’s operational footprint into new states, supporting expected growth generated by the agreement with Premier, Inc. and general working capital purposes. Kestrel Merchant Partners LLC (the “Sponsor”) acted as the exclusive sponsor and The Benchmark Company, LLC (the “Agent”) acted as sole placement agent in connection with the Offering. Additionally, certain directors, officers and employees are expected to participate in a subsequent offering to settle approximately $700 thousand of compensation at aoperations or financial condition.

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~~market price to be determined in accordance with Nasdaq listing requirements following the end of the Company’s trading blackout in accordance with the Company’s insider trading policy.~~

CRITICAL ACCOUNTING POLICIES

We prepare our consolidated financial statements in conformity with GAAP. Application of GAAP requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes and within this MD&A. We consider our most important accounting policies that require significant estimates and management judgment to be those policies with respect to revenue, accounts receivable, stock based compensation, acquired intangible assets, goodwill, and income taxes, which are discussed below. Our other significant accounting policies are summarized in Note 2, “Basis of Presentation” and Note 3, “Summary of Significant Accounting Policies,” of the Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 as filed with the Securities and Exchange Commission on March ~~30, 2021.~~14, 2022.

We continually evaluate the accounting policies and estimates used to prepare the consolidated financial statements. In general, our estimates are based on historical experience, evaluation of current trends, information from third-party professionals and various other assumptions that we believe to be reasonable under the known facts and circumstances. Estimates can require a significant amount of judgment and a different set of assumptions could result in material changes to our reported results.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, an evaluation was carried out under the supervision of, and with the participation of the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operations of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on that evaluation, the CEO and the CFO have concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were ~~effective~~ineffective in ensuring that (i) information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) information required to be disclosed by us in the reports that we

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file or submit under the Exchange Act is accumulated and communicated to our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There have been changes in our internal control over financial reporting during the quarter ended ~~September~~June 30, ~~2021~~2022 that ~~has~~have materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Changes in our internal control over financial reporting during the quarter ended ~~September~~June 30, ~~2021~~2022 are discussed below under “Remediation”.

Material Weaknesses

Previously, management noted that we had material weaknesses in our internal control over financial reporting related ~~to inadequate controls over the review of the accounting for complex transactions and~~ improper segregation of duties which management believes to be a material weakness.

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Remediation Progress

In response to the identified material weakness, during the first quarter of ~~2021, management has implemented a rigorous review process regarding~~2022 and continuing into the ~~accounting for complex transactions. During the third~~second quarter of ~~2021, the Company remediated~~2022, management began to restructure certain employee functions to allow for proper review of all transactions in order to remediate the segregation of duties control weakness. Management believes the segregation of duties material weakness ~~by restructuring certain employee functions.~~will be remediated during the fourth quarter of 2022.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not aware of any material pending or threatened litigation or of any proceedings known to be contemplated by governmental authorities that are, or would be, likely to have a material adverse effect upon us or our operations, taken as a whole.

In April 2022, the U.S. Department of Justice (“DOJ”) issued Civil Investigative Demands which seek information with respect to a civil investigation under the Anti-kickback Statute and the False Claims Act. We voluntarily contacted the DOJ offering to provide any materials needed in the investigation and to answer any questions. While our policy during the relevant time was to not seek payments from federal health care programs, the third-party billing company we used at that time submitted some claims to Medicare Advantage plans administered by commercial insurance companies. We have worked diligently to ensure that payments from Medicare Advantage plans have been returned to the commercial insurance companies and we believe we have returned substantially all such payments that we have discovered to date, totaling approximately $450,000. The DOJ has not made any allegations in the investigation, and we are currently unable to predict the eventual scope, ultimate timing, or outcome of this investigation. As a result, we are unable to estimate the amount or range of any potential loss, if any, arising from this investigation.

ITEM 1A. RISK FACTORS

During the ~~three~~six months ended ~~September~~June 30, ~~2021~~2022 there were no material changes to the risk factors disclosed in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Item 2(b) and 2(c) are not applicable.

Item 2(a) – Stock Issuances


		~~Total number of shares~~
~~2021~~		~~common stock issued~~
~~July~~ ⁽¹⁾		~~2,858~~
~~August~~		—
~~September~~		—
~~Total~~		~~2,858~~

~~(1)~~

~~Convertible debenture~~

~~In connection with~~ - Except as disclosed in our previously filed current reports on Form 8-K, the ~~terms~~Company has not issued equity securities of the ~~convertible debenture (See Note 5 to our Condensed Consolidated Financial Statements),~~Company on an unregistered basis during the Registrant issued 2,858 shares of common stock upon the conversion of $20 thousand principal amount of convertible debenture pursuant to Section 3(a)(9) of the Securities Act of 1933, as amended, and applicable state securities laws exemptions. The shares of common stock are “restricted securities” as defined in Rule 144 of the Securities Act and subject to hold periods under applicable Canadian securities laws.

quarter ended June 30, 2022.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

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ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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ITEM 5. OTHER INFORMATION

~~Credit Facility~~

~~As previously reported on Form 8-K filed on June 16, 2021, we entered into~~ definitive agreements to secure a credit facility with Centurion Financial Trust, an investment trust formed by Centurion Asset Management Inc. (“Centurion”). Assure issued a Debenture to Centurion, dated June 9, 2021, with a maturity date of June 9, 2025, in the principal amount of US$11,000,000 related to a credit facility comprised of a US$6,000,000 senior term loan, a US$2,000,000 senior revolving loan and a US$3,000,000 senior term acquisition line (the “Credit Facility”). The Credit Facility is guaranteed by certain Assure subsidiaries.

~~Adoption of Code of Business Conduct and Ethics~~

~~On August 11, 2021, the Board of Directors adopted a Code of Business Conduct and Ethics, which replaces our prior Code of Ethics.~~None.

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ITEM 6. EXHIBITS


Exhibit Number	Description
3.1	Articles of Incorporation of Montreux Capital Corp. dated May 15, 2017 (incorporated by reference to Exhibit 3.1 to the Company’s Form S-1 filed with the SEC on February 11, 2021)
3.2	Articles of Domestication (from British Columbia to State of Nevada) dated May 15, 2017 (incorporated by reference to Exhibit 3.2 to the Company’s Form S-1 filed with the SEC on February 11, 2021)
3.3	Certificate of Amendment to Articles of Incorporation (Name Change) of Montreux Capital Corp. dated May 17, 2017 (incorporate by reference to Exhibit 3.3 to the Company’s Form S-1 filed with the SEC on February 11, 2021)
3.4	Bylaws of Assure Holdings Corp. (incorporated by reference to Exhibit 3.4 to the Company’s Form S-1 filed with the SEC on February 11, 2021)
3.5	Certificate of Change (incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K filed with the SEC on September 3, 2021)
3.6	Amendment No.1 to the Bylaws (incorporated by referenced to Exhibit 3.2 to the Company’s Form 8-K filed with the SEC on September 3, 2021)
3.7	Amendment No. 2 to the Bylaws (incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K filed with the SEC on November 9, 2021)
~~3.8+~~3.8	Amended and Restated Bylaws of Assure Holdings Corp. (incorporated by reference to Exhibit 3.8 to the Company’s Form 10-Q filed with the SEC on November 15, 2021)
~~3.9+~~3.9	Amended Articles of Incorporation of Assure Holdings Corp. (incorporated by reference to Exhibit 3.9 to the Company’s Form 10-Q filed with the SEC on November 15, 2021)
31.1+	Certification of the Principal Executive Officer pursuant to Rule 13a-14 of the Exchange Act
31.2+	Certification of the Principal Financial Officer pursuant to Rule 13a-14 of the Exchange Act
32.1++	Certification of the Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2++	Certification of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS+	Inline XBRL Instance Document
101.SCH+	Inline XBRL Schema Document
101.CAL+	Inline XBRL Calculation Linkbase Document
101.DEF+	Inline XBRL Definition Linkbase Document
101.LAB+	Inline XBRL Label Linkbase Document
101.PRE+	Inline XBRL Presentation Linkbase Document
104+	The cover page of the Company’s Quarterly Report on Form 10-Q for the quarter ended ~~September~~June 30, ~~2021,~~2022, formatted in Inline XBRL (contained in Exhibit 101)

+	Filed herewith.

++	Furnished herewith.

*	Indicates a management contract or compensatory plan, contract or arrangement.

3128

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

ASSURE HOLDINGS CORP.


By:	/s/ John Farlinger	By	: /s/ John Price
	John Farlinger, Executive Chairman and Chief Executive Officer		John Price, Chief Financial Officer (Principal Financial Officer)
	(Principal Executive Officer)

	Date: ~~November~~August 15, ~~2021~~2022		Date: ~~November~~August 15, ~~2021~~2022

3229


	PPP		Convertible		Bank
	Loan			Debt	Indebtedness
Remainder 2021	$	—	$	—	$	—
2022		—		—		—
2023		—		965		—
2024		—		2,425		—
2025		—		—		8,000
2026		1,665		—		—
Total		1,665		3,390		8,000
Less: fair value ascribed to conversion feature and warrants		—		(1,523)		(1,204)
Plus: accretion and implied interest		—		610		100
Less: net debt issuance costs		—		—		(587)
	$	1,665	$	2,477	$	6,309


Purchase price consideration:
Cash	$	1,125
Common stock, at fair value		2,275
Total consideration	$	3,400

Assets acquired:
Cash	$	51
Accounts receivable		2,000
Right of use assets		131
Total assets acquired		2,182

Liabilities assumed:
Accounts payable and accrued liabilities		242
Lease liability		131
Total liabilities assumed		373

Preliminary Goodwill	$	1,591