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 UNITED
STATES

 SECURITIES
AND EXCHANGE COMMISSION

 Washington,
D.C. 20549

 Form

 (Mark
one)

 ANNUAL
 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the fiscal year ended December 31, 2023

 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: 001-36529

 CareCloud,
Inc.

 (Exact
name of registrant as specified in its charter)

 Delaware

 22-3832302

 (State
 or other jurisdiction of

 incorporation
 or organization)

 (I.R.S.
 Employer

 Identification
 No.)

 Clyde Road

 Somerset,
 New Jersey

 08873

 (Address
 of principal executive offices)

 (Zip
 Code)

 (732) 873-5133

 (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

 Stock, par value $0.001 per share

 CCLD

 Nasdaq
 Global Market

 11%
 Series A Cumulative Redeemable Perpetual Preferred Stock, par value $0.001 per share

 CCLDP

 Nasdaq
 Global Market

 8.75%
 Series B Cumulative Redeemable Perpetual Preferred Stock, par value $0.001 per share

 CCLDO

 Nasdaq
 Global Market

 Securities
registered pursuant to Section 12(g) of the Act: None

by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No

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

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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files). Yes No

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 the 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.

by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report.

 If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.

by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).

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

 As
of June 30, 2023, the aggregate market value of the registrant's common stock held by non-affiliates of the registrant was approximately
$ 30.4 million, based on the last reported trading price of the common stock on that date, as reported on the Nasdaq Global Market.

 At
March 19, 2024, the registrant had 16,118,492 shares of common stock, par value $0.001 per share, outstanding.

 DOCUMENTS
INCORPORATED BY REFERENCE

 Portions
of the Proxy Statement for the Annual Meeting of Shareholders to be held on June 17, 2024 are incorporated by reference into Part III,
Items 10, 11, 12, 13, and 14 of this Annual Report on Form 10-K.

 Table
of Contents

 Forward-Looking Statements

 Summary of Risk Factors

 Item 1. Business

 Item 1A. Risk Factors

 Item 1B. Unresolved Staff Comments

 Item 1C. Cybersecurity

 Item 2. Properties

 Item 3. Legal Proceedings

 Item 4. Mine Safety Disclosures

 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Item 6. [Reserved]

 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

 Item 7A. Quantitative and Qualitative Disclosures about Market Risk

 Item 8. Financial Statements and Supplementary Data

 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 Item 9A. Controls and Procedures

 Item 9B. Other Information

 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

 Item 10. Directors, Executive Officers and Corporate Governance

 Item 11. Executive Compensation

 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 Item 13. Certain Relationships and Related Transactions, and Director Independence

 Item 14. Principal Accountant Fees and Services

 Item 15. Exhibits and Financial Statement Schedules

 Signatures

 Forward-Looking
Statements

 Certain
statements that we make from time to time, including statements contained in this Annual Report on Form 10-K, constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E
of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All statements other than statements of historical fact contained
in this Annual Report on Form 10-K are forward-looking statements. These statements relate to anticipated future events, future results
of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may,"
"might," "will," "shall," "should," "could," "intends," "expects,"
"plans," "goals," "projects," "anticipates," "believes," "seeks,"
"estimates," "forecasts," "predicts," "possible," "potential," "target,"
or "continue" or the negative of these terms or other comparable terminology. Our operations involve risks and uncertainties,
many of which are outside our control, and any one of which, or a combination of which, could materially affect our results of operations
and whether the forward-looking statements ultimately prove to be correct. Forward-looking statements in this Annual Report on Form 10-K
include, without limitation, statements reflecting management's expectations for future financial performance and operating expenditures
(including our ability to continue as a going concern, to raise additional capital and to succeed in our future operations), expected
growth, profitability and business outlook, increased sales and marketing expenses, and the expected results from the integration of
our acquisitions.

 Forward-looking
statements are only predictions, are uncertain and involve substantial known and unknown risks, uncertainties, and other factors that
may cause our (or our industry's) actual results, levels of activity or performance to be materially different from any future
results, levels of activity or performance expressed or implied by these forward-looking statements. These factors include, among other
things, the unknown risks and uncertainties that we believe could cause actual results to differ from these forward-looking statements
as set forth under the heading, "Risk Factors" and elsewhere in this Annual Report on Form 10-K. New risks and uncertainties
emerge from time to time, and it is not possible for us to predict all of the risks and uncertainties that could have an impact on the
forward-looking statements, including without limitation, risks and uncertainties relating to:

 our
 ability to manage our growth, including acquiring, partnering with, and effectively integrating
 acquired businesses into our infrastructure and avoiding legal exposure and liabilities associated
 with acquired companies and assets;

 our
 ability to retain our clients and revenue levels, including effectively migrating new clients
 and maintaining or growing the revenue levels of our new and existing clients;

 our
 ability to maintain operations in Pakistan, Azad Jammu and Kashmir, and Sri Lanka (together,
 the "Offshore Offices") in a manner that continues to enable us to offer competitively
 priced products and services;

 our
 ability to keep pace with a rapidly changing healthcare industry;

 our
 ability to consistently achieve and maintain compliance with a myriad of federal, state,
 foreign, local, payor and industry requirements, regulations, rules, laws and contracts;

 our
 ability to maintain and protect the privacy of confidential and protected Company, client
 and patient information;

 our
 ability to develop new technologies, upgrade and adapt legacy and acquired technologies to
 work with evolving industry standards and third-party software platforms and technologies,
 and protect and enforce all of these and other intellectual property rights;

 our
 ability to attract and retain key officers and employees, and the continued involvement of
 Mahmud Haq as Executive Chairman and A. Hadi Chaudhry as Chief Executive Officer and President,
 all of which are critical to our ongoing operations and growing our business;

 our
 ability to realize the expected cost savings and benefits from our restructuring activities
 and structural cost reductions;

 our
 ability to comply with covenants contained in our credit agreement with our senior secured
 lender, Silicon Valley Bank, a division of First Citizens Bank, and other future debt facilities;

 our
 ability to resume and then continue to pay our monthly dividends to the holders of our Series
 A and Series B preferred stock;

 our
 ability to incorporate AI into our products faster and more successfully than our competitors,
 protecting the privacy of medical records and cybersecurity threats;

 our
 ability to compete with other companies developing products and selling services competitive
 with ours, and who may have greater resources and name recognition than we have;

 our
 ability to respond to the uncertainty resulting from pandemics, epidemics or other public
 health emergencies and the impact they may have on our operations, the demand for our services,
 our projected results of operations, financial performance or other financial metrics or
 any of the foregoing risks and economic activity in general;

 our
 ability to keep and increase market acceptance of our products and services;

 changes
 in domestic and foreign business, market, financial, political and legal conditions; and

 other
 factors disclosed in this Annual Report on Form 10-K or our other filings with the Securities
 and Exchange Commission (the "SEC").

 Although
we believe that the expectations reflected in the forward-looking statements contained in this Annual Report on Form 10-K are reasonable,
we cannot guarantee future results, levels of activity, performance, or achievements. You should read this Annual Report on Form 10-K
with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially
different from what we currently expect. Except as required by law, we are under no duty to update or revise any of such forward-looking
statements, whether as a result of new information, future events, or otherwise, after the date of this Annual Report on Form 10-K.

 Summary
of Risk Factors

 The
following is a summary of the principal risks and uncertainties that could materially adversely affect our business, financial condition
and results of operations. You should read this summary together with the more detailed description of each risk factor contained in
"Risk Factors" in Part 1, Item 1A below.

 Risks
Related to our Business

 We
 operate in a highly competitive industry, and our competitors may be able to compete more
 efficiently or evolve more rapidly than we do, which could have a material adverse effect
 on our business, revenue, growth rates and market share.

 If
 we are unable to successfully introduce new products or services or fail to keep pace with
 advances in technology, we would not be able to maintain our customers or grow our business,
 which will have a material adverse effect on our business.

 The
 continued success of our business model is heavily dependent upon our offshore operations,
 and any disruption to those operations will adversely affect us.

 Our
 offshore operations expose us to additional business and financial risks which could adversely
 affect us and subject us to civil and criminal liability.

 We
 may be adversely affected by global climate change or by legal, regulatory, or market responses
 to such change.

 in the healthcare industry could affect the demand for our services and may result in a decrease
 in our revenues and market share.

 If
 providers do not purchase our products and services or delay in choosing our products or
 services, we may not be able to grow our business.

 If
 the revenues of our customers decrease, or if our customers cancel or elect not to renew
 their contracts, our revenue will decrease.

 As
 a result of our variable sales and implementation cycles, we may be unable to recognize revenue
 from prospective customers on a timely basis and we may not be able to offset expenditures.

 We
 are required to collect sales and use taxes on certain products and services we sell in certain
 jurisdictions. We may be subject to liability for past sales and incur additional related
 costs and expenses, and our future sales may decrease.

 If
 we lose the services of Mahmud Haq as Executive Chairman, A. Hadi Chaudhry as Chief Executive
 Officer and President, or other members of our management team, or if we are unable to attract,
 hire, integrate and retain other necessary employees, our business would be harmed.

 We
 may be unable to adequately establish, protect or enforce our patents, trade secrets and
 other intellectual property rights and we may incur significant costs in enforcing our intellectual
 property rights.

 Claims
 by others that we infringe or may infringe on their intellectual property could force us
 to incur significant costs or revise the way we conduct our business.

 Current
 and future litigation against us could be costly and time-consuming to defend and could result
 in additional liabilities.

 Our
 proprietary software or service delivery platform may not operate properly, which could damage
 our reputation, give rise to claims against us, or divert application of our resources from
 other purposes, any of which could harm our business and operating results.

 If
 our security measures are breached or fail, and unauthorized access is obtained to a customer's
 data, our service may be perceived as insecure, the attractiveness of our services to current
 or potential customers may be reduced, and we may incur significant liabilities.

 Our
 products and services are required to meet the interoperability standards, which could require
 us to incur substantial additional development costs or result in a decrease in revenue.

 Disruptions
 in internet or telecommunication service or damage to our data centers could adversely affect
 our business by reducing our customers' confidence in the reliability of our services
 and products.

 We
 may be subject to liability for the content we provide to our customers and their patients.

 We
 are subject to the effects of payer and provider conduct that we cannot control and that
 could damage our reputation with customers and result in liability claims that increase our
 expenses.

 Failure
 by our clients to obtain proper permissions and waivers may result in claims against us or
 may limit or prevent our use of data, which could harm our business.

 Any
 deficiencies in our financial reporting or internal controls could adversely affect our business
 and the trading price of our securities.

 Our
 goodwill has been subject to impairment and may be subject to further impairment in the future,
 which could have a material adverse effect on our results of operations, financial condition,
 or future operating results.

 We
 are a party to several related-party agreements with our founder and Executive Chairman,
 Mahmud Haq, which have significant contractual obligations.

 We
 depend on key information systems and third-party service providers.

 Systems
 failures or cyberattacks and resulting interruptions in the availability of or degradation
 in the performance of our websites, applications, products or services could harm our business.

 We
 use artificial intelligence in our business, and challenges with properly managing its use
 could result in reputational and competitive harm, legal liability, and adversely affect
 our results of operations.

 Rapid
 technological change in the telehealth industry presents us with significant risks and challenges.

 Our
 business, financial condition, results of operations and growth may be adversely affected
 by pandemics, epidemics or other public health emergencies, such as COVID-19.

 Risks
Related to Our Acquisition Strategy

 At
 the current prices of our common and Preferred Stock, we may be unable to execute accretive
 acquisitions.

 We
 may be unable to retain customers following their acquisition, which may result in a decrease
 in our revenues and operating results.

 Acquisitions
 may subject us to liability with regard to the creditors, customers, and shareholders of
 the sellers.

 acquisitions may result in potentially dilutive issuances of equity securities, the incurrence
 of indebtedness and increased amortization expense.

 Regulatory
Risks

 The
 healthcare industry is heavily regulated. Our failure to comply with regulatory requirements
 could create liability for us, result in adverse publicity and negatively affect our business.

 If
 we do not maintain the certification of our EHR solutions pursuant to the HITECH Act and
 Cures Act, our business, financial condition and results of operations will be adversely
 affected.

 If
 a breach of our measures protecting personal data covered by HIPAA or the HITECH Act occurs,
 we may incur significant liabilities.

 If
 we or our customers fail to comply with federal and state laws governing submission of false
 or fraudulent claims to government healthcare programs and financial relationships among
 healthcare providers, we or our customers may be subject to civil and criminal penalties
 or loss of eligibility to participate in government healthcare programs.

 Potential
 healthcare reform and new regulatory requirements placed on our products and services could
 increase our costs, delay or prevent our introduction of new products or services, and impair
 the function or value of our existing products and services.

 Additional
 regulation of the disclosure of medical information outside the United States may adversely
 affect our operations and may increase our costs.

 Our
 services present the potential for embezzlement, identity theft, or other similar illegal
 behavior by our employees.

 Risks
Related to Ownership of Shares of Our Common Stock

 Our
 revenues, operating results and cash flows may fluctuate in future periods and we may fail
 to meet investor expectations, which may cause the price of our common stock to decline.

 sales of shares of our common stock could depress the market price of our common stock.

 Mahmud
 Haq currently controls 31.7% of our outstanding shares of common stock, which will prevent
 investors from influencing significant corporate decisions.

 Provisions
 of Delaware law, of our amended and restated charter and amended and restated bylaws may
 make a takeover more difficult, which could cause our common stock price to decline.

 Any
 issuance of additional preferred stock in the future may dilute the rights of our existing
 stockholders.

 We
 do not intend to pay cash dividends on our common stock.

 Complying
 with the laws and regulations affecting public companies may increase our costs and the demands
 on management and could harm our operating results.

 We
 are a smaller reporting company and we cannot be certain if the reduced disclosure requirements
 applicable to smaller reporting companies will make our common stock less attractive to investors.

 New
 climate disclosure rules, if adopted by the SEC, may increase our costs and litigation risks,
 which could materially and adversely affect our future results of operations and financial
 condition.

 Risks
Related to Ownership of Shares of Our Preferred Stock

 In
 December 2023 we suspended the dividends on the Preferred Stock and they have not been reinstated.
 If and when they are reinstated, we may not be able to continue to pay dividends on the Preferred
 Stock if we fall out of compliance with our loan covenants and are prohibited by our bank
 lender from paying dividends or if we have insufficient cash to make dividend payments.

 Our
 Series A and Series B Preferred Stock rank junior to all of our indebtedness and other liabilities.

 We
 may issue additional shares of Preferred Stock and additional series of preferred stock that
 rank on parity with the Preferred Stock as to dividend rights, rights upon liquidation or
 voting rights.

 Market
 interest rates may materially and adversely affect the value of the Preferred Stock.

 Holders
 of the Preferred Stock may be unable to use the dividends-received deduction and may not
 be eligible for the preferential tax rates applicable to "qualified dividend income".

 Our
 Preferred Stock has not been rated.

 We
 may redeem the Series A and Series B Preferred Stock at any time.

 The
 market price of our Preferred Stock is variable and is substantially affected by various
 factors.

 A
 holder of Preferred Stock has extremely limited voting rights.

 The
 Preferred Stock is not convertible, and investors will not realize a corresponding upside
 if the price of the common stock increases.

 While
 the dividend on the Preferred Stock is suspended, we may be unable to raise additional capital
 without incurring excessive dilution.

 PART
I

 Item
1. Business

 Overview

 CareCloud,
Inc., (together with its consolidated subsidiaries, "CareCloud", the "Company," "we," "us"
and/or "our") is a leading provider of technology-enabled services and solutions that redefine the healthcare revenue cycle
management process. We provide technology-enabled revenue cycle management and a full suite of proprietary cloud-based solutions to healthcare
providers, from small practices to enterprise medical groups, hospitals, and health systems throughout the United States. Healthcare
organizations today operate in highly complex and regulated environments. Our suite of technology-enabled solutions helps our clients
increase financial and operational performance, streamline clinical workflows, and improve the patient experience.

 Our
portfolio of proprietary software and business services includes: technology-enabled business solutions that maximize revenue cycle management
and create efficiencies through platform agnostic AI-driven applications; cloud-based software that helps providers manage their practice
and patient engagement while leveraging analytics to improve provider performance; digital health services to address value-based care
and enable the delivery of remote patient care; healthcare IT professional services & staffing to address physician burnout, staffing
shortages and leverage consulting expertise to transition into the next generation of healthcare; and, medical practice management services
to assist medical providers with operating models and the tools needed to run their practice.

 Our
high-value business services, such as revenue cycle management, are often paired with our cloud-based software, premiere healthcare consulting
and implementation services, and on-demand workforce staffing capabilities for high-performance medical groups and health systems nationwide.

 Our
technology-enabled business solutions can be categorized as follows:

 Technology-enabled
 revenue cycle management:

 Cycle Management ("RCM") services including end-to-end medical billing, eligibility,
 analytics, and related services, all of which can be provided utilizing our technology platform
 and robotic process automation tools or leveraging a third-party system;

 coding and credentialing services to improve provider collections, back-end cost containment,
 and drive total revenue realization for our healthcare clients; and

 claims clearinghouse which enables our clients to electronically scrub and submit claims
 and process payments from insurance companies.

 Cloud-based
 software:

 Electronic
 Health Records, which are easy to use and sometimes integrated with our business services,
 and enable our healthcare provider clients to deliver better patient care, streamline their
 clinical workflows, decrease documentation errors, and potentially qualify for government
 incentives;

 Practice
 Management ("PM") software and related capabilities, which support our clients'
 day-to-day business operations and financial workflows, including automated insurance eligibility
 software, a robust billing and claims rules engine, and other automated tools designed to
 maximize reimbursement;

 Artificial
 intelligence ("AI"):

 CareCloud
 cirrusAI is designed to serve as a digital healthcare assistant, helping to enhance clinical
 decision-making, streamline workflows, reduce administrative burdens, optimize revenue management,
 and promote patient-centered care. The functions include:

 AI-Powered
 Clinical Decision Support: CareCloud cirrusAI Guide automates clinical data input, and assists
 clinicians in workflow tasks, providing real-time, evidence-based recommendations and personalized
 suggestions via Vertex AI's generative AI tools for providers to consider. This innovation
 can lead to enhanced diagnosis accuracy and treatment planning.

 AI-Powered
 Virtual Support Assistant: CareCloud cirrusAI Chat facilitates natural language conversations
 with practice staff members, offering valuable assistance in navigating CareCloud Electronic
 Health Records ("EHR") workflows. This tool streamlines post-training and onboarding
 for new staff, reducing response times and providing real-time assistance, ultimately saving
 time.

 AI-Driven
 Appeals: CareCloud cirrusAI Appeals generates customized appeal letters by analyzing patient
 claim details, the appeal's reason, and the specific payer involved for healthcare
 workers to review, edit, and send. This functionality supports CareCloud's RCM teams
 in optimizing providers' RCM and securing proper reimbursement.

 CareCloud
 cirrusAI integrates with CareCloud's EHR solution, talkEHR, making it easily accessible
 to providers of all sizes.

 Patient
 Experience Management ("PXM") solutions designed to transform interactions between
 patients and their clinicians, including smartphone applications that assist patients and
 healthcare providers in the provision of healthcare services, contactless digital check-in
 solutions, messaging, and online appointment scheduling tools;

 Business
 Intelligence ("BI") and healthcare analytics platforms that allow our clients
 to derive actionable insights from their vast amount of data; and

 Customized
 applications, interfaces, and a variety of other technology solutions that support our healthcare
 clients.

 Digital
 health:

 Chronic
 care management is a program that supports care for patients with chronic conditions by certified
 care managers that operate under the supervision of the patient's regular physician;

 Remote
 patient monitoring enables patient data collected outside the clinical setting through remote
 devices to be fed into their provider's EHR to enable proactive patient care; and

 Telemedicine
 solutions which allow healthcare providers to conduct remote patient visits and extend the
 timely delivery of care to patients unable to travel to a provider's office.

 IT professional services & staffing:

 Professional
 services consisting of a broad range of consulting services including full software implementations
 and activation, revenue cycle optimization, data analytic services, and educational training
 services;

 Strategic
 advisory services to manage system evaluations and selection, provide interim management,
 and operational assessments; and

 Workforce
 augmentation and on-demand staffing to support our clients as they expand their businesses,
 seek highly trained personnel, or struggle to address staffing shortages.

 Our
medical practice management solutions include:

 practice management:

 practice management services are provided to medical practices. In this service model, we
 provide the medical practice with appropriate facilities, equipment, supplies, support services,
 nurses and administrative support staff. We also provide management, bill-paying and financial
 advisory services.

 The
modernization of the healthcare industry, along with the increased adoption of value-based care models, is transforming nearly every
aspect of a healthcare organization from policy to providers; clinical care to member services, devices to data, and ultimately the quality
of the patient's experience as a healthcare consumer.

 Our
solutions enable clients to increase financial and operational performance, streamline clinical workflows, get better insight through
data, and make better business and clinical decisions, resulting in improvement in patient care and collections while reducing administrative
burdens and operating costs.

 We
create elegant, user-friendly applications that solve many of the challenges facing healthcare organizations. We partner with organizations
to develop customized, best-in-class solutions to solve their specific challenges while ensuring they also meet future regulatory and
organizational requirements and market demands.

 Market
Overview

 In
June 2023, Centers for Medicare & Medicaid Services ("CMS") 1 reported that over 2022-2031 the average National
Health Expenditures ("NHE") growth (5.4%) is projected to outpace that of average Gross Domestic Product ("GDP")
growth (4.6%) resulting in an increase in the health spending share of GDP from 18.3% in 2021 to 19.6% in 2031.

 Additionally,
analysts from The Brainy Research have estimated the U.S. Healthcare IT industry market to be approximately $105 billion in 2022 and
is projected to reach $370.5 billion by 2032, growing at a 13.4% compound annual growth rate ("CAGR"). 2 Its largest
sub-segment, RCM, is reported to be nearly $140 billion in 2022 and is estimated to grow at a 10% CAGR through 2030 according to Grand
View Research. 3 The U.S. EHR market is expected to be valued at $40 billion by 2030 with a CAGR of 12.5% from 2022 to 2030. 4
 The Telehealth market is estimated to be approximately $30 billion in 2022 with a CAGR of 23% from 2023 to 2030. 5

 Our
Market Opportunity

 Considering
the evolving needs of our clients and the market, we believe we continue to be uniquely positioned to provide tremendous value and support
for our clients. We believe there are dynamics at play that are significantly increasing the market need for our products and services.
These market dynamics present opportunities for us to innovate and focus on impacting the day-to-day challenges our clients face as they
work to provide excellent patient care, all while managing and expanding their businesses.

practices and health systems alike are transitioning to increasingly complex reimbursement delivery models. As an example, the industry
has been gradually shifting from fee-for-service payments to value-based/clinical outcomes-based care payments. This transition comes
in a multitude of forms including reimbursement models associated with quality incentive programs, capitation payments models, bundled
payments, and at-risk payer contracts.

 There
are continuing legislative and regulatory reform efforts, as well as growing compliance requirements mandated by the federal government
and other governmental agencies. This ever-evolving regulatory landscape increases the pressure placed on healthcare organizations to
stay abreast of these changes and to remain in compliance. The complexities associated with emerging reimbursement models and continued
government regulations present opportunities for us as healthcare organizations seek out partners that offer a broad range of software
and services to help meet their needs.

 Our
clients also have to account for the rising cost of health insurance, changes in health benefit plan design, and the impact that these
factors have had on the increase in patient consumerism. Patients are seeking lower cost care in response to insurance carriers shifting
more of the cost burden onto patients, causing healthcare organizations to reconsider the full patient experience. Healthcare providers
now need to think more deeply about patient expectations. This is especially true as COVID-19 has reshaped the sector and accelerated
its digital transformation.

 Further
compounding the burden of rising health insurance cost is the ongoing shift in patient demographics. As the national population ages
into Medicare eligibility, the reimbursement received for procedures and services provided to these patients decreases. Medicaid is now
the largest insurance product in the country and continues to grow. Reimbursements overall are not increasing at the same rate as costs,
driving providers and practices to search for increased efficiencies and savings wherever possible.

 Strategic-thinking
healthcare organizations across the country are aggressively addressing these new realities and are finding opportunities for growth
and expansion. We see medical groups across the country and within all specialties and market segments, growing through consolidation
and investing in their businesses at an accelerated pace. This is also leading clients to focus on delivering emerging and disruptive
care delivery settings. Much of this change is driving executives and leaders to assess their IT and data strategy and reevaluate their
adoption of next generation healthcare solutions. The healthcare industry has seen tremendous change over the last three years, with
COVID-19 ushering in a new era of digital health. Our study of the evolving needs of our clients leads us to believe that there will
be an increasing need for our services and products and emerging needs for the products and services that we are already developing.

 CMS – National Health Expenditure Historical

The Brainy Research – US Healthcare IT Market

U.S. Revenue Cycle Management Market Size Report, 2030 (grandviewresearch.com)

US Electronic Health Record Market Set to Surge to $39.993 Billion by 2030 with Notable CAGR of 12.5% (yahoo.com)

Healthcare IT Market in US Size, Share, Trends | Report 2030 (alliedmarketresearch.com)

 These
trends will fuel growth over the next several years. In order for healthcare organizations to continue to succeed, these new realities
require robust solutions and careful execution. Legacy tools that once powered these healthcare organizations are insufficient to support
their growth and long-term strategies. Our solutions facilitate the transition needed by these organizations to adopt the next generation
of healthcare solutions to drive their future growth. Our expansive product and services portfolio enables us to displace competitors
and gain market share across a vast array of specialties, care settings and customer segments across the country.

 Our
Business Strategy

 The
Company is focused on reducing costs, returning to profitability and generating positive free cash flow in order to resume paying the
Preferred Stock dividends. CareCloud is a market leading provider of technology-enabled and integrated end-to-end Software-as-a-Service
("SaaS") solutions that help our clients with the business of medicine. Our mission is to redefine the next generation of
technology-enabled revenue cycle solutions. To that end, we invest significant resources toward improving our current offerings and building
new solutions that help transform our clients' organizations with next generation technology. We expect to have increased software
capabilities and offer additional complementary business services that will address the needs of the ever-changing, dynamic market conditions
of the U.S. healthcare space.

 To
achieve our objective and mission, we employ the following strategies:

 Providing
comprehensive next generation RCM solutions to medical practices and hospitals. We believe that healthcare providers are in need
of an integrated, end-to-end solution and a flexible service delivery model to manage the different facets of their businesses, from
care delivery software, to claim submission, financial reporting, and data analytics.

 Enhancing
our solutions. We intend to continue to enhance our solutions with new functionality and features leveraging our own teams, partnerships,
and acquisitions. We will continue to dedicate resources to research and development to bolster our existing applications and drive new
opportunities for innovation on behalf of our clients.

 Expanding
into new categories/specialties/markets. We are focused on always reassessing the market landscape, seeking new opportunities
to meet the needs of the clients in our addressable market with our products and services. This means developing new and exciting technologies,
launching new services, entering new specialties that can leverage our solutions and enabling growth for our clients or expanding into
adjacent markets that we may not serve today.

 Relentlessly
driving organic growth to expand our client base. We believe the market for our expansive value proposition is underserved, and
we will continue to make investments to create awareness of our brand, optimize our sales and implementation lifecycles, and capture
greater market share. We are investing in our sales and marketing activities, partners, and products to expand our client footprint.

 Extending
our relationships with existing clients. Our CareCloud Wellness offerings have been well-received allowing us to generate additional
recurring revenue from existing clients. We intend to increase the number of SaaS subscription licenses and services purchased by our
current clients as they use our solutions. We are also focused on converting SaaS clients into higher revenue per client offerings such
as revenue cycle management and other business services. This expansion of services typically represents a 3-4x increase in overall revenue
per client.

 Leveraging
significant cost advantages provided by our technology and global workforce. Our unique business model includes our cloud-based
software and a cost-effective offshore workforce located in our Offshore Offices. We believe this operating model provides us with significant
cost advantages compared to other revenue cycle management companies and it allows us to significantly reduce the operational costs of
the companies we acquire.

 Developing
our partner ecosystem. We offer an integrated partner ecosystem providing healthcare organizations access to a variety of innovative
solutions that complement our suite of products and services. Our partner ecosystem is a comprehensive collection of apps, services,
specialty solutions, and clinical connections. This is an integral part of our vision to be the premier cloud-based platform for healthcare.

 As
the market continues to evolve, we may choose to build or partner for some or all of these solutions in order to broaden our product
set. In the longer term, we also envision how this will allow for frictionless flow of information and care-coordination capabilities
between medical providers and their patients.

 Additionally,
given the nature of our large data repository, which is ever-growing as each patient encounter is captured, opportunities exist to potentially
monetize this data in an identified manner to help improve clinical outcomes and other financial metrics.

 Our
Offerings

 Our
solutions are designed to systematically drive clinical quality and patient outcomes, streamline staff and provider workflows and reimbursements,
as well as support different settings of care and healthcare models. Our product and service strategy is simple: we build products and
deliver solutions that meet our clients' needs.

 Through
the combination of our continued development of next generation solutions and strategic acquisition strategy, we provide comprehensive
products and services tailored for small medical practices, large physician groups and health systems, as well as industry partners.
We continue to optimize our technology offerings by integrating them into our application ecosystem and with other industry solutions.
The interconnectivity of our solutions will continue driving a consolidation of brands within our product architecture, aimed at improving
the awareness and alignment of our products to targeted industry segments.

 Our
robust product and service portfolio allows us to be both methodical and nimble across the healthcare organizations and market segments
we serve while providing a framework to create solution sets for the market today and more importantly, for what our clients will need
tomorrow.

 We
believe that our fully integrated solutions uniquely address the challenges in the industry. In most cases the standard fee for our complete,
integrated, end-to-end solution is based upon a percentage of each client's healthcare-related revenues, with a monthly minimum
fee, plus a nominal one-time setup fee, which is competitively priced.

and Development

 Our
research and development focuses are on enhancing and expanding our service offerings while ensuring all offerings meet regulatory compliance
standards. We continually update our software and technology infrastructures, regularly execute releases of new software enhancements,
and adapt our offerings to better serve our medical group and health system clients confronting rapid changes in the healthcare market
space.

 Our
agile software development methodology is designed to ensure that each software release is properly designed, built, tested, and released.
Our product, engineering, quality assurance, and development operations teams are located both onshore and offshore. We complement our
internal efforts with services from third-party technology providers for infrastructure, healthcare ecosystem connectivity needs such
as prescriptions, clinical laboratories, or specific application requirements.

 We
also employ product management, user experience, and product marketing personnel who work continually on improvements to our products
and services design.

 Clients

 We
estimate that as of December 31, 2023, we provided software and services to approximately 40,000 providers (which we define as physicians,
nurses, nurse practitioners, therapists, physician assistants and other clinicians that render bills for their services) practicing in
approximately 2,600 independent medical practices and hospitals, representing 80 specialties and subspecialties in 50 states allowing
for low revenue concentration risk.

 In
addition, we served approximately 150 clients that are not medical practices, but are primarily service organizations who serve the healthcare
community. The foregoing numbers include clients leveraging any of our products or services and are based in part upon estimates where
the precise number of practices or providers is unknown.

 We
service clients ranging from small practices to large groups and health systems. Our clients span from the single doctor independent
medical practices to large medical groups, including an enterprise specialty-specific healthcare organization with more than 3,000 providers
located across multiple states. We also service large major academic medical institutions, small and large hospitals and health systems
with service areas covering millions of patients.

 Sales
and Marketing

 Over
the past several years, organic growth has been a company-wide focus. We have developed sales and marketing capabilities aimed at driving
the growth of our client base, including small medical practices, large groups, and health systems. We expect to expand by selling our
complete suite of software and services to new clients and up-selling additional solutions into our existing client base. We have a direct
sales force including team members focused on specific functional or divisional areas, such as CareCloud Force (workforce augmentation)
and medSR (healthcare IT consulting). This direct sales force is supplemented by offshore staff who support our sales and marketing efforts
24 hours per day. In addition, our direct sales are augmented through our partner initiatives and marketing campaigns. We continue to
leverage and optimize various digital channels to present our solutions, identify national events to demonstrate our integrated capabilities
and expand our participation in thought leadership and social communications to connect with the healthcare community.

 Our
Growth Levers

 We
believe that we are in a good position to grow through organic growth and partnerships.

 Organic
Growth and Direct Sales

 We
have organized our sales force into different segments to promote the respective products and services for that segment and best address
our clients' needs and our markets. With this design, our sales team can address a client's specific needs, whether a new
client is seeking our products or services for the first time, or a current client is in need of additional solutions.

 Our
marketing team operates in support of our sales force and provides specialized demand generation capabilities for sales efforts, product
marketing to align solutions and segments, customer communication and upselling initiatives, and drives a national tradeshow strategy
to showcase our brand. Our sales approach is consultative in nature for most of our offerings, which generally includes an analysis based
on a prospective client's needs, crafting service proposals, and negotiating contracts that culminate in the commencement of services.

 Our
go-to-market strategy is designed to meet our customers' needs. Our vast array of products and services allow us to craft solutions
that can meet our customers' unique needs within a specific product category, client segment, or both.

 Growth
through Partnerships

 In
addition to our direct sales force, we maintain business relationships with third parties that utilize, promote, or support our sales
or services within specific industries or geographic regions. Some of these partners are customers through CareCloud Force and others
are more traditional channel partners who help promote our solutions. We believe we can further accelerate organic growth through industry
participants, whereby we utilize them as channel partners to offer integrated solutions to their clients. We have entered into such engagements
with industry participants, and developed application interfaces with numerous EHR systems, together with device and lab integration
to support these relationships.

 Competition

 The
market for RCM, practice management, EHR solutions, and related services is highly competitive, and we expect competition to increase
in the future. We face competition from other providers of both integrated and stand-alone RCM providers, practice management, and EHR
solutions, including competitors who utilize a web-based platform and providers of locally installed software systems.

 Many
of our competitors have longer operating histories, greater brand recognition and greater financial marketing. We also compete with various
regional RCM companies, some of which may continue to consolidate and expand into broader markets. We expect that competition will continue
to increase as a result of incentives provided by various governmental initiatives, and consolidation in both the information technology
and healthcare industries. Large groups and health systems that have grown through consolidation often realize economies of scale by
establishing billing and management offices to perform many of the services we offer themselves. In addition, our competitive edge could
be diminished or completely lost if our competition develops similar offshore operations in Pakistan or other countries, such as India
and the Philippines, where labor costs are lower than those in the U.S. (although higher than in Pakistan). Pricing pressures could negatively
impact our margins, growth rate and market share.

 We
believe we have a competitive advantage, as we are able to deliver our industry-leading solutions at competitive prices because we leverage
a combination of our proprietary software, which automates our workflows and increases efficiency, together with a global team that includes
more than 300 experienced health industry experts onshore. These experts are supported by our highly educated and specialized offshore
workforce of approximately 3,200 team members at labor costs that we believe are approximately one-tenth the cost of comparable U.S.
employees.

 Our
unique business model has allowed us to become a leading consolidator in our industry sector, gaining us a reputation for acquiring and
positively transforming distressed competitors into an accretive acquisition.

 Employees

 Including
the employees of our subsidiaries, as of December 2023, the Company employed approximately 3,600 people worldwide on a full-time basis.
Approximately 71% of our employees are focused on service and client delivery functions, approximately 10% are assigned to research and
development, and approximately 2% are engaged in sales and marketing. The balance of the employees is classified as general and administrative,
which includes support staff to maintain our offshore offices, a function that many businesses in other geographies might choose to outsource.
We also utilize the services of a small number of part-time employees. In addition, all officers of the Company work on a full-time basis.
During 2024, we anticipate further reducing our employee count.

 Voting
Rights of Our Directors, Executive Officers, and Principal Stockholders

 As
of December 31, 2023, approximately 38% of both the shares of our common stock and voting power of our common stock are held by our directors
and executive officers. Therefore, they have the ability to control the outcome of matters submitted to our stockholders for approval,
including the election of our directors, as well as the overall management and direction of our Company.

 We
were incorporated in Delaware on September 28, 2001, under the name Medical Transcription Billing, Corp., and legally changed our name
to MTBC, Inc. in February 2019. On March 29, 2021, we legally changed the name of the Company to CareCloud, Inc. Our principal executive
offices are located at 7 Clyde Road, Somerset, New Jersey 08873, and our telephone number is (732) 873-5133. Our website address is www. CareCloud.com.
Information contained on, or that can be accessed through, our website is not incorporated by reference into this Annual Report on Form
10-K, and you should not consider information on our website to be part of this document.

 CareCloud.com,
CareCloud, MTBC, A Unique Healthcare IT Company, and other trademarks and service marks of CareCloud appearing in this Annual Report
on Form 10-K are the property of CareCloud. Trade names, trademarks and service marks of other companies appearing in this Annual Report
on Form 10-K are the property of their respective holders.

 We
are a smaller reporting company. As a smaller reporting company, we may take advantage of specified reduced reporting requirements and
are relieved of certain other significant requirements that are otherwise generally applicable to public companies. As a smaller reporting
company, we have reduced disclosure obligations regarding executive compensation in our Annual Report, periodic reports and proxy statements
and providing only two years of audited financial statements in our Annual Report and our periodic reports. This year the Company is
not required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended. The Company
is a non-accelerated filer.

 Where
You Can Find More Information

 Our
website, which we use to communicate important business information, can be accessed at: www. CareCloud.com. We make our Annual Reports
on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports available free of charge
on or through our website as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities
and Exchange Commission ("SEC"). Materials we file with or furnish to the SEC may also be read and copied at the SEC's
Public Reference Room at 100 F Street, NE, Washington, D.C. 20549. Information on the operation of the Public Reference Room may be obtained
by calling the SEC at 1-800-SEC-0330. Also, the SEC's website (www.sec.gov) contains reports, proxy and information statements,
and other information that we file electronically with the SEC.

 Item
1A. Risk Factors

 Risks
Related to Our Business

 We
operate in a highly competitive industry, and our competitors may be able to compete more efficiently or evolve more rapidly than we
do, which could have a material adverse effect on our business, revenue, growth rates and market share.

 The
market for revenue cycle management and healthcare IT solutions is highly competitive, and we expect competition to increase in the future.
We face competition from other providers of both integrated and stand-alone practice management, EHR and RCM solutions, including competitors
who utilize a web-based platform and providers of locally installed software systems. Our competitors include larger healthcare IT companies,
such as athenahealth, Inc., eClinicalWorks, Greenway Medical Technologies, Inc., NextGen, R1 RCM and Veradigm, all of which may be able
to respond more quickly and effectively than we can to new or changing opportunities, technologies, standards, regulations or customer
needs and requirements. Many of our competitors have longer operating histories, greater brand recognition and greater financial marketing
and other resources than us. We also compete with various regional RCM companies, some of which may continue to consolidate and expand
into broader markets. We expect that competition will continue to increase as a result of incentives provided by the Health Information
Technology for Economic and Clinical Health ("HITECH") Act, and consolidation in both the information technology and healthcare
industries. Competitors may introduce products or services that render our products or services obsolete or less marketable. Even if
our products and services are more effective than the offerings of our competitors, current or potential customers might prefer competitive
products or services to our products and services. In addition, our competitive edge could be diminished or completely lost if our competition
develops similar offshore operations in Pakistan or other countries, such as India and the Philippines, where labor costs are lower than
those in the U.S. (although higher than in Pakistan). Pricing pressures could negatively impact our margins, growth rate and market share.

 In
order to operate more efficiently, control costs and improve profitability, we incurred $645,000 of restructuring costs in 2023, primarily
consisting of severance and separation costs associated with the optimization of the Company's operations and profitability improvements.
We expect to incur approximately an additional $250,000 of restructuring costs in 2024. There can be no assurance that these actions
will achieve their intended benefits.

 If
we are unable to successfully introduce new products or services or fail to keep pace with advances in technology, we would not be able
to maintain our customers or grow our business, which will have a material adverse effect on our business.

 Our
business depends on our ability to adapt to evolving technologies and industry standards and upgrade existing products and introduce
new products and services accordingly. If we cannot adapt to changing technologies and industry standards, including changing requirements
of third-party applications and software and meet the requirements of our customers, our products and services may become obsolete, and
our business would suffer significantly. Because both the healthcare industry and the healthcare IT technology market are constantly
evolving, our success will depend, in part, on our ability to continue to enhance our existing products and services, develop new technology
that addresses the increasingly sophisticated and varied needs of our customers, respond to technological advances and emerging industry
standards and practices on a timely and cost-effective basis, educate our customers to adopt these new technologies, and successfully
assist them in transitioning to our new products and services. The development of our proprietary technology entails significant technical
and business risks. We may not be successful in developing, using, marketing, selling, or maintaining new technologies effectively or
adapting our proprietary technology to evolving customer requirements, emerging industry standards or changing third party applications,
and, as a result, our business and reputation could materially suffer. We may not be able to introduce new products or services on schedule,
or at all, or such products or services may not achieve market acceptance or existing products or services may cease to function properly.
A failure by us to timely adapt to ever changing technologies or our failure to regularly upgrade existing or introduce new products
or to introduce these products on schedule could cause us to not only lose our current customers but also fail to attract new customers.

 The
continued success of our business model is heavily dependent upon our offshore operations, and any disruption to those operations will
adversely affect us.

 The
majority of our operations, including the development and maintenance of our web-based platform, our customer support services and medical
billing activities, are performed by our highly educated workforce of approximately 3,200 employees in our Offshore Offices. Approximately
98% of our offshore employees are in our Pakistan Offices and our remaining employees are located at our smaller offshore operation center
in Sri Lanka. The performance of our operations in our Pakistan Offices, and our ability to maintain our Offshore Offices, is an essential
element of our business model, as the labor costs where our Pakistan Offices are located are substantially lower than the cost of comparable
labor in India, the United States and other countries, and allows us to competitively price our products and services. Our competitive
advantage will be greatly diminished and may disappear altogether if our operations in our Pakistan Offices are negatively impacted.

 Pakistan
and Sri Lanka have in the past experienced and could in the future continue to experience periods of political and social unrest, war
and acts of terrorism. Our operations in our offshore locations may be negatively impacted by these and a number of other factors, including
currency fluctuations, cost of labor and supplies, power grid and infrastructure issues, vandalism, and changes in local law, as well
as laws within the United States relating to these countries. Client mandates or preferences for onshore service providers may also adversely
impact our business model. Our operations in our Offshore Offices may also be affected by trade restrictions, such as tariffs or other
trade controls. If we are unable to continue to leverage the skills and experience of our highly educated workforce, particularly in
our Pakistan Offices, we may be unable to provide our products and services at attractive prices, and our business would be materially
and negatively impacted or discontinued.

 We
believe that the labor costs in our Offshore Offices are approximately 9% of the cost of comparably educated and skilled workers in the
U.S. If there were potential disruptions in any of these locations, they could have a negative impact on our business.

 Our
offshore operations expose us to additional business and financial risks which could adversely affect us and subject us to civil and
criminal liability.

 The
risks and challenges associated with our operations outside the United States include laws and business practices favoring local competitors;
compliance with multiple, conflicting and changing governmental laws and regulations, including employment and tax laws and regulations;
and fluctuations in foreign currency exchange rates. Foreign operations subject us to numerous stringent U.S. and foreign laws, including
the Foreign Corrupt Practices Act ("FCPA"), and comparable foreign laws and regulations that prohibit improper payments or
offers of payments to foreign governments and their officials and political parties by U.S. and other business entities for the purpose
of obtaining or retaining business. Safeguards we implement to discourage these practices may prove to be less than effective and violations
of the FCPA and other laws may result in severe criminal or civil sanctions, or other liabilities or proceedings against us, including
class action lawsuits and enforcement actions from the SEC, Department of Justice and overseas regulators.

 We
may be adversely affected by global climate change or by legal, regulatory, or market responses to such change.

 The
long-term effects of climate change are difficult to predict and may be widespread. The impacts may include physical risks (such as severe
rains and flooding as a result of climate change that has been experienced in Pakistan), social and human effects (such as population
dislocations or harm to health and well-being), compliance costs and transition risks (such as regulatory or technology changes), and
other adverse effects. The effects could impair, for example, the availability and cost of certain products and energy (including utilities),
which in turn may impact our ability to procure goods or services required for the operation of our business at the quantities and levels
we require. We may bear losses incurred as a result of, for example, physical damage to, or destruction of, our facilities (such as our
operation centers), and business interruption due to weather events that may be attributable to climate change. These events and impacts
could materially adversely affect our business operations, financial position, or results of operation.

in the healthcare industry could affect the demand for our services and may result in a decrease in our revenues and market share.

 As
the healthcare industry evolves, changes in our customer base may reduce the demand for our services, result in the termination of existing
contracts, and make it more difficult to negotiate new contracts on terms that are acceptable to us. For example, the current trend toward
consolidation of healthcare providers may cause our existing customer contracts to terminate as independent practices are merged into
hospital systems or other healthcare organizations. Such larger healthcare organizations may have their own practice management, and
EHR and RCM solutions, reducing demand for our services. If this trend continues, we cannot assure you that we will be able to continue
to maintain or expand our customer base, negotiate contracts with acceptable terms, or maintain our current pricing structure, which
would result in a decrease in our revenues and market share.

 If
providers do not purchase our products and services or delay in choosing our products or services, we may not be able to grow our business.

 Our
business model depends on our ability to sell our products and services. Acceptance of our products and services may require providers
to adopt different behavior patterns and new methods of conducting business and exchanging information. Providers may not integrate our
products and services into their workflow and may not accept our solutions and services as a replacement for traditional methods of practicing
medicine. Providers may also choose to buy our competitors' products and services instead of ours. Achieving market acceptance
for our solutions and services will continue to require substantial sales and marketing efforts and the expenditure of significant financial
and other resources to create awareness and demand by providers. If providers fail to broadly accept our products and services, our business,
financial condition and results of operations will be adversely affected.

 If
the revenues of our customers decrease, or if our customers cancel or elect not to renew their contracts, our revenue will decrease.

 Under
most of our customer contracts, which include RCM, we base our charges on a percentage of the revenue that our customer collects through
the use of our services. Many factors may lead to decreases in customer revenue, including:

 reduction
 of customer revenue as a result of changes to the Affordable Care Act ("ACA") or fluctuations in medical appointments
 due to future pandemics;

 a
 rollback of the expansion of Medicaid or other governmental programs;

 reduction
 of customer revenue resulting from increased competition or other changes in the marketplace for physician services;

 failure
 of our customers to adopt or maintain effective business practices;

 actions
 by third-party payers of medical claims to reduce reimbursement;

 government
 regulations and government or other payer actions or inactions reducing or delaying reimbursement;

 interruption
 of customer access to our system; and

 our
 failure to provide services in a timely or high-quality manner.

 As
a result of our variable sales and implementation cycles, we may be unable to recognize revenue from prospective customers on a timely
basis and we may not be able to offset expenditures.

 The
sales cycle for our services can be variable, typically ranging from two to four months from initial contact with a potential customer
to contract execution to six to twelve months to rollout services which require each patient to participate. During the sales cycle,
we expend time and resources in an attempt to obtain a customer without recognizing revenue from that customer to offset such expenditures.
Our implementation cycle is also variable, typically ranging from two to four months from contract execution to completion of implementation.
Each customer's situation is different, and unanticipated difficulties and delays may arise as a result of a failure by us or by
the customer to meet our respective implementation responsibilities. During the implementation cycle, we expend substantial time, effort,
and financial resources implementing our services without recognizing revenue. Even following implementation, there can be no assurance
that we will recognize revenue on a timely basis or at all from our efforts. In addition, cancellation of any implementation after it
has begun may involve loss to us of time, effort, and expenses invested in the canceled implementation process, and lost opportunity
for implementing paying customers in that same period of time.

 We
are required to collect sales and use taxes on certain products and services we sell in certain jurisdictions. We may be subject to liability
for past sales and incur additional related costs and expenses, and our future sales may decrease.

 We
may lose sales or incur significant expenses should states be successful in imposing additional state sales and use taxes on our products
and services. A successful assertion by one or more states that we should collect sales or other taxes on the sale of our products and
services that we are currently not collecting could result in substantial tax liabilities for past sales, decrease our ability to compete
with healthcare IT vendors not subject to sales and use taxes, and otherwise harm our business. Each state has different rules and regulations
governing sales and use taxes, and these rules and regulations are subject to varying interpretations that may change over time. We review
these rules and regulations periodically and, when we believe that our products or services are subject to sales and use taxes in a particular
state, we voluntarily approach state tax authorities in order to determine how to comply with their rules and regulations. We cannot
assure you that we will not be subject to sales and use taxes or related penalties for past sales in states where we believe no compliance
is necessary.

 If
the federal government were to impose a tax on imports or services performed abroad, we might be subject to additional liabilities. At
this time, there is no way to predict whether this will occur or estimate the impact on our business.

 Vendors
of products and services like ours are typically held responsible by taxing authorities for the collection and payment of any applicable
sales and similar taxes. If one or more taxing authorities determine that taxes should have, but have not, been paid with respect to
our products or services, we may be liable for past taxes in addition to taxes going forward. Liability for past taxes may also include
very substantial interest and penalty charges. Nevertheless, customers may be reluctant to pay back taxes and may refuse responsibility
for interest or penalties associated with those taxes. If we are required to collect and pay back taxes and the associated interest and
penalties, and if our customers fail or refuse to reimburse us for all or a portion of these amounts, we will have incurred unplanned
expenses that may be substantial. Moreover, imposition of such taxes on our products and services going forward will effectively increase
the cost of those products and services to our customers and may adversely affect our ability to retain existing customers or to gain
new customers in the states in which such taxes are imposed.

 We
may also become subject to tax audits or similar procedures in states where we already pay sales and use taxes. The incurrence of additional
accounting and legal costs and related expenses in connection with, and the assessment of, taxes, interest, and penalties as a result
of audits, litigation, or otherwise could be materially adverse to our current and future results of operations and financial condition.

 If
we lose the services of Mahmud Haq as Executive Chairman, A. Hadi Chaudhry as Chief Executive Officer and President, or other members
of our management team, or if we are unable to attract, hire, integrate and retain other necessary employees, our business would be harmed.

 Our
future success depends in part on our ability to attract, hire, integrate and retain the members of our management team and other qualified
personnel. In particular, we are dependent on the services of Mahmud Haq, our founder, principal stockholder and Executive Chairman,
and A. Hadi Chaudhry, our Chief Executive Officer and President. Mr. Haq is instrumental in managing our offshore operations in our Pakistan
Offices and coordinating those operations with our U.S. activities. The loss of Mr. Haq, who would be particularly difficult to replace,
could negatively impact our ability to effectively manage our cost-effective workforce in our Pakistan Offices, which enables us to provide
our products and solutions at attractive prices. Our future success also depends on the continued contributions of our other executive
officers and certain key employees, each of whom may be difficult to replace, and upon our ability to attract and retain additional management
personnel. Competition for such personnel is intense, and we compete for qualified personnel with other employers. We may face difficulty
identifying and hiring qualified personnel at compensation levels consistent with our existing compensation and salary structure. If
we fail to retain our employees, we could incur significant expenses in hiring, integrating and training their replacements, and the
quality of our services and our ability to serve our customers could diminish, resulting in a material adverse effect on our business.

 We
may be unable to adequately establish, protect or enforce our patents, trade secrets and other intellectual property rights and we may
incur significant costs in enforcing our intellectual property rights.

 Our
patents, trademarks, trade secrets, copyrights, and other intellectual property rights are important assets to us. Various events outside
of our control pose a threat to our intellectual property rights, as well as to our products, services, and technologies. For instance,
any of our current or future intellectual property rights may be challenged by others or invalidated through administrative process or
litigation. Any of our pending or future patent applications, whether or not being currently challenged, may not be issued with the scope
of the claims we seek, if at all.

 Our
success depends in part upon our ability to establish, protect and enforce our patents, trade secrets and other intellectual property
and proprietary rights. If we fail to establish, protect or enforce these rights, we may lose customers and important advantages in the
market in which we compete. We rely on a combination of patent, trademark, copyright and trade secret law and contractual obligations
to protect our key intellectual property rights, all of which provide only limited protection. Our intellectual property rights may not
be sufficient to help us maintain our position in the market and our competitive advantages.

 Trade
secrets may not be protectable if not properly kept confidential. We strive to enter into non-disclosure agreements with our employees,
customers, contractors and business partners to limit access to and disclosure of our proprietary information. However, the steps we
have taken may not be sufficient to prevent unauthorized use of our customer information, technology, and adequate remedies may not be
available in the event of unauthorized use or disclosure of our trade secrets and proprietary information. Our ability to protect the
trade secrets of our acquired companies from disclosure by the former employees of these acquired entities may be limited by law in the
jurisdiction in which the acquired company and/or former employee resides, and/or where the disclosure occurred, and this leaves us vulnerable
to the solicitation of the customers we acquire by former employees of the acquired business that join our competitors.

 Accordingly,
despite our efforts, we may be unable to prevent third parties from using our intellectual property for their competitive advantage.
Any such use could have a material adverse effect on our business, results of operations and financial condition. Monitoring unauthorized
uses of and enforcing our intellectual property rights can be difficult and costly. Legal intellectual property actions are inherently
uncertain and may not be successful, and may require a substantial amount of resources and divert our management's attention.

 We
have taken efforts to protect our proprietary rights, including a combination of license agreements, confidentiality policies and procedures,
confidentiality provisions in employment agreements, confidentiality agreements with third parties, and technical security measures,
as well as our reliance on copyright, patent, trademark, trade secret and unfair competition laws. These efforts may not be sufficient
or effective. For example, the secrecy of our trade secrets or other confidential information could be compromised by our employees or
by third parties, which could cause us to lose the competitive advantage resulting from those trade secrets or confidential information.
Unauthorized third parties may try to copy or reverse engineer portions of our products or otherwise infringe upon, misappropriate or
use our intellectual property. We may not be able to discover or determine the extent of any unauthorized use of our proprietary rights.
We may also conclude that, in some instances, the benefits of protecting our intellectual property rights may be outweighed by the expense.

 In
addition, our platforms incorporate "open source" software components that are licensed to us under various public domain
licenses. Open source license terms are often ambiguous, and there is little or no legal precedent governing the interpretation of many
of the terms of certain of these licenses. Therefore, the potential impact of such terms on our business is somewhat unknown. Further,
some enterprises may be reluctant or unwilling to use cloud-based services, because they have concerns regarding the risks associated
with the security and reliability, among other things, of the technology delivery model associated with these services. If enterprises
do not perceive the benefits of our services, then the market for these services may not expand as much or develop as quickly as we expect,
either of which would adversely affect our business, financial condition, or operating results.

 Legal
standards relating to the validity, enforceability and scope of protection of intellectual property rights are uncertain and still evolving.
The laws of some foreign countries may not be as protective of intellectual property rights as those in the United States, and effective
intellectual property protection may not be available in every country in which our products and services are distributed.

 Any
impairment of our intellectual property rights, or our failure to protect our intellectual property rights adequately, could give our
competitors access to our technology and could materially and adversely impact our business and operating results. Any increase in the
unauthorized use of our intellectual property could also divert the efforts of our technical and management personnel and result in significant
additional expense to us, which could materially and adversely impact our operating results. Finally, we may be required to spend significant
resources to monitor and protect our intellectual property rights, including with respect to legal proceedings, which could result in
substantial costs and diversion of resources and could materially and adversely impact our business, financial condition and operating
results.

 Claims
by others that we infringe or may infringe on their intellectual property could force us to incur significant costs or revise the way
we conduct our business.

 Our
competitors protect their proprietary rights by means of patents, trade secrets, copyrights, trademarks and other intellectual property.
We have not conducted an independent review of patents and other intellectual property issued to third parties, who may have patents
or patent applications relating to our proprietary technology. We may receive letters from third parties alleging, or inquiring about,
possible infringement, misappropriation or violation of their intellectual property rights. Any party asserting that we infringe, misappropriate
or violate proprietary rights may force us to defend ourselves, and potentially our customers, against the alleged claim. These claims
and any resulting lawsuit, if successful, could subject us to significant liability for damages and/or invalidation of our proprietary
rights or interruption or cessation of our operations. Any such claims or lawsuit could:

 be
 time-consuming and expensive to defend, whether meritorious or not;

 require
 us to stop providing products or services that use the technology that allegedly infringes the other party's intellectual property;

 divert
 the attention of our technical and managerial resources;

 require
 us to enter into royalty or licensing agreements with third-parties, which may not be available on terms that we deem acceptable;

 prevent
 us from operating all or a portion of our business or force us to redesign our products, services or technology platforms, which
 could be difficult and expensive and may make the performance or value of our product or service offerings less attractive;

 subject
 us to significant liability for damages or result in significant settlement payments; and/or

 require
 us to indemnify our customers.

 Furthermore,
during the course of litigation, confidential information may be disclosed in the form of documents or testimony in connection with discovery
requests, depositions or trial testimony. Disclosure of our confidential information and our involvement in intellectual property litigation
could materially adversely affect our business. Some of our competitors may be able to sustain the costs of intellectual property litigation
more effectively than we can because they have substantially greater resources. In addition, any litigation could significantly harm
our relationships with current and prospective customers. Any of the foregoing could disrupt our business and have a material adverse
effect on our business, operating results and financial condition.

 In
addition, contentions by a third party such as a vendor or partner that we may pose a threat to their intellectual property can disrupt
our ability to work with such party and/or our customers who rely upon that third party's product or services. Withdrawal of participation
by key vendors or partners would cause a disruption of services to our clients and a loss of customers, which could negatively affect
our business and financial performance.

 Current
and future litigation against us could be costly and time-consuming to defend and could result in additional liabilities.

 We
may from time to time be subject to legal proceedings and claims that arise in the ordinary course of business, such as claims brought
by current and former clients in connection with commercial disputes and employment claims made by our current or former employees. Claims
may also be asserted by or on behalf of a variety of other parties, including government agencies, patients of our physician clients,
stockholders, the sellers of the businesses that we acquire, or the creditors of the businesses we acquire. Any litigation involving
us may result in substantial costs and may divert management's attention and resources, which may seriously harm our business,
overall financial condition, and operating results. Insurance may not cover existing or future claims, be sufficient to fully compensate
us for one or more of such claims, or continue to be available on terms acceptable to us. A claim brought against us that is uninsured
or underinsured could result in unanticipated costs, thereby reducing our operating results and leading analysts or potential investors
to reduce their expectations of our performance resulting in a reduction in the trading price of our stock.

 Our
proprietary software or service delivery platform may not operate properly, which could damage our reputation, give rise to claims against
us, or divert application of our resources from other purposes, any of which could harm our business and operating results.

 We
may encounter human or technical obstacles that prevent our proprietary or acquired applications from operating properly. If our applications
do not function reliably or fail to achieve customer expectations in terms of performance, customers could assert liability claims against
us or attempt to cancel their contracts with us. This could damage our reputation and impair our ability to attract or maintain customers.

 There
are particular risks when we inherit technologies through the companies we acquire. These technologies, often developed by distressed
companies, were not created under our direct supervision and control and therefore may not have been developed in accordance with our
standards. Such acquired technologies could, and at times do, contain operational deficiencies, defects, glitches or bugs that may not
be discovered immediately or otherwise could have been avoided had we built the technology ourselves. Whether technology we develop or
technology we acquire, we will need to replace certain components and remediate software defects or bugs from time to time. There can
be no assurance that such defects or bugs, or the process of remediating them, will not have a material impact on our business. Our inability
to promptly and cost-effectively correct a product defect could result in the Company having to withdraw an important product from market,
damage to our reputation, and result in material costs and expenses, any of which could have a material impact on our revenue, margins,
and operating results.

 Moreover,
information services as complex as those we offer have in the past contained, and may in the future develop or contain, undetected defects
or errors. We cannot assure you that material performance problems or defects in our products or services will not arise in the future.
Errors may result from receipt, entry, or interpretation of patient information or from interface of our services with legacy systems
and data that we did not develop and the function of which is outside of our control. Despite testing, defects or errors may arise in
our existing or new software or service processes. Because changes in payer requirements and practices are frequent and sometimes difficult
to determine except through trial and error, we are continuously discovering defects and errors in our software and service processes
compared against these requirements and practices. These defects and errors and any failure by us to identify and address them could
result in loss of revenue or market share, liability to customers or others, failure to achieve market acceptance or expansion, diversion
of development resources, injury to our reputation, and increased service and maintenance costs. Defects or errors in our software might
discourage existing or potential customers from purchasing our products and services. Correction of defects or errors could prove to
be impossible or impracticable. The costs incurred in correcting any defects or errors or in responding to resulting claims or liability
may be substantial and could adversely affect our operating results.

 In
addition, customers relying on our services to collect, manage, and report clinical, business, and administrative data may have a greater
sensitivity to service errors and security vulnerabilities than customers of software products in general. We market and sell services
that, among other things, provide information to assist healthcare providers in tracking and treating patients. Any operational delay
in or failure of our technology or service processes may result in the disruption of patient care and could cause harm to patients and
thereby create unforeseen liabilities for our business.

 Our
customers or their patients may assert claims against us alleging that they suffered damages due to a defect, error, or other failure
of our software or service processes. A product liability claim or errors or omissions claim could subject us to significant legal defense
costs and adverse publicity, regardless of the merits or eventual outcome of such a claim.

 Our
physicians rely on our platforms (including the platforms we acquired) to be certified by the Office of the National Coordinator for
Health Information Technology ("ONC"). If this certification were to be challenged, we might face liability related to any
incentive that the physicians received in reliance upon such certification.

 If
our security measures are breached or fail and unauthorized access is obtained to a customer's data, our service may not be perceived
as secure, the attractiveness of our services to current or potential customers may be reduced, and we may incur significant liabilities.

 Our
services involve the web-based storage and transmission of customers' proprietary information and patient information, including
health, financial, payment and other personal or confidential information. We rely on proprietary and commercially available systems,
software, tools and monitoring, as well as other processes, to provide security for processing, transmission and storage of such information.
Because of the sensitivity of this information and due to requirements under applicable laws and regulations, the effectiveness of our
security efforts is very important. We maintain servers, which store customers' data, including patient health records, in the
U.S. and offshore. We also process, transmit and store some data of our customers on servers and networks that are owned and controlled
by third-party contractors in India and elsewhere. Increasingly, threat actors are targeting the healthcare industry with ransomware
and other malicious software. If our security measures are breached or fail as a result of third-party action, acts of terror, social
unrest, employee error, malfeasance or for any other reasons, someone may be able to obtain unauthorized access to customer or patient
data. Improper activities by third parties, advances in computer and software capabilities and encryption technology, new tools and discoveries
and other events or developments may facilitate or result in a compromise or breach of our security systems. Our security measures may
not be effective in preventing unauthorized access to the customer and patient data stored on our servers. If a breach of our security
occurs, we could face damages for contract breach, penalties for violation of applicable laws or regulations, possible lawsuits by individuals
affected by the breach and significant remediation costs and efforts to prevent future occurrences. In addition, whether there is an
actual or a perceived breach of our security, the market perception of the effectiveness of our security measures could be harmed and
we could lose current or potential customers.

 Our
products and services are required to meet the interoperability standards, which could require us to incur substantial additional development
costs or result in a decrease in revenue.

 Our
customers and the industry leaders enacting regulatory requirements are concerned with and often require that our products and services
be interoperable with other third-party healthcare information technology suppliers. Although our products comply with the latest ONC
standards and provide seamless and secure access, use and sharing of electronic health records, market forces or regulatory authorities
could create software interoperability standards that would apply to our solutions, and if our products and services are not consistent
with those standards, we could be forced to incur substantial development costs. There currently exists a comprehensive set of criteria
for the functionality, interoperability and security of various software modules in the healthcare information technology industry. However,
those standards are subject to continuous modification and refinement. Maintaining compliance with industry interoperability standards
and related requirements could result in larger than expected software development expenses and administrative expenses in order to conform
to these requirements. These standards and specifications, once finalized, will be subject to interpretation by the entities designated
to certify such technology. We will incur increased development costs in delivering solutions if we need to change or enhance our products
and services to be in compliance with these varying and evolving standards. If our products and services are not consistent with these
evolving standards, our market position and sales could be impaired and we may have to invest significantly in changes to our solutions.

 Disruptions
in internet or telecommunication service or damage to our data centers could adversely affect our business by reducing our customers'
confidence in the reliability of our services and products.

 Our
information technologies and systems are vulnerable to damage or interruption from various causes, including acts of God and other natural
disasters, war and acts of terrorism and power losses, computer systems failures, internet and telecommunications or data network failures,
operator error, losses of and corruption of data and similar events. Our customers' data, including patient health records, reside
on our own servers located in the U.S., and our Offshore Offices. Although we conduct business continuity planning to protect against
fires, floods, other natural disasters and general business interruptions to mitigate the adverse effects of a disruption, relocation
or change in operating environment at our data centers, the situations we plan for and the amount of insurance coverage we maintain may
not be adequate in any particular case. In addition, the occurrence of any of these events could result in interruptions, delays or cessations
in service to our customers. Any of these events could impair or prohibit our ability to provide our services, reduce the attractiveness
of our services to current or potential customers and adversely impact our financial condition and results of operations.

 In
addition, despite the implementation of security measures, our infrastructure, data centers, or systems that we interface with or utilize,
including the internet and related systems, may be vulnerable to physical break-ins, hackers, improper employee or contractor access,
computer viruses, programming errors, denial-of-service attacks or other attacks by third-parties seeking to disrupt operations or misappropriate
information or similar physical or electronic breaches of security. Any of these can cause system failure, including network, software
or hardware failure, which can result in service disruptions. As a result, we may be required to expend significant capital and other
resources to protect against security breaches and hackers or to alleviate problems caused by such breaches.

 We
may be subject to liability for the content we provide to our customers and their patients.

 We
provide content for use by healthcare providers in treating patients. This content includes, among other things, patient education materials,
coding and drug databases developed by third parties, and prepopulated templates providers can use to document visits and record patient
health information. If content in the third-party databases we use is incorrect or incomplete, adverse consequences, including death,
may give rise to product liability and other claims against us. A court or government agency may take the position that our delivery
of health information directly, including through licensed practitioners, or delivery of information by a third-party site that a consumer
accesses through our solutions, exposes us to personal injury liability, or other liability for wrongful delivery or handling of healthcare
services or erroneous health information. Our liability insurance coverage may not be adequate or continue to be available on acceptable
terms, if at all. A claim brought against us that is uninsured or under-insured could harm our business. Even unsuccessful claims could
result in substantial costs and diversion of management resources.

 We
are subject to the effect of payer and provider conduct that we cannot control and that could damage our reputation with customers and
result in liability claims that increase our expenses.

 We
offer electronic claims submission services for which we rely on content from customers, payers, and others. While we have implemented
features and safeguards designed to maximize the accuracy and completeness of claims content, these features and safeguards may not be
sufficient to prevent inaccurate claims data from being submitted to payers. Should inaccurate claims data be submitted to payers, we
may experience poor operational results and be subject to liability claims, which could damage our reputation with customers and result
in liability claims that increase our expenses.

 Failure
by our clients to obtain proper permissions and waivers may result in claims against us or may limit or prevent our use of data, which
could harm our business.

 Our
clients are obligated by applicable law to provide necessary notices and to obtain necessary permission waivers for use and disclosure
of the information that we receive. If they do not obtain necessary permissions and waivers, then our use and disclosure of information
that we receive from them or on their behalf may be limited or prohibited by state or federal privacy laws or other laws. This could
impair our functions, processes, and databases that reflect, contain, or are based upon such data and may prevent use of such data. In
addition, this could interfere with or prevent creation or use of rules, and analyses or limit other data-driven activities that benefit
us. Moreover, we may be subject to claims or liability for use or disclosure of information by reason of lack of valid notice, permission,
or waiver. These claims or liabilities could subject us to unexpected costs and adversely affect our operating results.

 Any
deficiencies in our financial reporting or internal controls could adversely affect our business and the trading price of our securities.

 As
a public company, we are required to maintain internal control over financial reporting and to report any material weaknesses in such
internal controls. Section 404 of the Sarbanes-Oxley Act requires that we evaluate and determine the effectiveness of our internal control
over financial reporting.

 In
the future, if we have a material weakness in our internal control over financial reporting, we may not detect errors on a timely basis
and our financial statements may be materially misstated. In addition, our internal control over financial reporting would not prevent
or detect all errors and fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute
assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

 If
there are material weaknesses or failures in our ability to meet any of the requirements related to the maintenance and reporting of
our internal controls, investors may lose confidence in the accuracy and completeness of our financial reports, which in turn could cause
the price of our common stock and preferred stock to decline. Moreover, effective internal controls are necessary to produce reliable
financial reports and to prevent fraud. If we have deficiencies in our internal controls, it may negatively impact our business, results
of operations and reputation. In addition, we could become subject to investigations by Nasdaq, the SEC or other regulatory authorities,
which could require additional management attention and which could adversely affect our business.

 Our
goodwill has been subject to impairment and may be subject to further impairment in the future, which could have a material adverse effect
on our results of operations, financial condition, or future operating results.

 We
perform an annual goodwill impairment test on October 31 st of each year, or more frequently if indicators for potential
impairment exist. As a result of the annual goodwill impairment test, we recorded impairment charges of approximately $2 million.
Indicators that are considered include significant changes in performance relative to expected operating results, significant
negative industry or economic trends, or a significant decline in our stock price and/or market capitalization or enterprise value
for a sustained period of time. While we believe the assumptions used in determining whether there was an impairment and the amount
of any resulting impairment were reasonable and commensurate with the views of a market participant, changes in key assumptions in
the future, including increasing the discount rate, lowering forecast for revenue and operating margin, selection of guideline
public companies or lowering the long-term growth rate, could result in additional charges; similarly, one or more changes in these
assumptions in future periods due to changes in circumstances could result in additional future impairments. There was a triggering
event at August 31, 2023, but it was determined that there was no impairment. During December 2023, the Company had an additional
triggering event as a result of the suspension of the dividends on the Preferred Stock. As a result of the December triggering
event, the Company recorded additional impairment charges of approximately $40 million and we cannot predict if or when additional
future goodwill impairments may occur. Any additional goodwill impairments could have material adverse effects on our operating
results, net assets, or our cost of, or access to, capital, which could harm our business. See Note 3, Goodwill and Intangible
Assets - Net, to our consolidated financial statements in this Annual Report on Form 10-K for more details.

 We
are a party to several related-party agreements with our founder and Executive Chairman, Mahmud Haq, which have significant contractual
obligations. These agreements are reviewed by our Audit Committee on an annual basis.

 Since
inception, we have entered into several related-party transactions with our founder and Executive Chairman, Mahmud Haq, which subject
us to significant contractual obligations. We believe these transactions reflect terms comparable to those that would be available from
third parties. Our independent audit committee has reviewed these arrangements and continues to do so on an annual basis.

 Although
we have procedures in place to identify related party transactions, it is possible that such transactions could occur without being contemporaneously
identified, reviewed and approved by the Audit Committee.

 We
depend on key information systems and third-party service providers.

 We
depend on key information systems to accurately and efficiently transact our business, provide information to management and prepare
financial reports. These systems and services are vulnerable to interruptions or other failures resulting from, among other things, natural
disasters, terrorist attacks, software, equipment or telecommunications failures, processing errors, computer viruses, other security
issues or supplier defaults. Security, backup and disaster recovery measures may not be adequate or implemented properly to avoid such
disruptions or failures. Any disruption or failure of these systems or services could cause substantial errors, processing inefficiencies,
security breaches, inability to use the systems or process transactions, loss of customers or other business disruptions, all of which
could negatively affect our business and financial performance.

 Systems
failures or cyberattacks and resulting interruptions in the availability of or degradation in the performance of our websites, applications,
products or services could harm our business.

 As
cybersecurity attacks continue to evolve and increase, our information systems could also be penetrated or compromised by internal and
external parties' intent on extracting confidential information, disrupting business processes or corrupting information. Our systems
may experience service interruptions or degradation due to hardware and software defects or malfunctions, computer denial-of-service
and other cyberattacks, human error, earthquakes, hurricanes, floods, fires, natural disasters, power losses, disruptions in telecommunications
services, fraud, military or political conflicts, terrorist attacks, computer viruses, or other events. Our systems are also subject
to break-ins, sabotage and intentional acts of vandalism. Some of our systems are not fully redundant and our disaster recovery planning
is not sufficient for all eventualities. We have experienced and will likely continue to experience system failures, denial of service
attacks and other events or conditions from time to time that interrupt the availability or reduce the speed or functionality of our
websites and mobile applications. These events likely will result in loss of revenue. A prolonged interruption in the availability or
reduction in the speed or other functionality of our websites and mobile applications could materially harm our business. Frequent or
persistent interruptions in our services could cause current or potential users to believe that our systems are unreliable, leading them
to switch to our competitors or to avoid our sites, and could permanently harm our reputation and brands. Moreover, to the extent that
any system failure or similar event results in damages to our customers or their businesses, these customers could seek significant compensation
from us for their losses and those claims, even if unsuccessful, would likely be time-consuming and costly for us to address. These risks
could arise from external parties or from acts or omissions of internal or service provider personnel. Such unauthorized access could
disrupt our business and could result in the loss of assets, litigation, remediation costs, damage to our reputation and failure to retain
or attract customers following such an event, which could adversely affect our business.

 We
use artificial intelligence in our business, and challenges with properly managing its use could result in reputational and competitive
harm, legal liability, and adversely affect our results of operations.

 We
currently incorporate artificial intelligence ("AI") solutions into our intelligent cloud products, and these applications
will become important in our operations over time. Our competitors or other third parties may incorporate AI into their products and
offerings quicker or more successfully than us, which could impair our ability to compete effectively and adversely affect our results
of operations. Additionally, if the content, analyses, or recommendations that AI applications assist in producing are, or are alleged
to be inaccurate, deficient, or biased, our business, financial condition, and results of operations may be adversely affected. The use
of AI applications has resulted in, and may in the future result in, cybersecurity incidents that implicate the sensitive data of customers
analyzed within such applications. Any such cybersecurity incidents related to our use of AI applications for analysis of sensitive data
could adversely affect our reputation and results of operations. AI also presents emerging ethical issues and if our use of AI becomes
controversial, we may experience brand or reputational harm, competitive harm, or legal liability. The rapid evolution of AI, including
potential government regulation of AI and its various uses will require significant resources to develop, test and maintain our intelligence
cloud platform, offerings, services, and features to help us implement AI ethically in order to minimize any unintended, harmful impact.

 Rapid
technological change in the telehealth industry presents us with significant risks and challenges.

 The
telehealth market is characterized by rapid technological change, changing consumer requirements, short product lifecycles and evolving
industry standards. Our success will depend on our ability to enhance our solution with next-generation technologies and to develop or
to acquire and market new services to access new consumer populations. There is no guarantee that we will possess the resources, either
financial or personnel, for the research, design and development of new applications or services, or that we will be able to utilize
these resources successfully and avoid technological or market obsolescence. Further, there can be no assurance that technological advances
by one or more of our competitors or future competitors will not result in our present or future applications and services becoming uncompetitive
or obsolete.

 Our
business, financial condition, results of operations and growth may be adversely affected by pandemics, epidemics or other public health
emergencies, such as COVID-19.

 We
are subject to risks related to a public health crisis such as a global pandemic similar to the coronavirus (COVID-19). Numerous governmental
jurisdictions, including the State of New Jersey where we maintain our principal executive offices, and those in which many of our U.S.
and international offices are based may impose "shelter-in-place" orders, quarantines, executive orders and similar government
orders and restrictions for their residents to control the spread of public health emergencies. Such orders or restrictions, and the
perception that such orders or restrictions could occur, could result in business closures, work stoppages, slowdowns and delays, work-from-home
policies, travel restrictions and cancellation of events, among other effects, thereby negatively impacting our customers, employees,
and offices, among others.

 A
recession or prolonged economic contraction as a result of health emergencies could harm the business and results of operations of our
enterprise customers, resulting in potential business closures, layoffs of employees and a significant increase in unemployment in the
United States and elsewhere. The occurrence of any such events may lead to reduced income for customers and reduced size of workforces,
which could reduce our revenue and harm our business, financial condition and results of operations.

 The
prolonged impact of these public health emergencies is highly uncertain and unpredictable, depending upon the severity and duration of
the emergency and the effectiveness of actions taken globally to contain or mitigate its effects. Future financial impact cannot be estimated
reasonably at this time, but may materially adversely affect our business, results of operations and financial condition.

 Risks
Related to Our Acquisition Strategy

 At
the current prices of our common and Preferred Stock, we may be unable to execute accretive acquisitions.

 Historically
we have used our common and Preferred Stock to pay for acquisitions. Due to the depressed market prices of these securities, we may not
be able to use these securities to execute future acquisitions.

 We
may be unable to retain customers following their acquisition, which may result in a decrease in our revenues and operating results.

 Customers
of the businesses we acquire often have the right to terminate their service contracts for any reason at any time upon notice of 90 days
or less. These customers may elect to terminate their contracts as a result of our acquisition or choose not to renew their contracts
upon expiration. Legal and practical limitations on our ability to enforce non-competition and non-solicitation provisions against customer
representatives and sales personnel that leave the businesses we acquire to join competitors may result in the loss of customers. In
the past, our failure to retain acquired customers has at times resulted in decreases in our revenues. Our inability to retain customers
of businesses we acquire could adversely affect our ability to benefit from those acquisitions and to grow our future revenues and operating
income.

 Acquisitions
may subject us to liability with regard to the creditors, customers, and shareholders of the sellers.

 While
we attempt to limit our exposure to the liabilities associated with the businesses we acquire, we cannot guarantee that we will be successful
in avoiding all material liability. Regardless of how we structure the acquisition, whether as an asset purchase, stock purchase, merger
or other business combination, creditors, customers, vendors, governmental agencies and other parties at times seek to hold us accountable
for unpaid debts, breach of contract claims, regulatory violations and other liabilities that relate to the business we acquired. Disaffected
shareholders of the businesses we acquire have also attempted to interfere with our business acquisitions or brought claims against us.
We attempt to minimize all of these risks through thorough due diligence, negotiating indemnities and holdbacks, obtaining relevant representations
from sellers, procuring insurance coverage and leveraging experienced professionals when appropriate.

acquisitions may result in potentially dilutive issuances of equity securities, the incurrence of indebtedness and increased amortization
expense.

acquisitions may result in dilutive issuances of equity securities, the incurrence of debt, the assumption of known and unknown liabilities,
the write-off of software development costs and the amortization of expenses related to intangible assets, all of which could have an
adverse effect on our business, financial condition and results of operations.

 Regulatory
Risks

 The
healthcare industry is heavily regulated. Our failure to comply with regulatory requirements could create liability for us, result in
adverse publicity and negatively affect our business.

 The
healthcare industry is heavily regulated and is constantly evolving due to the changing political, legislative, regulatory landscape
and other factors. Many healthcare laws are complex, and their application to specific services and relationships may not be clear. In
particular, many existing healthcare laws and regulations, when enacted, did not anticipate or address the services that we provide.
Further, healthcare laws differ from state to state and it is difficult to ensure that our business, products and services comply with
evolving laws in all states. By way of example, certain federal and state laws forbid billing based on referrals between individuals
or entities that have various financial, ownership, or other business relationships with healthcare providers. These laws vary widely
from state to state, and one of the federal laws governing these relationships, known as the Stark Law, is very complex in its application.
Similarly, many states have laws forbidding physicians from practicing medicine in partnership with non-physicians, such as business
corporations, as well as laws or regulations forbidding splitting of physician fees with non-physicians or others. Other federal and
state laws restrict assignment of claims for reimbursement from government-funded programs, the manner in which business service companies
may handle payments for such claims and the methodology under which business services companies may be compensated for such services.

 The
21 st Century Cures Act (the "Cures Act"), passed by Congress in 2016, is meant to improve various aspects of the
healthcare industry, including interoperability and information blocking. The Cures Act's interoperability provisions relate to
Information Exchange and Certification administered by the ONC. The certification involves complex and specific requirements related
to various types of requests for the access, exchange or use of Electronic Health Information. In addition, the information blocking
rule aims to resolve concerns that individuals in the healthcare industry intentionally prevent the exchange of information between multiple
stakeholders. The Cures Act allows for penalties for stakeholders, including but not limited to, health IT developers and providers who
do not comply with same. While we remain committed to efficient exchange of information in the healthcare industry and continue meeting
all new certification requirements, failure to comply with these regulatory requirements, could create liability for us, result in adverse
publicity and negatively affect our business.

 The
Office of Inspector General ("OIG") of the Department of Health and Human Services ("HHS") has a longstanding
concern that percentage-based billing arrangements may increase the risk of improper billing practices. In addition, certain states have
adopted laws or regulations forbidding splitting of fees with non-physicians which may be interpreted to prevent business service providers,
including medical billing providers, from using a percentage-based billing arrangement. The OIG and HHS recommend that medical billing
companies develop and implement comprehensive compliance programs to mitigate this risk. While we have developed and implemented a comprehensive
billing compliance program that we believe is consistent with these recommendations, our failure to ensure compliance with controlling
legal requirements, accurately anticipate the application of these laws and regulations to our business and contracting model, or other
failure to comply with regulatory requirements, could create liability for us, result in adverse publicity and negatively affect our
business.

 The
federal Anti-Kickback Statute ("AKS") prohibits us from knowingly and willfully soliciting, receiving, offering or providing
remuneration in exchange for referrals or recommendations for purposes of selling products or services which are paid for by federal
healthcare programs such as Medicare and Medicaid. In addition, a claim including products or services resulting from a violation of
AKS constitutes a violation of the federal False Claims Act ("FCA"). If we are determined to have violated the FCA, we may
be required to pay up to three times the actual damages sustained by the government, plus mandatory civil penalties for each separate
false claim. If we are found to be in violation of the FCA, AKS, ACA, or any other applicable state or any federal fraud and abuse laws,
whether by our current practices or for the past practices of a company we acquire, we may be subject to substantial civil damages and
criminal penalties and fines that could have a material adverse impact on our business.

 In
addition, federal and state legislatures and agencies periodically consider proposals to revise aspects of the healthcare industry or
to revise or create additional statutory and regulatory requirements. For instance, the current administration may make changes to the
ACA, the nature and scope of which are presently unknown. Similarly, certain computer software products are regulated as medical devices
under the Federal Food, Drug, and Cosmetic Act. While the Food and Drug Administration ("FDA") has sometimes chosen to disclaim
authority to, or to refrain from actively regulating certain software products which are similar to our products, this area of medical
device regulation remains in flux. We expect that the FDA will continue to be active in exploring legal regimes for regulating computer
software intended for use in healthcare settings. Any additional regulation can be expected to impose additional overhead costs on us
and should we fail to adequately meet these legal obligations, we could face potential regulatory action. Regulatory authorities such
as the Centers for Medicare and Medicaid Services may also impose functionality standards with regard to electronic prescribing technologies.
If implemented, proposals like these could impact our operations, the use of our services and our ability to market new services, or
could create unexpected liabilities for us. We cannot predict what changes to laws or regulations might be made in the future or how
those changes could affect our business or our operating costs.

 Further,
our ability to provide our telehealth services in each state is dependent upon a state's treatment of telehealth and emerging technologies
(such as digital health services), which are subject to changing political, regulatory and other influences. Many states have laws that
limit or restrict the practice of telehealth, such as laws that require a provider to be licensed and/or physically located in the same
state where the patient is located. For example, California, Massachusetts, and Oregon, among others, are not members of the Interstate
Medical Licensure Compact, which streamlines the process by which physicians licensed in one state are able to practice in other participating
states. Failure to comply with these laws could result in denials of reimbursement for services (to the extent such services are billed),
recoupments of prior payments, professional discipline for providers or civil or criminal penalties.

 If
we do not maintain the certification of our EHR solutions pursuant to the HITECH Act and Cures Act, our business, financial condition
and results of operations will be adversely affected.

 The
HITECH Act provides financial incentives for healthcare providers that demonstrate "meaningful use" of an EHR and mandates
use of health information technology systems that are certified according to technical standards developed under the supervision of the
U.S. Department of Health and Human Services ("HHS"). The HITECH Act also imposes certain requirements upon governmental
agencies to use, and requires healthcare providers, health plans, and insurers contracting with such agencies to use, systems that are
certified according to such standards. The healthcare IT industry continues to experience changes as a result of new laws, regulations,
and changes to healthcare industry standards. For instance, the meaningful use incentive program has since expired and has been consolidated,
among other incentive programs, within the Merit-based Incentive Payment System ("MIPS"), which was created as part of the
Quality Payment Program ("QPP"), launched by CMS after passage of the Medicare Access and CHIP Reauthorization Act ("MACRA").
MACRA and regulations promulgated by it change the way CMS rewards clinicians in the healthcare industry by rewarding value-based care
over volume-based care. MIPS requires substantial reporting mechanisms based on clinical quality measures that highly depend on reporting
feature within EHR systems.

 The
HITECH and Cures Acts (as described in more detail above) contain certification requirements which affect our business because we have
invested and continue to invest in conforming our products and services to these standards. HHS has developed certification programs
for electronic health records and health information exchanges. Our web-based EHR solutions have been certified as complete EHR systems
by ICSA Labs or Drummond Group, non-governmental, independent certifying bodies. We must ensure that our EHR solutions continue to be
certified according to applicable HITECH Act and Cures Act technical standards so that our customers qualify for any MIPS/MACRA incentive
payments and are not subject to penalties for non-compliance. Failure to maintain this certification under the HITECH Act and Cures Act
could jeopardize our relationships with customers who are relying upon us to provide certified software, and will make our products and
services less attractive to customers than the offerings of other EHR vendors who maintain certification of their products.

 If
a breach of our measures protecting personal data covered by HIPAA or the HITECH Act occurs, we may incur significant liabilities.

 The
Health Insurance Portability and Accountability Act of 1996, as amended ("HIPAA"), and the regulations that have been issued
under it contain substantial restrictions and requirements with respect to the use, collection, storage and disclosure of individuals'
protected health information. Under HIPAA, covered entities must establish administrative, physical and technical safeguards to protect
the confidentiality, integrity and availability of electronic protected health information maintained or transmitted by them or by others
on their behalf. In February 2009, HIPAA was amended by the HITECH Act to add provisions that impose certain of HIPAA's privacy
and security requirements directly upon business associates of covered entities. Under HIPAA and the HITECH Act, our customers are covered
entities and we are a business associate of our customers as a result of our contractual obligations to perform certain services for
those customers. The HITECH Act transferred enforcement authority of the security rule from CMS to the Office for Civil Rights of HHS,
thereby consolidating authority over the privacy and security rules under a single office within HHS. Further, HITECH empowered state
attorneys' general to enforce HIPAA.

 The
HITECH Act heightened enforcement of privacy and security rules, indicating that the imposition of penalties will be more common in the
future and such penalties will be more severe. For example, the HITECH Act requires that the HHS fully investigate all complaints if
a preliminary investigation of the facts indicates a possible violation due to "willful neglect" and imposes penalties if
such neglect is found. Further, where our liability as a business associate to our customers was previously merely contractual in nature,
the HITECH Act now treats the breach of duty under an agreement by a business associate to carry the same liability as if the covered
entity engaged in the breach. In other words, as a business associate, we are now directly responsible for complying with HIPAA. We may
find ourselves subject to increased liability as a possible liable party and we may incur increased costs as we perform our obligations
to our customers under our agreements with them.

 Finally,
regulations also require business associates to notify covered entities, who in turn must notify affected individuals and government
authorities of data security breaches involving unsecured protected health information. We have performed an assessment of the potential
risks and vulnerabilities to the confidentiality, integrity and availability of electronic health information. In response to this risk
analysis, we implemented and maintain physical, technical and administrative safeguards intended to protect all personal data and have
processes in place to assist us in complying with applicable laws and regulations regarding the protection of this data and properly
responding to any security incidents. If we knowingly breach the HITECH Act's requirements, we could be exposed to criminal liability.
A breach of our safeguards and processes could expose us to civil penalties of up to $1.5 million for each incident and the possibility
of civil litigation.

 If
we or our customers fail to comply with federal and state laws governing submission of false or fraudulent claims to government healthcare
programs and financial relationships among healthcare providers, we or our customers may be subject to civil and criminal penalties or
loss of eligibility to participate in government healthcare programs.

 As
a participant in the healthcare industry, our operations and relationships, and those of our customers, are regulated by a number of
federal, state and local governmental entities. The impact of these regulations can adversely affect us even though we may not be directly
regulated by specific healthcare laws and regulations. We must ensure that our products and services can be used by our customers in
a manner that complies with those laws and regulations. Inability of our customers to do so could affect the marketability of our products
and services or our compliance with our customer contracts, or even expose us to direct liability under the theory that we had assisted
our customers in a violation of healthcare laws or regulations. A number of federal and state laws, including anti-kickback restrictions
and laws prohibiting the submission of false or fraudulent claims, apply to healthcare providers and others that make, offer, seek or
receive referrals or payments for products or services that may be paid for through any federal or state healthcare program and, in some
instances, any private program. These laws are complex and their application to our specific services and relationships may not be clear
and may be applied to our business in ways that we do not anticipate. Federal and state regulatory and law enforcement authorities have
recently increased enforcement activities with respect to Medicare and Medicaid fraud and abuse regulations and other healthcare reimbursement
laws and rules. From time to time, participants in the healthcare industry receive inquiries or subpoenas to produce documents in connection
with government investigations. We could be required to expend significant time and resources to comply with these requests, and the
attention of our management team could be diverted by these efforts. The occurrence of any of these events could give our customers the
right to terminate our contracts with us and result in significant harm to our business and financial condition.

 These
laws and regulations may change rapidly, and it is frequently unclear how they apply to our business. Any failure of our products or
services to comply with these laws and regulations could result in substantial civil or criminal liability and could, among other things,
adversely affect demand for our services, invalidate all or portions of some of our contracts with our customers, require us to change
or terminate some portions of our business, require us to refund portions of our revenue, cause us to be disqualified from serving customers
doing business with government payers, and give our customers the right to terminate our contracts with them, any one of which could
have an adverse effect on our business.

 Potential
healthcare reform and new regulatory requirements placed on our products and services could increase our costs, delay or prevent our
introduction of new products or services, and impair the function or value of our existing products and services.

 Our
products and services may be significantly impacted by healthcare reform initiatives and will be subject to increasing regulatory requirements,
either of which could negatively impact our business in a multitude of ways. If substantive healthcare reform or applicable regulatory
requirements are adopted, we may have to change or adapt our products and services to comply. Reform or changing regulatory requirements
may also render our products or services obsolete or may block us from accomplishing our work or from developing new products or services.
This may in turn impose additional costs upon us to adapt to the new operating environment or to further develop or modify our products
and services. Such reforms may also make the introduction of new products and service costlier or more time-consuming than we currently
anticipate. These changes may also prevent our introduction of new products and services or make the continuation or maintenance of our
existing products and services unprofitable or impossible.

 Additional
regulation of the disclosure of medical information outside the United States may adversely affect our operations and may increase our
costs.

 Federal
or state governmental authorities may impose additional data security standards or additional privacy or other restrictions on the collection,
use, transmission, and other disclosures of medical information. Legislation has been proposed at various times at both the federal and
the state level that would limit, forbid, or regulate the use or transmission of medical information outside of the United States. Such
legislation, if adopted, may render our use of our servers in Offshore Offices for work related to such data impracticable or substantially
more expensive. Alternative processing of such information within the United States may involve substantial delay in implementation and
increased cost.

 Our
services present the potential for embezzlement, identity theft, or other similar illegal behavior by our employees.

 Among
other things, our services from time to time involve handling mail from payers and payments from patients for our customers, and this
mail frequently includes original checks and credit card information and occasionally includes currency. Where requested, we deposit
payments and process credit card transactions from patients on behalf of customers and then forward these payments to the customers.
Even in those cases in which we do not handle original documents or mail, our services also involve the use and disclosure of personal
and business information that could be used to impersonate third parties or otherwise gain access to their data or funds. The manner
in which we store and use certain financial information is governed by various federal and state laws. If any of our employees takes,
converts, or misuses such funds, documents, or data, we could be liable for damages, subject to regulatory actions and penalties, and
our business reputation could be damaged or destroyed. In addition, we could be perceived to have facilitated or participated in illegal
misappropriation of funds, documents, or data and therefore be subject to civil or criminal liability.

 Risks
Related to Ownership of Shares of Our Common Stock

 Our
revenues, operating results and cash flows may fluctuate in future periods and we may fail to meet investor expectations, which may cause
the price of our common stock to decline.

 Variations
in our quarterly and year-end operating results are difficult to predict and may fluctuate significantly from period to period. If our
sales or operating results fall below the expectations of investors or securities analysts, the price of our common stock could decline
substantially. Specific factors that may cause fluctuations in our operating results include:

 demand
 and pricing for our products and services;

 the
 encounter volumes of our customer base;

 government
 or commercial healthcare reimbursement policies;

 physician
 and patient acceptance of any of our current or future products;

 introduction
 of competing products;

 our
 operating expenses which fluctuate due to growth of our business;

 timing
 and size of any new product or technology acquisitions we may complete; and

 variable
 sales cycle and implementation periods for our products and services.

sales of shares of our common stock could depress the market price of our common stock.

 Sales
of a substantial number of shares of our common stock in the public market could occur at any time. If our stockholders sell, or the
market perceives that our stockholders intend to sell substantial amounts of our common stock in the public market, the market price
of our common stock could decline significantly.

 Mahmud
Haq currently controls 31.7% of our outstanding shares of common stock, which will prevent investors from influencing significant corporate
decisions.

 Mahmud
Haq, our founder and Executive Chairman, beneficially owns 31.7% of our outstanding shares of common stock. As a result, Mr. Haq exercises
a significant level of control over all matters requiring stockholder approval, including the election of directors, amendment of our
certificate of incorporation, and approval of significant corporate transactions. This control could have the effect of delaying or preventing
a change of control of our company or changes in management, and will make the approval of certain transactions difficult or impossible
without his support, which in turn could reduce the price of our common stock.

 Provisions
of Delaware law, of our amended and restated charter and amended and restated bylaws may make a takeover more difficult, which could
cause our common stock price to decline.

 Provisions
in our amended and restated certificate of incorporation and amended and restated bylaws and in the Delaware General Corporation Law
("DGCL") may make it difficult and expensive for a third party to pursue a tender offer, change in control or takeover attempt,
which is opposed by management and the Board of Directors. Public stockholders who might desire to participate in such a transaction
may not have an opportunity to do so. We have a staggered Board of Directors that makes it difficult for stockholders to change the composition
of the Board of Directors in any one year. Further, our amended and restated certificate of incorporation provides for the removal of
a director only for cause upon the affirmative vote of the holders of at least 50.1% of the outstanding shares entitled to cast their
vote for the election of directors, which may discourage a third party from making a tender offer or otherwise attempting to obtain control
of us. These and other anti-takeover provisions could substantially impede the ability of public stockholders to change our management
and Board of Directors. Such provisions may also limit the price that investors might be willing to pay for shares of our Preferred Stock
in the future.

 Any
issuance of additional preferred stock in the future may dilute the rights of our existing stockholders.

 Our
Board of Directors has the authority to issue up to 7,000,000 shares of preferred stock and to determine the price, privileges and other
terms of these shares, of which 4,526,231 shares of Series A Preferred Stock and 1,468,792 of Series B Preferred Stock have been issued
as of December 31, 2023. Our Board of Directors may exercise its authority with respect to the remaining shares of preferred stock without
any further approval of common stockholders. The rights of the holders of common stock may be adversely affected by the rights of future
holders of preferred stock.

 We
do not intend to pay cash dividends on our common stock.

 Currently,
we do not anticipate paying any cash dividends to holders of our common stock. As a result, capital appreciation, if any, of our common
stock will be a stockholder's sole source of gain.

 Complying
with the laws and regulations affecting public companies will increase our costs and the demands on management and could harm our operating
results.

 As
a public company, the Sarbanes-Oxley Act requires, among other things, that we assess the effectiveness of our internal control over
financial reporting annually and the effectiveness of our disclosure controls and procedures quarterly. As a "smaller reporting
company," we elected to avail ourselves of the exemption from the requirement that our independent registered public accounting
firm attest to the effectiveness of our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act. We were
not required to have this attestation performed for the years 2023 or 2022. In future years, if we are required to have our independent
registered public accounting firm attest the effectiveness of our internal control over financial reporting, the cost of our compliance
with Section 404 will correspondingly increase. Our compliance with applicable provisions of Section 404 requires that we incur substantial
accounting expense and expend significant management time on compliance-related issues and stay in compliance with reporting requirements.
Moreover, if we are not able to stay in compliance with the requirements of Section 404 applicable to us in a timely manner, or if we
or our independent registered public accounting firm identifies any deficiencies in our internal control over financial reporting that
are deemed to be material weaknesses, the market price of our stock could decline and we could be subject to sanctions or investigations
by the SEC or other regulatory authorities, which would require additional financial and management resources.

 Furthermore,
investor perceptions of our Company may suffer if deficiencies are found, and this could cause a decline in the market price of our common
and preferred stock. Irrespective of compliance with Section 404, any failure of our internal control over financial reporting could
have a material adverse effect on our stated operating results and harm our reputation. If we are unable to implement these changes effectively
or efficiently, it could harm our operations, financial reporting, or financial results and could result in an adverse opinion on internal
control from our independent registered public accounting firm.

 We
are a smaller reporting company and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies
will make our common stock less attractive to investors.

 There
are many exemptions available to smaller reporting companies like us that have less than $250 million of worldwide common equity held
by non-affiliates. The disclosures we will be required to provide in our SEC filings are still less than they would be if we were not
considered a smaller reporting company. Specifically, smaller reporting companies are able to provide simplified executive compensation
disclosures in their fillings and have certain other decreased disclosure obligations in their SEC filings. Our status as a smaller reporting
company may make it harder for investors to analyze our results of operations and financial prospects. We cannot predict if investors
will find our common stock less attractive because we will rely on the exemption available to smaller reporting companies. If some investors
find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price
may be more volatile.

 New
climate disclosure rules, if adopted by the SEC, may increase our costs and litigation risks, which could materially and adversely affect
our future results of operations and financial condition.

2022, the SEC proposed new climate disclosure rules, which, if adopted, would require new climate-related disclosure in SEC filings,
including certain climate-related metrics and greenhouse gas emissions data, information about climate-related targets and goals, transition
plans, if any, and extensive attestation requirements. In addition to requiring public companies to quantify and disclose direct emissions
data, the new rules also would require disclosure of climate impact arising from the operations and uses by the company's business
partners and contractors and end-users of the company's products and/or services. We are currently assessing the impact of the
new rules, if adopted as proposed, but at this time, we cannot predict the costs of implementation or any potential adverse impacts resulting
from the new rules if adopted. However, we may incur increased costs relating to the assessment and disclosure of climate-related risks
and increased litigation risks related to disclosures made pursuant to the new rules, either of which could materially and adversely
affect our future results of operations and financial condition.

 Risks
Related to Ownership of Shares of Our Preferred Stock

 In
December 2023 we suspended the dividends on the Preferred Stock and they have not been reinstated. If and when they are reinstated, we
may not be able to continue to pay dividends on the Preferred Stock if we fall out of compliance with our loan covenants and are prohibited
by our bank lender from paying dividends or if we have insufficient cash to make dividend payments.

 Our
ability to pay cash dividends on the Preferred Stock requires us to have either net profits or positive net assets (total assets less
total liabilities), and to be able to pay our debts as they become due in the usual course of business. We cannot predict with certainty
whether we will remain in compliance with the covenants of our senior secured lender, Silicon Valley Bank, a division First Citizens
Bank, ("SVB"), which include, among other things, generating adjusted EBITDA or complying with a minimum liquidity ratio
at times when we are utilizing our line of credit. If we fall out of compliance, our lender may exercise any of its rights and remedies
under the loan agreement, including restricting us from making dividend payments.

 Notwithstanding
these factors, during December 2023, the Company suspended the dividends on the Preferred Stock. If and when the dividends are reinstated,
we may not maintain sufficient cash to continue to pay dividends on the Preferred Stock and we cannot assure you that our businesses
will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable
us to make the Preferred Stock dividend payments that are currently due or in arrears and to fund our other liquidity needs. Our ability
to pay dividends may again be impaired if any of the risks described in this document, including the documents incorporated by reference
herein, were to occur. Also, payment of our dividends depends upon our financial condition, remaining in compliance with our affirmative
and negative loan covenants with SVB, which we may be unable to do in the future, and other factors as our Board of Directors may deem
relevant from time to time.

 Our
Series A and Series B Preferred Stock rank junior to all of our indebtedness and other liabilities.

 Our
Series A Preferred Stock ranks pari passu to our Series B Preferred Stock with respect to the distribution of assets upon our liquidation,
dissolution or winding-up of our affairs. In the event of our bankruptcy, liquidation, dissolution or winding-up of our affairs, our
assets will be available to pay obligations on the Preferred Stock only after all of our indebtedness and other liabilities have been
paid. The rights of holders of the Preferred Stock to participate in the distribution of our assets will rank junior to the prior claims
of our current and future creditors and any future series or class of preferred stock we may issue that ranks senior to the Preferred
Stock. Also, the Preferred Stock effectively ranks junior to all existing and future indebtedness and to the indebtedness and other liabilities
of our existing subsidiaries and any future subsidiaries. Our existing subsidiaries are, and future subsidiaries would be, separate legal
entities and have no legal obligation to pay any amounts to us in respect of dividends due on the Preferred Stock. If we are forced to
liquidate our assets to pay our creditors, we may not have sufficient assets to pay amounts due on any or all of the Preferred Stock
then outstanding. We may in the future incur debt and other obligations that will rank senior to the Preferred Stock. At December 31,
2023, our total liabilities equaled approximately $36.1 million.

 Certain
of our existing or future debt instruments may restrict the authorization, payment or setting apart of dividends on the Preferred Stock.
Our Credit Agreement with SVB restricts the payment of dividends in the event of any event of default, including failure to meet certain
financial covenants. There can be no assurance that we will remain in compliance with the SVB Credit Agreement, and if we default, we
may be contractually prohibited from paying dividends on the Preferred Stock. Also, future offerings of debt or senior equity securities
may adversely affect the market price of the Preferred Stock. If we decide to issue debt or senior equity securities in the future, it
is possible that these securities will be governed by an indenture or other instruments containing covenants restricting our operating
flexibility. Additionally, any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges
more favorable than those of the Preferred Stock and may result in dilution to owners of the Preferred Stock. We and, indirectly, our
shareholders, will bear the cost of issuing and servicing such securities. Because our decision to issue debt or equity securities in
any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount,
timing or nature of our future offerings. The holders of the Preferred Stock will bear the risk of our future offerings, which may reduce
the market price of the Preferred Stock and will dilute the value of their holdings.

 We
may issue additional shares of Preferred Stock and additional series of preferred stock that rank on parity with the Preferred Stock
as to dividend rights, rights upon liquidation or voting rights.

 We
are allowed to issue additional shares of Preferred Stock and additional series of preferred stock that would rank equal to or below
the Preferred Stock as to dividend payments and rights upon our liquidation, dissolution or winding up of our affairs pursuant to our
amended and restated certificate of incorporation and the certificate of designations relating to the Preferred Stock without any vote
of the holders of the Preferred Stock. Upon the affirmative vote of the holders of at least two-thirds of the outstanding shares of Preferred
Stock (voting together as a class with all other series of parity preferred stock we may issue upon which like voting rights have been
conferred and are exercisable), we are allowed to issue additional series of preferred stock that would rank above the Preferred Stock
as to dividend payments and rights upon our liquidation, dissolution or the winding up of our affairs pursuant to our amended and restated
certificate of incorporation and the certificate of designations relating to the Preferred Stock. The issuance of additional shares of
Preferred Stock and additional series of preferred stock could have the effect of reducing the amounts available to the Preferred Stock
upon our liquidation or dissolution or the winding up of our affairs. It also may reduce dividend payments on the Preferred Stock if
we do not have sufficient funds to pay dividends on all Preferred Stock outstanding and other classes or series of stock with equal priority
with respect to dividends.

 Also,
although holders of Preferred Stock are entitled to limited voting rights with respect to the circumstances under which the holders of
Preferred Stock are entitled to vote, the Preferred Stock votes separately as a class along with all other series of our preferred stock
that we may issue upon which like voting rights have been conferred and are exercisable. As a result, the voting rights of holders of
Preferred Stock may be significantly diluted, and the holders of such other series of preferred stock that we may issue may be able to
control or significantly influence the outcome of any vote.

issuances and sales of senior or pari passu preferred stock, or the perception that such issuances and sales could occur, may cause prevailing
market prices for the Preferred Stock and our common stock to decline and may adversely affect our ability to raise additional capital
in the financial markets at times and prices favorable to us.

 Market
interest rates may materially and adversely affect the value of the Preferred Stock.

 One
of the factors that influences the price of the Preferred Stock is the dividend yield on the Preferred Stock (as a percentage of the
market price of each class of the Preferred Stock) relative to market interest rates. An increase in market interest rates may lead prospective
purchasers of the Preferred Stock to expect a higher dividend yield (and higher interest rates would likely increase our borrowing costs
and potentially decrease funds available for dividend payments). Thus, higher market interest rates could cause the market price of the
Preferred Stock to materially decrease.

 Holders
of the Preferred Stock may be unable to use the dividends-received deduction and may not be eligible for the preferential tax rates applicable
to "qualified dividend income".

 Distributions
paid to corporate U.S. holders of the Preferred Stock may be eligible for the dividends-received deduction, and distributions paid to
non-corporate U.S. holders of the Preferred Stock may be subject to tax at the preferential tax rates applicable to "qualified
dividend income," if we have current or accumulated earnings and profits, as determined for U.S. federal income tax purposes. We
do not currently have such accumulated earnings and profits. Additionally, we may not have sufficient current earnings and profits during
future fiscal years for the distributions on the Preferred Stock to qualify as dividends for U.S. federal income tax purposes. If the
distributions fail to qualify as dividends, U.S. holders would be unable to use the dividends-received deduction and may not be eligible
for the preferential tax rates applicable to "qualified dividend income." If any distributions on the Preferred Stock with
respect to any fiscal year are not eligible for the dividends-received deduction or preferential tax rates applicable to "qualified
dividend income" because of insufficient current or accumulated earnings and profits, it is possible that the market value of the
Preferred Stock might decline.

 Our
Preferred Stock has not been rated.

 We
have not sought to obtain a rating for the Preferred Stock. No assurance can be given, however, that one or more rating agencies might
not independently determine to issue such a rating or that such a rating, if issued, would not adversely affect the market price of the
Preferred Stock. Also, we may elect in the future to obtain a rating for the Preferred Stock, which could adversely affect the market
price of the Preferred Stock. Ratings only reflect the views of the rating agency or agencies issuing the ratings and such ratings could
be revised downward, placed on a watch list or withdrawn entirely at the discretion of the issuing rating agency if in its judgment circumstances
so warrant. Any such downward revision, placing it on a watch list or withdrawal of a rating could have an adverse effect on the market
price of the Preferred Stock.

 We
may redeem the Series A and Series B Preferred Stock at any time.

 Since
November 4, 2020, we may, at our option, redeem the Series A Preferred Stock, in whole or in part, at any time or from time to time.
On March 18, 2022, we redeemed 800,000 shares of the Series A Preferred Stock in accordance with our amended and restated certificate
of designations for the Series A Preferred Stock. Since February 15, 2024, we may, at our option, redeem the Series B Preferred Stock,
in whole or in part, at any time or from time to time, paying a small premium if we choose to redeem any Series B Preferred Stock prior
to February 15, 2027. Also, upon the occurrence of a change of control, we may, at our option, redeem the Preferred Stock, in whole or
in part, within 120 days after the first date on which such change of control occurred. We may have an incentive to redeem the Preferred
Stock voluntarily if market conditions allow us to issue other preferred stock or debt securities at a rate that is lower than the dividend
on the Preferred Stock. If we redeem the Preferred Stock, then from and after the redemption date, dividends will cease to accrue on
shares of Preferred Stock, the shares of Preferred Stock shall no longer be deemed outstanding and all rights as a holder of those shares
will terminate, except the right to receive the redemption price plus accumulated and unpaid dividends, if any, payable upon redemption.
The Company also intends to allow holders of the Series A Preferred Stock in the future to exchange their shares of the Series A Preferred
Stock into an equivalent number of shares of the Series B Preferred Stock. Currently, the dividends on the Preferred Stock are suspended.
At the time of redemption, any accumulated and unpaid dividends up to, but not including the date of redemption, is required to be paid.

 The
market price of our Preferred Stock is variable and is substantially affected by various factors.

 The
market price of our Preferred Stock is subject to wide fluctuations in response to numerous factors. These factors include, but are not
limited to, the following:

 suspension
 of the dividend payments in December 2023;

 prevailing
 interest rates, increases in which may have an adverse effect on the market price of the
 Preferred Stock;

 trading
 prices of similar securities;

 the
 annual yield from dividends on the Preferred Stock as compared to yields on other financial
 instruments;

 general
 economic and financial market conditions;

 government
 action or regulation;

 our
 financial condition, performance and prospects of our competitors;

 changes
 in financial estimates or recommendations by securities analysts with respect to us or our
 competitors in our industry;

 our
 issuance of additional preferred equity or debt securities; and

 actual
 or anticipated variations in quarterly operating results of us and our competitors.

 A
holder of Preferred Stock has extremely limited voting rights.

 The
voting rights for a holder of Preferred Stock are limited. Our shares of common stock are the only class of our securities that carry
full voting rights, and Mahmud Haq, our Executive Chairman, beneficially owns approximately 31.7% of our outstanding shares of common
stock. As a result, Mr. Haq exercises a significant level of control over all matters requiring stockholder approval, including the election
of directors, amendment of our certificate of incorporation, and approval of significant corporate transactions. This control could have
the effect of delaying or preventing a change of control of our Company or changes in management, and will make the approval of certain
transactions difficult or impossible without his support, which in turn could reduce the price of our Preferred Stock.

 Voting
rights for holders of the Preferred Stock exist primarily with respect to the ability to elect, voting together with the holders of any
other series of our preferred stock having similar voting rights, two additional directors to our Board of Directors, subject to limitations,
in the event that eighteen monthly dividends (whether or not consecutive) payable on the Preferred Stock are in arrears, and with respect
to voting on amendments to our articles of incorporation or articles of amendment relating to the Preferred Stock that materially and
adversely affect the rights of the holders of Preferred Stock or authorize, increase or create additional classes or series of our capital
stock that are senior to the Preferred Stock. Other than the limited circumstances and except to the extent required by law, holders
of Preferred Stock do not have any other voting rights.

 The
Preferred Stock is not convertible, and investors will not realize a corresponding upside if the price of the common stock increases.

 The
Preferred Stock is not convertible into the common stock and earns dividends at a fixed rate. Accordingly, an increase in the market
price of our common stock will not necessarily result in an increase in the market price of our Preferred Stock. The market value of
the Preferred Stock may depend more on dividend and interest rates for other preferred stock, commercial paper and other investment alternatives
and our actual and perceived ability to pay dividends on, and in the event of dissolution satisfy the liquidation preference with respect
to, the Preferred Stock.

 While
the dividend on the Preferred Stock is suspended, we may be unable to raise additional capital without incurring excessive dilution.

 In
December 2023, we suspended payment on the Preferred Stock dividends. While the dividend is suspended, we are not able to use our at-the-market
("ATM") facilities or utilize our shelf registration statement. Additionally, investors may not have interest in purchasing
our securities while the dividend is suspended.

 Item
1B. Unresolved Staff Comments

 None.

 Item
1C. Cybersecurity

 Cybersecurity
Risk Management and Strategy

 We
recognize the importance of assessing, identifying, and managing material risks associated with cybersecurity threats, as such term is
defined in Item 106(a) of Regulation S-K. These risks include internal and external threats, data loss, phishing attacks, distributed
denial of service attacks, third party risks, unpatched systems, weak authentications and zero-day vulnerabilities.

 Identifying
and assessing cybersecurity risk is integrated into our overall risk management systems and processes. Cybersecurity risks related to
our business, technical operations, privacy and compliance issues are identified and addressed through a multi-faceted approach including
third party assessments, internal IT Audit, IT security, governance, risk and compliance reviews. To defend, detect and respond to cybersecurity
incidents, the Company conducts proactive cybersecurity reviews of systems and applications, audits applicable data policies, performs
penetration testing using external third-party tools and techniques to test security controls, conducts employee training, monitors emerging
laws and regulations related to data protection and information security and implements appropriate changes.

 We
have implemented incident response and breach management processes which have four overarching and interconnected stages: 1) preparation
for a cybersecurity incident, 2) detection and analysis of a security incident, 3) containment, eradication and recovery, and 4) post-incident
analysis. Such incident responses are overseen by leaders from our Information Security, Compliance and Legal teams regarding matters
of cybersecurity.

 Security
events and data incidents are evaluated, ranked by severity and prioritized for response and remediation. Incidents are evaluated to
determine materiality as well as operational and business impact, and reviewed for privacy impact. As of the date of this Form 10-K,
we have not experienced a cybersecurity threat or incident that resulted in a material adverse impact to our business or operations.

 We
also conduct exercises to simulate responses to cybersecurity incidents. Our team of cybersecurity professionals then collaborate with
technical and business stakeholders across our business units to further analyze the risk to the Company, and form detection, mitigation
and remediation strategies.

 As
part of the above processes, we regularly engage consultants to assess our internal cybersecurity programs and compliance with applicable
practices and standards. For 2023, our Information Security Management System is compliant with ISO 27001. We also had a SOC 2, Type
2 review performed for the year 2023.

 Our
risk management program also assesses third party risks, and we perform third-party risk management to identify and mitigate risks from
third parties such as vendors, suppliers, and other business partners associated with our use of third-party service providers.

 We
describe whether and how risks from identified cybersecurity threats, including as a result of any previous cybersecurity incidents,
have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or
financial condition, under the heading "Disruptions in internet or telecommunication service or damage to our data centers could
adversely affect our business by reducing our customers' confidence in the reliability of our services and products" included
as part of our risk factor disclosures in Item 1A of this Annual Report on Form 10-K.

 Our
Vice President of IT Infrastructure is responsible for overseeing the Company's cybersecurity. He has a Bachelor's degree
in computer science and has 16 years of extensive experience spanning diverse IT domains, with a specialized emphasis on Information
Security across endpoints, servers, data centers, cloud infrastructure, and enterprise applications. He has been actively overseeing
the strategic implementation of cybersecurity in accordance with information security management standards, HIPAA, and SOC 2 policies
and procedures throughout the entire organization. This multifaceted responsibility involves managing and ensuring compliance with internationally
recognized standards such as the ISO 27001 framework, healthcare regulatory guidelines under HIPAA and other recognized standards.

 Cybersecurity
Governance

 Cybersecurity
is an important part of our risk management processes and an area of focus for our Board of Directors and management. Our Cybersecurity
subcommittee of the Board of Directors is responsible for the oversight of risks from cybersecurity threats. Members of the Cybersecurity
subcommittee receive updates on a quarterly basis from senior management, including leaders from our Information Security, Finance, Internal
Audit, Compliance and Legal teams regarding matters of cybersecurity. This includes existing and new cybersecurity risks, status on how
management is addressing and/or mitigating those risks, cybersecurity and data privacy incidents, (if any), and status on key information
security initiatives.

 Our
cybersecurity risk management and strategy processes are overseen by leaders from our Information Technology department. These individuals
are informed about, and monitor the prevention, mitigation, detection and remediation of cybersecurity incidents through their management
of, and participation in, the cybersecurity risk management and strategy processes described above, including the operation of our incident
response plan, and report to the Cybersecurity subcommittee on any appropriate items.

 Item
2. Properties

 Our
corporate headquarters are located at 7 Clyde Road, Somerset, New Jersey 08873 where we occupy approximately 2,400 square feet of space
under a month-to-month lease. Additionally, at December 31, 2023 we lease approximately 73,000 square feet of office space in 15 locations
throughout the U.S., with lease terms that are typically five years or less. We also lease approximately 40,000 square feet for five
pediatric offices in the Midwest, with leases that will expire between December 2025 and April 2036.

 We
lease approximately 14,000 square feet of land in Islamabad, Pakistan, where we constructed modular buildings used for office space and
computer server facilities for three years expiring on September 30, 2024, with the first two years under a non-cancellable lease. The
Company also leases a total of approximately 255,000 square feet of office space in Bagh and Karachi, Pakistan, and in Sri Lanka. The
lease in Sri Lanka expires in March 2024 and we intend to renew it for an additional year at expiration.

 We
believe our current facilities are adequate for our current needs and that suitable additional space will be available as and when needed.

 Item
3. Legal Proceedings

 On
December 22, 2023, an arbitrator rendered a decision in favor of Ramapo Anesthesiologists, PC ("Ramapo") and granted in part
and denied in part certain claims brought against Origin Healthcare Solutions, LLC; Meridian Medical Management, Inc.; and the Company
for alleged breach of contract and other allegations. Ramapo was awarded mitigation related costs of $117,000. The payment for such an
award was made during the first quarter of 2024. The deadline for Ramapo to file a summary action in New Jersey seeking to overturn the
arbitrator's decision is April 20, 2024. The Company's portion of the settlement is approximately $32,000 and our insurance
will pay the balance. The Company's portion has been recorded in accrued expenses in the December 31, 2023 consolidated balance
sheet.

 From
time to time, we may become involved in other legal proceedings arising in the ordinary course of our business. Including the proceeding
described above, we are not presently a party to any legal proceedings that, in the opinion of our management, would individually or
taken together have a material adverse effect on our business, consolidated results of operations, financial position or cash flows of
the Company.

 Please
see "Risk Factor - Acquisitions may subject us to liability with regard to the creditors, customers, and shareholders of the
sellers." in Part 1, Item 1A of this Annual Report on Form 10-K.

 Item
4. Mine Safety Disclosures

 None.

 PART
II

 Item
5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Our
common stock has been listed since July 23, 2014 and is trading on the Nasdaq Global Market under the symbol "CCLD".

Stockholders

 As
of December 31, 2023, there were approximately 6,800 holders of record of our common stock.

 Dividends
on Common Stock

 We
have not declared a cash dividend on our common stock since we became public on July 23, 2014, and currently we do not anticipate paying
any cash dividends to holders of our common stock in the foreseeable future. The Company is prohibited from paying any dividends on common
stock without the prior written consent of its senior lender, SVB.

 Sales
of Unregistered Securities

 There
were no sales of unregistered equity securities during the year ended December 31, 2023.

 Purchases
of Equity Securities by the Issuer and Affiliated Purchasers

 There
was no share repurchase activity during the three months ended December 31, 2023.

 Securities
Authorized for Issuance under the Equity Compensation Plan

 As
of December 31, 2023, the following table shows the number of securities to be issued upon vesting under the equity compensation plan
approved by the Company's Board of Directors.

 Equity
Compensation Plan Information

 Plan Category

 Number of securities to be issued upon vesting

 Number of securities remaining available for future issuance under equity incentive plan (excluding securities to be issued upon vesting)

 Equity compensation plan approved by security holders - common shares

 753,495

 493,579

 Equity compensation plan approved by security holders - preferred shares

 57,199

 71,769

 Total

 810,694

 565,348

 Item
6. [Reserved]

 Item
7. Management's Discussion and Analysis of Financial Condition and Results of Operations

 The
following is a discussion of our consolidated financial condition and results of operations for the years ended December 31, 2023 and
2022 and other factors that are expected to affect our prospective financial condition. The following discussion and analysis should
be read together with our Consolidated Financial Statements and related notes beginning on page F-1 of this Annual Report on Form 10-K.

 Some
of the statements set forth in this section are forward-looking statements relating to our future results of operations. Our actual results
may vary from the results anticipated by these statements. Please see " Forward-Looking Statements " on page 2 of this
Annual Report on Form 10-K.

 Overview

 The
Company is a healthcare information technology company that provides technology-enabled business solutions and Software-as-a-Service
offerings ("SaaS"), which are often bundled, but are occasionally provided individually, together with related business services
to healthcare providers and hospitals throughout the United States. The SaaS component is not material to the overall contract compared
to the stand-alone value of RCM. Our integrated SaaS platform includes technology-enabled revenue cycle management ("RCM"),
practice management ("PM"), electronic health records ("EHR"), artificial intelligence ("AI") tools,
business intelligence, telehealth, patient experience management ("PXM") solutions and complementary software tools and business
services for high-performance medical groups and health systems.

 At
a high level, these solutions can be categorized as follows:

 Technology-enabled
 business solutions, which are sometimes provided as individual offerings and often provided
 in combination with each other, including:

 RCM
 services including end-to-end medical billing, eligibility, analytics, and related services,
 all of which can be provided utilizing our technology platform or through a third-party system;

 AI
 tools are designed to serve as a digital healthcare assistant, helping to enhance clinical
 decision-making, streamline workflows, reduce administrative burdens, optimize revenue management,
 and promote patient-centered care;

 EHRs,
 which are easy to use and sometimes integrated with our business services, and enable our
 healthcare provider clients to deliver better patient care, streamline their clinical workflows,
 decrease documentation errors and potentially qualify for government incentives;

 PM
 software and related capabilities, which support our clients' day-to-day business operations
 and financial workflows, including automated insurance eligibility software, a robust billing
 and claims rules engine and other automated tools designed to maximize reimbursement;

 PXM
 solutions designed to transform interactions between patients and their clinicians, including
 smartphone applications that assist patients and healthcare providers in the provision of
 healthcare services, including contactless digital check-in solutions, messaging and online
 appointment scheduling tools;

 CareCloud
 Wellness, a digital health solution which includes chronic care management interactions with
 certified care managers, remote patient monitoring which feeds patient data directly to the
 EHR and highlights exceptions, and telehealth solutions which allow healthcare providers
 to conduct remote patient visits;

 Business
 intelligence and healthcare analytics platforms that allow our clients to derive actionable
 insights from their vast amount of data;

 claims clearinghouse which enables our clients to electronically scrub and submit claims
 and process payments from insurance companies;

 Interoperability
 and data transformation software to support the complex realities of data exchange with healthcare
 trading partners, including labs, insurance companies, and other healthcare IT vendors;

 Customized
 applications, interfaces and a variety of other technology solutions that support our healthcare
 clients;

 Professional
 services consisting of application and advisory services, revenue cycle services, data analytic
 services and educational training services; and

 Workforce
 augmentation and on-demand staffing to support our clients as they expand their businesses,
 seek highly trained personnel, or struggle with staffing shortages.

 practice management services are provided to medical practices. In this service model, we
 provide the medical practice with appropriate facilities, equipment, supplies, support services,
 nurses and administrative support staff. We also provide management, bill-paying and financial
 advisory services.

 Our
offshore operations in Pakistan and Sri Lanka together accounted for approximately 9% and 14% of total expenses for the years ended December
31, 2023 and 2022, respectively. A significant portion of those expenses were personnel-related costs (approximately 76% and 79% of foreign
costs for the years ended December 31, 2023 and 2022, respectively). Because personnel-related costs are significantly lower in Pakistan
and Sri Lanka than in the U.S. and many other offshore locations, we believe our offshore operations give us a competitive advantage
over many industry participants. All of the medical billing companies that we have acquired used domestic labor or subcontractors from
higher cost locations to provide all or a substantial portion of their services. We are able to achieve significant cost reductions as
we shift these labor costs to our offshore operations.

 Key
Performance Measures

 We
consider numerous factors in assessing our performance. Key performance measures used by management include adjusted EBITDA, adjusted
operating income, adjusted operating margin, adjusted net income and adjusted net income per share. These key performance measures are
non-GAAP financial measures, which we believe better enable management and investors to analyze and compare the underlying business results
from period to period.

 These
non-GAAP financial measures should not be considered in isolation, or as a substitute for or superior to, financial measures calculated
in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Moreover, these non-GAAP
financial measures have limitations in that they do not reflect all the items associated with the operations of our business as determined
in accordance with GAAP. We compensate for these limitations by analyzing current and future results on a GAAP basis, as well as a non-GAAP
basis, and we provide reconciliations from the most directly comparable GAAP financial measures to the non-GAAP financial measures. Our
non-GAAP financial measures may not be comparable to similarly titled measures of other companies. Other companies, including companies
in our industry, may calculate similarly titled non-GAAP financial measures differently than we do, limiting the usefulness of those
measures for comparative purposes.

 Adjusted
EBITDA, adjusted operating income, adjusted operating margin, adjusted net income and adjusted net income per share provide an alternative
view of performance used by management and we believe that an investor's understanding of our performance is enhanced by disclosing
these adjusted performance measures.

 Adjusted
EBITDA excludes the following elements which are included in GAAP net (loss) income:

 tax (benefit) provision or the cash requirements to pay our taxes;

 expense or the cash requirements necessary to service interest on principal payments on our
 debt;

 currency gains and losses and other non-operating expenses;

 Stock-based
 compensation expense, which includes cash-settled awards and the related taxes, based on
 changes in the stock price;

 and amortization charges;

 Integration
 costs, such as severance amounts paid to employees from acquired businesses and transaction
 costs, such as brokerage fees, pre-acquisition accounting costs and legal fees and exit costs
 related to contractual agreements;

 impairment charges;

 Net
 loss on lease terminations, unoccupied lease charges and restructuring costs; and

 in contingent consideration.

 Set
forth below is a presentation of our adjusted EBITDA for the years ended December 31, 2023 and 2022:

 2023

 2022

 $

 $

 GAAP net (loss) income

)

 5,432

 (Benefit) provision for income taxes

 (364
)

 Net interest expense

 1,040

 Foreign exchange loss / other expense

 4,716

 4,914

 14,402

 11,725

 -

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 1,105

 1,138

 -

)

 $
 15,429

 $
 22,248

 Adjusted
operating income and adjusted operating margin exclude the following elements which are included in GAAP operating (loss) income:

 Stock-based
 compensation expense, which includes cash-settled awards and the related taxes, based on
 changes in the stock price;

 of purchased intangible assets;

 Integration
 costs, such as severance amounts paid to employees from acquired businesses and transaction
 costs, such as brokerage fees, pre-acquisition accounting costs and legal fees and exit costs
 related to contractual agreements;

 impairment charges;

 Net
 loss on lease terminations, unoccupied lease charges and restructuring costs; and

 in contingent consideration.

 Set
forth below is a presentation of our adjusted operating income and adjusted operating margin, which represents adjusted operating income
as a percentage of net revenue, for the years ended December 31, 2023 and 2022:

 2023

 2022

 $

 $

 GAAP net (loss) income

)

 5,432

 (Benefit) provision for income taxes

 (364
)

 Net interest expense

 1,040

 GAAP operating (loss) income

 (47,115
)

 6,610

 GAAP operating margin

 (40.2
 %)

 4.8
 %

 4,716

 4,914

 Amortization of purchased intangible assets

 4,975

 6,277

 -

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 1,105

 1,138

 -

)

 Non-GAAP adjusted operating income

 $
 5,967

 $
 16,725

 Non-GAAP adjusted operating margin

 5.1
 %

 12.0
 %

 Adjusted
net income and adjusted net income per share exclude the following elements which are included in GAAP net (loss) income:

 currency gains and losses and other non-operating expenses;

 Stock-based
 compensation expense, which includes cash-settled awards and the related taxes, based on
 changes in the stock price;

 of purchased intangible assets;

 Integration
 costs, such as severance amounts paid to employees from acquired businesses and transaction
 costs, such as brokerage fees, pre-acquisition accounting costs and legal fees and exit costs
 related to contractual agreements;

 impairment charges;

 Net
 loss on lease terminations, unoccupied lease charges and restructuring costs;

 in contingent consideration; and

 tax (benefit) provision resulting from the amortization of goodwill related to our acquisitions.

 No
tax effect has been provided in computing non-GAAP adjusted net income and non-GAAP adjusted net income per share as the Company has
sufficient carry forward net operating losses to offset the applicable income taxes. The following table shows our reconciliation of
GAAP net (loss) income to non-GAAP adjusted net income for the years ended December 31, 2023 and 2022:

 2023

 2022

 GAAP net (loss) income

 $
)

 $
 5,432

 Foreign exchange loss / other expense

 4,716

 4,914

 Amortization of purchased intangible assets

 4,975

 6,277

 -

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 1,105

 1,138

 -

)

 Income tax (benefit) provision related to goodwill

 (525
)

 Non-GAAP adjusted net income

 $
 4,801

 $
 16,334

 2023

 2022

 GAAP net loss attributable to common shareholders, per share

 $
 (4.11
)

 $
 (0.67
)

 Impact of preferred stock dividend

 1.04

 1.03

 Net (loss) income per end-of-period share

 (3.07
)

 0.36

 Foreign exchange loss / other expense

 0.06

 0.05

 Stock-based compensation expense

 0.30

 0.32

 Amortization of purchased intangible assets

 0.31

 0.41

 0.02

 0.06

 2.65

 -

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 0.07

 0.07

 0.00

 (0.20
)

 Income tax (benefit) provision related to goodwill

 (0.04
)

 0.00

 Non-GAAP adjusted earnings per share

 $
 0.30

 $
 1.07

 End-of-period common shares

 15,880,092

 15,229,405

 In-the-money warrants and outstanding unvested RSUs

 733,908

 598,245

 Total fully diluted shares

 16,614,000

 15,827,650

 Non-GAAP adjusted diluted earnings per share

 $
 0.29

 $
 1.03

 For
purposes of determining non-GAAP adjusted earnings per share, the Company used the number of common shares outstanding at the end of
December 31, 2023 and 2022. Non-GAAP adjusted diluted earnings per share was computed using an as-converted method and includes warrants
that are in-the-money as of that date as well as outstanding unvested RSUs. Non-GAAP adjusted earnings per share and non-GAAP adjusted
diluted earnings per share do not take into account dividends on the Preferred Stock. No tax effect has been provided in computing non-GAAP
adjusted earnings per share and non-GAAP adjusted diluted earnings per share as the Company has sufficient carry forward net operating
losses to offset the applicable income taxes.

Statements of Operations Data

 Years Ended December 31,

 2023

 2022

 2021

 2020

 2019

 ($ in thousands, except per share data)

 $

 $

 $
 139,599

 $
 105,122

 $
 64,439

 Operating expenses:

 70,817

 84,434

 86,918

 64,821

 41,186

 9,650

 9,788

 8,786

 6,582

 1,522

 21,464

 23,820

 24,273

 22,811

 17,912

 4,736

 4,401

 4,408

 9,311

 -

)

 (2,515
)

 (1,000
)

 (344
)

 14,402

 11,725

 12,195

 9,905

 3,006

 -

 -

 -

 -

 Net loss on lease terminations, impairment, unoccupied lease charges and restructuring costs

 1,105

 1,138

 2,005

 164,174

 132,216

 136,070

 113,393

 64,372

 Operating (loss) income

 (47,115
)

 6,610

 3,529

 (8,271
)

 Interest expense - net

 (1,040
)

 (364
)

 (440
)

 (446
)

 (121
)

 Other (expense) income - net

 (883
)

 (637
)

 (96
)

 (625
)

 (Loss) income before (benefit) provision for income taxes

 (49,038
)

 5,609

 2,993

 (8,710
)

 (679
)

 (364
)

 $
)

 $
 5,432

 $
 2,836

 $
 (8,813
)

 $
 (872
)

 Preferred stock dividend

 15,674

 15,517

 14,052

 13,877

 6,386

 Net loss attributable to common shareholders

 $
 (64,348
)

 $
 (10,085
)

 $
 (11,216
)

 $
 (22,690
)

 $
 (7,258
)

 Weighted average common shares outstanding basic and diluted

 15,669,472

 15,109,587

 14,541,061

 12,678,845

 12,087,947

 Net loss per common share: basic and diluted

 $
 (4.11
)

 $
 (0.67
)

 $
 (0.77
)

 $
 (1.79
)

 $
 (0.60
)

Balance Sheet Data

 As of December 31,

 2023

 2022

 2021

 2020

 2019

 Cash

 $
 3,331

 $
 12,299

 $
 10,340

 $
 20,925

 $
 19,994

 Working capital - net (1)

 (57
)

 12,255

 5,997

 15,795

 19,823

 Total assets

 77,826

 136,174

 140,848

 137,999

 56,402

 Total liabilities

 36,109

 34,485

 42,917

 36,754

 13,565

 Shareholders' equity

 41,717

 97,931

 101,245

 42,837

 (1)
 Working
 capital-net is defined as current assets less current liabilities.

 Other
Financial Data

 To
provide investors with additional insight and allow for a more comprehensive understanding of the information used by management in its
financial and operational decision-making, we supplement our consolidated financial statements presented on a basis consistent with U.S.
generally accepted accounting principles, or GAAP, with adjusted EBITDA, (previously defined), a non-GAAP financial measure of earnings.

 Years Ended December 31,

 2023

 2022

 2021

 2020

 2019

 $
 15,429

 $
 22,248

 $
 22,119

 $
 10,871

 $
 8,101

 Quarterly
Results of Operations

 September 30,

 June 30,

 March 31,

 September 30,

 June 30,

 March 31,

 2023

 2023

 2023

 2023

 2022

 2022

 2022

 2022

 ($ in thousands, except per share data)

 $
 28,416

 $
 29,280

 $
 29,362

 $
 30,001

 $
 32,534

 $
 33,723

 $
 37,228

 $
 35,341

 Operating expenses:

 16,974

 18,260

 17,476

 18,107

 19,568

 20,406

 21,787

 22,673

 2,121

 2,337

 2,580

 2,612

 2,474

 2,504

 2,426

 2,384

 4,946

 5,482

 5,916

 5,120

 5,341

 6,500

 6,394

 5,585

 1,213

 1,260

 1,185

 1,078

 1,150

 1,168

 1,098

 -

 -

 -

 -

 (200
)

 (1,660
)

 (630
)

 (600
)

 4,120

 3,903

 3,341

 3,038

 3,039

 2,810

 2,936

 2,940

 -

 -

 -

 -

 -

 -

 -

 Net loss on lease terminations, unoccupied lease
 charges and restructuring costs

 72,049

 31,250

 30,651

 30,224

 31,582

 32,035

 34,474

 34,125

 Operating (loss) income

 (43,633
)

 (1,970
)

 (1,289
)

 (223
)

 1,688

 2,754

 1,216

 Interest expense - net

 (335
)

 (300
)

 (275
)

 (130
)

 (83
)

 (82
)

 (104
)

 (95
)

 Other (expense) income - net

 (292
)

 (422
)

 (186
)

 (337
)

 (495
)

 (Loss) income before (benefit) provision for income taxes

 (44,260
)

 (2,692
)

 (1,750
)

 (336
)

 1,111

 2,762

 1,204

 (568
)

 $
 (43,692
)

 $
 (2,749
)

 $
 (1,832
)

 $
 (401
)

 $

 $
 1,056

 $
 2,737

 $
 1,140

 Preferred stock dividend

 3,917

 3,916

 3,910

 3,931

 3,855

 3,849

 3,776

 4,037

 Net loss attributable to common shareholders

 $
 (47,609
)

 $
 (6,665
)

 $
 (5,742
)

 $
 (4,332
)

 $
 (3,356
)

 $
 (2,793
)

 $
 (1,039
)

 $
 (2,897
)

 Net loss per common share:

 Basic and diluted

 $
 (3.04
)

 $
 (0.42
)

 $
 (0.37
)

 $
 (0.28
)

 $
 (0.22
)

 $
 (0.18
)

 $
 (0.07
)

 $
 (0.19
)

 $
 4,128

 $
 3,245

 $
 3,819

 $
 4,237

 $
 5,684

 $
 4,817

 $
 7,017

 $
 4,730

 Reconciliation
of net (loss) income to adjusted EBITDA

 The
following table contains a reconciliation of net (loss) income to adjusted EBITDA by year.

 Years Ended December 31,

 2023

 2022

 2021

 2020

 2019

 $
)

 $
 5,432

 $
 2,836

 $
 (8,813
)

 $
 (872
)

 2,001

 1,952

 1,927

 1,354

 12,401

 9,773

 10,268

 8,551

 2,097

 Foreign exchange loss / other expense

 Interest expense - net

 1,040

 (364
)

 4,716

 4,914

 5,396

 6,502

 3,216

 1,364

 2,694

 1,735

 -

 -

 -

 -

 Net loss on lease terminations, impairment, unoccupied lease charges and restructuring costs

 1,105

 1,138

 2,005

 -

)

 (2,515
)

 (1,000
)

 (344
)

 $
 15,429

 $
 22,248

 $
 22,119

 $
 10,871

 $
 8,101

 The
following table contains a reconciliation of net (loss) income to adjusted EBITDA by quarter.

 September 30,

 June 30,

 March 31,

 September 30,

 June 30,

 March 31,

 2023

 2023

 2023

 2023

 2022

 2022

 2022

 2022

 $
 (43,692
)

 $
 (2,749
)

 $
 (1,832
)

 $
 (401
)

 $

 $
 1,056

 $
 2,737

 $
 1,140

 3,615

 3,410

 2,830

 2,546

 2,492

 2,336

 2,454

 2,491

 Foreign exchange loss (gain) / other expense

 (8
)

 (108
)

 (56
)

 Net interest expense

 (568
)

 1,209

 1,502

 1,072

 1,515

 1,328

 1,184

 -

 -

 -

 -

 -

 -

 -

 Net loss on lease terminations, unoccupied lease charges and restructuring
 costs

 -

 -

 -

 -

 (200
)

 (1,660
)

 (630
)

 (600
)

 $
 4,128

 $
 3,245

 $
 3,819

 $
 4,237

 $
 5,684

 $
 4,817

 $
 7,017

 $
 4,730

 Key
Metrics

 In
addition to the line items in our consolidated financial statements, we regularly review the following key metrics to evaluate our business,
measure our performance, identify trends in our business, prepare financial projections, make strategic business decisions, and assess
market share trends and working capital needs. We believe information on these metrics is useful for investors to understand the underlying
trends in our business.

 Providers
and Practices Served: As of December 31, 2023 and December 31, 2022, we provided services to approximately 40,000 providers (which
we define as physicians, nurses, nurse practitioners, physician assistants and other clinical staff that render bills for their services),
representing approximately 2,600 practices. In addition, we served approximately 150 clients who were not medical practices, but are
service organizations who serve the healthcare community. The foregoing numbers include clients leveraging any of our products or services
and are based in part upon estimates in cases where the precise number of practices or providers is unknown.

 Customer
Renewal Rate: Our customer renewal rate measures the percentage of our RCM clients who utilize our technology platform who were a
party to a services agreement with us on January 1 of a particular year and continued to operate and be a client on December 31 of the
same year. It also includes acquired accounts, if they are a party to a services agreement with the company we acquired and are generating
revenue for us, so long as the risk of client loss under the respective purchase agreement has fully shifted to us by January 1 of the
particular year. Our renewal rates for 2023 and 2022 were 91% and 98% of the number of practices that renewed, respectively. These renewal
percentages are not indicative of the loss of revenue due to non-renewal.

 Sources
of Revenue

 Revenue:
 We primarily derive our on-going revenues from technology-enabled business solutions, reported in our Healthcare IT segment, which
typically includes revenue cycle management and is billed as a percentage of payments collected by our customers. This fee includes the
ability to use our EHR, practice management systems and other software as part of the bundled fee. These solutions accounted for approximately
65% and 63% of our revenues during the years ended December 31, 2023 and 2022, respectively. This includes customers utilizing our proprietary
product suites, as well as customers from acquisitions of RCM companies which we are servicing utilizing third-party software. Key drivers
of our revenue include growth in the number of providers we are servicing, the number of patients served by those providers, and collections
by those providers. It also includes SaaS fees, for clients not utilizing revenue cycle management services. When clients utilize our
revenue cycle management services, basic SaaS services are included at no additional charge. Revenue is also generated from coding, credentialing,
indexing, transcription and other ancillary services.

 Our
professional services include an extensive set of services including EHR vendor-agnostic optimization and activation, project management,
IT transformation, consulting, process improvement, training, education and staffing for large healthcare organizations including health
systems and hospitals. Revenue is recorded monthly on either a time and materials or a fixed rate basis for each contract.

 We
also generate revenue from our printing and mailing, group purchasing services and medical practice management services.

 We
earned approximately 1% of our revenue from group purchasing services during both the years ended December 31, 2023 and 2022. We earned
approximately 11% and 10% of our revenue from medical practice management services during the years ended December 31, 2023 and 2022,
respectively. This revenue represents fees based on our actual costs plus a percentage of the operating profit and is reported in our
Medical Practice Management segment.

 Direct
Operating Costs. Direct operating costs consist primarily of salaries and benefits related to personnel who provide services to our
customers, claims processing costs, costs to operate the three managed practices, including facility lease costs, supplies, insurance
and other direct costs related to our services. Costs associated with the implementation of new customers are expensed as incurred. The
reported amounts of direct operating costs do not include depreciation and amortization, which are broken out separately in the consolidated
statements of operations. Operations in our Offshore Offices together accounted for approximately 11% of direct operating costs for both
the years ended December 31, 2023 and 2022. As we grow, we expect to achieve further economies of scale and to see our direct operating
costs decrease as a percentage of revenue.

 Selling
and Marketing Expense. Selling and marketing expense consists primarily of compensation and benefits, commissions, travel and advertising
expenses, which includes onshore and offshore personnel.

 General
and Administrative Expense. General and administrative expense consists primarily of personnel-related expense for administrative
employees, including compensation, benefits, travel, facility lease costs and insurance, software license fees and outside professional
fees. Our Offshore Offices accounted for approximately 17% and 23% of general and administrative expenses for the years ended December
31, 2023 and 2022, respectively.

and Development Expense. Research and development expense consists primarily of personnel-related costs, software expense and third-party
contractor costs.

in Contingent Consideration. Contingent consideration represents the portion of consideration payable to the sellers of some of our
acquisitions, the amount of which is based on the achievement of defined performance measures contained in the purchase agreements. Contingent
consideration is adjusted to fair value at the end of each reporting period.

and Amortization Expense. Depreciation expense is charged using the straight-line method over the estimated lives of the assets ranging
from three to five years. Amortization expense is charged on either an accelerated or on a straight-line basis over a period of three
or four years for most intangible assets acquired in connection with acquisitions including those intangibles related to the group purchasing
services. Amortization expense related to the value of our medical practice management clients is amortized on a straight-line basis
over a period of twelve years.

Impairment Charges. Goodwill impairment charges, which were related to the Healthcare IT reporting unit, represent the impairment
recorded as it was determined that the fair value of the goodwill was less than the carrying value.

 Net
Loss on Lease Terminations, Unoccupied Lease Charges and Restructuring Costs. Net loss on lease termination represents the write-off
of leasehold improvements and gains or losses as the result of lease terminations. Unoccupied lease charges represent the portion of
lease and related costs for vacant space not being utilized by the Company. The Company was able to turn back to the landlord one of
the unused facilities effective January 1, 2022. Restructuring costs, which were incurred in 2023, primarily consist of severance and
separation costs associated with the optimization of the Company's operations and profitability improvements.

and Other Income (Expense). Interest income represents interest earned on temporary cash investments and late fees from customers.
Interest expense consists primarily of interest costs related to our line of credit, motor vehicle loans and amounts due in connection
with acquisitions. Other income (expense) results primarily from foreign currency transaction gains (losses).

Taxes. In preparing our consolidated financial statements, we estimate income taxes in each of the jurisdictions in which we operate.
This process involves estimating actual current tax exposure together with assessing temporary differences resulting from differing treatment
of items for tax and financial reporting purposes. These differences result in deferred income tax assets and liabilities. Although the
Company reported GAAP earnings in 2022, it incurred losses historically and in 2023 and there is uncertainty regarding future U.S. taxable
income, which make realization of a deferred tax asset difficult to support in accordance with ASC 740. Accordingly, a valuation allowance
has been recorded against all deferred tax assets as of December 31, 2023 and December 31, 2022. For the global intangible low-taxed
income ("GILTI") tax, companies can either account for the GILTI inclusion in the period in which they are incurred or establish
deferred tax liabilities for the expected future taxes associated with GILTI. The Company records the GILTI provisions as they are incurred
each period.

 Critical
Accounting Policies and Estimates

 We
prepare our consolidated financial statements in accordance with GAAP. The preparation of these financial statements requires us to make
estimates and assumptions about future events, and apply judgments that affect the reported amounts of assets, liabilities, revenue,
expense and related disclosures. We base our estimates, assumptions and judgments on historical experience, current trends and various
other factors that we believe to be reasonable under the circumstances. The accounting estimates used in the preparation of our consolidated
financial statements will change as new events occur, as more experience is acquired, as additional information is obtained and as our
operating environment changes. On a regular basis, we review our accounting policies, estimates, assumptions and judgments to ensure
that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot
be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.
The methods, estimates and judgments that we use in applying our accounting policies have a significant impact on our results of operations.

 Critical
accounting policies are those policies used in the preparation of our consolidated financial statements that require management to make
difficult, subjective, or complex adjustments, and to make estimates about the effect of matters that are inherently uncertain.

from Contracts with Customers:

 We
account for revenue in accordance with ASC 606, Revenue from Contracts with Customers. Our revenue recognition policies require
us to make significant judgments and estimates, particularly as it relates to revenue cycle management. Under ASC 606, certain significant
accounting estimates, such as payment-to-charge ratios, effective billing rates and the estimated contractual payment periods are required
to measure the revenue cycle management revenue. We analyze various factors including, but not limited to, contractual terms and conditions,
the credit-worthiness of our customers and our pricing policies. Changes in judgment on any of the above factors could materially impact
the timing and amount of revenue recognized in a given period.

is recognized as the performance obligations are satisfied. We derive revenue from five primary sources: technology-enabled business
solutions, professional services, printing and mailing services, group purchasing services and medical practice management services.
All of our revenue arrangements are based on contracts with customers. Most of our contracts with customers contain a single performance
obligation. For contracts where we provide multiple services such as where we perform multiple ancillary services, each service represents
its own performance obligation. Selling or transaction prices are based on the contractual price for the service, which is consistent
with the stand-alone selling price.

 Technology-enabled
business solutions:

 Our
technology-enabled business solutions include our revenue cycle management and SaaS services. Revenue cycle management services are the
recurring process of submitting and following up on claims with health insurance companies in order for the healthcare providers to receive
payment for the services they rendered, assisted by our proprietary technology. CareCloud typically invoices customers on a monthly basis
based on the actual collections received by its customers and the agreed-upon rate in the sales contract. The services include use of
practice management software and related tools (on a SaaS basis), electronic health records (on a SaaS basis), medical billing services
and use of mobile health solutions. We consider the services to be one performance obligation since the promises are not distinct in
the context of the contract. The performance obligation consists of a series of distinct services that are substantially the same and
have the same periodic pattern of transfer to our customers.

 In
many cases, our clients may terminate their agreements with 90 days' notice without cause, thereby limiting the term in which we
have enforceable rights and obligations, although this time period can vary between clients. Our payment terms are normally net 30 days.
Although our contracts typically have stated terms of one or more years, under ASC 606 our contracts are considered month-to-month and
accordingly, there is no financing component.

 For
the majority of our contracts which include revenue cycle management services, the total transaction price is variable because our obligation
is to process an unknown quantity of claims, as and when requested by our customers over the contract period. When a contract includes
variable consideration, we evaluate the estimate of the variable consideration to determine whether the estimate needs to be constrained;
therefore, we include variable consideration in the transaction price only to the extent that it is probable that a significant reversal
of the amount of cumulative revenue recognized will not occur when the uncertainty associated with variable consideration is subsequently
resolved. Estimates to determine variable consideration such as payment to charge ratios, effective billing rates, and the estimated
contractual payment periods are updated at each reporting date. Revenue is recognized over the performance period using the input method.

 Professional
services:

 Revenues
from professional services are recorded as the services are provided as the performance obligations are satisfied over time. Revenue
is recorded based on the number of hours incurred and the agreed-upon hourly rate. Invoicing is primarily performed as of the end of
each month.

 Printing
and mailing services:

 The
Company provides printing and mailing services for both revenue cycle management customers and a non- revenue cycle management customer,
and invoices on a monthly basis based on the number of prints, the agreed-upon rate per print and the postage incurred. The performance
obligation is satisfied once the printing and mailing is completed.

 Group
purchasing services:

 The
Company provides group purchasing services which enable medical providers to purchase various vaccines directly from selected pharmaceutical
companies at a discounted price. Currently, there are approximately 4,000 medical providers who are members of the program. Revenue is
recognized as the vaccine shipments are made to the medical providers. Fees from the pharmaceutical companies are paid either quarterly
or annually and the Company adjusts its revenue accrual at the time of payment. The Company makes significant judgments regarding the
variable consideration which we expect to be entitled to for the group purchasing services which includes the anticipated shipments to
the members enrolled in the program, anticipated volumes of purchases made by the members, and the changes in the number of members.
The amounts recorded are constrained by estimates of decreases in shipments and loss of members to avoid a significant revenue reversal
in the subsequent period. The only performance obligation is to provide the pharmaceutical companies with the medical providers who want
to become members in order to purchase vaccines. The performance obligation is satisfied once the medical provider agrees to purchase
a specific quantity of vaccines and the medical provider's information is forwarded to the vaccine suppliers. The Company records
a contract asset for revenue earned and not paid as the ultimate payment is conditioned on achieving certain volume thresholds.

 Practice
management services:

 We
estimate the amount that will be collected on claims submitted to insurance carriers which is used to determine the compensation to be
paid to the owners of the managed practices. These compensation amounts reduce the revenue that the Company recognizes since they are
deducted from gross billings. The estimate of the amounts to be received from the insurance claims are updated at each reporting period.

 Although
we believe that our approach to estimates and judgments is reasonable, actual results could differ, and we may be exposed to increases
or decreases in revenue that could be material. Our estimates of variable consideration may prove to be inaccurate, in which case we
may have understated or overstated the revenue recognized in an accounting period. The amount of variable consideration recognized to
date that remains subject to estimation is included within the contract asset in the consolidated balance sheets.

 Contingent
Consideration:

 If
a business combination provides for contingent consideration, the Company records the contingent consideration at fair value at the acquisition
date. The Company adjusts the contingent consideration liability at the end of each reporting period based on fair value inputs representing
changes in forecasted revenue of the acquired entities and the probability of an adjustment to the purchase price. Critical estimates
include determining the forecasted revenue for certain acquisitions, probability and timing of cash collections and an appropriate discount
rate. Changes in the fair value of the contingent consideration after the acquisition date are included in earnings if the contingent
consideration is recorded as a liability.

Impairment:

is evaluated for impairment annually as of October 31 st, referred to as the annual test date. As a result of the annual
impairment test, an impairment of approximately $2 million was recorded. The Company will also test for impairment between annual
test dates if an event occurs or circumstances change that would indicate the carrying amount may be impaired. Impairment testing
for goodwill is performed at the reporting-unit level. The Company has determined that its business consists of two operating
segments and two reporting units (Healthcare IT and Medical Practice Management). Application of the goodwill impairment test
requires judgment including the use of a discounted cash flow approach, the trading price of publicly traded stock and the guideline public
company method. These analyses require significant assumptions and judgments. These assumptions and judgments include estimation of
future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for our business, estimation
of the useful life over which cash flows will occur, determination of our weighted average cost of capital and the selection of
comparable companies and the interpretation of their data. Future business and economic conditions, as well as differences in actual
financial results related to any of the assumptions, could materially impact the consolidated financial statements through
impairment of goodwill or intangible assets and acceleration of the amortization period of the purchased intangible assets which are
finite-lived assets. There was a triggering event at August 31, 2023, but it was determined that there was no impairment. Due to a
triggering event in December 2023, an additional impairment test was performed. As a result, the Company recorded an additional
impairment of approximately $40 million. No impairment charges were recorded during the year ended December 31, 2022.

 Business
Combinations:

 The
Company accounts for business combinations under the provisions of ASC 805, Business Combinations, which requires that the acquisition
method of accounting be used for all business combinations. Assets acquired and liabilities assumed are recorded at the date of acquisition
at their respective fair values. The fair value amount assigned to intangible assets is based on an exit price from a market participant's
viewpoint, and utilizes data such as discounted cash flow analysis and replacement cost models. Critical estimates in valuing certain
intangible assets include, but are not limited to, historical and projected client retention rates, expected future cash inflows and
outflows, discount rates, and estimated useful lives of those intangible assets. ASC 805 also specifies criteria that intangible assets
acquired in a business combination must meet to be recognized and reported apart from goodwill. Goodwill represents the excess purchase
price over the fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses
are recognized separately from the business combinations and are expensed as incurred.

 Results
of Operations

 The
following table sets forth our consolidated results of operations as a percentage of total revenue for the years shown.

 2023

 2022

 100.0
 %

 100.0
 %

 Operating expenses:

 60.5
 %

 60.8
 %

 8.2
 %

 7.0
 %

 18.3
 %

 17.2
 %

 4.0
 %

 3.2
 %

 -

 (2.2
 %)

 12.3
 %

 8.4
 %

 35.9
 %

 -

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 0.9
 %

 0.8
 %

 140.1
 %

 95.2
 %

 Operating (loss) income

 (40.1
 %)

 4.8
 %

 Interest expense - net

 0.9
 %

 0.3
 %

 (0.8
 %)

 (0.5
 %)

 (Loss) income before (benefit) provision for income taxes

 (41.8
 %)

 4.0
 %

 (0.3
 %)

 0.1
 %

 (41.5
 %)

 3.9
 %

 Comparison
of 2023 and 2022

 Year Ended

 2023

 2022

 Percent

 $

 $

 $
 (21,767
)

 (16
 %)

 Net
revenue. Net revenue of $117.1 million for the year ended December 31, 2023 decreased by $21.8 million or 16% from revenue of $138.8
million for the year ended December 31, 2022. Revenue for the years ended December 31, 2023 and December 31, 2022 includes $76.6 million
and $88.1 million relating to technology-enabled business solutions, $23.0 million and $34.0 million related to professional services
and $13.4 million and $13.6 million for medical practice management services, respectively.

 There
was a $9.5 million decrease in project-based professional services revenue for the year ended December 31, 2023 as compared to 2022.
The 2023 technology-enabled business solutions revenue was negatively impacted by two large accounts that had each been previously acquired
prior to our beginning to serve them after a 2020 acquisition. The services provided to them were each winding down at the time of our
acquisition and they both transitioned to the systems of their acquirers during 2022. Revenue from these two customers for the year ended
December 31, 2023 was approximately $3.1 million, accounting for approximately $9.0 million of the decline in revenue. Revenue from these
customers is expected to be approximately $300,000 for the year 2024. (Refer to Forward-Looking Statements disclosure on page 2 of this
Form 10-K.)

 Year Ended

 2023

 2022

 Percent

 $
 70,817

 $
 84,434

 $
 (13,617
)

 (16
 %)

 9,650

 9,788

 (138
)

 (1
 %)

 21,464

 23,820

 (2,356
)

 (10
 %)

 4,736

 4,401

 %

 -

)

 3,090

 %

 2,001

 1,952

 %

 12,401

 9,773

 2,628

 %

 -

 %

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 1,105

 1,138

 (33
)

 (3
 %)

 $
 164,174

 $
 132,216

 $
 31,958

 %

 Direct
Operating Costs. Direct operating costs of $70.8 million for the year ended December 31, 2023 decreased by $13.6 million or 16% from
direct operating costs of $84.4 million for the year ended December 31, 2022. Salary costs decreased by $9.4 million due to the decrease
in the Pakistan exchange rate, a decrease in the U.S. headcount and the redeployment of employees performing functions that were classified
as direct operating costs to functions classified as research and development expense. Outsourcing and other customer processing costs
decreased by $3.1 million and other costs such as medical supplies, vaccines, rent and consultancy fees decreased by $957,000.

 Selling
and Marketing Expense. Selling and marketing expense of $9.7 million for the year ended December 31, 2023 decreased by $138,000 or
1% from selling and marketing expense of $9.8 million for the year ended December 31, 2022. The decrease for the year ended December
31, 2023 was due to lower spending on selling and marketing activities.

 General
and Administrative Expense. General and administrative expense of $21.5 million for the year ended December 31, 2023 decreased by
$2.4 million or 10% from general and administrative expense of $23.8 million for the year ended December 31, 2022. Salary costs decreased
by $1.1 million due to the decrease in headcount and the Pakistan exchange rate. The Company's contributions to community based
projects and to a new academic institution in the Bagh area, a community where the Company has a large employee base, decreased by $1.0
million. Other costs such as computer expenses, utilities and office supplies decreased by $646,000. This increase was offset by a $635,000
increase in consulting expenses.

and Development Expense. Research and development expense of $4.7 million for the year ended December 31, 2023 increased by $335,000
or 8% from research and development expense of $4.4 million for the year ended December 31, 2022. The increase was due to the redeployment
of employees performing functions that were previously classified as direct operating costs to functions classified as research and development
expense which was offset by a decrease in the U.S. headcount. During the years ended December 31, 2023 and 2022, the Company capitalized
approximately $8.6 million and $9.2 million of development costs in connection with its internal-use software, respectively.

in Contingent Consideration. The change of $3.1 million for the year ended December 31, 2022 reflected the estimated decrease in
the fair value of the contingent consideration from the medSR acquisition. There was no contingent consideration liability recorded at
December 31, 2023 or 2022.

 Depreciation.
 Depreciation was $2.0 million for both the years ended December 31, 2023 and 2022.

Expense. Amortization expense of $12.4 million for the year ended December 31, 2023 increased by $2.6 million or 27% from amortization
expense of $9.8 million for the year ended December 31, 2022. The increase in amortization expense was due to the amortization on certain
internal-use software placed into production.

Impairment Charges. Goodwill impairment charges represent the impairment recorded as it was determined that the fair value of the
Healthcare IT reporting unit was less than the carrying value at both the annual impairment test date of October 31 and as a result of
a triggering event in December 2023.

 Net
Loss on Lease Terminations, Unoccupied Lease Charges and Restructuring Costs. Net loss on lease terminations represents the write-off
of leasehold improvements and gains or losses as the result of lease terminations. During the year ended December 31, 2023, the Miami
office lease that we assumed in connection with an acquisition ended and we entered into a new lease arrangement with the landlord for
significantly less space. Charges of $102,000 for the year ended December 31, 2023, were incurred as a result of vacating the former
premises. During the year ended December 31, 2022, a facility lease was terminated in conjunction with the Company ceasing its document
storage services resulting in additional costs for the year ended December 31, 2023 of $162,000. In addition, during the year ended December
31, 2023, the Company paid $27,000 to settle a claim regarding a lease termination in India. Unoccupied lease charges represent the portion
of lease and related costs for that portion of the space that is vacant and not being utilized by the Company. The Company was able to
turn back to the landlord one of the unused facilities effective January 1, 2022. Unoccupied lease charges for the year ended December
31, 2023 were $169,000. In addition, there was $645,000 of restructuring costs being recorded in 2023, whereas in 2022, there were no
restructuring costs. Restructuring costs consists of severance and separation costs associated with the optimization of the Company's
operations and profitability improvements.

 2023

 2022

 Percent

 Interest income

 $

 $

 $

 %

 Interest expense

 (1,194
)

 (405
)

 (789
)

 (195
 %)

 (883
)

 (637
)

 (246
)

 (39
 %)

 (364
)

 (541
)

 %

Income. Interest income of $154,000 for the year ended December 31, 2023 increased by $113,000 or 276% from interest income of $41,000
for the year ended December 31, 2022. The interest income represents interest earned on temporary cash investments, which increased due
to rising interest rates and late fees from customers.

Expense. Interest expense of $1.2 million for the year ended December 31, 2023 increased by $789,000 or 195% from interest expense
of $405,000 for the year ended December 31, 2022. The increase in interest expense was due to the increased use of the line of credit
and increases in interest rates. Interest expense on the line of credit was $906,000 and $138,000 and the amortization of deferred financing
costs was $169,000 and $124,000 during the years ended December 31, 2023 and 2022, respectively.

 Other
Expense - net. Other expense - net was $883,000 for the year ended December 31, 2023 compared to other expense - net of $637,000
for the year ended December 31, 2022. Other expense primarily represents foreign currency transaction gains and losses. There were foreign
exchange losses of $790,000 and $610,000 for the years ended December 31, 2023 and 2022, respectively. Transaction gains and losses result
from revaluing intercompany accounts which are denominated in U.S. dollars that represent amounts receivable/payable between the entities.
Whenever the exchange rate varies, the gains and losses are recorded in the consolidated statements of operations.

Tax (Benefit) Provision. There was a $364,000 benefit for
income taxes for the year ended December 31, 2023 compared to the provision for income taxes of $177,000 for the year ended December
31, 2022.

 The
current income tax expense for the year ended December 31, 2023 was approximately $161,000 compared to a current income tax expense of
approximately $101,000 for the year ended December 31, 2022. The current provision for 2023 and 2022 primarily relates to state and foreign
income taxes. The pre-tax loss and pre-tax income was $49 million
 and $5.6 million for the years ended December 31, 2023 and 2022, respectively. The Company has incurred
losses historically and there is uncertainty regarding future U.S. taxable income, which make realization of a deferred tax asset difficult
to support in accordance with ASC 740. Accordingly, a valuation allowance was recorded against all deferred tax assets at December 31,
2023 and 2022.

 The
Company has recorded goodwill as a result of its acquisitions. Goodwill is generally not amortized for financial reporting purposes.
However, goodwill from asset acquisitions is tax deductible and amortized over 15 years for tax purposes. As such, deferred income tax
expense and a deferred tax liability arise as a result of the tax-deductibility of this indefinitely lived asset. The resulting deferred
tax liability, which is recorded over the amortization period, will have an indefinite life. As a result of the Company incurring tax
losses for 2023 and 2022 which have an indefinite life under the recent tax reform legislation, the federal deferred tax liability resulting
from the amortization of goodwill was offset against these indefinite federal operating net loss deferred tax assets to the extent allowable.
The remaining deferred tax liability remains on the Company's consolidated balance sheet indefinitely unless there is an impairment
of goodwill (for financial reporting purposes) or a portion of the related business is sold. In 2023, there was a goodwill impairment
charge of $42 million, a portion of which was allocated to the tax deductible portion of the goodwill balance. The impairment charge
resulted in the reversal of the entire deferred tax liability at December 31, 2023.

 The
Company will maintain a full valuation allowance on deferred tax assets until there is sufficient evidence to support the reversal of
all or some portion of these allowances.

 As
of December 31, 2023, the Company has a total federal NOL carry forward of approximately $274 million of which approximately $198 million
will expire between 2034 and 2037, and the balance of approximately $76 million has an indefinite life. Out of the total federal NOL
carry forward, approximately $238 million is from the CareCloud and Meridian acquisitions and is subject to the federal Section 382 NOL
annual usage limitations. The Company has state NOL carry forwards of approximately $199 million, of which $86 million relates to the
State of New Jersey. These NOLs expire starting in 2025.

 Liquidity
and Capital Resources

the year ended December 31, 2023, there was positive cash flow from operations of $15.5 million and at year-end, the Company had $3.3
million in cash and negative working capital of $57,000. During the year ended December 31, 2022, there was positive
cash flow from operations of $21.2 million and at year-end, the Company
 had $12.3 million in cash and positive working capital of $12.3 million. The Company has a revolving
line of credit with SVB, and as of December 31, 2023, there was $10 million outstanding. During the year ended
December 31, 2023, the Company sold 59,773 shares of 8.75% Series B Preferred Stock and raised $1.4
million in net proceeds after fees and expenses. During the year ended December 31, 2022, the Company sold
1,324,858 shares of 8.75% Series B Preferred Stock and raised $30.9 million in net proceeds after fees and expenses.

 The
following table summarizes our cash flows for the years presented.

 2023

 2022

 Percent

 Net cash provided by operating activities

 $
 15,461

 $
 21,151

 $
 (5,690
)

 (27
 %)

 Net cash used in investing activities

 (11,613
)

 (11,767
)

 %

 Net cash used in financing activities

 (13,285
)

 (7,650
)

 (5,635
)

 (74
 %)

 Effect of exchange rate changes on cash

 %

 Net (decrease) increase in cash

 $
 (8,968
)

 $
 1,959

 $
 (10,927
)

 (558
 %)

 The
loss before income taxes was $49 million for
the year ended December 31, 2023, of which $42 million was a non-cash goodwill impairment charge and $14.4 million was non-cash depreciation.
The income before income taxes for the year ended December 31, 2022 was $5.6 million, which included $11.7 million of non-cash depreciation
and amortization.

 In
fiscal year 2023, the Company incurred a net loss of $48.7 million compared to $5.4 million of net income in fiscal year 2022, and at
December 31, 2023, had cash of $3.3 million and a working capital deficit of $57,000. The decrease in cash for fiscal 2023 was $9 million
compared to an increase in cash of $2 million in fiscal 2022. The Company also has $10 million drawn on its line of credit. Together,
these factors raise substantial doubt regarding the Company's ability to continue as a going concern.

 However,
management has considered its plans to continue the Company as a going concern and believes substantial doubt is alleviated by
focusing on cost-control. Management developed a plan that was substantially implemented during fiscal 2023 to improve liquidity in
its operations through reductions in payroll and operating expenses. After the reduction is implemented and through employee
attrition, the Company expects an improvement of approximately $10 million in annualized free cash flow, which represents
approximately 14% of total payroll cost. This reduction will result in approximately $5 million in annualized payroll expense
savings. In addition, the Company instituted certain other expense reductions. The Company also suspended its Preferred Stock
dividends in December 2023 resulting in cash savings of $1.3 million per month. Additional headcount reductions occurred in early
2024. Additional cost reductions will continue throughout the year. The Company is focused on reducing costs, returning to
profitability, generating positive cash flow and maintaining compliance with its debt covenants. Although there are no guarantees
that the Company will be successful, it believes that such initiatives will enable it to continue as a going concern through at
least the next twelve months.

continues to focus on the Company's overall profitability, including managing expenses, and to the extent possible growing revenue,
and expects that these efforts will continue to enhance our liquidity and financial position. Based on management's forecasts,
the Company will have sufficient liquidity to meet its obligations as they become due for the next twelve months from the date of the
financial statements issuance.

 We
have not been adversely affected by inflation as typically we receive a percentage of the fees our clients collect from our revenue cycle
management services. Additionally, our medical practice management contracts are based on our costs plus a percentage of the medical
practice's operating income. We continue to monitor the impact of inflation in order to minimize its effects through pricing strategies,
productivity improvements and cost reductions. In the event of inflation, we believe that we will be able to pass on any price increases
for fixed rate contracts to our customers, as the prices that we charge are not governed by long-term contracts. The interest rate on
our line of credit is based on prime rate which had been increasing through 2023 but now appears to be remaining steady.

Activities

 Cash
provided by operating activities was $15.5 million and $ 21.2
million during the years ended December 31, 2023 and 2022, respectively. The decrease in the net income of $54.1
million included the following changes in non-cash items: a goodwill impairment charge of $42
million, an increase in depreciation and amortization of $2.6 million and
 a decrease in the change in contingent consideration of $3.1 million.
Revenue decreased by $21.8 million for the year ended December 31, 2023 compared to the year ended
December 31, 2022, offset by a decrease in cash operating expenses of $15.8 million for the same period.

 Accounts
receivable decreased by $2.2 million and $1.5 million
for the years ended December 31, 2023 and 2022, respectively. Accounts payable, accrued compensation and accrued expenses increased by
 $3.3 million and $6.6 million for the years ended December
31, 2023 and 2022, respectively.

 Investing
Activities

 Cash
used in investing activities during the year ended December 31, 2023 was $11.6 million, a decrease
of $154,000 compared to $11.8 million during the year ended December 31, 2022. Capitalized
software was $8.6 million and $9.2 million during the years ended December 31, 2023 and 2022, respectively. Purchases of property and
equipment were $3.1 million and $2.6 million during the years ended December 31, 2023 and 2022, respectively.

 Financing
Activities

 Cash
used by financing activities during the year ended December 31, 2023 was $13.3 million, compared to $7.7 million of cash used for the
year ended December 31, 2022. Cash provided by financing activities during 2023 includes $1.4 million of net proceeds from issuing 59,773
shares, offset by $888,000 of repayments for debt obligations, and $14.3 million of preferred stock dividends. Cash provided by financing
activities during 2022 includes $30.9 million of net proceeds from issuing 1,324,858 shares of Series B Preferred Stock of which $20.0
million was used to redeem 800,000 shares of Series A Preferred Stock, offset by $1.0 million of repayments for debt obligations, and
$15.3 million of preferred stock dividends. There was also $1.5 million of payments to settle the tax withholding obligations in 2023
compared to $1.2 million in 2022. The net proceeds from the line of credit were $2.0 million during the year ended December 31, 2023.
There were no net proceeds from the line of credit during the year ended December 31, 2022.

 Contractual
Obligations and Commitments

 We
have contractual obligations under our line of credit. We also maintain operating leases for property and certain office equipment. We
were in compliance with all SVB covenants in 2023.

 Off-Balance
Sheet Arrangements

 As
of December 31, 2023, and 2022, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities
often referred to as structured finance or special-purpose entities, which would have been established for the purpose of facilitating
off-balance sheet arrangements or other contractually narrow or limited purposes. During the first quarter of 2020, a New Jersey corporation,
talkMD Clinicians, PA ("talkMD"), was formed by the wife of the Executive Chairman, who is a licensed physician, to provide
telehealth services. talkMD was determined to be a variable interest entity ("VIE") for financial reporting purposes because
the entity will be controlled by the Company. As of December 31, 2023, talkMD had not yet commenced operations. The Company has made
arrangements to have the income tax returns prepared for talkMD and will advance the funds for the required taxes. Cumulatively, the
Company has paid approximately $5,000 on behalf of talkMD for income taxes. We do not engage in off-balance sheet financing arrangements.

 Item
7A. Quantitative and Qualitative Disclosures about Market Risk

 We
are a smaller reporting company as defined by 17 C.F.R. 229.10(f)(1) and are not required to provide information under this item, pursuant
to Item 305(e) of Regulation S-K.

 Item
8. Financial Statements and Supplementary Data

 See
"Index to Consolidated Financial Statements" which appears on page F-1 of this Annual Report on Form 10-K.

 Item
9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 None.

 Item
9A. Controls and Procedures

 Evaluation
of Disclosure Controls and Procedures

 Our
management, with the participation of our Chief Executive Officer and Interim Chief Financial Officer, based on the Internal Control-Integrated
Framework (2013 framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"), evaluated
the effectiveness of our disclosure controls and procedures as of December 31, 2023 as required by Rules 13a-15(b) and 15d-15(b) of the
Exchange Act. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange
Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company
in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods
specified in the SEC's rules and forms.

 Disclosure
controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed
by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management,
including its principal executive and principal financial officers, to allow timely decisions regarding required disclosure. Management
recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving
their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and
procedures.

 Based
on the evaluation of our disclosure controls and procedures, as of December 31, 2023, our Chief Executive Officer and Interim Chief Financial
Officer concluded that, as of such date, our disclosure controls and procedures were effective. Our management, including our Chief Executive
Officer and Interim Chief Financial Officer, has concluded that the consolidated financial statements in this Annual Report on Form 10-K
fairly present, in all material respects, our consolidated financial condition, results of operations and cash flows for the periods
presented in accordance with U.S. generally accepted accounting principles.

 Management's
Report on Internal Control over Financial Reporting

 Our
management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined
in Rule 13a-15(f) and 15d-15(f) of the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes
in accordance with generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions
of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements
in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance
with authorizations of our management; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

is required to base its assessment on the effectiveness of our internal control over financial reporting on a suitable, recognized control
framework. Management has utilized the criteria established in COSO to evaluate the effectiveness of internal control over financial
reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that
there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not
be prevented or detected on a timely basis.

 Our
management has performed its assessment according to the guidelines established by COSO. Our management concluded that as of December
31, 2023, the Company's internal control over financial reporting was effective.

has performed analysis and procedures in preparing our consolidated financial statements. We have concluded that our consolidated financial
statements fairly present, in all material respects, our financial condition, results of operations and cash flows at and for the periods
presented.

 Because
of its inherent limitations, our internal controls over financial reporting provide reasonable, not absolute, assurance that the financial
statements and notes thereto are free of material error. In addition, no internal control structure can provide absolute assurance that
all instances of fraud have been detected. Also, projections of any evaluation of effectiveness to future periods are subject to the
risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures
may deteriorate.

 This
Annual Report does not include an attestation report of the Company's registered public accounting firm regarding internal control
over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting
firm pursuant to the rules of the SEC that permit the Company to provide only management's report in this Annual Report on Form
10-K.

in Internal Control over Financial Reporting

the fourth quarter of 2023, there were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the
Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 Item
9B. Other Information

the quarter ended December 31, 2023, no director or Section 16 officer adopted or terminated any Rule 10b5-1 trading agreement or non-Rule
10b5-1 trading agreement.

 Item
9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

 Not
applicable.

 PART
III

 Item
10. Directors, Executive Officers and Corporate Governance

required by this item will be included in our definitive Proxy Statement for the 2024 Meeting of Shareholders which will be filed within
120 days of the end of our fiscal year ended December 31, 2023 ("2024 Proxy Statement") and is incorporated herein by reference.

 Item
11. Executive Compensation

required by this item will be included in the 2024 Proxy Statement and is incorporated herein by reference.

 Item
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

required by this item will be included in the 2024 Proxy Statement and is incorporated herein by reference.

 Item
13. Certain Relationships and Related Transactions, and Director Independence

required by this item will be included in the 2024 Proxy Statement and is incorporated herein by reference.

 Item
14. Principal Accountant Fees and Services

required by this item will be included in the 2024 Proxy Statement and is incorporated herein by reference.

 PART
IV

 Item
15. Exhibits and Financial Statement Schedules

 (a)

 The
 following documents are filed as part of this Annual Report on Form 10-K:

 (1)

 Financial
 Statements

 (i)

 Balance Sheets as of December 31, 2023 and 2022

 (ii)

 Statements of Operations for the years ended December 31, 2023 and 2022

 (iii)

 Statements of Comprehensive (Loss) Income for the years ended December 31, 2023 and 2022

 (iv)

 Statements of Shareholders' Equity for the years ended December 31, 2023 and 2022

 (v)

 Statements of Cash Flows for the years ended December 31, 2023 and 2022

 (vi)

 Notes
 to Consolidated Financial Statements

 (2)

 Financial
 Statement Schedules

 There
are no Financial Statement Schedules filed as part of this Annual Report on Form 10-K, as the required information is not applicable
or is included in the Notes to Consolidated Financial Statements.

 (b)
 Exhibit
 Index:

 Exhibit

 Number

 Description

 2.1

 Assignment Agreement dated October 3, 2016, by and between the Company, The Prudential Insurance Company of America, and Prudential Retirement Insurance and Annuity Company (filed as Exhibit 10.1 to the Company's Form 8-K filed on October 5, 2016, and incorporated herein by reference).

 2.2

 Strict Foreclosure Agreement dated October 3, 2016, by and between MTBC Acquisition, Corp., MediGain, LLC and Millennium Practice Management Associates, LLC (filed as Exhibit 10.2 to the Company's Form 8-K filed on October 5, 2016, and incorporated herein by reference).

 2.3

 Transition Services Agreement dated October 3, 2016, by and between MTBC Acquisition, Corp., MediGain, LLC and Millennium Practice Management Associates, LLC (filed as Exhibit 10.3 to the Company's Form 8-K filed on October 5, 2016, and incorporated herein by reference).

 2.4

 First Amendment to Assignment Agreement dated January 3, 2017, by and between the Company, The Prudential Insurance Company of America, and Prudential Retirement Insurance and Annuity Company (filed as Exhibit 2.1 to the Company's Form 8-K filed on January 6, 2017, and incorporated herein by reference).

 2.5

 Second Amendment to Assignment Agreement dated January 23, 2017, by and between the Company, The Prudential Insurance Company of America, and Prudential Retirement Insurance and Annuity Company (filed as Exhibit 2.1 to the Company's Form 8-K filed on January 24, 2017, and incorporated herein by reference).

 2.6

 Asset Purchase Agreement dated June 25, 2018, by and between MTBC, and Orion Healthcorp, Inc. (filed as Exhibit 10.1 to the Company's Form 8-K filed on July 2, 2018, and incorporated herein by reference).

 2.7

 Transition Services Agreement dated June 25, 2018, by and between MTBC, and Orion Healthcorp, Inc. (filed as Exhibit 2.29 to the Company's Form S-1 filed on September 25, 2018, and incorporated herein by reference).

 2.8

 Asset Purchase Agreement dated March 27, 2019, by and between MTBC-Med, Inc., and Etransmedia Technology, Inc., et. al. (filed as Exhibit 10.1 to the Company's Form 8-K filed on March 28, 2019, and incorporated herein by reference).

 2.9

 Amended and Restated Asset Purchase Agreement dated April 3, 2019, by and between MTBC-Med, Inc., and Etransmedia Technology, Inc., et. al. (filed as Exhibit 10.1 to the Company's Form 8-K filed on April 4, 2019, and incorporated herein by reference).

 2.10

 Agreement and Plan of Merger by and among MTBC, Inc., MTBC Merger Sub, Inc., CareCloud Corporation and Runway Growth Credit Fund Inc., as the Seller's representative dated January 8, 2020 (filed as Exhibit 2.1 to the Company's Form 8-K filed on January 8, 2020, and incorporated herein by reference).

 2.11

 Escrow Agreement dated January 8, 2020 by and among MTBC, Inc., Runway Growth Credit Fund., Inc. and TD Bank (filed as Exhibit 10.17 to the Company's Form 10-K filed on February 28, 2020, and incorporated herein by reference).

 2.12

 Stock Purchase Agreement dated June 16, 2020 by and among MTBC, Inc., Origin Holdings, Inc., Meridian Billing Management Co., Origin Holdings, Inc., and GMM II Holdings, LLC, (filed as Exhibit 2.1 to the Company's Form 8-K on June 17, 2020, and incorporated herein by reference).

 2.13

 Asset and Stock Purchase Agreement by and among CareCloud Acquisition. Corp., MedMatica Consulting Associates, Inc., and Jerold Howell dated June 1, 2021 (filed as Exhibit 2.1 to the Company's Form 8-K filed on June 2, 2021, and incorporated herein by reference).

 2.14

 Non-Competition and Non-Solicitation Agreement by and among Santa Rosa Consulting, Inc., SureTest Holdings, LLC, Laura O'Toole, Mark Scruggs, Raleigh Brewer, Thomas Watford, and CareCloud Acquisition, Corp., dated June 1, 2021 (filed as Exhibit 2.2 to the Company's Form 8-K filed on June 2, 2021, and incorporated herein by reference).

 2.15

 Transition Services Agreement by and among CareCloud Acquisition, Corp., MedMatica Consulting Associates, Inc., and Jerold Howell, dated June 1, 2021 (filed as Exhibit 2.3 to the Company's Form 8-K filed on June 2, 2021 and incorporated herein by reference).

 3.1

 Amended and Restated Certificate of Incorporation of the Company dated April 4, 2014 (filed as Exhibit 3.1 to the Company's Form S-1 filed on September 25, 2018 and incorporated herein by reference).

 3.2

 Certificate of Amendment of Certificate of Incorporation of the Company dated June 28, 2016 (filed as Exhibit 3.2 to the Company's Form S-1 filed on September 25, 2018 and incorporated herein by reference).

 3.3

 Certificate of Amendment of Amended and Restated Certificate of Incorporation of the Company dated June 18, 2018 (filed as Exhibit 3.6 to the Company's Form S-1 filed on September 25, 2018 and incorporated herein by reference).

 3.4

 Certificate of Amendment of Amended and Restated Certificate of Incorporation of the Company dated February 6, 2019 (filed as Exhibit 3.1 to the Company's Form 8-K filed on February 7, 2019 and incorporated herein by reference).

 3.5

 Certificate of Amendment of Amended and Restated Certificate of Incorporation of the Company dated June 25, 2019 (filed as Exhibit 3.1 to the Company's Form 8-K filed on June 25, 2019 and incorporated herein by reference).

 3.6

 Certificate of Amendment of Amended and Restated Certificate of Incorporation of the Company dated February 26, 2021 (filed as Exhibit 3.1 to the Company's Form 8-K filed on March 29, 2021 and incorporated herein by reference).

 3.7

 Certificate of Amendment to Amended and Restated Certificate of Incorporation of the Company dated June 16, 2022 (filed as Exhibit 3.6 to the Company's Form 8-K/A filed on June 17, 2022 and incorporated herein by reference).

 3.8

 Certificate of Correction to Certificate of Amendment to Amended and Restated Certificate of Incorporation (filed as Exhibit 3.1 to the Company's Form 8-K/A filed June 17, 2022 and incorporated herein by reference).

 3.9

 Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated July 6, 2016 (filed as Exhibit 3.3 to the Company's Form S-1 filed on September 25, 2018, and incorporated herein by reference).

 3.10

 First Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated September 15, 2017 (filed as Exhibit 3.4 to the Company's Form S-1 filed on September 25, 2018, and incorporated herein by reference).

 3.11

 Second Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated March 23, 2018 (filed as Exhibit 3.5 to the Company's Form S-1 filed on September 25, 2018, and incorporated herein by reference).

 3.12

 Third Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated September 25, 2018 (filed as Exhibit 3.7 to the Company's Form S-1 filed on September 25, 2018, and incorporated herein by reference).

 3.13

 Fourth Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated January 9, 2020 (filed as Exhibit 3.1 to the Company's Form 8-K filed on January 28, 2020, and incorporated herein by reference).

 3.14

 Fifth Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated May 19, 2020 (filed as Exhibit 3.2 to the Company's Form 8-K filed on May 21, 2020, and incorporated herein by reference).

 3.15

 Sixth Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated July 9, 2020 (filed as Exhibit 3.1 to the Company's Form 8-K filed on July 9, 2020, and incorporated herein by reference).

 3.16

 Seventh Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock (filed as exhibit 3.1 to the Company's Form 8-K filed January 31, 2022 and incorporated herein by reference).

 3.17

 Certificate of Correction to Eighth Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock (filed as Exhibit 3.2 to the Company's Form 8-K/A filed June 17, 2022 and incorporated herein by reference).

 3.18

 Eighth Amendment to Amended and Restated Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Perpetual Preferred Stock dated June 15, 2022 (filed as Exhibit 3.4 to the Company's Form 8-K/A filed June 17, 2022 and incorporated herein by reference).

 3.19

 Certificate of Designations, Preferences and Rights of 8.75% Series B Cumulative Redeemable Perpetual Preferred Stock (filed as exhibit 3.2 to the Company's Form 8-K filed January 31, 2022 and incorporated herein by reference).

 3.20

 Certificate of Correction to First Amendment to Certificate of Designations, Preferences and Rights of 8.75% Series B Cumulative Redeemable Perpetual Preferred Stock (filed as Exhibit 3.3 to the Company's Form 8-K/A filed June 17, 2022 and incorporated herein by reference).

 3.21

 First Amendment to Certificate of Designations, Preferences and Rights of 8.75% Series B Cumulative Redeemable Perpetual Preferred Stock dated June 15, 2022 (filed as Exhibit 3.5 to the Company's Form 8-K/A filed June 17, 2022 and incorporated herein by reference).

 3.22

 Amended and Restated By-laws of the Company (filed as Exhibit 3.2 to the Company's Amendment No. 1 to Form S-1 filed on April 7, 2014, and incorporated herein by reference).

 4.1

 Form of common stock certificate of the Company (filed as Exhibit 4.1 to Amendment No. 2 to the Company's Form S-1 filed on May 7, 2014, and incorporated herein by reference).

 4.2

 Form of stock certificate of the 11% Series A Cumulative Redeemable Perpetual Preferred Stock (filed as Exhibit 4.2 to Amendment No. 2 to the Company's Form S-1 on October 19, 2015, and incorporated herein by reference).

 4.3

 Form of stock certificate of the 8.75% Series B Cumulative Redeemable Perpetual Preferred Stock (filed as Exhibit 4.3 to the Company's Form 8-A on January 31, 2022 and incorporated herein by reference).

 4.4

 Warrant to Purchase Stock dated as of October 13, 2017 issued by the Company to Silicon Valley Bank (filed as Exhibit 10.2 to the Company's Form 8-K filed on October 16, 2017, and incorporated herein by reference).

 4.5

 Warrant to Purchase Stock issued by the Company on September 20, 2018 to Silicon Valley Bank (filed as Exhibit 10.2 to the Company's Form 8-K filed on September 20, 2018, and incorporated herein by reference).

 4.6

 Warrant to Purchase Stock issued by the Company on January 8, 2020 to Runway Growth Credit Fund Inc. (filed as Exhibit 4.5 to the Company's Form 10-K filed on February 28, 2020, and incorporated herein by reference).

 4.7

 Warrant to Purchase Stock issued by the Company on January 8, 2020 to Runway Growth Credit Fund Inc. (filed as Exhibit 4.6 to the Company's Form 10-K filed on February 28, 2020, and incorporated herein by reference).

 4.8

 Form of Warrant to Purchase Stock issued by the Company on June 16, 2020 with respect to the Meridian transaction (filed as Exhibit 4.7 to the Company's Form S-1 filed on August 20, 2020, and incorporated herein by reference).

 4.9

 Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (filed as Exhibit 4.9 to the Company's Form 10-K filed on March 2, 2023, and incorporated herein by reference).

 10.1

 Form of Indemnification Agreement between the Company and each of its directors and executive officers (filed as Exhibit 10.1 to Amendment No. 2 to the Company's Form S-1 filed on May 7, 2014, and incorporated herein by reference).

 10.2
 *

 Amended and Restated Equity Incentive Plan of the Company (filed as Appendix B to the Company's Proxy Statement on Schedule 14A filed on February 10, 2017, and incorporated herein by reference).

 10.3
 *

 First Amendment to the Amended and Restated Equity Incentive Plan of the Company (filed as Exhibit 10.16 to the Company's Form 10-Q filed on August 8, 2018, and incorporated herein by reference).

 10.4*

 Second Amendment to MTBC, Inc. Amended and Restated Equity Incentive Plan (filed as Exhibit 3.1 to the Company's Form 8-K filed on May 21, 2020, and incorporated herein by reference).

 10.5
 *

 Form of Restricted Stock Unit Agreement under Amended and Restated Equity Incentive Plan (filed as Exhibit 10.3 to Amendment No. 1 to the Company's Form S-1 filed on April 7, 2014, and incorporated herein by reference).

 10.6
 *

 Third Amendment to Amended and Restated Equity Incentive Plan (filed as Exhibit 3.1 to the Company's Form 8-K filed on June 9, 2022, and incorporated herein by reference).

 10.7
 *

 Form of Restricted Stock Award Agreement under the Amended and Restated Equity Incentive Plan (filed as Exhibit 10.12 to the Company's Form 10-K filed on March 24, 2016, and incorporated herein by reference).

 10.8

 Lease between Company and Mahmud Haq with respect to offices located at 7 Clyde Road, Somerset, NJ 08873 (filed as Exhibit 10.4 to the Company's Form S-1 filed on December 20, 2013, and incorporated herein by reference).

 10.9
 *

 Employment Agreement between the Company and Mahmud Haq dated as of May 1, 2018 (filed as Exhibit 10.1 to the Company's Form 8-K filed on May 7, 2018, and incorporated herein by reference).

 10.10
 *

 Employment Agreement between the Company and A. Hadi Chaudhry dated as of March 23, 2021 (filed as Exhibit 10.2 to the Company's Form 8-K filed on March 24, 2021, and incorporated herein by reference).

 10.11
 *

 Employment Agreement between the Company and Bill Korn dated as of May 1, 2018 (filed as Exhibit 10.4 to the Company's Form 8-K filed on May 7, 2018, and incorporated herein by reference).

 10.12

 Employment
 Agreement and Bonus Agreement between the Company and Larry Steenvoorden each dated as of July 6, 2023 (filed as Exhibit 10.1 and
 10.2, respectively, to the Company's Form 8-K filed on July 11, 2023 and incorporated herein by reference).

 10.13

 Loan and Security Agreement dated as of October 13, 2017 between Medical Transcription Billing, Corp., MTBC Acquisition, Corp. and Silicon Valley Bank (filed as Exhibit 10.1 to the Company's Form 8-K filed on October 16, 2017, and incorporated herein by reference).

 10.14

 Joinder and First Loan Modification Agreement dated as of September 20, 2018 between Medical Transcription Billing, Corp., MTBC Acquisition, Corp., MTBC Health, Inc. and MTBC Practice Management, Corp. and Silicon Valley Bank (filed as Exhibit 10.1 to the Company's Form 8-K filed on September 20, 2018, and incorporated herein by reference).

 10.15

 Second Loan Modification Agreement dated November 15, 2019, by and between the Company and SVB (filed as Exhibit 1.1 to the Company's Form 8-K filed on November 21, 2019, and incorporated herein by reference).

 10.16

 Joinder and Third Loan Modification Agreement dated as of February 28, 2020 between MTBC, Inc., MTBC Acquisition Corp., MTBC Health, Inc. and MTBC Practice Management Corp., MTBC-Med, Inc., CareCloud Corporation and Silicon Valley Bank (filed as Exhibit 10.16 to the Company's Form 10-K filed on February 28, 2020, and incorporated herein by reference).

 10.17

 Joinder and Fourth Loan Modification Agreement dated September 21, 2020, by and between the Company and SVB (filed as Exhibit 1.1 to the Company's Form 8-K filed on September 25, 2020, and incorporated herein by reference).

 10.18

 Joinder and Fifth Loan Modification Agreement dated September 21, 2021, by and between the Company and SVB (filed as Exhibit 10.1 to the Company's Form 8-K filed on September 22, 2021 and incorporated herein by reference).

 10.19

 Sixth Loan Modification Agreement dated January 27, 2022, by and between the Company and SVB (filed as Exhibit 10.19 to the Company's Form 10-Q filed on May 9, 2022 and incorporated herein by reference).

 10.20

 Seventh Loan Modification Agreement dated February 17, 2023, by and between the Company and SVB (filed as Exhibit 10.1 to the Company's Form 8-K filed on February 21, 2023 and incorporated herein by reference).

 10.21

 Eighth Loan Modification Agreement dated August 31, 2023, by and between the Company and SVB (filed as Exhibit 10.1 to the Company's Form 8-K filed on September 1, 2023 and incorporated herein by reference).

 10.22

 Underwriting Agreement dated January 28, 2022 by and between the Company and B. Riley FBR, Inc. as representative of several underwriters named therein (filed as Exhibit 1.1 to the Company's Form 8-K filed on January 31, 2022, and incorporated herein by reference).

 10.23

 At Market Issuance Sales Agreement dated February 14, 2022 by and between CareCloud, Inc. and B. Riley Securities, Inc. (filed as Exhibit 1.1 to the Company's Form 8-K filed on February 14, 2022 and incorporated herein by reference).

 10.24

 Consulting Agreement dated June 3, 2022 by and between the Company and Hill City Advisors, LLC (filed as Exhibit 10.22 to the Company's Form 10-K filed on March 2, 2023, and incorporated herein by reference).

 10.25

 Amendment to Consulting Agreement dated February 16, 2023 by and between the Company and Hill City Advisors, LLC (filed as Exhibit 10.23 to the Company's Form 10-K filed on March 2, 2023, and incorporated herein by reference).

 10.26

 Additional Statement of Work dated January 29, 2024 added as Exhibit B to the Consulting Agreement between the Company and Hill City Advisors, LLC.

 10.27

 Consulting Agreement dated January 9, 2024, and as amended February 12, 2024, by and between the Company and Korn Intellect, LLC.

 21.1

 List of subsidiaries.

 23.1

 Consent of Grant Thornton LLP.

 31.1

 Certification of the Company's Principal Executive Officer pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), of the Securities Exchange Act of 1934, as amended.

 31.2

 Certification of the Company's Principal Financial Officer pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), of the Securities Exchange Act of 1934, as amended.

 32.1

 Certification of the Company's Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 32.2

 Certification of the Company's Interim Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 97.1

 Policy relating to recovery of erroneously awarded compensation, as required by applicable listing standards adopted pursuant to 17 CFR 240.10D-1.

 101.INS

 Instance

 101.SCH

 Taxonomy Extension Schema

 101.CAL

 Taxonomy Extension Calculation Linkbase

 101.LAB

 Taxonomy Extension Label Linkbase

 101.PRE

 Taxonomy Extension Presentation Linkbase

 101.DEF

 Taxonomy Extension Definition Linkbase

 Cover

 *
 Indicates management contract or compensatory plan or arrangement.

 The
 certifications on Exhibit 32 hereto are deemed not "filed" for purposes of Section 18 of the Securities and Exchange
 Act of 1934, as amended, or otherwise subject to the liability of that Section. Such certifications will not be deemed incorporated
 by reference into any filing under the Securities Act or the Exchange Act.

 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.

 CareCloud, Inc.

 By:

 /s/
 A. Hadi Chaudhry

 A.
 Hadi Chaudhry

 Chief
 Executive Officer

 Date:

 March

 By:

 /s/
 Norman Roth

 Norman
 Roth

 Interim
 Chief Financial Officer and Corporate Controller

 Date:

 March

 Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:

 Signature

 Title

 Date

 /s/
 Mahmud Haq

 March

 Mahmud
 Haq

 Executive
 Chairman and Director

 /s/
 A. Hadi Chaudhry

 March

 A.
 Hadi Chaudhry

 Principal
 Executive Officer, President and Director

 /s/
 Norman Roth

 March

 Norman
 Roth

 Principal
 Financial and Accounting Officer

 /s/
 Anne Busquet

 March

 Anne
 Busquet

 /s/
 John N. Daly

 March

 John
 N. Daly

 /s/
 Bill Korn

 March

 Bill
 Korn

 /s/
 Cameron Munter

 March

 Cameron
 Munter

 /s/
 Lawrence Sharnak

 March

 Lawrence
 Sharnak

to Consolidated Financial Statements

 Report of Independent Registered Public Accounting Firm Grant Thornton, LLP (PCAOB ID Number 248)

 Consolidated Balance Sheets as of December 31, 2023 and 2022

 Consolidated Statements of Operations for the years ended December 31, 2023 and 2022

 Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2023 and 2022

 Consolidated Statements of Shareholders' Equity for the years ended December 31, 2023 and 2022

 Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2022

 Notes to Consolidated Financial Statements

 F- 1

 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 Board
of Directors and Shareholders

 CareCloud,
Inc.

 Opinion
on the financial statements

 We
have audited the accompanying consolidated balance sheets of CareCloud, Inc. (a Delaware corporation) and subsidiaries (the "Company")
as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive (loss) income, changes in shareholders'
equity, and cash flows for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred
to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the
financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of
the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States
of America.

 Basis
for opinion

 These
financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's
financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board
(United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits
we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion
on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

 Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.

 Critical
audit matters

 The
critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated
or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial
statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters
does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit
matters below, providing separate opinion on the critical audit matters or on the accounts or disclosures to which it relates.

Impairment Assessment - Healthcare IT Reporting Unit

 As
described further in Note 2, 3, and 19 to the consolidated financial statements, the Company performed its annual goodwill impairment
assessment as of October 31, 2023, on its Healthcare IT (HIT) reporting unit. In addition, the Company identified triggering events on
August 31, 2023 and December 12, 2023 that resulted in goodwill impairment assessments of HIT for each of the respective dates. For the
annual impairment test date and at December 12, 2023, the Company concluded that the fair value of the HIT reporting unit was less than
the carrying value at these dates, leading to the Company recording an impairment charge. We identified the Company's goodwill
impairment assessment over the HIT reporting unit for each of those assessment dates as a critical audit matter.

 The
principal considerations for our determination that the goodwill impairment assessment as of August 31, 2023, October 31, 2023 and December
12, 2023 is a critical audit matter are the significant management estimates and judgements related to forecasts of expected future cash
flows required to estimate the HIT reporting unit's fair value. Management's significant estimates and judgements include
the determination of the discount rates, revenue growth rates, operating margins, long-term growth rate, and weightings assigned to the
valuation methodologies used. Auditing these estimates requires a high degree of auditor judgement, including the use of professionals
with specialized skills and knowledge.

 F- 2

 Our
audit procedures related to the goodwill impairment assessment included the following, among others:

 We
 assessed management's ability to forecast by comparing historical projections to actual results.

 We
 evaluated management's revenue growth rates, operating margins, and cash flows for consistency with relevant historical data
 and trends, recent changes in the business, underlying business strategies, and external industry data and forecasts used at each
 impairment testing date.

 With
 the assistance of our valuation professionals with specialized skills and knowledge,
 we evaluated the valuation methodologies, inputs, and assumptions utilized by management, including the long-term growth rate and
 discount rate.

 We
 performed sensitivity analyses on discount rates used to evaluate the impact that changes in these assumptions have on management's
 conclusion.

 Going
Concern Analysis

 As
described further in Note 2 to the consolidated financial statements, as of and for the year end December 31, 2023, the Company generated
a net loss of $48.7 million, suspended the dividend on its Series A and B Preferred Stock and had negative working capital of $57,000
and cash of $3.3 million. These factors, among others, raised substantial doubt regarding the Company's ability to continue as
a going concern for a period of at least once year from the date of the issuance of the financial statements; however, management believes
its plan to mitigate these conditions alleviates this substantial doubt. Management's plan includes an assessment of liquidity,
judgments about the Company's future activities and compliance with terms of its lending arrangement that are based on estimates
of future cash flows. Significant assumptions used in the Company's forecasted model of liquidity include forecasted revenue and
accounts receivable, costs, and cash flows. Changes in these assumptions could have a material impact on the forecasted liquidity and
going concern assessment. We identified the going concern analysis as a critical audit matter.

 The
principal consideration for our determination that the going concern analysis is a critical audit matter are the significant judgements
and assumptions involved in determining whether it is probable that management's plans will be effectively implemented and alleviate
substantial doubt about the Company's ability to continue as a going concern. More specifically, there was a high degree of auditor
judgment and subjectivity in performing our procedures to evaluate the reasonableness of the Company's forecasted financial results.

 Our
audit procedures related to the going concern assessment included the following, among others:

 We
 evaluated the Company's forecasted financial results and ability to meet obligations as they come due for at least twelve months
 from the issuance date of these financial statements by:

 Comparing
 the Company's forecasted future financial results to (1) historical results and previous forecasts, (2) internal communications
 to management and the Board of Directors, (3) forward-looking guidance set forth by the Company within their earnings release, (4)
 industry data, and (5) forecasted balances against actual results of the first two months of fiscal year 2024.

 Performing
 sensitivity analyses on the Company's forecasted cash flows and liquidity covenant calculations by adjusting management's
 projected cash balances using actual results subsequent to year end and adjusted levels of revenue growth.

 We
 evaluated management's plans, including estimated cost savings and probability that the Company will be able to successfully
 implement these plans to alleviate substantial doubt about the Company's ability to continue as a going concern.

 We
 assessed the appropriateness of the disclosures included within the consolidated financial statements relating to liquidity and going
 concern.

 /s/
 GRANT THORNTON LLP

 We
 have served as the Company's auditor since 2015.

 Iselin,
 New Jersey

 March

 F- 3

 CARECLOUD, INC.

 CONSOLIDATED BALANCE SHEETS

 AS OF DECEMBER 31, 2023 AND 2022

 ($ in thousands, except share and per share amounts)

 2023

 2022

 ASSETS

 Current assets:

 Cash

 $
 3,331

 $
 12,299

 Accounts receivable - net

 11,888

 14,773

 Contract asset

 5,094

 4,399

 Inventory

 Current assets - related party

 Prepaid expenses and other current assets

 2,449

 2,785

 Total current assets

 23,243

 34,653

 Property and equipment - net

 5,317

 5,056

 Operating lease right-of-use assets

 4,365

 4,921

 Intangible assets - net

 25,074

 29,520

 19,186

 61,186

 Other assets

 TOTAL ASSETS

 $
 77,826

 $
 136,174

 LIABILITIES AND SHAREHOLDERS' EQUITY

 Current liabilities:

 Accounts payable

 $
 5,798

 $
 5,681

 Accrued compensation

 3,444

 4,248

 Accrued expenses

 5,065

 4,432

 Operating lease liability (current portion)

 1,888

 2,273

 Deferred revenue (current portion)

 1,380

 1,386

 Notes payable (current portion)

 Dividend payable

 5,433

 4,059

 Total current liabilities

 23,300

 22,398

 Notes payable

 Borrowings under line of credit

 10,000

 8,000

 Operating lease liability

 2,516

 3,207

 Deferred revenue

 Deferred tax liability

 -

 Total liabilities

 36,109

 34,485

 COMMITMENTS AND CONTINGENCIES (NOTE 10)

 -

 SHAREHOLDERS' EQUITY:

 Preferred stock, $ 0.001 par value - authorized 7,000,000 shares. Series A, issued and outstanding 4,526,231 shares at December 31, 2023 and December 31, 2022. Series B, issued and outstanding 1,468,792 and 1,344,128 shares at December 31, 2023 and December 31, 2022, respectively

 Common stock, $ 0.001 par value - authorized 35,000,000 shares. Issued 16,620,891 and 15,970,204 shares at December 31, 2023 and December 31, 2022, respectively. Outstanding 15,880,092 and 15,229,405 shares at December 31, 2023 and December 31, 2022, respectively

 Additional paid-in capital

 120,706

 Accumulated deficit

 ( 74,481
)

 ( 25,621
)

 Accumulated other comprehensive loss

 ( 3,869
)

)

 Less: 740,799 common shares held in treasury, at cost at December 31, 2023 and December 31, 2022

 ( 662
)

 ( 662
)

 Total shareholders' equity

 41,717

 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

 $
 77,826

 $
 136,174

 See

 F- 4

 CARECLOUD,
INC.

 CONSOLIDATED
STATEMENTS OF OPERATIONS

 FOR
THE YEARS ENDED DECEMBER 31, 2023 AND 2022

 ($
in thousands, except share and per share amounts)

 2023

 2022

 2023

 2022

 NET REVENUE

 $

 $

 OPERATING EXPENSES:

 70,817

 84,434

 9,650

 9,788

 21,464

 23,820

 4,736

 4,401

 -

)

 14,402

 11,725

 -

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 1,105

 1,138

 164,174

 132,216

 OPERATING (LOSS) INCOME

 ( 47,115
)

 6,610

 OTHER:

 Interest income

 Interest expense

 ( 1,194
)

 ( 405
)

 ( 883
)

 ( 637
)

 (LOSS) INCOME BEFORE (BENEFIT) PROVISION FOR INCOME TAXES

 ( 49,038
)

 5,609

 ( 364
)

 NET (LOSS) INCOME

 $
)

 $
 5,432

 Preferred stock dividend

 15,674

 15,517

 NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS

 $
 ( 64,348
)

 $
 ( 10,085
)

 Net loss per common share: basic and diluted

 $
 ( 4.11
)

 $
 ( 0.67
)

 Weighted-average common shares used to compute basic and diluted loss per share

 15,669,472

 15,109,587

 See

 F- 5

 CARECLOUD, INC.

 CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

 FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

 2023

 2022

 2023

 2022

 NET (LOSS) INCOME

 $
)

 $
 5,432

 OTHER COMPREHENSIVE LOSS, NET OF TAX

 Foreign currency translation adjustment (a)

 ( 832
)

 ( 1,283
)

 COMPREHENSIVE (LOSS) INCOME

 $
 ( 49,506
)

 $
 4,149

 (a)
 No tax effect has
been recorded as the Company recorded a valuation allowance against the tax benefit from its foreign currency translation adjustments.

 See

 F- 6

 CARECLOUD, INC.

 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

 FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

 ($ in thousands, except for number of shares)

 Capital

 Deficit

 Loss

 Stock

 Equity

 Preferred
 Stock Series A

 Preferred
 Stock Series B

 Stock

 Additional Paid-in

 Accumulated

 Accumulated Other
 Comprehensive

 Treasury (Common)

 Total Shareholders'

 Capital

 Deficit

 Loss

 Stock

 Equity

 Balance - January 1, 2023 before adoption of ASC 326

 $

 1,344,128

 $

 15,970,204

 $

 $

 $
 ( 25,621
)

 $
)

 $
 ( 662
)

 $

 Cumulative effect of adopting ASC 326

 -

 -

 -

 -

 -

 -

 -

 ( 186
)

 -

 -

 ( 186
)

 Balance - January 1, 2023 after adoption

 1,344,128

 15,970,204

 ( 25,807
)

)

 ( 662
)

 101,503

 Net loss

 -

 -

 -

 -

 -

 -

 -

)

 -

 -

)

 Foreign currency translation adjustment

 -

 -

 -

 -

 -

 -

 -

 -

 ( 832
)

 -

 ( 832
)

 Stock issued under the equity incentive plan

 -

 -

 64,891

 -

 610,687

 -

 -

 -

 -

 Issuance of Series B Preferred Stock (1)

 -

 -

 59,773

 -

 -

 -

 1,427

 -

 -

 -

 1,427

 Shares issued for services

 -

 -

 -

 -

 40,000

 -

 -

 -

 -

 -

 -

 Stock-based compensation, net of cash settlements

 -

 -

 -

 -

 -

 -

 3,966

 -

 -

 -

 3,966

 Preferred stock dividends

 -

 -

 -

 -

 -

 -

 ( 15,674
)

 -

 -

 -

 ( 15,674
)

 Balance - December 31, 2023

 $

 1,468,792

 $

 16,620,891

 $

 $
 120,706

 $
 ( 74,481
)

 $
 ( 3,869
)

 $
 ( 662
)

 $
 41,717

 Balance - January 1, 2022

 5,299,227

 $

 -

 $
 -

 15,657,641

 $

 $
 131,379

 $
 ( 31,053
)

 $
 ( 1,754
)

 $
 ( 662
)

 $
 97,931

 Balance

 5,299,227

 $

 -

 $
 -

 15,657,641

 $

 $
 131,379

 $
 ( 31,053
)

 $
 ( 1,754
)

 $
 ( 662
)

 $
 97,931

 Net income

 -

 -

 -

 -

 -

 -

 -

 5,432

 -

 -

 5,432

 -

 -

 -

 -

 -

 -

 -

 5,432

 -

 -

 5,432

 Foreign currency translation adjustment

 -

 -

 -

 -

 -

 -

 -

 -

 ( 1,283
)

 -

 ( 1,283
)

 Stock issued under the equity incentive plan

 27,004

 -

 19,270

 -

 303,491

 -

 -

 -

 -

 -

 -

 Redemption of Series A Preferred Stock

 ( 800,000
)

 -

 -

 -

 -

 -

 ( 20,005
)

 -

 -

 -

 ( 20,005
)

 Exercise of common stock warrants

 -

 -

 -

 -

 9,072

 -

 -

 -

 -

 -

 -

 Issuance of Series B Preferred Stock (1)

 -

 -

 1,324,858

 -

 -

 30,900

 -

 -

 -

 30,901

 Stock issuance costs

 -

 -

 -

 -

 -

 -

 ( 32
)

 -

 -

 -

 ( 32
)

 Stock-based compensation, net of cash settlements

 -

 -

 -

 -

 -

 -

 4,262

 -

 -

 -

 4,262

 Preferred stock dividends

 -

 -

 -

 -

 -

 -

 ( 15,517
)

 -

 -

 -

 ( 15,517
)

 Balance - December 31, 2022

 $

 1,344,128

 $

 15,970,204

 $

 $

 $
 ( 25,621
)

 $
)

 $
 ( 662
)

 $

 Balance

 $

 1,344,128

 $

 15,970,204

 $

 $

 $
 ( 25,621
)

 $
)

 $
 ( 662
)

 $

 (1)
 Amounts are net
of issuance cost of approximately $ 71,000 and $ 2.3 million for 2023 and 2022, respectively.

 For
2022, the preferred stock dividends were paid monthly at the rate of $ 2.75 and $ 2.19 for Series A and Series B, respectively, per share
per annum.

 For
2023, the preferred stock dividends were paid monthly from January through November at the rate of $ 2.75 and $ 2.19 for Series A and Series
B, respectively, per share per annum.

 See

 F- 7

 CARECLOUD, INC.

 CONSOLIDATED STATEMENTS OF CASH FLOWS

 FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

 2023

 2022

 OPERATING ACTIVITIES:

 $
)

 $
 5,432

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

 14,889

 12,318

 Lease amortization

 2,152

 3,286

 Deferred revenue

 ( 92
)

 Provision for expected credit losses

 Deferred income taxes (benefit) provision

 ( 525
)

 Foreign exchange loss

 Interest accretion

 -

 Stock-based compensation expense

 4,886

 4,914

 -

)

 Changes in operating assets and liabilities:

 Accounts receivable

 2,246

 1,493

 Contract asset

 ( 695
)

 Inventory

 ( 84
)

 Other assets

 Accounts payable and other liabilities

 ( 3,256
)

 ( 6,593
)

 Net cash provided by operating activities

 15,461

 21,151

 INVESTING ACTIVITIES:

 Purchases of property and equipment

 ( 3,063
)

 ( 2,588
)

 Capitalized software and other intangible assets

 ( 8,550
)

 ( 9,179
)

 Net cash used in investing activities

 ( 11,613
)

 ( 11,767
)

 FINANCING ACTIVITIES:

 Preferred stock dividends paid

 ( 14,300
)

 ( 15,314
)

 Settlement of contingent obligation

 -

 ( 1,000
)

 Settlement of tax withholding obligations on stock issued to employees

 ( 1,524
)

 ( 1,197
)

 Repayments of notes payable

 ( 888
)

 ( 1,003
)

 Stock issuance costs

 -

 ( 32
)

 Proceeds from issuance of Series B Preferred Stock, net of expenses

 1,427

 30,901

 Redemption of Series A Preferred Stock

 -

 ( 20,005
)

 Proceeds from line of credit

 14,700

 25,500

 Repayment of line of credit

 ( 12,700
)

 ( 25,500
)

 Net cash used in financing activities

 ( 13,285
)

 ( 7,650
)

 EFFECT OF EXCHANGE RATE CHANGES ON CASH

 NET (DECREASE) INCREASE IN CASH

 ( 8,968
)

 1,959

 CASH - Beginning of the year

 12,299

 10,340

 CASH - End of the year

 $
 3,331

 $
 12,299

 SUPPLEMENTAL NONCASH INVESTING AND FINANCING ACTIVITIES:

 Dividends declared, not paid

 $
 5,433

 $
 4,059

 Purchase of prepaid insurance and motor vehicle with assumption of notes

 $

 $

 SUPPLEMENTAL INFORMATION - Cash paid during the year for:

 Income taxes

 $

 $

 $

 $

 See

 F- 8

 CARECLOUD,
INC.

 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS

 AS
OF AND FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

 1.
 ORGANIZATION AND BUSINESS

 CareCloud,
Inc., (together with its consolidated subsidiaries, "CareCloud," the "Company," "we," "us"
and/or "our") is a healthcare information technology company that provides a full suite of proprietary cloud-based solutions,
related business services, to healthcare providers and hospitals throughout the United States. The Company's integrated services
are designed to help customers increase revenues, streamline workflows and make better business and clinical decisions, while reducing
administrative burdens and operating costs. Our Software-as-a-Service ("SaaS") platform includes revenue cycle management
("RCM"), practice management ("PM"), electronic health records ("EHR"), business intelligence, telehealth,
patient experience management ("PXM") solutions and complementary software tools and business services for high-performance
medical groups and health systems. CareCloud has its corporate offices in Somerset, New Jersey and maintains client support teams throughout
the U.S., and offshore offices in Pakistan and Azad Jammu and Kashmir, a region administered by Pakistan (the "Pakistan Offices"),
and in Sri Lanka.

 CareCloud
was founded in 1999 under the name Medical Transcription Billing, Corp. and incorporated under the laws of the State of Delaware in 2001.
In 2004, the Company formed MTBC Private Limited ("MTBC Pvt. Ltd."), a 99.9 % majority-owned subsidiary of CareCloud based
in Pakistan. The remaining 0.1 % of the shares of MTBC Pvt. Ltd. is equally owned by the founder and Executive Chairman of CareCloud and
a local employee who is also a director of this entity. In 2016, the Company formed MTBC Acquisition Corp. ("MAC"), a Delaware
corporation, in connection with its acquisition of substantially all of the assets of MediGain, LLC and its subsidiary, Millennium Practice
Management Associates, LLC (together "MediGain"). MAC has a wholly owned subsidiary in Sri Lanka, RCM MediGain Colombo, Pvt.
Ltd. In May 2018, the Company formed CareCloud Practice Management, Corp. ("CPM"), a Delaware corporation, to operate the
medical practice management business acquired from Orion Healthcorp.

 In
January 2020, the Company purchased CareCloud Corporation, a company whose name we took. That company is now known as CareCloud Health,
Inc. ("CCH"). In June 2020, the Company purchased Meridian Billing Management Co. and its affiliate Origin Holdings, Inc.
(collectively "Meridian" and sometimes referred to as "Meridian Medical Management"). Both companies were subsequently
merged and the surviving company was renamed Meridian Medical Management, Inc.

March 2021, the Company formed a new wholly-owned subsidiary, CareCloud Acquisition, Corp. ("CAC"). In June 2021, CAC purchased
certain assets and assumed certain liabilities of MedMatica Consulting Associates Inc., ("MedMatica") and purchased the stock
of Santa Rosa Staffing, Inc. ("SRS"). The assets and liabilities of MedMatica were merged into SRS and the company was renamed
medSR, Inc. ("medSR").

 Effective
April 1, 2022, the Company formed MTBC Bagh Private Limited ("MTBC Bagh Pvt. Ltd."), a 99.8 % majority-owned subsidiary of
CareCloud based in Azad Jammu and Kashmir, a region administered by Pakistan. The remaining 0.2 % of the shares of MTBC Bagh Pvt. Ltd.
is equally owned by the founder and Executive Chairman of CareCloud and the same director/employee as noted above.

the second quarter of 2023, the Company formed a wholly owned subsidiary, CareCloud ME Health Consultancy LLC, in the United Arab Emirates,
which has not yet begun operations.

 2.
 BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

 Principles
of Consolidation — The accompanying consolidated financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America ("GAAP") and include the operating results and financial condition of
CareCloud, its wholly-owned subsidiaries, MAC, CPM, its majority-owned subsidiary MTBC Pvt. Ltd, majority-owned subsidiary MTBC Bagh
Pvt. Ltd, CCH (since January 2020), Meridian Medical Management (since June 2020), medSR (since June 2021) and the subsidiary in Sri
Lanka. The non-controlling interests of MTBC Pvt. Ltd. and MTBC Bagh Pvt. Ltd. are inconsequential to the consolidated financial statements.
All intercompany accounts and transactions have been eliminated in consolidation.

 F- 9

 Liquidity
and Going Concern — Primarily due to a decline in revenue associated with our Healthcare IT segment and a goodwill impairment
of $ 42 million, the Company generated a net loss of $ 48.7 million and had a net decrease in cash of $ 9.0 million for the year ended December
31, 2023. At December 31, 2023, the Company had negative working capital of $ 57,000 and cash of $ 3.3 million. Absent any other action,
the Company will require additional liquidity to continue its operations over the next 12 months.

 However,
management has considered its plans to continue the Company as a going concern and believes substantial doubt is alleviated by
focusing on cost-control. As discussed in Note 13, the Company approved a restructuring plan to reduce headcount and operating costs
and generate positive cash flow. In addition, the Company has suspended the dividend on the Company's Preferred Stock, which
saves approximately $ 1.3 million
of cash each month. The dividend will continue to accrue in arrears each month since it is cumulative, but would not be a legal
obligation until the dividend is reinstated. The dividend will not be recorded as a liability until its declared by the Board of
Directors. The Company projects that this restructuring plan, that was implemented in 2023 and will be completed by the end of 2024,
will reduce expenses, thereby reducing ongoing liquidity needs to enable continuation of operations and compliance with debt covenants
for the foreseeable future. Although there are no guarantees that the Company will be successful, it believes such initiatives will
enable it to continue as a going concern through at least the next twelve months.

 Segment
Reporting — The Company views its operations as comprising two operating segments, Healthcare IT and Medical Practice Management.
The chief operating decision maker ("CODM") monitors and reviews financial information at these segment levels for assessing
operating results and the allocation of resources.

 Use
of Estimates — The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements, as well
as the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions made by management
include, but are not limited to: (1) impairment of goodwill and long-lived assets, (2) depreciable lives of assets, (3) allowance for
expected credit losses, (4) contingent consideration, (5) estimates of variable consideration related to the contract asset, (6) fair
value of identifiable purchased tangible and intangible assets, including determination of expected customer life, (7) stock-based compensation,
and (8) estimating lease terms and incremental borrowing rates. Actual results could significantly differ from those estimates.

Recognition — We derive revenue from five primary sources: (1) technology-enabled business solutions including revenue cycle
management, (2) professional services, (3) printing and mailing services, (4) group purchasing services and (5) medical practice management
services. All of our revenue arrangements are based on contracts with customers. Most of our contracts with customers contain single
performance obligations, although certain contracts do contain multiple performance obligations where we perform more than one service
for the same customer. We account for individual performance obligations separately if they are distinct within the context of the contract.
For contracts where we provide multiple services such as where we perform multiple ancillary services, each service represents its own
performance obligation. Selling or transaction prices are based on the contractual prices for each service at its stand-alone selling
price.

 A
five-step approach is applied in the recognition of revenue under ASC 606: (1) identify the contract with a customer, (2) identify the
performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations
in the contract, and (5) recognize revenue when we satisfy a performance obligation.

 Although
we believe that our approach to estimates and judgments is reasonable, actual results could differ, and we may be exposed to increases
or decreases in revenue that could be material. Our estimates of variable consideration may prove to be inaccurate, in which case we
may have understated or overstated the revenue recognized in a reporting period. The amount of variable consideration recognized to date
that remains subject to estimation is included within the contract asset within the consolidated balance sheet.

 Payment
of invoices is due as specified in the underlying customer agreement, typically 30 days from the invoice date, which occurs on the date
of transfer of control of the services to the customer. Since payment terms are less than a year, we have elected the practical expedient
and do not assess whether a customer contract has a significant financing component.

 The
Company's revenue arrangements generally do not include a general right of refund for services provided (See Note 8, Revenue, for
additional information).

 F- 10

 Direct
Operating Costs — Direct operating costs consist primarily of salaries and benefits related to personnel who provide services
to clients and at our managed medical practices, claims processing costs, medical supplies at our managed practices and other direct
costs related to the Company's services. Costs associated with the implementation of new clients are expensed as incurred. The
reported amounts of direct operating costs include allocated amounts for rent expense and overhead costs.

 Selling
and Marketing Expenses — Selling and marketing expenses consist primarily of compensation and benefits, travel and advertising
expenses and are expensed as incurred. The Company incurred approximately $ 4.0 million and $ 4.5 million of advertising costs for the
years ended December 31, 2023 and 2022, respectively.

and Development Expenses — Research and development expenses consist primarily of personnel-related costs incurred performing
market research, analyzing proposed products and developing new products.

 Internal-Use
Software Costs — The Company capitalizes certain development costs incurred in connection with its internal-use software. Costs
incurred in the preliminary stages of development are expensed as incurred. Once an application has reached the development stage, internal
and external costs, if direct, are capitalized until the software is substantially complete and ready for its intended use. Capitalization
ceases upon completion of all substantial testing. The Company also capitalizes costs related to specific upgrades and enhancements when
it is probable that the expenditures will result in additional functionality. Capitalized costs are recorded as part of intangible assets
in the accompanying consolidated balance sheets. Maintenance and training costs are expensed as incurred. Internal use software is amortized
on a straight line basis over its estimated useful life, generally three years. Management evaluates the useful lives of these assets
on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of
these assets. During the years ended December 31, 2023 and 2022, the Company capitalized approximately
 $ 8.6 million and $ 9.2 million, respectively, primarily consisting of salaries and payroll-related costs of employees and consultants
who devoted time to the development of internal-use software projects.

 Accounts
Receivable — Accounts receivable are stated at their net realizable value. Accounts receivable are presented on the consolidated
balance sheet net of an allowance for expected credit losses, which is established based on a lifetime estimated credit loss expected
to occur for trade accounts receivable.

 Property
and Equipment — Property and equipment are stated at cost, less accumulated depreciation. Depreciation is calculated using
the straight-line basis over the estimated useful lives of the assets ranging from three to five years. Ordinary maintenance and repairs
are expensed as incurred. Depreciation for computers is calculated over three years, while the remaining assets (except leasehold improvements)
are depreciated over five years. The Company amortizes leasehold improvements over the lesser of the lease term or the remaining economic
life of those assets. Generally, the lease term is the base lease term plus certain renewal option periods for which renewal is reasonably
certain and for which failure to exercise the renewal option would result in an economic penalty to the Company.

 Intangible
Assets — Intangible assets include customer relationships, covenants not-to-compete acquired in connection with acquisitions,
software purchase and development costs and trademarks acquired. Amortization for intangible assets related to revenue cycle management
is recorded primarily using the double declining balance method over three to four years. Amortization for intangible assets related
to the group purchasing organization and medical practice management is recorded on a straight line basis over four and twelve years,
respectively.

 Evaluation
of Long-Lived Assets — The Company reviews its long-lived assets for impairment whenever changes in circumstances indicate
that the carrying value of an asset may not be recoverable. If the sum of undiscounted expected future cash flows is less than the carrying
amount of the asset group, the Company will recognize an impairment loss based on the fair value of the asset.

 There
was no impairment of internal-use software costs, intangible assets, operating lease right of use assets or property and equipment during
the years ended December 31, 2023 and 2022.

 Goodwill —
Goodwill consists of the excess of the purchase price over the fair value of identifiable net assets of businesses acquired. The
Company tests goodwill for impairment annually as of October 31 st, referred to as the annual test date. The goodwill
impairment test for the Healthcare IT segment is performed using the discounted cash flow approach, the trading price of publicly
traded stock, and the guideline public company method. Conditions that could trigger a more frequent impairment assessment include,
but are not limited to, a significant adverse change to the Company in certain agreements, significant underperformance relative to
historical or projected future operating results, loss of customer relationships, an economic downturn in customers'
industries, or increased competition. Impairment testing for goodwill is performed at the reporting-unit level. The Company has
determined that its business consists of two operating segments and two reporting units. The Company had a triggering event at
August 31, 2023, but it was determined that no
goodwill impairment existed at that time. The Company had an additional triggering event in December 2023. It was determined that
the fair value of the Healthcare IT reporting unit was less than the carrying value at October 31 and on December 12, 2023
(triggering event). Accordingly, impairment charges of approximately $ 2.0
million and $ 40.0
million, respectively, were recorded. (See Note 3.) No
impairment charges were recorded during the year ended December 31, 2022.

 F- 11

 Treasury
Stock — Treasury stock is recorded at cost and represents shares repurchased by the Company. No shares were repurchased or
issued from treasury stock during the years ended December 31, 2023 and 2022.

 Stock-Based
Compensation — The Company recognizes compensation for all share-based payments granted based on the grant date fair value.
Compensation expense is generally recognized on a straight-line basis over the vesting period. The Company does not estimate forfeitures
in recognizing the expense for share-based payments, as historical forfeiture rates have not been significant. For
restricted stock units ("RSUs") classified as equity, the market price of our common stock on the date of grant is used in
recording the fair value of the award. For RSUs classified as a liability, the earned amount is marked to market based on the end-of-period
common stock price.

 Business
Combinations — The Company accounts for business combinations under the provisions of ASC 805, Business Combinations,
which requires that the acquisition method of accounting be used for all business combinations. Assets acquired and liabilities assumed
are recorded at the date of acquisition at their respective fair values. ASC 805 also specifies criteria that intangible assets acquired
in a business combination must be recognized and reported apart from goodwill. Goodwill represents the excess purchase price over the
fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses are recognized
separately from the business combinations and are expensed as incurred. If the business combination provides for contingent consideration,
the Company records the contingent consideration at fair value at the acquisition date with changes in the fair value recorded through
earnings.

Taxes — The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred
tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements.
Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax
bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The
effect of a change in tax rates on deferred tax assets and liabilities is recognized in operations in the period that includes the enactment
date.

 The
Company records net deferred tax assets to the extent that these assets will more likely than not be realized. All available positive
and negative evidence is considered in making such a determination, including future reversals of existing taxable temporary differences,
projected future taxable income, tax planning strategies, and results of recent operations. A valuation allowance would be recorded to
reduce deferred income tax assets when it is determined that it is more likely than not that the Company would not be able to realize
its deferred income tax assets in the future in excess of their net recorded amount.

 The
Company records uncertain tax positions on the basis of a two-step process whereby (1) the Company determines whether it is more likely
than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that
meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is greater than 50
percent likely to be realized upon ultimate settlement with the related tax authority. At December 31, 2023 and 2022, the Company did
not have any uncertain tax positions that required recognition. Interest and penalties related to uncertain tax positions are recognized
in income tax expense. For the years ended December 31, 2023 and 2022, the Company did not recognize any penalties or interest related
to unrecognized tax benefits in its consolidated financial statements.

 Dividends
 — Dividends are recorded when declared by
the Company's Board of Directors. The Board of Directors had declared monthly dividends on the Series A and Series B Preferred
Stock through February 2024. However, in December 2023, the dividends on the Preferred Stock were suspended. The dividend scheduled for
payment on December 15, 2023 together with the remaining dividends that were declared, have been accrued in the consolidated balance
sheet. Future monthly dividends will continue to accrue in arrears but will not be recorded as a liability until declared by the Board
of Directors. Preferred Stock dividends are charged against paid in capital because the Company does not have sufficient retained
earnings. The Company is prohibited from paying dividends on its common stock without the prior written consent of its lender, Silicon
Valley Bank, a division of First Citizens Bank ("SVB").

 F- 12

 Deferred
Revenue — Deferred revenue primarily consists of payments received in advance of the revenue recognition criteria being met.
Deferred revenue includes certain deferred implementation services fees that are recognized as revenue ratably over the longer of the
life of the agreement or the estimated expected customer life, which is currently estimated to be three years. Deferred revenue that
will be recognized during the succeeding 12-month period is recorded as current deferred revenue and the remaining portion is recorded
as non-current. At the time of customer termination, any unrecognized service fees associated with implementation services are recognized
as revenue.

 Fair
Value Measurements — ASC 820, Fair Value Measurement, requires the disclosure of fair value information about financial
instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate that value. The
Company follows a fair value measurement hierarchy to measure financial instruments. The fair value of the Company's financial
instruments is measured using inputs from the three levels of the fair value hierarchy as follows:

 Level
 1 —

 Inputs
 are unadjusted quoted market prices in active markets for identical assets or liabilities that the Company has the ability to access
 at the measurement date.

 Level
 2 —

 Inputs
 are directly or indirectly observable, which include quoted prices for similar assets and liabilities in active markets, quoted prices
 for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable
 for the asset or liability and inputs that are derived principally from or corroborated by observable market data by correlation
 or other means.

 Level
 3 —

 Inputs
 are unobservable inputs that are used to measure fair value to the extent observable inputs are not available.

 The
Company has certain financial instruments that are not measured at fair value on a recurring basis. These financial instruments are subject
to fair value adjustments only in certain circumstances and include cash, accounts receivable, accounts payable and accrued expenses,
borrowings under term loans and line of credit, and notes payable. Due to the short term nature of these financial instruments and that
the borrowings bear interest at prevailing market rates, the carrying value approximates the fair value.

Currency Translation — The financial statements of the Company's foreign subsidiaries are translated from their functional
currency into U.S. dollars, the Company's functional currency. All foreign currency assets and liabilities are translated at the
period-end exchange rate, and all revenue and expenses are translated at transaction date exchange rates. The effects of translating
the financial statements of the foreign subsidiaries into U.S. dollars are reported as a cumulative translation adjustment, a separate
component of accumulated other comprehensive loss in the consolidated statements of shareholders' equity, except for transactions
related to the intercompany receivable for which transaction adjustments are recorded in the consolidated statements of operations as
they are not deemed to be permanently reinvested. Foreign currency transaction gains/losses are reported as a component of other expense
– net in the consolidated statements of operations and amounted to losses of approximately $ 790,000 and $ 610,000 for the years
ended December 31, 2023 and 2022, respectively.

 Net
Loss on Lease Terminations, Unoccupied Lease Charges and Restructuring Costs — Net loss on lease termination represents the
write-off of leasehold improvements as the result of early lease terminations. Unoccupied lease charges represent the portion of lease
and related costs for that portion of the space that is vacated and not being utilized by the Company. The Company was able to turn back
to the landlord one of the unused facilities effective January 1, 2022. Restructuring costs which were incurred in 2023, primarily consist
of severance and separation costs associated with the optimization of the Company's operations and profitability improvements.
(See Note 13.)

 Recent
Accounting Pronouncements — From time to time, new accounting pronouncements are issued by the Financial Accounting Standards
Board ("FASB") and are adopted by us as of the specified effective date. Unless otherwise discussed, we believe that the
impact of recently adopted and recently issued accounting pronouncements will not have a material impact on our consolidated financial
position, results of operations and cash flows.

 F- 13

 In
June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments.
 The guidance in Accounting Standards Update ("ASU") 2016-13 replaces the incurred loss impairment methodology under current
GAAP. The new impairment model requires immediate recognition of estimated credit losses expected to occur for most financial assets
and certain other instruments. It will apply to all entities. For trade receivables, loans and held-to-maturity debt securities, entities
will be required to estimate lifetime expected credit losses. This may result in the earlier recognition of credit losses. In November
2019, the FASB issued ASU No. 2019-10, which delayed this standard's effective date for SEC smaller reporting companies to the
fiscal years beginning on or after December 15, 2022. The Company adopted this guidance on January 1, 2023 using a modified retrospective
adoption methodology, whereby the cumulative impact of all prior periods is recorded in accumulated deficit or other impacted balance
sheet items upon adoption. The impact to the accumulated deficit as of January 1, 2023 for the allowance related to accounts receivable
was a charge of approximately $ 186,000 and a corresponding increase to the allowance for expected credit losses.

 In
October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) – Accounting for Contract Assets and Contract Liabilities
from Contracts with Customers. The amendments in
this update require acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business
combination. The amendments are effective for public business entities for fiscal years beginning after December 15, 2022. There was
no impact on the consolidated financial statements as a result of this standard.

 In
October 2023, the FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC's Disclosure
Update and Simplification Initiative. This update amends the disclosure or presentation requirements related to various subtopics
in the FASB Accounting Standards Codification. The new guidance is intended to align U.S. GAAP requirements with those of the SEC and
to facilitate the application of U.S. GAAP for all entities. The effective date for each amendment will be the date on which the SEC's
removal of that related disclosure requirement from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.
If by June 30, 2027 the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of
the associated amendment will be removed from the Codification and will not become effective.

 In
November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Disclosures. The amendments
in this update improve segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The
amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after
December 15, 2024. Early adoption is permitted. The expected impact would only be to the financial statement disclosures.

 In
December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures. The amendments in
this update enhance the transparency and decision usefulness of income tax disclosures primarily related to rate reconciliation and income
taxes paid information. The update also includes certain other amendments to improve the effectiveness of income tax disclosures. The
amendments are effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The Company does not expect
this update to have a material impact on the consolidated financial statements.

 3.
 GOODWILL AND INTANGIBLE ASSETS – NET

consists of the excess of the purchase price over the fair value of identifiable net assets of businesses acquired. At
December 31, 2023, and 2022, approximately $ 90,000 of goodwill was allocated to the Medical Practice Management segment and the balance
was allocated to the Healthcare IT segment. The following is the summary of the changes to the carrying
amount of goodwill for the years ended December 31, 2023 and 2022:

OF CHANGES TO THE CARRYING AMOUNT OF GOODWILL

 2023

 2022

 2023

 2022

 Beginning gross balance

 $
 61,186

 $
 61,186

 Acquisitions

 -

 -

 Impairment charges

 ( 42,000
)

 -

 Ending gross balance

 $
 19,186

 $
 61,186

 As
a result of a triggering event in December 2023 resulting from the suspension of the Preferred Stock dividend, the Company updated its
annual goodwill impairment test that was performed as of October 31, 2023 for the Healthcare IT segment. It was determined that the fair
value of the Healthcare IT reporting unit was less than the carrying value at both October 31 and as a result of the triggering event.
Accordingly, impairment charges of approximately $ 2.0 million and $ 40.0 million, respectively, were recorded.

 F- 14

 Below
is a summary of intangible asset activity for the years ended December 31, 2023 and 2022:

OF FINITE-LIVED INTANGIBLE ASSETS

 Customer

 Capitalized

 Other Intangible

 Relationships

 Software

 Assets

 Total

 COST

 Balance, January 1, 2023

 $
 47,597

 $
 21,547

 $
 9,651

 $
 78,795

 Additions

 -

 8,548

 8,550

 Translation loss

 -

 ( 716
)

 -

 ( 716
)

 Balance, December 31, 2023

 $
 47,597

 $
 29,379

 $
 9,653

 $
 86,629

 Useful lives

 3 - 12 years

 3 years

 3 years

 ACCUMULATED AMORTIZATION

 Balance, January 1, 2023

 $
 39,523

 $
 4,932

 $
 4,820

 $
 49,275

 Amortization expense

 4,849

 7,426

 12,401

 Translation loss

 -

 ( 121
)

 -

 ( 121
)

 Balance, December 31, 2023

 44,372

 12,237

 4,946

 61,555

 Net book value

 $
 3,225

 $
 17,142

 $
 4,707

 $
 25,074

 COST

 Balance, January 1, 2022

 $
 47,597

 $
 13,196

 $
 9,632

 $
 70,425

 Additions

 -

 9,160

 9,179

 Translation loss

 -

 ( 809
)

 -

 ( 809
)

 Balance, December 31, 2022

 $
 47,597

 $
 21,547

 $
 9,651

 $
 78,795

 Useful lives

 3 - 12 years

 3 years

 3 years

 ACCUMULATED AMORTIZATION

 Balance, January 1, 2022

 $
 33,851

 $
 1,591

 $
 4,205

 $
 39,647

 Amortization expense

 5,672

 3,485

 9,772

 Translation loss

 -

 ( 144
)

 -

 ( 144
)

 Balance, December 31, 2022

 39,523

 4,932

 4,820

 49,275

 Net book value

 $
 8,074

 $
 16,615

 $
 4,831

 $
 29,520

 As
a result of a triggering event in December 2023, we also reviewed our other long term assets for impairment. We determined that the fair
value of these assets exceeded their carrying value and that there was no impairment.

 The
amount for capitalized software represents payroll and development costs incurred for internally developed software. Other intangible
assets primarily represent non-compete agreements, purchased and acquired software and trademarks. Amortization expense was approximately
$ 12.4 million and $ 9.8 million for the years ended December 31, 2023 and 2022, respectively.
The weighted-average amortization period is three years.

 As
of December 31, 2023, future amortization expense scheduled to be expensed is as follows:

OF FINITE-LIVED INTANGIBLE ASSETS, FUTURE AMORTIZATION EXPENSE

 Years ending December 31,

 2024

 $
 11,634

 2025

 8,384

 2026

 4,006

 2027

 2028

 Thereafter

 Total

 $
 25,074

 F- 15

 4.
 PROPERTY AND EQUIPMENT

 Property
and equipment consisted of the following:

OF PROPERTY AND EQUIPMENT

 2023

 2022

 2023

 2022

 Computer equipment

 $
 5,510

 $
 5,831

 Office furniture and equipment

 1,985

 1,990

 Transportation equipment

 1,129

 1,099

 Leasehold improvements

 5,350

 3,460

 Assets not placed in service

 -

 Total property and equipment

 13,974

 12,452

 Less accumulated depreciation

 ( 8,657
)

 ( 7,396
)

 Property and equipment – net

 $
 5,317

 $
 5,056

expense was approximately $ 2.0 million for both the years ended December 31, 2023 and 2022.

 As
a result of a triggering event in December 2023, we also reviewed our property and equipment for impairment. We determined that the fair
value of these assets exceeded their carrying value and that there was no impairment.

 5.
 CONCENTRATIONS

 Financial
Risks — As of December 31, 2023 and 2022, the Company held cash of approximately $ 255,000
 and $ 1.8
 million, respectively, in the name of its subsidiaries,
at banks in Pakistan and Sri Lanka. The banking systems in these countries do not provide deposit insurance coverage. Additionally, from
time to time, the Company maintains cash balances at financial institutions in the United States in excess of federal insurance limits.
The Company has not experienced any losses on such accounts. The cash held by each U.S. operating company was below the federal insurance
limit at December 31, 2023.

 Concentrations
of credit risk with respect to trade accounts receivable are managed by periodic credit evaluations of customers. The Company does not
require collateral for outstanding trade accounts receivable. As of December 31, 2023, two customers
each individually accounted for approximately 7 % of accounts receivable. As of December 31, 2022, two customers each individually accounted
for approximately 6 % of accounts receivable. During the years ended December 31, 2023 and 2022, there was one customer with sales
of approximately 9 % and 7 % of total revenue, respectively.

 Geographical
Risks — The Company's offices in Islamabad and Bagh, Pakistan, and Colombo, Sri Lanka conduct significant back-office
operations for the Company. The Company has no revenue earned outside of the United States. The office in Bagh is located in a different
territory of Pakistan from the Islamabad office known as Azad Jammu and Kashmir. The Bagh office was opened in 2009 for the purpose of
providing operational support and operating as a backup to the Islamabad office. The Bagh office now operates as the main operational
center for the Company. The Company's operations outside the United States are subject to special considerations and significant
risks not typically associated with companies in the United States. The Company's business, financial condition and results of
operations may be influenced by the political, economic, and legal environment in the countries in which it operates and by the general
state of these countries' economies. The Company's results may be adversely affected by, among other things, changes in governmental
policies with respect to laws and regulations, changes in local countries' telecommunications industries, regulatory rules and
policies, anti-inflationary measures, currency conversion and remittance, and rates and methods of taxation.

 Carrying
amounts of net assets located outside the United States were approximately $ 7.6
million and $ 8.5 million as of December 31, 2023 and 2022, respectively. These balances exclude net intercompany
receivables of approximately $ 1.0 million as of both December 31, 2023 and 2022, respectively. The following is a summary of the
net assets located outside the United States as of December 31, 2023 and 2022:

OF CONCENTRATION OF RISK, BY GEOGRAPHICAL RISKS FACTOR

 2023

 2022

 2023

 2022

 Current assets

 $

 $
 2,306

 Non-current assets

 8,250

 7,890

 Assets

 9,056

 10,196

 Current liabilities

 ( 1,250
)

 ( 1,500
)

 Non-current liabilities

 ( 240
)

 ( 224
)

 Net assets

 $
 7,566

 $
 8,472

 F- 16

 6.
 NET LOSS PER COMMON SHARE

 The
following table reconciles the weighted-average shares outstanding for basic and diluted net loss per common share for the years ended
December 31, 2023 and 2022:

OF RECONCILIATION OF WEIGHTED-AVERAGE SHARES OUTSTANDING FOR BASIC AND DILUTED NET LOSS PER COMMON SHARE

 2023

 2022

 Year ended December 31,

 2023

 2022

 ($ in thousands, except share and per share amounts)

 Basic and Diluted:

 Net loss attributable to common shareholders

 $
 ( 64,348
)

 $
 ( 10,085
)

 Weighted-average common shares used to compute basic and diluted loss per share

 15,669,472

 15,109,587

 Net loss attributable to common shareholders per share - basic and diluted

 $
 ( 4.11
)

 $
 ( 0.67
)

 At
December 31, 2023, the 733,908 unvested restricted stock units ("RSUs") as discussed in Note 15 have been excluded from the
above calculations as they were anti-dilutive. All of the warrants previously outstanding expired unexercised in 2023 and are excluded
from the above calculations. At December 31, 2022, the 598,245 unvested equity RSUs and 1,128,489 unexercised warrants have been excluded
from the above calculations as they were anti-dilutive. Vested RSUs, vested restricted shares and exercised warrants have been included
in the above calculations.

 7.
 DEBT

 SVB
 — During October 2017, the Company opened a revolving line of credit from SVB under a three-year agreement which replaced the
previous credit facility. The SVB credit facility is a secured revolving line of credit where borrowings are based on a formula of 200%
of repeatable revenue adjusted by an annualized attrition rate as defined in the credit agreement. During the third quarter of 2018,
the credit line was increased from $ 5 million to $ 10 million and the term was extended for an additional year. During the third quarter
of 2021, the credit line was further increased to $ 20 million and the term was extended for two years. During February 2023, the line
of credit was increased to $ 25 million and the term was extended for two years through October 13, 2025. Effective August 31, 2023, the
credit facility agreement was amended whereby the interest rate was increased from the prime rate plus 1.5 % to the prime rate plus 2.0 %.
The requirement for the minimum liquidity ratio was slightly reduced. These amendments expire March 31, 2024 and the credit facility
reverts to its previous terms.

 As
of December 31, 2023 and 2022, there was $ 10 million and $ 8 million, respectively, of borrowings under the credit facility. Interest
on the SVB revolving line of credit is currently charged at the prime rate plus 2.0 %. There is also a fee of one-half of 1% annually
for the unused portion of the credit line. The debt is secured by all of the Company's domestic assets and 65 % of the shares in
its offshore subsidiaries. Future acquisitions are subject to approval by SVB. At December 31, 2023, the remaining
borrowing base was approximately $ 4.6 million.

 In
connection with the original SVB debt agreement, the Company paid SVB approximately $ 50,000 of fees upfront and issued warrants for SVB
to purchase 125,000 shares of its common stock, and committed to pay an annual anniversary fee of $ 50,000 a year. Based on the terms
in the original SVB credit agreement, these warrants had a strike price equal to $ 3.92. They had a five -year exercise window and net
exercise rights, and were valued at $ 3.12 per warrant. These warrants were exercised during 2022. As a result of the revision in the
SVB credit line, which increased the credit line from $ 5 million to $ 10 million and reduced the interest rate by 25 basis points, the
Company paid approximately $ 50,000 of fees upfront and issued an additional 28,489 warrants, with a strike price equal to $ 5.26, a five-year
exercise window and net exercise rights. The additional warrants were valued at $ 3.58 per warrant and expired unexercised in September
2023. The SVB credit agreement contains various covenants and conditions governing the revolving line of credit including a current annual
fee of $ 100,000. These covenants include a minimum level of adjusted EBITDA or a minimum liquidity ratio, one of which must be satisfied
when borrowings are outstanding. At December 31, 2023 and 2022, the Company was in compliance with all covenants.

 F- 17

January 2022, the agreement with SVB was modified to allow the Company to issue Series B Preferred Stock and pay monthly dividends on
this stock, to use a portion of the offering proceeds to redeem a portion of the Series A Preferred Stock that is outstanding and to
allow for the potential exchange of shares of Series A Preferred Stock for Series B Preferred Stock.

March 2023, SVB became a division of First Citizens Bank & Trust Company. The agreements that governed the former SVB relationship
remain in place. As a result, there were no changes to the terms of the credit agreement.

 Vehicle
Financing Notes — The Company finances certain vehicle purchases both in the United States and in Pakistan. The vehicle financing
notes typically have three to six year terms and are issued at current market rates.

 Insurance
Financing — The Company finances certain insurance purchases over the term of the policy life. The interest rate charged is
 8.56 %.

 Maturities
of the outstanding notes payable and other obligations as of December 31, 2023 are as follows:

OF MATURITIES OF LONG-TERM DEBT

 Years ending December 31,

 Line of Credit

 Vehicle Financing Notes

 Insurance Financing

 Total

 2024

 $
 -

 $

 $

 $

 2025

 10,000

 -

 10,012

 2026

 -

 -

 2027

 -

 -

 2028

 -

 -

 Total

 $
 10,000

 $

 $

 $
 10,329

 8.
 REVENUE

 Introduction

 The
Company accounts for revenue in accordance with ASC 606, Revenue from Contracts with Customers. All revenue is recognized as our
performance obligations are satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to
a customer, and is the unit of account under ASC 606. The Company recognizes revenue when the revenue cycle management services begin
on the medical billing claims, which is generally upon receipt of the claim from the provider. For many services the Company recognizes
revenue as a percentage of the amount the customer collects on the medical billing claims. The Company's software is utilized at
the time the provider sees the patient, and the Company estimates the value of the consideration it will earn over the remaining contractual
period as our services are provided and recognizes the fees over the term; this estimation involves predicting the amounts our clients
will ultimately collect associated with the services they provided. Certain significant estimates, such as payment-to-charge ratios,
effective billing rates and the estimated contractual payment periods are required to measure revenue cycle management revenue under
the new standard.

 Most
of our current contracts with customers contain a single performance obligation. For contracts where we provide multiple services, such
as where we perform multiple ancillary services, each service represents its own performance obligation. The standalone selling prices
are based on the contractual price for the service.

 We
apply the portfolio approach as permitted by ASC 606 as a practical expedient to contracts with similar characteristics and we use estimates
and assumptions when accounting for those portfolios. Our contracts generally include standard commercial payment terms. We have no significant
obligations for refunds, warranties or similar obligations and our revenue does not include taxes collected from our customers.

 F- 18

 Disaggregation
of Revenue from Contracts with Customers

 We
derive revenue from five primary sources: (1) Technology-enabled business solutions, (2) professional services, (3) printing and mailing
services, (4) group purchasing services and (5) medical practice management services.

 The
following table represents a disaggregation of revenue for the years ended December 31, 2023 and 2022:

OF DISAGGREGATION OF REVENUE

 2023

 2022

 2023

 2022

 Healthcare IT:

 Technology-enabled business solutions

 $
 76,640

 $
 88,140

 Professional services

 23,022

 33,984

 Printing and mailing services

 2,968

 2,207

 Group purchasing services

 1,053

 Medical Practice Management:

 Medical practice management services

 13,376

 13,550

 Total

 $

 $

 $

 $

 Technology-enabled
business solutions:

derived on an on-going basis from our technology-enabled solutions, which typically includes revenue cycle management services, is billed
as a percentage of payments collected by our customers. The fee for our services often includes the ability to use our EHR and practice
management software as well as RCM as part of the bundled fee. The SaaS component is not a material portion of the contract compared
to the stand-alone value of RCM.

 Technology-assisted
revenue cycle management services are the recurring process of submitting and following up on claims with health insurance companies
in order for the healthcare providers to receive payment for the services they rendered. The Company typically invoices customers on
a monthly basis based on the actual collections received by its customers and the agreed-upon rate in the sales contract. The fee for
these services typically includes use of practice management software and related tools (on a SaaS basis), electronic health records
(on a SaaS basis), medical billing services and use of mobile health solutions. We consider the services to be one performance obligation
since the promises are not distinct in the context of the contract. The performance obligation consists of a series of distinct services
that are substantially the same and have the same periodic pattern of transfer to our customers.

 In
many cases, our clients may terminate their agreements with 90 days' notice without cause, thereby limiting the term in which we
have enforceable rights and obligations, although this time period can vary between clients. Our payment terms are normally net 30 days.
Although our contracts typically have stated terms of one or more years, under ASC 606 our contracts are considered month-to-month and
accordingly, there is no financing component.

 For
the majority of our revenue cycle management contracts, the total transaction price is variable because our obligation is to process
an unknown quantity of claims, as and when requested by our customers over the contract period. When a contract includes variable consideration,
we evaluate the estimate of the variable consideration to determine whether the estimate needs to be constrained; therefore, we include
variable consideration in the transaction price only to the extent that it is probable that a significant reversal of the amount of cumulative
revenue recognized will not occur when the uncertainty associated with variable consideration is subsequently resolved. Estimates to
determine variable consideration such as payment to charge ratios, effective billing rates, and the estimated contractual payment periods
are updated at each reporting date. Revenue is recognized over the performance period using the input method.

 Our
proprietary, cloud-based practice management application automates the labor-intensive workflow of a medical office in a unified and
streamlined SaaS platform. The Company has a large number of clients who utilize the Company's practice management software, electronic
health records software, patient experience management solutions, business intelligence software and/or robotic process automation software
on a SaaS basis, but who do not utilize the Company's revenue cycle management services. SaaS fees may be fixed based on the number
of providers, or may be variable.

 F- 19

 Our
digital health services, which began generating revenue in 2022, include chronic care management, where a care manager has remote visits
with patients with one or more chronic conditions under the supervision of a physician who is our client. The performance obligation
for chronic care management is satisfied at a point in time once the patient receives the remote visit. The digital health services also
include remote patient monitoring where our system monitors recordings from FDA approved internet connected devices. These devices record
patient trends and alerts the physician to changes which might trigger the need for additional follow-up visits. The performance obligations
for remote patient monitoring are satisfied over time as the recordings are received and the patient receives the remote visit. The revenue
for chronic care management for the years ended December 31, 2023 and 2022, was approximately $ 1.5 million and $ 208,000, respectively.
The revenue for remote patient monitoring for the years ended December 31, 2023 and 2022 was approximately $ 400,000 and $ 6,000, respectively.

 The
medical billing clearinghouse service takes claim information from customers, checks the claims for errors and sends this information
electronically to insurance companies. The Company invoices customers on a monthly basis based on the number of claims submitted and
the agreed-upon rate in the agreement. This service is provided to medical practices and providers to medical practices who are not revenue
cycle management customers. The performance obligation is satisfied once the relevant submissions are completed.

 Additional
services such as coding and transcription are rendered in connection with the delivery of revenue cycle management and related medical
services. The Company invoices customers monthly, based on the actual amount of services performed at the agreed-upon rate in the contract.
These services are only offered to revenue cycle management customers. These services do not represent a material right because the services
are optional to the customer and customers electing these services are charged the same price for those services as if they were on a
standalone basis. Each individual coding or transcription transaction processed represents a performance obligation, which is satisfied
over time as that individual service is rendered.

 Professional
services:

 Our
professional services include an extensive set of services including EHR vendor-agnostic optimization and activation, project management,
IT transformation consulting, process improvement, training, education and staffing for large healthcare organizations including health
systems and hospitals. The performance obligation is satisfied over time using the input method. The revenue is recorded on a monthly
basis as the professional services are rendered. Unbilled revenue at December 31, 2023 and 2022 was approximately $ 100,000 and $ 2.0 million,
respectively.

 Printing
and mailing services:

 The
Company provides printing and mailing services for both revenue cycle management customers and a non- revenue cycle management customer,
and invoices on a monthly basis based on the number of prints, the agreed-upon rate per print and the postage incurred. The performance
obligation is satisfied once the printing and mailing is completed.

 Group
purchasing services:

 The
Company provides group purchasing services which enable medical providers to purchase various vaccines directly from selected pharmaceutical
companies at a discounted price. Currently, there are approximately 4,000 medical providers who are members of the program. Revenue is
recognized as the vaccine shipments are made to the medical providers. Fees from the pharmaceutical companies are paid either quarterly
or annually and the Company adjusts its revenue accrual at the time of payment. The Company makes significant judgments regarding the
variable consideration which we expect to be entitled to for the group purchasing services which includes the anticipated shipments to
the members enrolled in the program, anticipated volumes of purchases made by the members, and the changes in the number of members.
The amounts recorded are constrained by estimates of decreases in shipments and loss of members to avoid a significant revenue reversal
in the subsequent period. The only performance obligation is to provide the pharmaceutical companies with the medical providers who want
to become members in order to purchase vaccines. The performance obligation is satisfied once the medical provider agrees to purchase
a specific quantity of vaccines and the medical provider's information is forwarded to the vaccine suppliers. The Company records
a contract asset for revenue earned and not paid as the ultimate payment is conditioned on achieving certain volume thresholds.

 F- 20

 For
all of the above revenue streams other than group purchasing services and chronic care management, revenue is recognized over time, which
is typically one month or less, which closely matches the point in time that the customer simultaneously receives and consumes the benefits
provided by the Company. For the group purchasing services, revenue is recognized at a point in time. Each service is substantially the
same and has the same periodic pattern of transfer to the customer. Each of the services provided above is considered a separate performance
obligation.

 There
were no unsatisfied performance obligations for contracts with an original duration greater than one year. The Company has
elected to utilize the practical expedient available within the guidance for contracts with an expected duration of one year or less.

practice management services:

 The
Company also provides medical practice management services under long-term management service agreements to three medical
practices. We provide the medical practices with the nurses, administrative support, facilities, supplies, equipment, marketing, RCM,
accounting, and other non-clinical services needed to efficiently operate their practices. Revenue is recognized as the services are
provided to the medical practices. Revenue recorded in the consolidated statements of operations represents the reimbursement of costs
paid by the Company for the practices and the management fee earned each month for managing the practice. The management fee is based
on either a fixed fee or a percentage of the net operating income.

 The
Company assumes all financial risk for the performance of the managed medical practices. Revenue is impacted by the amount of the costs
incurred by the practices and their operating income. The gross billing of the practices is impacted by billing rates, changes in current
procedural terminology code reimbursement and collection trends which in turn impacts the management fee that the Company is entitled
to. Billing rates are reviewed at least annually and adjusted based on current insurer reimbursement practices. The performance
obligation is satisfied as the management services are provided.

 Our
contracts for medical practice management services have approximately an additional 15 years remaining and are only cancellable under
very limited circumstances. The Company receives a management fee each month for managing the day-to-day business operations of each
medical group as a fixed fee or a percentage payment of the net operating income which is included in revenue in the consolidated statements
of operations.

 Our
medical practice management services obligations consist of a series of distinct services that are substantially the same and have the
same periodic pattern of transfer to our customers. Revenue is recognized over time, however for reporting and convenience purposes,
the management fee is computed at each month end.

about contract balances:

 As
of December 31, 2023, the estimated revenue expected to be recognized in the future related to the remaining revenue cycle management
performance obligations outstanding was approximately $ 4.7 million. We expect to recognize substantially
all of the revenue for the remaining performance obligations over the next three months. Approximately $ 374,000 of the contract asset
represents revenue earned, not paid, from the group purchasing services.

 Amounts
that we are entitled to collect under the applicable contract are recorded as accounts receivable. Invoicing is performed at the end
of each month when the services have been provided. The contract asset includes our right to payment for services already transferred
to a customer when the right to payment is conditional on something other than the passage of time. For example, contracts for revenue
cycle management services where we recognize revenue over time but do not have a contractual right to payment until the customer receives
payment of their claim from the insurance provider. The contract asset also includes the revenue accrued, not received, for the group
purchasing services.

in the contract asset are recorded as adjustments to net revenue. The changes primarily result from providing services to revenue cycle
management customers that result in additional consideration and are offset by our right to payment for services becoming unconditional
and changes in the revenue accrued for the group purchasing services. The contract asset for our group purchasing services is reduced
when we receive payments from vaccine manufacturers and is increased for revenue earned, not received. The opening and closing balances
of the Company's accounts receivable, contract asset and deferred revenue are as follows:

OF CHANGES IN ACCOUNTS RECEIVABLE, CONTRACT ASSET AND DEFERRED REVENUE

 Accounts
 Receivable – Net

 Contract Asset

 Deferred Revenue
 (current)

 Deferred Revenue
 (long term)

 Balance as of January 1, 2023

 $
 14,773

 $
 4,399

 $
 1,386

 $

 (Decrease) increase, net

 ( 2,885
)

 ( 6
)

 ( 86
)

 Balance as of December 31, 2023

 $
 11,888

 $
 5,094

 $
 1,380

 $

 Balance as of January 1, 2022

 $
 17,006

 $
 4,725

 $
 1,085

 $

 (Decrease) increase, net

 ( 2,233
)

 ( 326
)

 Balance as of December 31, 2022

 $
 14,773

 $
 4,399

 $
 1,386

 $

 F- 21

 Deferred
revenue:

 The
amount of deferred revenue at the beginning of the year and recognized during the year ended December 31, 2023 and 2022 was approximately
$1.1 million and $1.3 million, respectively.

 Deferred
commissions:

 Our
sales incentive plans include commissions payable to employees and third parties at the time of the initial contract execution that are
capitalized as incremental costs to obtain a contract. The capitalized commissions are amortized over the period the related services
are transferred. As we do not offer commissions on contract renewals, we have determined the amortization period to be the estimated
client life, which is three years. Deferred commissions were approximately $ 517,000 and $ 643,000 at
December 31, 2023 and 2022,
respectively, and are included in the other assets amounts in the consolidated balance sheets. The amortization of deferred sales commissions
during the years ended December 31, 2023 and 2022 was approximately $ 487,000 and $ 594,000, respectively.

 Trade
Accounts Receivable – Estimate of Credit Losses:

 ASU
2016-13 requires the recognition of lifetime estimated credit losses expected to occur for trade accounts receivable. The guidance also
requires we pool assets with similar risk characteristics and consider current economic conditions when estimating losses. The adoption
of the ASU 2016-13 for trade accounts receivable was recorded as a charge to accumulated deficit of approximately $ 186,000 as of January
1, 2023.

 At
adoption, we segmented the accounts receivable population into pools based on their risk assessment. Risks related to trade accounts
receivable are a customer's inability to pay or bankruptcy. Each pool was defined by their internal credit assessment and business
size. The pools are aligned with management's review of financial performance. For the year ended December 31, 2023, no adjustment
to the pools was necessary.

 We
utilize a loss-rate method to measure the expected credit loss for each pool. The loss rate is calculated using a three-year lookback
period of write-offs and adjustments, divided by the revenue for each pool by aging category, net of customer payments during that period.
We consider current and future economic conditions, internal forecasts, customer collection experience and credit memos issued during
the current period when assessing loss rates. We reviewed these factors and concluded that no adjustments should be made to the historical
loss rate data for the current quarter. In addition, the Company uses specific account identification in determining the total allowance
for expected credit losses. Trade receivables are written off only after the Company has exhausted all collection efforts.

in the allowance for expected credit losses for trade accounts receivable are presented in the table below:

OF TRADE ALLOWANCE FOR DOUBTFUL ACCOUNTS

 2023

 2022

 2023

 2022

 Beginning balance

 $

 $

 Adoption of ASC 326

 -

 Provision

 Recoveries/adjustments

 Write-offs

 ( 691
)

 ( 767
)

 Ending balance

 $

 $

 F- 22

 9.
 SHAREHOLDERS' EQUITY

 Treasury
stock

 The
Board of Directors of the Company previously approved common stock repurchase programs. The last program expired January 25, 2017. As
a result of these stock repurchases, the Company has 740,799 common shares held as treasury stock at an aggregate cost of $ 662,000.

stock

 The
Company had the right to sell up to $ 50 million of its common stock using an "at-the-market" facility ("ATM").
The underwriter receives 3 % of the gross proceeds. During the years ended December 31, 2023 and 2022, no
shares of common stock were issued under this ATM. This right terminated when the Company suspended the Preferred Stock dividends.

 Holders
of our common stock are entitled to one vote for each share held on all matters properly submitted to a vote of shareholders on which
holders of common stock are entitled to vote. Holders of common stocks are entitled to receive dividends only at times and amounts as
determined by the Board of Directors. The common stock is not entitled to pre-emptive rights, and is not subject to conversion, redemption
or sinking fund provisions. The common stock is listed on the Nasdaq Global Market under the trading symbol "CCLD."

 Preferred
stock

 The
Company has seven million authorized shares of preferred stock of which 4,526,231 have been designated as Series A shares and the balance
have been designated as Series B shares.

 The
Company also had the right to sell up to $ 35 million of its Series B Preferred Stock using an ATM facility. This right terminated when
the Company suspended the Preferred Stock dividends. The underwriter received 3 % of the gross proceeds. During
the year ended December 31, 2023, the Company sold 59,773 of shares of Series B Preferred Stock
under the Company's ATM and received net proceeds of approximately $ 1.4 million.
 During the year ended December 31, 2022, the Company sold 1,324,858 shares of Series B Preferred Stock and received net proceeds
of approximately $ 30.9 million. This includes 224,048 shares sold
under the Company's ATM. On March 18, 2022, the Company used a portion of the proceeds from selling Series B Preferred Stock to
redeem 800,000 shares of Series A Preferred Stock for $ 25.00 per share, plus all accrued and unpaid dividends to, but not including,
the redemption date.

 Since
November 4, 2020, the Company has the right to redeem, at its option, the Series A Preferred Stock,
in whole or in part, at a cash redemption price of $ 25.00
 per share, plus all accrued and unpaid dividends
to, but not including, the redemption date. The Series A Preferred Stock has no stated maturity,
is not subject to any sinking fund or other mandatory redemption, and is not convertible into or exchangeable for any of the Company's
other securities. Holders of the Series A Preferred Stock have no voting rights except for limited
voting rights if dividends payable on the Series A Preferred Stock are in arrears for eighteen
or more consecutive or non-consecutive monthly dividend periods, at which time they are entitled to appoint two additional directors
to our Board of Directors. If the Company were to liquidate, dissolve or wind up, the holders of the Series
A Preferred Stock will have the right to receive $ 25.00
 per share, plus any accumulated and unpaid dividends
to, but not including, the date of payment, before any payment is made to the holders of the common stock. The Series
A Preferred Stock is listed on the Nasdaq Global Market under the trading symbol "CCLDP."

 Since
February 15, 2024 and prior to February 15, 2025, we may redeem, at our option, the Series B Preferred Stock, in whole or in part, at
a cash redemption price of $ 25.75 per share, plus all accrued and unpaid dividends to, but not including, the redemption date. On or
after February 15, 2025 and prior to February 15, 2026, we may redeem, at our option, the Series B Preferred Stock, in whole or in part,
at a cash redemption price of $ 25.50 per share, plus all accrued and unpaid dividends to, but not including, the redemption date. On
or after February 15, 2026 and prior to February 15, 2027, we may redeem, at our option, the Series B Preferred Stock, in whole or in
part, at a cash redemption price of $ 25.25 per share, plus all accrued and unpaid dividends to, but not including, the redemption date.
On or after February 15, 2027, we may redeem, at our option, the Series B Preferred Stock, in whole or in part, at a cash redemption
price of $ 25.00 per share, plus all accrued and unpaid dividends to, but not including, the redemption date. The Series B Preferred Stock
is listed on the Nasdaq Global Market under the trading symbol "CCLDO."

 Dividends
on the Series A and Series B Preferred Stock of $ 2.75 and $ 2.19, respectively, annually per share are cumulative from the date of issue
and are payable each month when, as and if declared by the Company's Board of Directors.
In October, 2023, the Board of Directors had declared monthly dividends on the Series A and Series
B Preferred Stock payable through February 2024; however, on December 11, 2023, the Board of Directors suspended the monthly cash dividends
for Series A Preferred Stock and Series B Preferred Stock beginning with the payment scheduled for December 15, 2023 together with the
remaining dividends that were declared. The suspension of these dividends will defer approximately $ 1.3 million in cash dividend payments
each month. During this suspension, dividends will continue to accrue in arrears on the Series A and Series B Preferred Stock. The Board
of Directors will regularly review and consider when the suspension should be lifted.

 F- 23

 Warrants

 The
Company has issued 6,603,489 warrants for its common stock, of which 1,128,489 remained
outstanding at December 31, 2022. All of these warrants expired unexercised during 2023 and there were no warrants outstanding at December
31, 2023. During the year ended December 31, 2022, 125,000 warrants were exercised at a $ 3.92 exercise price. The warrants were
exercised via a cashless exercise.

 The
Company incurs common and preferred stock offering costs which consist principally of professional fees, primarily legal and accounting,
and other costs such as printing and registration costs. In connection with the 2023 and 2022 equity offerings, the Company incurred
 approximately $ 71,000 and $ 2.3 million, respectively, of such costs, including underwriting commissions
and placement agent fees. For the year ended December 31, 2022, there was $ 32,000 of fees paid for comfort letters in connection with
the equity offerings.

 10.
 COMMITMENTS AND CONTINGENCIES

 Legal
Proceedings — On December 9, 2022, an arbitrator rendered a decision in favor of MTBC Acquisition Corp. ("MAC")
and dismissed the claims brought against MAC by Randolph Pain Relief and Wellness Center ("RPRWC"), determining that RPRWC
failed to prove any breach of the applicable billing services agreement and failed to prove that any alleged damages were due. The deadline
for RPRWC to file a summary action in Superior Court of New Jersey seeking to overturn the arbitrator's decision was April 5, 2023
and no summary action was filed by such deadline. As such, the arbitrator's decision dismissing RPRWC's claims is final.

 On
December 22, 2023, an arbitrator rendered a decision in favor of Ramapo Anesthesiologists, PC ("Ramapo") and granted in part
and denied in part certain claims brought against Origin Healthcare Solutions, LLC; Meridian Medical Management, Inc.; and the Company
for alleged breach of contract and other allegations. Ramapo was awarded mitigation related costs of $ 117,000. The payment for such an
award was made during the first quarter of 2024. The deadline for Ramapo to file a summary action in New Jersey seeking to overturn the
arbitrator's decision is April 20, 2024. The Company's portion of the settlement is approximately $ 32,000 and the insurance
company will pay the balance. The Company's portion has been recorded in accrued expenses at December 31, 2023 in the consolidated
balance sheet.

 From
time to time, we may become involved in other legal proceedings arising in the ordinary course of our business. We are not presently
a party to any legal proceedings that, in the opinion of our management, would individually or taken together have a material adverse
effect on our business, consolidated results of operations, financial position or cash flows of the Company.

 11.
 LEASES

 We
determine if an arrangement is a lease at inception. We have operating leases for office and temporary living space as well as for some
office equipment. Operating leases are included in operating lease ROU assets, current operating lease liability and non-current operating
lease liability in our consolidated balance sheets as of December 31, 2023 and 2022. The Company does not have any finance leases.

 ROU
assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease
payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the estimated present
value of the lease payments over the lease term.

 As
most of our leases do not provide an implicit rate, we use our estimated incremental borrowing rates, which are derived from information
available at the lease commencement date, in determining the present value of lease payments. We give consideration to our bank financing
arrangements, geographical location and collateralization of assets when calculating our incremental borrowing rates.

 Our
lease terms include options to extend the lease when it is reasonably certain that we will exercise that option. Leases with a term of
less than 12 months are not recorded in the consolidated balance sheets. Our lease agreements do not contain any residual value guarantees.
For real estate leases, we account for the lease and non-lease components as a single lease component. Some leases include escalation
clauses and termination options that are factored in the determination of the lease payments when appropriate.

 F- 24

 If
a lease is modified after the effective date, the operating lease ROU asset and liability is re-measured using the current incremental
borrowing rate. There was one lease modification during the year ended December 31, 2023 and none during the year ended December 31,
2022. We review our incremental borrowing rate for our portfolio of leases on a quarterly basis.

the years ended December 31, 2023 and 2022, there were approximately $ 169,000 and $ 1.0 million, respectively, of unoccupied lease charges
for two of the Company's facilities. There were no lease impairments recorded for the years ended December 31, 2023 and 2022.

the year ended December 31, 2022, there was a gain on lease termination of approximately $ 105,000. Additionally, a facility lease was
terminated in conjunction with the Company ceasing its document storage services resulting in additional costs of approximately $ 203,000.
These amounts are included in the net loss on lease terminations, unoccupied lease charges and restructuring costs in the consolidated
statements of operations.

 Lease
expense is included in direct operating costs, general and administrative expense, selling and marketing expense and research and development
expense in the consolidated statements of operations based on the nature of the expense. As of December 31, 2023, we had 32 leased properties,
five in Medical Practice Management and 27 in Healthcare IT, with the remaining terms ranging from less than one year to twelve years.
Our lease terms are determined taking into account lease renewal options, the Company's anticipated operating plans and leases
that are on a month-to-month basi s. We also have some related party leases – see Note 12.

 The
components of lease expense were as follows:

OF LEASE EXPENSE

 2023

 2022

 2023

 2022

 Operating lease cost

 $
 2,669

 $
 3,714

 Short-term lease cost

 -

 Variable lease cost

 Total - net lease cost

 $
 2,701

 $
 3,835

 Short-term
lease cost represents leases that were not capitalized as the lease term as of the later of January 1, 2023 or the beginning of the lease
was less than 12 months. Variable lease costs include utilities, real estate taxes and common area maintenance costs.

 Supplemental
balance sheet information related to leases was as follows:

OF SUPPLEMENTAL BALANCE SHEET INFORMATION RELATED TO LEASES

 December 31, 2023

 December 31, 2022

 Operating leases:

 Operating lease ROU assets, net

 $
 4,365

 $
 4,921

 Operating lease liabilities (current portion)

 $
 1,888

 $
 2,273

 Operating lease liabilities

 2,516

 3,207

 Total operating lease liabilities

 $
 4,404

 $
 5,480

 Operating leases:

 ROU assets

 $
 6,571

 $
 8,293

 Asset lease expense

 ( 2,152
)

 ( 3,286
)

 Foreign exchange loss

 ( 54
)

 ( 86
)

 ROU assets, net

 $
 4,365

 $
 4,921

 Operating lease right-of-use assets

 $
 4,365

 $
 4,921

 Weighted average remaining lease term (in years):

 Operating leases

 4.5

 5.1

 Weighted average discount rate:

 Operating leases

 13.3
 %

 7.9
 %

 leases, Weighted average discount rate:

 13.3
 %

 7.9
 %

 F- 25

 Supplemental
cash flow and other information related to leases was as follows:

OF SUPPLEMENTAL CASH FLOW AND OTHER INFORMATION RELATED TO LEASES

 2023

 2022

 2023

 2022

 Cash paid for amounts included in the measurement of lease liabilities:

 Operating cash flows from operating leases

 $
 3,244

 $
 4,743

 ROU assets obtained in exchange for lease liabilities:

 Operating leases, excluding impairments and terminations

 $
 1,682

 $
 1,569

 Maturities
of lease liabilities are as follows:

OF MATURITIES OF LEASE LIABILITIES

 Operating leases - Years ending December 31,

 2024

 $
 2,304

 2025

 1,295

 2026

 2027

 2028

 Thereafter

 1,427

 Total lease payments

 6,327

 Less: imputed interest

 ( 1,923
)

 Total lease obligations

 4,404

 Less: current obligations

 ( 1,888
)

 Long-term lease obligations

 $
 2,516

 F- 26

 12.
 RELATED PARTIES

 The
Company had sales to a related party, a physician who is the wife of the Executive Chairman. Revenues from this customer were approximately
$ 125,000 and $ 58,000 for the years ended December 31,
2023 and 2022, respectively. As of December 31, 2023 and 2022, the accounts receivable balance due from
this customer was approximately $ 18,000 and $ 10,000, respectively, an d is included in accounts receivable - net in the consolidated
balance sheets.

 The
Company leases its corporate offices in New Jersey, its temporary housing for its foreign visitors, a storage facility, its backup operations
center in Bagh, Pakistan and an apartment for temporary housing in Dubai, the UAE, from the Executive Chairman. The related party rent
expense for the years ended December 31, 2023 and 2022 was approximately $ 256,000 and $ 198,000, respectively, and is included in direct
operating costs and general and administrative expense in the consolidated statements of operations. During the years ended December
31, 2023 and 2022, the Company spent approximately $ 1.8 million
 and $ 941,000, respectively, to upgrade the related party leased facilities. During the years ended December
31, 2023 and 2022, the Company temporarily advanced the Executive Chairman approximately $ 330,000 and $ 42,000, respectively, to purchase
vacant land surrounding the Bagh facility for the sole use and benefit of the Company in order to expedite the purchase on the Company's
behalf as only individuals with citizenship in Kashmir are allowed to purchase land in this region. All advanced amounts were repaid
shortly after the advance was made. Current assets-related party in the consolidated balance sheets includes security deposits related
to the leases of the Company's corporate offices in the amount of approximately $ 16,000 for both the years ended December
31, 2023 and 2022. The Company also leases two facilities used for temporary housing from a management
employee for approximately $ 6,200 per month.

 Included
in the ROU asset at December 31, 2023 is approximately $ 331,000 applicable to the related party leases. Included in the current and non-current
operating lease liability at December 31, 2023 is approximately $ 182,000 and $ 142,000, respectively, applicable to the related party
leases.

 Included
in the ROU asset at December 31, 2022 is approximately $ 467,000 applicable to the related party leases. Included in the current and non-current
operating lease liability at December 31, 2022 is approximately $ 158,000 and $ 301,000, respectively, applicable to the related party
leases.

June 2022, the Company entered into a one-year consulting agreement with an entity owned and controlled by one of its former non-independent
directors whereby that director received 10,000 shares of the Company's 8.75 % Series B Cumulative Redeemable Perpetual Preferred
Stock ("Series B Preferred Stock") in exchange for assisting the Company to identify and acquire additional companies, including
performing due diligence. In addition, the Company may make additional payments under the agreement for any successful acquisitions by
the Company based on the purchase price of the transaction. No such additional payments were made in 2022. During February 2023, the
agreement was amended and extended through December 2024 whereby the former director received 14,000 shares of Series B Preferred Stock
in February 2023 and received an additional 14,000 shares in January 2024. All of the payments made were expensed during the year ended
December 31, 2023. The amortization is recorded as stock compensation in general and administrative expense in the consolidated statement
of operations. All such shares of the Series B Preferred Stock were issued in accordance with the Company's Amended and Restated
2014 Equity Incentive Plan. In addition to the extension of the consulting agreement, the amendment provides that any transaction fees
due will be offset against the last two above payments before any amounts are due to that former director. There were no transaction
fees through December 31, 2023. (See Note 20.)

2020, a New Jersey corporation, talkMD Clinicians, PA ("talkMD"), was formed by the wife of the Executive Chairman, who is
a licensed physician, to provide telehealth services. talkMD was determined to be a variable interest entity ("VIE") for
financial reporting purposes because the entity will be controlled by the Company. As of December 31, 2023, talkMD had not yet commenced
operations. Cumulatively, the Company has paid approximately
$ 5,000 on behalf of talkMD for income taxes.

 13.
 RESTRUCTURING COSTS

 On
October 2, 2023, the Company committed to effectively align resources with business priorities and improve profitability through a reduction
in the workforce for the Healthcare IT segment. The Company identified opportunities for improvements in its workforce realignment, strategy
and staffing, and increased its focus on performance management, to ensure it has the right skillsets and number of employees to execute
its long-term vision. In addition, the Company instituted certain other expense reductions.

 F- 27

 The
difference between the free cash flow and the expense savings represents amounts which were previously capitalized as part of
software capitalization. A majority of the impacted employees exited in the fourth quarter of 2023. The Company estimates that it
will incur expenses of approximately $ 900,000 related to the reduction in workforce of which approximately $ 645,000 was incurred in 2023, with the remaining
expenses to be incurred in 2024. These restructuring expenses consisted of one-time termination benefits, including but not limited
to, severance payments and healthcare benefits. Also as previously noted, the dividends on the Preferred Stock have been suspended
in order to increase cash flow.

 The
following table summarizes restructuring costs which are included in net loss on lease termination, unoccupied lease charges and restructuring
costs in the December 31, 2023 consolidated statement of operations:

OF RESTRUCTURING COSTS

 Year ended December 31, 2023

 Severance and separation costs

 $

 Equity awards acceleration costs associated with severance

 Other exit related costs

 Total restructuring and other costs

 $

 The
expense associated with the restructuring is included in net loss on lease terminations, unoccupied lease charges and restructuring cost
in the consolidated statement of operations for the year ended December 31, 2023. This line also includes $ 291,000 for net loss on lease
terminations and $ 169,000 for unoccupied lease charges. The liabilities associated with restructuring costs are included in accrued expenses
and other current liabilities in the December 31, 2023 consolidated balance sheet. The following table summarizes activity related to
liabilities associated with restructuring costs:

OF LIABILITIES ASSOCIATED WITH RESTRUCTURING COSTS

 Severance and
 separation costs

 Equity awards
 acceleration costs

 Other exit

 related costs

 Total
 restructuring and
 other costs

 Balance as of January 1, 2023

 $
 -

 $
 -

 $
 -

 $
 -

 Additions

 Payments and other adjustments

 ( 294
)

 ( 170
)

 ( 10
)

 ( 474
)

 Balance as of December 31, 2023

 $

 $
 -

 $

 $

 14.
 EMPLOYEE BENEFIT PLANS

 The
Company has qualified 401(k) plans covering all U.S. employees who have completed one month of service. The plans provide for matching
contributions by the Company for employees of the Company and most U.S. subsidiaries, although there is no match for CPM employees. Employer
contributions to the plans for the years ended December 31, 2023 and 2022 were approximately $ 587,000 and $ 549,000,
respectively.

 Additionally,
the Company has a defined contribution retirement plan covering all employees located in our Pakistan Offices who have completed three
months of service. The plan provides for monthly contributions by the Company which are equal to 10% of qualified employees' basic
monthly compensation. The Company's contributions for the years ended December 31, 2023 and 2022 were approximately
$ 394,000 and $ 329,000, respectively.

 The
Company maintains a defined contribution retirement plan covering all employees in Sri Lanka. The employee and employer contribute 8 %
and 12 %, respectively, of the employee's gross salary. The Company's contribution for the years ended December 31, 2023 and
2022 was approximately $ 24,000 and $ 22,000, respectively. The contributions are required to be
deposited with the Employees' Provident Fund Organization, a government owned entity.

 F- 28

 15.
 STOCK-BASED COMPENSATION

 In
April 2014, the Company adopted the Medical Transcription Billing, Corp. 2014 Equity Incentive Plan (the "Original Plan"),
reserving a total of 1,351,000 shares of common stock for grants to employees, officers, directors and consultants. On April 14, 2017,
the Original Plan was amended and restated whereby an additional 1,500,000 shares of common stock and 100,000 shares of Series A Preferred
Stock were added to the plan for future issuance (the "A&R Plan"). During 2018, an additional 200,000 shares of Series
A Preferred Stock were added to the A&R Plan for future issuance. In May 2020, an additional 2,000,000 shares of common stock and
an additional 300,000 shares of Series A Preferred Stock were added to the A&R Plan for future issuance. During 2022, an additional
 1,000,000 shares of common stock and 200,000 shares of Series B Preferred Stock were added to the A&R Plan for future issuance. As
of December 31, 2023, 493,579 shares of common stock, 33,769 shares of Series A Preferred Stock and 38,000 shares of Series B Preferred
Stock are available for grant. Permissible awards include incentive stock options, non-statutory stock options, stock appreciation rights,
restricted stock, RSUs, performance stock and cash-settled awards and other stock-based awards in the discretion of the Compensation
Committee of the Board of Directors including unrestricted stock grants.

 The
equity based RSUs contain a provision in which the units shall immediately vest and become converted into common shares at the rate of
one common share per RSU, immediately after a change in control, as defined in the award agreement.

stock

2023, 1,098,976 RSUs of common stock were granted to employees and independent contractors to vest at different dates during the years
2023 through 2025. Included therein were 30,000 RSUs of common stock granted over two years equally to the five outside members of the
Board of Directors with 25 % of the shares vesting every six months.

2022, 777,715 RSUs of common stock were granted to employees and independent contractors to vest at different dates during the years
2022 through 2024. Included therein were 80,000 shares of common stock granted over two years equally to the four outside members of
the Board of Directors with 25 % of the shares vesting every six months.

December 2022, it was agreed that certain bonuses to employees of medSR that were originally going to be paid in cash would be paid in
common stock. The change of paying the bonuses in common stock resulted in approximately 135,000 shares being issued in February 2023.
This change resulted in approximately $ 404,000 of stock compensation expense, which offset the amounts previously accrued.

 The
following table summarizes the RSU and restricted stock transactions related to the common and Preferred Stock under the A&R Plan
for the years ended December 31, 2023 and 2022:

 DISCLOSURE
OF SHARE-BASED COMPENSATION ARRANGEMENTS BY SHARE-BASED PAYMENT AWARD

 Common Stock

 Series A
 Preferred Stock

 Series B
 Preferred Stock

 Outstanding and unvested shares at January 1, 2023

 645,475

 -

 80,462

 Granted

 1,098,976

 -

 62,000

 Vested

 ( 896,893
)

 -

 ( 85,263
)

 Forfeited

 ( 94,063
)

 -

 -

 Outstanding and unvested shares at December 31, 2023

 753,495

 -

 57,199

 Outstanding and unvested shares at January 1, 2022

 418,039

 34,000

 -

 Granted

 777,715

 8,644

 100,000

 Vested

 ( 465,455
)

 ( 42,644
)

 ( 19,538
)

 Forfeited

 ( 84,824
)

 -

 -

 Outstanding and unvested shares at December 31, 2022

 645,475

 -

 80,462

 As
of December 31, 2023 and 2022, there was approximately $ 1.3 million and $ 1.4 million, respectively, of total unrecognized compensation
cost related to the common stock RSUs classified as equity that will be expensed through 2025. As of December 31, 2023 and 2022, there
was approximately $ 351,000 and $ 557,000, respectively, of total unrecognized compensation cost related to the Series B Preferred Stock
RSUs classified as equity that will be, or was, expensed through the following year. There was no unrecognized compensation cost related
to the Series A Preferred Stock RSUs for both the years ended December 31, 2023 and 2022.

 Of
the total outstanding and unvested common stock RSUs at December 31, 2023 and 2022, 733,908 and 598,245 RSUs, respectively, are classified
as equity and 19,587 and 47,230 RSUs, respectively, are classified as a liability. For both 2023 and 2022, all of the Preferred Stock
RSUs are classified as equity.

 F- 29

 The
following table summarizes the share activity during the years ended December 31, 2023 and 2022 and the amount of common and preferred
shares available for grant at December 31, 2023 and 2022:

 SCHEDULE OF SHARE-BASED COMPENSATION, RESTRICTED STOCK UNITS AWARD ACTIVITY

 Common Stock

 Series A
 Preferred Stock

 Series B
 Preferred Stock

 Shares available for grant at January 1, 2023

 1,498,492

 33,769

 100,000

 RSUs granted

 ( 1,098,976
)

 -

 ( 62,000
)

 RSUs forfeited

 94,063

 -

 -

 Shares available for grant at December 31, 2023

 493,579

 33,769

 38,000

 Shares available for grant at January 1, 2022

 1,191,383

 320,065

 -

 Shares added to plan

 1,000,000

 -

 200,000

 RSUs granted

 ( 777,715
)

 ( 8,644
)

 ( 100,000
)

 Shares redesignated as Series B

 -

 ( 277,652
)

 -

 RSUs forfeited

 84,824

 -

 -

 Shares available for grant at December 31, 2022

 1,498,492

 33,769

 100,000

 The
liability for the cash-settled awards and accrued payroll taxes on equity awards was approximately $ 767,000 and $ 1.0 million at December
31, 2023 and 2022, respectively, and is included in accrued compensation in the consolidated balance sheets. During the years ended December
31, 2023 and 2022, approximately $ 19,000 and $ 105,000, respectively, was paid in connection with the cash-settled awards.

 Series
A Preferred Stock

 In
2021, the Compensation Committee granted executive bonuses to be paid in 34,000 shares of Series A Preferred Stock with the final number
of shares and the amount based on specified performance criteria being achieved during 2021. Also in 2021, 16,010 shares of Series A
Preferred Stock were granted as performance bonuses and in lieu of sales commissions. During January 2022, the Compensation Committee
determined that the financial objectives were attained and all of the performance bonus shares were issued.

 Series
B Preferred Stock

 In
February 2023, the Compensation Committee granted executive bonuses to be paid in 34,000 shares of Series B Preferred Stock, with the
number of shares and the amount based on specified criteria being achieved during the year 2023. During October, the Compensation Committee
approved for issuance 10,000 of the above shares to one of the executives who retired. The remaining shares will not be issued.

 Stock-based
compensation expense

 The
Company recognizes compensation expense on a straight-line basis over the total requisite service period for the entire award. For stock
awards classified as equity, the market price of our common stock or Preferred Stock on the date of grant is used to record the fair
value of the award and includes the related taxes. For stock awards classified as a liability, the earned amount is marked to market
based on the end of period common stock price. The weighted average grant date fair value of the common stock price in connection with
the RSUs classified as equity was $ 3.40 and $ 4.27 for the years ended December 31, 2023 and 2022, respectively. The weighted average
grant date fair value of the Series A Preferred Stock in connection with the RSUs was $ 26.69 for the year ended December 31, 2022. There
were no grants of the Series A Preferred Stock in 2023. For the Series B Preferred Stock, the weighted average grant date fair value
was $ 25.07 and $ 25.24 for the years ended December 31, 2023 and 2022, respectively. The following table summarizes the components of
stock-based compensation expense for the years ended December 31, 2023 and 2022:

 SCHEDULE OF EMPLOYEE SERVICE SHARE-BASED COMPENSATION, ALLOCATION OF RECOGNIZED PERIOD COSTS

 Stock-based compensation included in the consolidated statements of operations:

 2023

 2022

 $

 $
 1,047

 2,835

 2,598

 1,024

 Net loss on lease terminations, unoccupied lease charges and restructuring costs

 -

 Total stock-based compensation expense

 $
 4,886

 $
 4,914

 F- 30

 16.
 INCOME TAXES

 For
the years ended December 31, 2023 and 2022, the Company estimated its income tax provision based upon the annual pre-tax income or loss.
Although the Company reported GAAP earnings in 2022 and 2023, it incurred losses historically and there is uncertainty regarding future
U.S. taxable income, which makes realization of a deferred tax asset difficult to support in accordance with ASC 740. Accordingly, a
valuation allowance has been recorded against all federal and state deferred tax assets as of December 31, 2023 and December 31, 2022,
with the exception of a net deferred tax liability relating to the amortization of intangibles for tax purposes.

 The
annual adjusted earnings and profits of our foreign affiliates pass through to the U.S. as federal and state taxable income under the
Global Intangible Low-Taxed Income ("GILTI") regime. For the tax years ended December 31, 2023 and 2022, the net GILTI from
our foreign affiliates was absorbed against our current year U.S. consolidated loss. For state tax purposes, the Company's foreign
earnings may be taxable depending on each individual state's legislative stance on the recent tax reform legislation. The activity
in the deferred tax valuation allowance was as follows for the years ended December 31, 2023 and 2022:

 SCHEDULE OF DEFERRED TAX VALUATION ALLOWANCE

 2023

 2022

 Beginning balance

 $
 92,091

 $
 86,728

 Current year valuation allowance (decrease) increase

 ( 4,494
)

 5,363

 Ending balance

 $
 87,597

 $
 92,091

 The
(loss) income before tax for financial reporting purposes during the years ended December 31, 2023 and 2022 consisted of the following:

 SCHEDULE OF INCOME BEFORE INCOME TAX, DOMESTIC AND FOREIGN

 2023

 2022

 United States

 $
 ( 48,985
)

 $
 6,137

 ( 53
)

 ( 528
)

 Total

 $
 ( 49,038
)

 $
 5,609

 F- 31

 The
(benefit) provision for income taxes for the years ended December 31, 2023 and 2022 consisted of the following:

OF COMPONENTS OF INCOME TAX PROVISION (BENEFIT)

 2023

 2022

 Current:

 Federal

 $
 -

 $
 -

 State

 Current Income Tax Expense (Benefit)

 Deferred:

 Federal

 ( 252
)

 State

 ( 273
)

 Deferred Income Tax Expense
 (Benefit)

 ( 525
)

 Total income tax (benefit) provision

 $
 ( 364
)

 $

 The
components of the Company's deferred income taxes as of December 31, 2023 and 2022 are as follows:

 SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

 2023

 2022

 Deferred tax assets:

 Allowance for expected credit losses

 $

 $

 Deferred revenue

 Property and intangible assets

 1,933

 2,213

 State net operating loss ("NOL") carryforwards

 19,749

 27,262

 Federal net operating loss ("NOL") carryforwards

 57,562

 57,179

 Section 163(j) interest limitation

 2,731

 2,525

 Stock based compensation

 -

 ASC 842 - ROU asset

 ( 1,026
)

 ( 1,243
)

 Prepaid commissions

 ( 303
)

 ( 253
)

 Cumulative balance translation adjustment

 Section 267 limitation

 Credit carryovers

 2,498

 2,498

 ASC 842 - Lease liability

 1,031

 1,386

 Accrued compensation

 Other

 ( 59
)

 Section 174 Costs

 3,799

 -

 Valuation allowance

 ( 87,597
)

 ( 92,091
)

 Total deferred tax assets

 1,688

 1,033

 Deferred tax liabilities:

 Goodwill amortization

 ( 1,688
)

 ( 1,558
)

 Net deferred tax liability

 $
 -

 $
 ( 525
)

 Deferred
income tax balances reflect the effects of temporary differences between the carrying amounts of assets and liabilities and their tax
bases, as well as from net operating loss carryforwards. Deferred income tax assets represent amounts available to reduce income taxes
payable on taxable income in future years.

 The
Company has recorded goodwill as a result of its acquisitions. Goodwill is generally not amortized for financial reporting purposes.
However, in 2023 the Company recorded a $ 42 million goodwill impairment charge, which partially reduced the basis of the tax-deductible
goodwill. For tax purposes, goodwill from asset acquisitions is tax deductible and amortized over 15 years. As such, deferred income
tax expense and a deferred tax liability arise as a result of the tax-deductibility of this indefinitely lived asset (also known as a
naked credit). The resulting deferred tax liability, which is expected to continue to increase over the amortization period, will have
an indefinite life. As a result of the Company having indefinite life net operating losses under the recent tax reform legislation, the
federal deferred tax liability resulting from the amortization of goodwill was offset against these indefinite federal operating net
loss deferred tax assets to the extent allowable.

 Due
to the fact that the aforementioned deferred tax liability could have an indefinite life, it is not netted against the Company's
deferred tax assets when determining the required valuation allowance in accordance with ASC 740 guidelines. Doing so would result in
the understatement of the valuation allowance and related deferred income tax expense.

 F- 32

 A
reconciliation of the federal statutory income tax rate ( 21 %) to the Company's effective income tax rate (determined in dollars)
for the years ended December 31, 2023 and 2022 is as follows:

 SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION

 2023

 2022

 Federal (benefit) provision at statutory rate

 $
 ( 10,298
)

 $
 1,178

 Increase (decrease) in income taxes resulting from:

 State tax expense, net of federal benefit

 7,383

 Non-deductible items

 Impact of foreign operations

 ( 137
)

 Subpart F GILTI inclusion

 Stock based compensation

 -

 ( 649
)

 5,692

 -

 Deferred true-up

 Valuation allowance

 ( 4,494
)

 ( 1,471
)

 Total income tax (benefit) provision

 $
 ( 364
)

 $

 At
December 31, 2023 and 2022, the Company did not record any uncertain tax positions based on the technical merits. Therefore, a tabular
roll forward was excluded and there has been no accrued interest and penalties. The Company is subject to taxation in the United States,
various states, Pakistan and Sri Lanka. As of December 31, 2023, all tax years since 2014 remain open to examination due to the carryover
of unused net operating losses and tax credits in the United States by major taxing jurisdictions in which the Company is subject to
tax. For the first six months of 2022, the Pakistan Federal Board of Revenue allowed a 100 % tax credit against earnings from IT activities,
which precludes the Pakistan subsidiaries from being subject to income taxes. A new tax became effective July 1, 2022, whereby IT companies
are subject to a 0.25% tax deducted at the source on receipts received from foreign sources with no further tax being due. It is the
Company's policy that any assessed penalties and interest on uncertain tax positions would be charged to income tax expense.

 The
former Pakistan tax credit and foreign receipts tax does not have a significant impact on the Company's effective tax rate as all
of its earnings in Pakistan have been fully included in the U.S. federal tax rate reconciliation at 21 % for 2023 and 2022. The Pakistan
statutory corporate tax rate is 29 % before consideration of the aforementioned tax credit and the foreign receipts tax.

 As
of December 31, 2023, the Company has a total federal NOL carry forward of approximately $ 274 million of which approximately $ 198 million
will expire between 2034 and 2037, and the balance of approximately $ 76 million has an indefinite life. Out of the total federal NOL
carry forward, approximately $ 238 million is from the CareCloud and Meridian acquisitions and is subject to the federal Section 382 NOL
annual usage limitations. The Company has state NOL carry forwards of approximately $ 199 million, of which $ 86 million relates to the
State of New Jersey. These NOLs expire starting in 2025.

 The
Company has a full valuation allowance on its deferred tax assets in the U.S. which results in there being no U.S. deferred tax assets
or liabilities recorded on the consolidated balance sheet at December 31, 2023. As of December 31, 2022, the Company recorded a deferred
tax liability related to the amortization of goodwill.

 17.
 OTHER EXPENSE – NET

 Other
expense - net for the years ended December 31, 2023 and 2022 consisted of the following:

 SCHEDULE OF OTHER (EXPENSE) INCOME - NET

 2023

 2022

 2023

 2022

 Foreign exchange losses

 $
 ( 790
)

 $
 ( 610
)

 Other expense

 ( 93
)

 ( 27
)

 $
 ( 883
)

 $
 ( 637
)

 F- 33

currency transaction gains and losses primarily result from transactions in foreign currencies other than the functional currency. These
transaction gains and losses are recorded in the consolidated statements of operations related to the recurring measurement and settlement
of such transactions.

 18.
 SEGMENT REPORTING

 The
Company's Chief Executive Officer and Executive Chairman serve as the CODM, organize the Company, manage resource allocations and
measure performance among two operating and reportable segments: (i) Healthcare IT and (ii) Medical Practice Management.

 The
Healthcare IT segment includes technology-assisted revenue cycle management, SaaS solutions and other services. The Medical Practice
Management segment includes the management of three medical practices. Each segment is considered a reporting unit. The CODM evaluates
the financial performance of the business units on the basis of revenue and direct operating costs excluding unallocated amounts, which
are mainly corporate overhead costs. Our CODM does not evaluate operating segments using asset or liability information. The accounting
policies of the segments are the same as those disclosed in the summary of significant accounting policies. The following tables present
revenues, operating expenses and operating income (loss) by reportable segment for the years ended December 31, 2023 and 2022:

OF REVENUES, OPERATING EXPENSES AND OPERATING INCOME (LOSS) BY REPORTABLE SEGMENT

 Healthcare IT

 Medical Practice

 Unallocated

 Total

 Year Ended December 31, 2023

 Healthcare IT

 Medical Practice

 Unallocated

 Total

 $
 103,683

 $
 13,376

 $
 -

 $

 Operating expenses:

 60,319

 10,498

 -

 70,817

 9,614

 -

 9,650

 10,992

 1,854

 8,618

 21,464

 4,736

 -

 -

 4,736

 in contingent consideration

 14,046

 -

 14,402

 -

 -

 Loss on lease terminations, unoccupied lease charges and restructuring costs

 1,105

 -

 -

 1,105

 142,812

 12,744

 8,618

 164,174

 Operating (loss) income

 $
 ( 39,129
)

 $

 $
 ( 8,618
)

 $
 ( 47,115
)

 IT

 Practice

 Unallocated

 Total

 Year
 Ended December 31, 2022 ($ in thousands)

 IT

 Practice

 Unallocated

 Total

 Net
 revenue

 $
 125,276

 $
 13,550

 $
 -

 $

 expenses:

 Direct
 operating costs

 73,702

 10,732

 -

 84,434

 Selling
 and marketing

 9,760

 -

 9,788

 General
 and administrative

 12,558

 1,802

 9,460

 23,820

 and development

 4,401

 -

 -

 4,401

 in contingent consideration

)

 -

 -

)

 and amortization

 11,368

 -

 11,725

 Net
 loss on lease terminations and unoccupied lease charges

 1,138

 -

 -

 1,138

 Loss on lease terminations, unoccupied lease charges and restructuring costs

 1,138

 -

 -

 1,138

 Total
 operating expenses

 109,837

 12,919

 9,460

 132,216

 income (loss)

 $
 15,439

 $

 $
 ( 9,460
)

 $
 6,610

 F- 34

 19.
 FAIR VALUE OF FINANCIAL INSTRUMENTS

 Fair
value measurements are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent
sources, while unobservable inputs reflect our view of market participant assumptions in the absence of observable market information.
We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The fair values
of assets and liabilities required to be measured at fair value are categorized based upon the level of judgement associated with the
inputs used to measure their value in one of the following three categories:

 Level
1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. We held no Level 1 financial instruments
at December 31, 2023 or December 31, 2022.

 Level
2: Quoted prices for similar instruments in active markets with inputs that are observable, either directly or indirectly. Our Level
2 financial instruments include notes payable which are carried at cost and approximate fair value since the interest rates being charged
approximate market rates.

 Level
3: Unobservable inputs are significant to the fair value of the asset or liability, and include situations where there is little, if
any, market activity for the asset or liability. Our Level 3 instruments include the fair value of contingent consideration related to
completed acquisitions. There was no contingent consideration recorded at December 31, 2023 and 2022.

 The
following table provides a reconciliation of the beginning and ending balances for the contingent consideration measured at fair value
using significant unobservable inputs (Level 3):

OF FAIR VALUE, LIABILITIES MEASURED ON RECURRING BASIS, UNOBSERVABLE INPUT RECONCILIATION

 Fair Value Measurement at Reporting

 Date Using Significant Unobservable

 Inputs, Level 3 Year Ended December 31,

 2023

 2022

 Balance - January 1,

 $
 -

 $
 3,090

 Acquisitions

 -

 -

 Change in fair value

 -

)

 Payments

 -

 -

 Balance - December 31,

 $
 -

 $
 -

 The
following table provides the assets and liabilities carried at fair value measured on a non-recurring basis as of December 31, 2023.
Refer to Note 2 - Basis of Presentation and Significant Accounting Policies, for a description of the valuation techniques used to
determine the fair value of the assets measured on a non-recurring basis in the table below.

 FAIR
VALUE OF THE ASSETS MEASURED ON A NON-RECURRING BASIS

 Fair Value Measurement at December 31, 2023

 Expense for the year ended

 Carrying Value

 Level 1

 Level 2

 Level 3

 December 31, 2023

 Goodwill - Healthcare IT

 $
 19,186

 $
 -

 $
 -

 $
 19,186

 $

 20.
 SUBSEQUENT EVENTS

 Effective
January 9, 2024, and as amended February 12, 2024, the Company entered into a Consulting Agreement with an entity owned and controlled
by a member of its Board of Directors to provide investor relations services for $ 8,000 per month and other services as requested by
the Company to be paid on an hourly basis. The Consulting Agreement is cancelable with ten days' notice.

 Effective
February 1, 2024, MAC and its wholly owned subsidiary were merged into CCI. Also effective February 1, 2024, the Company added an additional
Statement of Work ("SOW") to the Consulting Agreement with an entity owned and controlled by one of its former non-independent
directors. As compensation for the SOW, the entity will receive $ 25,000 per month. The SOW is cancelable with ten days' notice.
(See Note 12.)

 F- 35