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Item 1. Financial Statements

2024-08-07 compared with 2024-05-08 · 381 added, 247 removed, 810 unchanged (44% of the section changed)

Financial Statements

Condensed Consolidated Balance Sheets as of March 3 1 , 202 4 (Unaudited) and December 31, 20 23

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended March 3 1 , 202 4 and 20 23

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three Months Ended March 3 1 , 202 4 and 202 3

Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 3 1 , 202 4 and 202 3

Condensed Consolidated Balance Sheets as of June 3 0 , 2024 (Unaudited) and December 31, 2023

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three and Six Months Ended June 3 0 , 2024 and 2023

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months Ended June 30 , 2024 and 2023

Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30 , 2024 and 2023

Notes to Unaudited Condensed Consolidated Financial Statements

5 unchanged sentences

Cash and cash equivalents $ 66,059,922 $ 59,286,147

Accounts receivable, net of allowance of $ 6,319,441 and $ 6,276,454 as of March 31, 2024 and December 31, 2023, respectively

Accounts receivable, net of allowance for credit loss of $ 6,263,055 and $ 6,276,454 as of June 30, 2024 and December 31, 2023, respectively

257,503,002 262,083,462

29 unchanged sentences

Common stock ($ 0.0001 par value;

500,000,000 shares authorized as of March 31, 2024 and December 31, 2023;

102,961,495 and 104,055,168 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively)

500,000,000 shares authorized as of June 30, 2024 and December 31, 2023;

101,682,770 and 104,055,168 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively)

10,168 10,406

11 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Revenues, net $ 164,949,716 $ 125,486,760 $ 357,037,245 $ 238,489,463

14 unchanged sentences

Gain (loss) on disposal of fixed assets 12,563 ( 98,630 ) 65,398 ( 153,469 )

Other income 244,607 214,880

Other income (expense) 337,276 ( 920,058 ) 581,883 ( 705,178 )

Total other income (expense) ( 581,655 ) ( 587,389 ) ( 734,639 ) 266,538

2 unchanged sentences

Net income (loss) 5,858,574 1,343,619 16,461,953 ( 2,575,171 )

Net loss attributable to noncontrolling interests ( 624,070 ) ( 453,120 )

Net income (loss) attributable to noncontrolling interests ( 671,029 ) 3,354,886 ( 1,295,099 ) 2,901,766

Net income (loss) attributable to stockholders of DocGo Inc.

16 unchanged sentences

Comprehensive

Loss Noncontrolling

Income Noncontrolling

Interests Total

12 unchanged sentences

Balance - March 31, 2023 102,932,174 $ 10,293 $ 310,049,864 $ ( 32,367,602 ) $ 984,864 $ 5,243,605 $ 283,921,024

Acquisition of CRMS 117,330 12 1,000,000 — — — 1,000,012

Acquisition of FMC NA 360,145 36 ( 1,432,963 ) 649,167 — ( 3,213,956 ) ( 3,997,716 )

Acquisition of Healthworx — — — — — ( 1,296,553 ) ( 1,296,553 )

Exercise of stock options 260,410 26 706,379 — — — 706,405

Stock based compensation, net of tax settled in shares 92,033 9 1,778,001 — — — 1,778,010

Net income attributable to noncontrolling interests — — — — — 3,354,886 3,354,886

Foreign currency translation — — — — 405,778 — 405,778

Net loss attributable to stockholders of DocGo Inc.

and Subsidiaries

— — — ( 2,011,267 ) — — ( 2,011,267 )

Balance - June 30, 2023 103,762,092 $ 10,376 $ 312,101,281 $ ( 33,729,702 ) $ 1,390,642 $ 4,087,982 $ 283,860,579

Common Stock Additional

16 unchanged sentences

Balance - March 31, 2024 102,961,495 $ 10,297 $ 320,135,875 $ ( 10,166,861 ) $ 1,344,771 $ 3,752,019 $ 315,076,101

Common stock repurchased ( 1,395,957 ) ( 140 ) ( 4,904,312 ) — — — ( 4,904,452 )

Stock-based compensation 181,136 18 2,417,092 — — — 2,417,110

Shares withheld for taxes ( 64,334 ) ( 7 ) ( 245,379 ) — — — ( 245,386 )

Exercise of stock options 430 — 684 — — — 684

Net loss attributable to noncontrolling interests — — — — — ( 671,029 ) ( 671,029 )

Dividends paid to noncontrolling interest — — — — — ( 250,000 ) ( 250,000 )

Foreign currency translation — — — — 33,973 — 33,973

Net income attributable to stockholders of DocGo Inc.

and Subsidiaries

— — — 6,529,603 — — 6,529,603

Balance - June 30, 2024 101,682,770 $ 10,168 $ 317,403,960 $ ( 3,637,258 ) $ 1,378,744 $ 2,830,990 $ 317,986,604

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

1 unchanged sentence

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss) $ 16,461,953 $ ( 2,575,171 )

Adjustments to reconcile net income (loss) to net cash used in operating activities:

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

Depreciation of property and equipment 2,907,965 3,072,647

15 unchanged sentences

Accrued liabilities ( 27,996,715 ) 1,198,399

Net cash used in operating activities ( 10,639,744 ) ( 23,117,951 )

Net cash provided by (used in) operating activities 26,416,562 ( 12,424,782 )

CASH FLOWS FROM INVESTING ACTIVITIES:

2 unchanged sentences

Acquisition of businesses — ( 20,203,464 )

Equity method investments ( 148,487 ) —

Proceeds from disposal of property and equipment 82,713 277,238

5 unchanged sentences

Due to seller ( 3,863 ) ( 2,556,188 )

Earnout payments on contingent liabilities ( 1,600,029 ) —

Dividends paid to noncontrolling interest ( 250,000 ) —

Proceeds from exercise of stock options 684 1,123,295

4 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents ( 74,527 ) 685,076

Net decrease in cash and restricted cash ( 13,324,123 ) ( 36,590,356 )

Net increase (decrease) in cash and restricted cash 13,605,408 ( 40,348,312 )

Cash and restricted cash at beginning of period 72,217,986 164,109,074

3 unchanged sentences

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

Supplemental disclosure of cash and non-cash transactions:

5 unchanged sentences

Fixed assets acquired in exchange for notes payable $ — $ 623,017

Supplemental non-cash investing activity:

Acquisition of business funded by acquisition payable $ — $ 19,473,805

Supplemental non-cash investing and financing activities:

Acquisition of remaining FMC NA through due to seller and issuance of stock $ — $ 7,000,000

Acquisition of CRMS $ — $ 1,000,000

Pre-acquisition receivables written off through due to seller $ 3,360,067 $ —

Reconciliation of cash and restricted cash

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Ambulnz is the sole owner of Ambulnz Holdings, LLC (“Holdings”), which was formed in the state of Delaware on August 5, 2015 as a limited liability company.

Holdings is the owner of multiple operating entities incorporated in various states in the U.S.

as well as within England and Wales, U.K.

The Company is a mobile healthcare services company that uses proprietary dispatch and communication technology to help provide (i) quality mobile, in-person medical treatment directly to patients in the comfort of their homes, workplaces and other non-traditional locations and (ii) healthcare transportation in major metropolitan cities in the United States (“U.S.”) and the United Kingdom (“U.K.”).

Holdings is the owner of multiple operating entities incorporated in various states in the United States (“U.S.”) as well as within England and Wales, United Kingdom (“U.K.”).

The Company conducts business in three operating segments:

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GAAP have been condensed or omitted pursuant to such rules and regulations.

As such, the information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2023.

As such, the information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

The Consolidated Balance Sheet as of December 31, 2023 included herein was derived from the audited financial statements as of that date but does not include all disclosures including notes required by U.S.

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Further, Ambulnz was determined to be the accounting acquirer in the transaction, and as such, the acquisition is considered a business combination under Accounting Standards Codification (“ASC”) Topic 805, Business Combinations (“ASC 805”) and was accounted for using the acquisition method of accounting.

In accordance with ASC 810, Consolidation (“ASC 810”), the Company assesses whether it has a variable interest in legal entities in which it has a financial relationship and, if so, whether or not those entities are VIEs.

In accordance with ASC 810, Consolidation (“ASC 810”), the Company assesses whether it has a variable interest in legal entities in which it has a financial interest and, if so, whether or not those entities are VIEs.

For those entities that qualify as VIEs, ASC 810 requires the Company to determine if the Company is the primary beneficiary of the VIE, and if so, to consolidate the VIE.

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The Company has determined that it is the primary beneficiary of its VIEs and therefore appropriately consolidates its VIEs.

Net loss for the Company's VIEs was $ 275,905 and $ 186,637 for the three months ended March 31, 2024 and 2023, respectively.

The total assets amounted to $ 5,364,950 and $ 4,364,274 as of March 31, 2024 and December 31, 2023, respectively.

Total liabilities were $ 6,088,439 and $ 4,811,857 as of March 31, 2024 and December 31, 2023, respectively.

The Company's VIEs' total stockholders’ deficit was $ 723,489 and $ 447,583 as of March 31, 2024 and December 31, 2023, respectively.

Net income (loss) for the Company’s VIEs was $( 81,978 ) and $ 306,854 for the three months ended June 30, 2024 and 2023, respectively and $( 357,883 ) and $ 120,217 for the six months ended June 30, 2024 and 2023, respectively.

Total assets amounted to $ 6,798,202 and $ 4,364,274 as of June 30, 2024 and December 31, 2023, respectively.

Total liabilities were $ 7,603,668 and $ 4,811,857 as of June 30, 2024 and December 31, 2023, respectively.

The Company’s VIEs’ total stockholders’ deficit was $ 805,466 and $ 447,583 as of June 30, 2024 and December 31, 2023, respectively.

and Subsidiaries

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The Company’s functional currency is the U.S.

The functional currency of our foreign operation is the British pound.

Assets and liabilities of foreign operations denominated in local currencies are translated at the spot rate in effect at the applicable reporting date, except for equity accounts, which are translated at historical rates.

The unaudited Condensed Consolidated Statements of Operations and Comprehensive Income are translated at the weighted average rate of exchange during the applicable period.

The resulting unrealized cumulative translation adjustment for the three months ended March 31, 2024 and 2023 were $( 140,134 ) and $ 243,658 , respectively.

The functional currency of the Company’s foreign operation is the British pound.

Assets and liabilities of the Company’s foreign operation denominated in the British pound are translated at the spot rate in effect at the applicable reporting date, except for equity accounts, which are translated at historical rates.

The unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) are translated at the weighted average rate of exchange during the applicable period.

The resulting unrealized cumulative translation adjustment for the three months ended June 30, 2024 and 2023 were $ 33,973 and $ 405,778 , respectively, and $( 106,161 ) and $ 649,436 for the six months ended June 30, 2024 and 2023, respectively.

Use of Estimates

2 unchanged sentences

and the reported amounts of expenses during the reporting period.

The most significant estimates in the Company’s financial statements relate to revenue recognition related to the allowance for doubtful accounts, stock-based compensation, calculations related to the incremental borrowing rate for the Company’s lease agreements, estimates related to ongoing lease terms, software development costs, impairment of long-lived assets, goodwill and indefinite-lived intangible assets, business combinations, reserve for losses within the Company’s insurance deductibles, income taxes and deferred income tax.

The most significant estimates in the Company’s financial statements relate to revenue recognition related to the allowance for credit loss, stock-based compensation, calculations related to the incremental borrowing rate for the Company’s lease agreements, estimates related to ongoing lease terms, software development costs, impairment of long-lived assets, goodwill and indefinite-lived intangible assets, business combinations, reserve for losses within the Company’s insurance deductibles, income taxes and deferred income tax.

These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources.

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Major Customers

The Company had one customer that accounted for approximately 39 % of revenues and 34 % of net accounts receivable and another customer that accounted for 32 % of revenues and 46 % of net accounts receivable for the three months ended March 31, 2024.

The Company had one customer that accounted for approximately 46 % of revenues and 62 % of net accounts receivable for the three months ended March 31, 2023.

The Company had one vendor that accounted for approxi mately 18 % and 18 % of total cost for the three months ended March 31, 2024 and 2023, respectively.

The Company expects to maintain th is relationship with the vendor and believes the services provided by this vendor are available from alternative sources.

The Company had one customer that accounted for approximately 37 % of revenues and 32 % of net accounts receivable and another customer that accounted for 31 % of revenues and 47 % of net accounts receivable for the three months ended June 30, 2024.

The Company had one customer that accounted for approximately 35 % of revenues and 47 % of net accounts receivable and another customer that accounted for 35 % of revenues and 32 % of net accounts receivable for the six months ended June 30, 2024.

The Company had one customer that accounted for approximately 36 % of revenues and 36 % of net accounts receivable for the three months ended June 30, 2023 and one customer that accounted for approximately 41 % of revenues and 36 % of net accounts receivable for the six months ended June 30, 2023.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company had one vendor that accounted for approximately 18 % and 13 % of total cost for the three months ended June 30, 2024 and 2023, respectively.

The Company expects to maintain this relationship with the vendor and believes the services provided by this vendor are available from alternative sources.

The Company had one vendor that accounted for approximately 18 % and 11 % of total cost for the six months ended June 30, 2024 and 2023, respectively.

The Company expects to maintain this relationship with the vendor and believes the services provided from this vendor are available from alternative sources.

Reclassifications

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are insured by the FDIC and are in excess of FDIC insured limits.

The Company had cash balances of approximately $ 5,047,684 and $ 3,699,793 with foreign financial institutions on March 31, 2024 and December 31, 2023, respectively.

The Company had cash balances of approximatel y $ 3,811,469 an d $ 3,699,793 with foreign financial institutions on June 30, 2024 and December 31, 2023, respectively.

Restricted Cash

1 unchanged sentence

Restricted cash is classified as either a current or non-current asset depending on the restriction period.

The Company is required to pledge or otherwise restrict a portion of cash and cash equivalents as collateral for self-insurance exposures, transportation equipment leases and a standby letter of credit as required by its insurance carrier (see Notes 9 and 14).

The Company is required to pledge or otherwise restrict a portion of cash and cash equivalents as collateral for self-insurance exposures and a standby letter of credit as required by its insurance carrier (see Note 9).

The Company utilizes a combination of insurance and self-insurance programs, including a wholly owned captive insurance entity, to provide for the potential liabilities for certain risks, including workers’ compensation, automobile liability, general liability and professional liability.

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As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The accounting guidance classifies fair value measurements in one of the following three categories for disclosure purposes:

2 unchanged sentences

Unobservable inputs that are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management as of March 31, 2024 and December 31, 2023.

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2024 and December 31, 2023.

For certain financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, restricted cash, accounts payable, accrued expenses, and due to seller, the carrying amounts approximate their fair values as they are short term in nature.

1 unchanged sentence

Level 3 instruments are valued based on unobservable inputs that are supported by little or no market activity and reflect the Company’s own assumptions in measuring fair value.

Future changes in fair value of the contingent financial milestone consideration, as a result of changes in significant inputs such as the discount rate and estimated probabilities of financial milestone achievements, could have a material effect on the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income and Condensed Consolidated Balance Sheets in the period of the change.

Future changes in fair value of the contingent consideration, as a result of changes in significant inputs such as the discount rate and estimated probabilities of financial milestone achievements, could have a material effect on the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and Condensed Consolidated Balance Sheets in the period of the change.

In connection with the acquisition of Ryan Bros.

Fort Atkinson, LLC (“Ryan Brothers”), the Company recorded $ 4,000,000 in contingent consideration to be paid based on the completion of certain performance obligations over a 24-month period.

The Company recorded a change in fair value of contingent consideration in the amount of $ 7,284 and $ 0 for the three months ended March 31, 2024 and 2023, respectively.

There was a remaining contingent liability balance of $ 1,828,302 and $ 1,821,018 as of March 31, 2024 and December 31, 2023, respectively (see Note 4).

The Company recorded a change in fair value of contingent consideration in the amount of $ 45,319 and $ 0 for the three months ended June 30, 2024 and 2023, respectively, and $ 52,603 and $ 0 for the six months ended June 30, 2024 and 2023, respectively.

There was a remaining contingent liability balance of $ 1,873,621 and $ 1,821,018 as of June 30, 2024 and December 31, 2023, respectively (see Note 4).

In connection with the acquisition of Exceptional Medical Transportation, LLC (“Exceptional”), the Company also agreed to pay up to $ 2,000,000 in contingent consideration upon meeting certain performance conditions within two years of the closing date of such acquisition.

The Company recorded a change in fair value of contingent consideration in the amount of $( 13,730 ) and $ 0 for the three months ended March 31,2024 and 2023, respectively.

There was a remaining contingent liability balance of $ 265,571 and $ 279,301 as of March 31, 2024 and December 31, 2023, respectively (see Note 4).

The Company recorded a change in fair value of contingent consideration in the amount of $( 11,100 ) and $ 0 for the three months ended June 30, 2024 and 2023, respectively, and $( 24,830 ) and $ 0 for the six months ended June 30, 2024 and 2023, respectively.

There was a remaining contingent liability balance of $ 254,471 and $ 279,301 as of June 30, 2024 and December 31, 2023, respectively (see Note 4).

In connection with the acquisition of Location Medical Services, LLC (“LMS”), the Company recorded $ 2,475,540 in contingent consideration to be paid upon LMS meeting certain performance conditions in 2023.

The Company did not record a change in fair value of contingent consideration for the three months ended March 31, 2024 and 2023, but recorded $( 4,799 ) and $ 50,542 as a result of foreign exchange movement for the three months ended March 31, 2024 and 2023, respectively .

There was a remaining contingent liability balance of $ 600,029 and $ 604,827 as of March 31, 2024 and December 31, 2023 , respectively (see Note 4).

In connection with the acquisition of Cardiac RMS, LLC (“CRMS”), the Company recorded $ 15,822,190 in contingent consideration to be paid out over 36 months for the remaining 49 % equity of CRMS, based on CRMS’ attainment of full-year EBITDA targets.

The Company did not record a change in fair value of contingent consideration for the three months ended March 31, 2024 and 2023, respectively.

There was a remaining contingent liability balance of $ 17,087,835 as of March 31, 2024 and December 31, 2023 (see Note 4).

The Company did no t record a change in fair value of contingent consideration for the three and six months ended June 30, 2024 and 2023.

The Company made a payment of $ 600,029 for the three and six months ended June 30, 2024 and recorded foreign exchange movem ents of $ 0 and $ 61,022 for the three months ended June 30, 2024 and 2023, respectively, and $( 4,798 ) and $ 111,564 for the six months ended June 30, 2024 and 2023, respectively .

There was a remaining contingent liability bal ance of $ 0 and $ 604,827 as of June 30, 2024 and December 31, 2023 , respectively (see Note 4).

In connection with the acquisition of Cardiac RMS, LLC (“CRMS”), the Company recorded $ 15,822,190 in contingent consideration, consisting of an estimated true-up payment of $ 2,088,243 to be paid in 2024 based on the attainment of full-year 2023 EBIDTA targets and estimated earn out payments amounting to $ 13,733,947 .

The earn out payments are to be paid out over 36 months, beginning in 2025, for the remaining 49 % equity of CRMS, based on CRMS’ attainment of full-year EBITDA targets.

The Company made a true-up payment of $ 1,000,000 for the three and six months ended June 30, 2024 and recorded a change in fair value of contingent consideration in the amount of $ 298,419 for the three and six months ended June 30, 2024, respectively, and $ 0 for the three and six months ended June 30, 2023.

There was a remaining contingent liability balance of $ 16,386,254 and $ 17,087,835 as of June 30, 2024 and December 31, 2023, respectively (see Note 4).

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Accounts Receivable

The Company contracts with hospitals, healthcare facilities, businesses, state and local government entities, and insurance providers to provide Mobile Health Services and to transport patients at specified rates.

These rates are either on a per procedure or per transport basis, or on an hourly or daily basis.

1 unchanged sentence

Billings typically are either paid or settled on the patient’s behalf by health insurance providers, managed care organizations, treatment facilities, government sponsored programs or businesses or patients directly.

Accounts receivable are net of insurance provider contractual allowances, which are estimated at the time of billing based on contractual terms or other arrangements.

Accounts receivable are periodically evaluated for collectability based on past credit history with payors and their current financial condition.

Changes in the estimated collectability of accounts receivable are recorded in the results of operations for the period in which the estimate is revised.

Accounts receivable deemed uncollectible are offset against the allowance for uncollectible accounts.

The Company generally does not require collateral for accounts receivable .

Accounts receivable are net of insurance provider contractual allowances, which are estimated at the time of billing based on contractual terms or other arrangements.

The Company maintains an allowance for credit losses for accounts receivable, net which is recorded as an offset to accounts receivable, net and changes in this allowance are recorded within general and administrative expenses in the unaudited Consolidated Statements of Operations and Comprehensive Income (Loss).

The carrying amount of accounts receivable represents the maximum credit risk exposure of these assets.

On a quarterly basis, in accordance with FASB ASC 326, Measurement of Credit Losses on Financial Instruments (“ASC 326”), the Company evaluates the collectability of outstanding accounts receivable balances to determine an allowance for credit loss that reflects its best estimate of the lifetime expected credit losses.

Individual uncollectible accounts are written off against the allowance when collection of the individual account does not appear probable.

Under the current expected credit loss impairment model, the Company develops and documents its allowance for credit losses on its trade receivables based on a single portfolio segment.

The Company assesses collectability by aggregating and reviewing accounts receivable on a collective basis for customers that share similar risk characteristics.

Additionally, when accounts receivable do not share risk characteristics with other accounts receivables, management will evaluate such accounts receivable for expected credit loss on an individual specific identification basis when the Company identifies specific customers with known disputes or collectability issues.

Due to the short-term nature of the Company’s accounts receivables, the estimate of expected credit loss is based on the aging of accounts using an aging schedule as of period ends.

In determining the amount of the allowance for credit losses, the Company considers historical collection history based on past due status, the current aging of receivables, customer-specific credit risk factors including their current financial condition, current market conditions, and probable future economic conditions which inform adjustments to historical loss patterns.

As of January 1, 2024, the Company held a beginning balance in its allowance for credit losses on accounts receivable of $ 6,276,454 .

The Company recognized an additional provision for credit losses of $ 2,164,318 and write offs of $ 2,177,717 during the year.

The Company’s balance in its allowance for credit losses amounted to $ 6,263,055 as of June 30, 2024.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation and amortization.

When an item is sold or retired, the costs and related accumulated depreciation or amortization are eliminated, and the resulting gain or loss, if any, is recorded in operating expenses in the unaudited Condensed Consolidated Statement of Operations and Comprehensive

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company provides for depreciation and amortization using the straight-line method over the estimated useful lives of the respective assets.

8 unchanged sentences

Expenditures that improve an asset or extend its estimated useful life are capitalized.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Software Development Costs

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The Company evaluates the recoverability of the recorded amount of long-lived assets, primarily property and equipment and finite-lived intangible assets, whenever events or changes in circumstance indicate that the recorded amount of an asset may not be fully recoverable.

An impairment is assessed when the undiscounted expected future cash flows derived from

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

an asset are less than its carrying amount.

An impairment is assessed when the undiscounted expected future cash flows derived from an asset are less than its carrying amount.

If an asset is determined to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value.

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or (iv) a sustained decrease in the Company’s market capitalization, as indicated by its publicly quoted share price, below its net book value.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Line of Credit

2 unchanged sentences

The Company defines related parties as affiliates of the Company, entities for which investments are accounted for by the equity method, trusts for the benefit of employees, principal owners (beneficial owners of more than 10 % of the voting interest), management, members of immediate families of principal owners or management and other parties with which the Company may deal with if one party controls or can significantly influence management or the operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.

Related party transactions are recorded within operating expenses in the Company’s unaudited Condensed Consolidated Statement of Operations and Comprehensive Income.

For details regarding the related party transactions that occurred during the three months ended March 31, 2024 and 2023 refer to Note 16.

Related party transactions are recorded within operating expenses in the Company’s unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

For details regarding the related party transactions that occurred during the three and six months ended June 30, 2024 and 2023 refer to Note 16.

Revenue Recognition

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The Company has utilized the “right to invoice” expedient, which allows an entity to recognize revenue in the amount of consideration to which the entity has the right to invoice when the amount that the Company has the right to invoice corresponds directly to the value transferred to the customer.

Revenues are recorded net of estimated contractual allowances for claims subject to contracts with responsible paying entities.

The Company estimates contractual allowances at the time of billing based on contractual terms, historical collections or other arrangements.

All transaction prices are fixed and determinable, which includes a fixed base rate, fixed mileage rate and an evaluation of historical collections by each payor.

Nature of Our Services

The transaction price associated with the Company’s contracts with customers is generally determined based on fixed and determinable amounts of consideration as specified in a contract, which includes a fixed base rate and/or fixed mileage rate.

For Transportation Services arrangements with billings to third party payors and healthcare facilities, this may also include variable consideration in instances where it is considered probable that a significant reversal of cumulative revenue recognized will not occur.

For these services, revenues are recorded net of estimated contractual allowances for claims subject to contracts with responsible paying entities.

The Company estimates contractual allowance at the time of billing based on contractual terms, historical collections or other arrangements.

The Company also estimates the amount unbilled at month end and recognizes such amounts as revenue, based on available data and customer history.

The Company utilizes the expected value method when estimating its variable consideration.

The assumptions utilized in estimating variable consideration include the Company’s previous experience with similar contracts and history of collection rates on prior trips that have been performed.

The Company reevaluates its variable consideration at each reporting period.

Nature of the Company’s Services

Revenue is primarily derived from:

1 unchanged sentence

These services include a wide variety of healthcare services performed at homes, offices and other locations and event services such as on-site healthcare support at sporting events and concerts.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

segment also provides total care management solutions to large, typically underserved population groups, primarily through arrangements with municipalities, which include healthcare services as well as ancillary services, such as shelter.

This segment also provides total care management solutions to large, typically underserved population groups, primarily through arrangements with municipalities, which include healthcare services as well as ancillary services, such as shelter.

Transportation Services :

1 unchanged sentence

Non-emergency transport services include ambulance transports and wheelchair transports.

Net revenue from Transportation Services is derived from the transportation of patients based on billings to third party payors and healthcare facilities.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

from Transportation Services is derived from the transportation of patients based on billings to third party payors and healthcare facilities.

For Mobile Health Services, the performance of the services and any related support activities in the majority of the Company’s contracts are a single performance obligation under ASC 606.

1 unchanged sentence

The Company also concluded that Transportation Services and any related support activities are a single performance obligation under ASC 606.

The transaction price is determined by the fixed rate usage-based fees or fixed fees that are agreed upon in the Company’s executed contracts.

As the performance associated with such services is known and quantifiable at the end of a period in which the services occurred (i.e., monthly or quarterly), revenues are typically recognized in the respective period performed.

1 unchanged sentence

For large municipal customers in the Mobile Health Services segment, invoices are generally produced on a monthly basis, in arrears, and are generally due within 30-60 days of when they are submitted to the customer.

For Transportation Services, the Company estimates the amount unbilled at month end and recognizes such amounts as revenue, based on available data and customer history.

Since the majority of the Company’s Mobile Health Services and Transportation Services each represent a single performance obligation, allocation is not necessary as the transaction price (fees) for the services provided is standard and explicitly stated in the contractual fee schedule and/or invoice.

The majority of the Company’s Mobile Health Services and Transportation Services each represent a single performance obligation.

Therefore, allocation is not necessary as the transaction price (fees) for the services provided is standard and explicitly stated in the contractual fee schedule and/or invoice.

For contracts with multiple distinct performance obligations, the Company allocates the transaction price based on their agreed-upon price to the individually identified performance obligations in the contract.

3 unchanged sentences

For certain Mobile Health Services that have a fixed fee arrangement and are provided over time, revenue is recognized over time as the services are provided to the customer.

For Transportation Services, since the customer simultaneously receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, the Company satisfies performance obligations at the same time.

For Transportation Services, since the customer simultaneousl y receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, the Company satisfies performance obligations at the same time.

For Transportation Services, where the customer pays fixed rate usage-based fees, the actual usage in the period represents the best measure of progress.

1 unchanged sentence

Revenue Breakdown Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Primary Geographical Markets

6 unchanged sentences

Total revenues $ 164,949,716 $ 125,486,760 $ 357,037,245 $ 238,489,463

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Stock-Based Compensation

4 unchanged sentences

The Company accounts for forfeitures as they occur.

For performance-based awards, expense is recognized over the period from the grant date to the estimated attainment date, which is the derived service period of the award, if management determines that it is probable that the performance-based vesting conditions will be achieved.

All stock-based compensation costs are recorded in operating expenses in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income.

For performance-based awards, expense is recognized over the period from the grant date to the estimated attainment date, which is the derived service period of the award, if management

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

determines that it is probable that the performance-based vesting conditions will be achieved.

All stock-based compensation costs are recorded in operating expenses in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Earnings per Share

1 unchanged sentence

Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue Common Stock were exercised or converted into Common Stock during the reporting periods.

Potential dilutive Common Stock equivalents consist of the incremental shares of Common Stock issuable upon exercise of warrants and the incremental shares issuable upon conversion of stock options.

Potential dilutive Common Stock equivalents consist of the incremental shares of Common Stock issuable upon conversion of stock options, unvested RSUs and PSUs.

In reporting periods in which the Company has a net loss, the effect is considered anti-dilutive and excluded from the diluted earnings per share calculation.

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Net income (loss) attributable to stockholders of DocGo Inc.

12 unchanged sentences

Under the equity method, the Company’s investment is initially measured at cost and subsequently increased or decreased to recognize the Company’s share of income and losses of the investee, capital contributions and distributions and impairment losses.

The Company performs a qualitative assessment annually and recognizes an impairment if there are sufficient indicators that the fair value of the investment is less than carrying value.

The Company periodically reviews the investments for other than temporary declines in fair value below cost or more frequently when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable.

On October 26, 2021, the Company acquired a 50 % interest in RND Health Services Inc.

(“RND”) for $ 655,876 .

During the year ended December 31, 2023, the Company made an additional investment amounting to $ 298,932 .

During the period ended June 30, 2024 and December 31, 2023, the Company made additional investments amounting to $ 148,487 and $ 298,932 , respectively.

The Company’s carrying value in RND, an equity method investee, is reflected in the caption “Equity method investments” in the unaudited Condensed Consolidated Balance Sheets.

Changes in value of RND are recorded in “(Loss) gain on equity method investments” in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Changes in value of RND are recorded in “Loss on equity method investments” in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

On November 1, 2021, the Company acquired a 20 % interest in National Providers Association, LLC (“NPA”) for $ 30,000 .

Effective December 21, 2021, three members withdrew from NPA, resulting in the remaining two members obtaining the remaining ownership percentage.

As of March 31, 2024 and December 31, 2023, the Company owned 50 % of NPA.

As of June 30, 2024 and December 31, 2023, the Company owned 50 % of NPA.

The Company’s carrying value in NPA, an equity method investee, is reflected in the caption “Equity method investments” in the unaudited Condensed Consolidated Balance Sheets.

Changes in value of NPA are recorded in “(Loss) gain on equity method investments” in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income.

Changes in value of NPA are recorded in “Loss on

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

equity method investments” in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

The Company categorizes leases at its inception as either operating or finance leases based on the criteria in ASC 842, Leases (“ASC 842”).

32 unchanged sentences

Property and Equipment, Net

Property and equipment, net as of March 31, 2024 and December 31, 2023 are as follows:

Property and equipment, net as of June 30, 2024 and December 31, 2023 are as follows:

2024 December 31,

8 unchanged sentences

Property and equipment, net $ 15,996,793 $ 16,835,484

During the three months ended March 31, 2024, the Company disposed of assets with a cost of $ 102,079 and accumulated depreciation of $ 61,834 for proceeds of $ 93,080 .

The Company recorded a gain on disposal of assets of $ 52,835 for the three months ended March 31, 2024 .

The Company recorded depreciation expense of $ 1,431,308 and $ 1,482,610 for the three months ended March 31, 2024 and 2023, respectively.

During the six months ended June 30, 2024, the Company disposed of assets with a cost of $ 231,640 and accumulated depreciation of $ 146,245 for proceeds of $ 150,793 .

The Company recorded a gain on disposal of assets of $ 65,398 for the six months ended June 30, 2024.

The Company recorded depreciation expense of $ 1,476,657 and $ 1,590,037 for the three months ended June 30, 2024 and 2023, respectively.

The Company recorded depreciation expense of $ 2,907,965 and $ 3,072,647 for the six months ended June 30, 2024 and 2023, respectively.

Acquisition of Businesses

2 unchanged sentences

The Company also agreed to pay up to $ 2,000,000 in contingent consideration upon meeting certain performance conditions within two years of the closing date of such acquisition.

During the three months ended March 31, 2024, the Company recorded a change in contingent consideration in the amount of $( 13,730 ).

The Company paid $ 3,000,000 of the $ 6,000,000 remaining purchase price payable as of December 31, 2023.

As of June 30, 2024 and December 31, 2023, there was a due to seller balance of $ 3,000,000 .

During the year ended December 31, 2023, the Company made a payment for the first installment due on the contingent liability in the amount of $ 426,655 .

The estimated contingent consideration amount payable for Exceptional was $ 265,571 and $ 279,301 as of March 31, 2024 and December 31, 2023, respectively.

Additionally, the Company paid $ 3,000,000 of the $ 6,000,000 remaining purchase price payable as of December 31, 2023.

As of March 31, 2024 and December 31, 2023, there was a due to seller balance of $ 3,000,000 .

The estimated contingent consideration amount payable for Exceptional was $ 254,471 and $ 279,301 as of June 30, 2024 and December 31, 2023, respectively.

Fort Atkinson, LLC

On August 9, 2022, Holdings acquired 100 % of the outstanding shares of common stock of Ryan Brothers, a provider of medical transportation services, in exchange for an aggregate purchase price of $ 11,422,252 , consisting of $ 7,422,252 in cash at closing and an estimated $ 4,000,000 in contingent consideration to be paid out over 24 months, commencing on August 1, 2022, based on performance of certain obligations.

During the three months ended March 31, 2024, the Company recorded a change in contingent consideration in the amount of $ 7,284 .

During the year ended December 31, 2023, the Company made a payment for the first installment due on the contingent liability in the amount of $ 1,840,026 .

The estimated contingent consideration amount payable for Ryan Brothers was $ 1,828,302 and $ 1,821,018 as of March 31, 2024 and December 31, 2023, respectively.

During the six months ended June 30, 2024, the Company wrote off $ 3,360,067 pre-acquisition accounts receivable through due to seller, the liability established during acquisition.

Additionally, the Company made a payment in the amount of $ 3,863 on the remaining purchase price payable during the six months ended June 30, 2024.

As of June 30, 2024 and December 31, 2023, there was a due to seller balance $ 5,113 and $ 3,369,043 , respectively.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

During the year ended December 31, 2023, the Company made a payment for the first installment due on the contingent liability in the amount of $ 1,840,026 .

The estimated contingent consideration amount payable for Ryan Brothers was $ 1,873,621 and $ 1,821,018 as of June 30, 2024 and December 31, 2023, respectively.

Location Medical Services, LLC

On December 9, 2022, Holdings, through UK Ltd., acquired 100 % of the outstanding shares of common stock of LMS.

On December 9, 2022, Holdings, through its indirect wholly owned subsidiary Ambulnz U.K.

(“UK Ltd.”), acquired 100 % of the outstanding shares of common stock of LMS.

The aggregate purchase price consisted of $ 302,450 in cash consideration.

The Company also agreed to pay LMS an additional $ 11,279,201 in deferred consideration and an estimated $ 2,475,540 in contingent consideration upon LMS meeting certain performance conditions in 2023.

The Company recorded $( 4,799 ) and $ 50,542 in foreign exchange movement during the three months ended March 31, 2024 and 2023, respectively.

The estimated contingent consideration amount payable for LMS was $ 600,029 and $ 604,827 as of March 31, 2024 and December 31, 2023, respectively.

Additionally, the Company paid $ 11,279,201 of deferred consideration to LMS during the year ended December 31, 2023.

As of March 31, 2024 and December 31, 2023, there was no remaining due to seller amounts outstanding.

On April 2, 2024, the Company paid the contingent consideration balance in the amount of $ 600,029 .

As of June 30, 2024 and December 31, 2023, there was no remaining due to seller amounts outstanding.

The Company did not record a change in fair value of contingent consideration for the three and six months ended June 30, 2024 and 2023 , but recorded foreign exchange movements of $ 0 and $ 61,022 for the three months ended June 30, 2024 and 2023, respectively, and $( 4,798 ) and $ 111,564 for the six months ended June 30, 2024 and 2023, respectively.

On April 2, 2024, the Company paid the remaining contingent consideration balance in the amount of $ 600,029 .

The estimated contingent consideration amount payable for LMS was $ 0 and $ 604,827 as of June 30, 2024 and December 31, 2023, respectively.

Cardiac RMS, LLC

1 unchanged sentence

The closing consideration of $ 10,000,000 consisted of $ 9,000,000 in cash and $ 1,000,000 worth of shares of Common Stock issued in a private placement transaction.

A further probable consideration of $ 15,822,190 is to be paid out over 36 months following the closing of the transaction for the remaining 49 % equity of CRMS, based on CRMS’ attainment of full-year EBITDA targets.

The Company also agreed to pay additional consideration following the initial closing, consisting of an estimated true-up payment of $ 2,088,243 to be paid in 2024 based on the attainment of full-year 2023 EBITDA targets (the “True-up Payment”) and estimated earn out payments amounting to $ 13,733,947 .

The earn out payments are to be paid out over 36 months, beginning in 2025, for the remaining 49 % equity of CRMS, based on CRMS’ attainment of full-year EBITDA targets.

$ 5,000,000 of such further probable consideration is to be paid in cash and the remaining $ 10,822,190 is to be paid in shares of Common Stock.

Acquisition costs are included in general and administrative expenses and totaled $ 229,937 for the year ended December 31, 2023.

During the year ended December 31, 2023, the Company recorded a change in contingent consideration in the amount of $ 1,265,645 .

As of March 31, 2024 and December 31, 2023, there was a remaining contingent liability balance of $ 17,087,835 .

The Company recorded a change in fair value of contingent consideration in the amount of $ 298,419 and $ 0 for the three and six months ended June 30, 2024, respectively, and $ 0 for the three and six months ended June 30, 2023.

During the six months ended June 30, 2024, the Company paid a portion of the True-up Payment in the amount of $ 1,000,000 .

The estimated contingent consideration amount payable for CRMS was $ 16,386,254 and $ 17,087,835 as of June 30, 2024 and December 31, 2023, respectively.

Ambulnz-FMC North America LLC

2 unchanged sentences

Healthworx LLC

On May 10, 2023, the Company acquired the remaining outstanding shares of common stock of Healthworx LLC (“Healthworx”), a provider of management, administration and support services to service providers focused on medical testing and diagnostic screening, from its joint venture with Rapid Reliable Testing, LLC (“RRT”) in exchange for $ 1,385,156 in cash.

The following table presents the assets acquired and liabilities assumed at the date of the acquisitions:

24 unchanged sentences

Total purchase price $ 7,000,000 $ 25,822,190 $ 14,057,191 $ 11,422,252 $ 14,788,333 $ 73,089,966

There were no new acquisitions for the three months ended March 31, 2024.

There were no new acquisitions during the six months ended June 30, 2024.

and Subsidiaries

1 unchanged sentence

Pro Forma Disclosures

The following unaudited pro forma combined financial information for the three months ended March 31, 2023 gives effect to the acquisitions disclosed above as if they had occurred on January 1, 2023.

The following unaudited pro forma combined financial information for the three and six months ended June 30, 2023 gives effect to the acquisitions disclosed above as if they had occurred on January 1, 2023.

The pro forma information is not necessarily indicative of the results of operations that actually would have occurred under the ownership and management of the Company.

Three Months Ended March 31, 2023

The figures presented below for the three months ended June 30, 2023 represent the actual results of the Company, as the financial results of CRMS were consolidated in the Company’s results of operations for the entirety of the period.

Three Months Ended June 30, 2023 Six Months Ended June 30, 2023

Revenue $ 125,486,760 $ 241,603,082

Net loss ( 2,879,996 )

Net income (loss)

1,343,619 ( 1,536,377 )

The unaudited pro forma combined financial information presented above includes the accounting effects of the acquisitions, including, to the extent applicable, amortization charges from acquired intangible assets, depreciation of property and equipment that have been revalued, transaction costs, interest expense and the related tax effects.

There were no new acquisitions for the three months ended March 31, 2024.

There were no new acquisitions during the six months ended June 30, 2024.

ABC Transaction and Held for Sale

4 unchanged sentences

Prior to commencing the ABC, Health ceased business operations and all of its employees were terminated and treated in accordance with California law.

In the ABC, all of Health’s assets were transferred to the Assignee, who acted as a fiduciary for creditors and in a capacity equivalent to that of a bankruptcy trustee.

The Assignee was responsible for liquidating the assets.

In the ABC, all of Health’s assets were transferred to the Assignee, who acts as a fiduciary for creditors and in a capacity equivalent to that of a bankruptcy trustee.

The Assignee is responsible for liquidating the assets.

Similar to a bankruptcy case, there was a claims process.

4 unchanged sentences

The Company recorded an aggregate of $ 8,642,190 in goodwill in connection with its acquisitions in the year ended December 31, 2023.

The Company also updated the carrying value of the goodwill in its unaudited Condensed Consolidated Balance Sheets to reflect the currency translation adjustment.

The carrying value of goodwill amounted to $ 47,489,759 as of March 31, 2024.

The changes in the carrying value of goodwill for the three months ended March 31, 2024 are as noted in the table below:

The Company also updated the carrying value of the goodwill in its unaudited Condensed Consolidated Balance Sheets to

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

reflect the currency translation adjustment.

The carrying value of goodwill amounted to $ 47,505,110 as of June 30, 2024.

The changes in the carrying value of goodwill for the six months ended June 30, 2024 are as noted in the table below:

Carrying Value

1 unchanged sentence

Currency translation adjustment ( 34,819 )

Balance as of March 31, 2024 $ 47,489,759

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Intangible assets consisted of the following as of March 31, 2024 and December 31, 2023:

March 31, 2024

Balance as of June 30, 2024 $ 47,505,110

Intangible assets consisted of the following as of June 30, 2024 and December 31, 2023:

June 30, 2024

Estimated Useful

33 unchanged sentences

$ 30,180,863 $ 19,971,661 $ ( 12,469,596 ) $ 37,682,928

The intangible assets include an immaterial foreign currency translation adjustment in the amount of $( 3,050 ) for the three months ended March 31, 2024.

The intangible assets include an immaterial foreign currency translation adjustment in the amount of $( 1,744 ) for the six months ended June 30, 2024.

Intangible asset balances are translated into U.S.

dollars using exchange rates in effect at period end, and adjustments related to foreign currency translation are included in other comprehensive income.

The Company recorded amortization expense of $ 1,694,983 and $ 1,365,636 for the three months ended March 31, 2024 and 2023, respectively.

The Company recorded amortization expense of $ 1,583,871 and $ 1,414,944 for the three months ended June 30, 2024 and 2023, respectively.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Future amortization expense at March 31, 2024 for the next five years and in the aggregate are as follows:

The Company recorded amortization expense of $ 3,278,854 and $ 2,780,580 for the six months ended June 30, 2024 and 2023, respectively.

Future amortization expense at June 30, 2024 for the next five years and in the aggregate are as follows:

2024, remaining $ 1,994,840

6 unchanged sentences

Accrued Liabilities

Accrued liabilities consisted of the following as of March 31, 2024 and December 31, 2023:

Accrued liabilities consisted of the following as of June 30, 2024 and December 31, 2023:

2024 December 31,

Accrued subcontractors $ 19,039,490 $ 37,858,755

Accrued general expenses 19,644,487 27,001,232

Accrued workers' compensation and other insurance liabilities $ 18,506,513 $ 12,881,902

Accrued general expenses 17,391,125 27,001,232

Accrued subcontractors 14,170,036 37,858,755

Accrued payroll 8,082,188 6,464,192

3 unchanged sentences

Line of Credit

On November 1, 2022, the Company entered into a credit agreement (the "Credit Agreement") with two banks, with one bank in the capacity as a lender and the administrative agent (collectively with the other lender, the “Lenders”).

On November 1, 2022, the Company entered into a credit agreement (as amended, the “Credit Agreement”) with two banks, with one bank in the capacity as a lender and the administrative agent (collectively with the other lender, the “Lenders”).

The Credit Agreement provides for a revolving credit facility in the initial aggregate principal amount of $ 90,000,000 (the “Revolving Facility”).

9 unchanged sentences

The Company drew down an additional $ 15,000,000 on February 8, 2024 under the Revolving Facility.

On February 27, 2024, the Company paid the $ 40,000,000 line of credit balance.

On February 27, 2024, the Company paid the $ 40,000,000 Revolving Facility balance.

On March 4, 2024, the Company drew down $ 15,000,000 and made an additional $ 15,000,000 draw on March 18, 2024.

As of March 31, 2024, the outstanding balance of the line of credit was $ 30,000,000 and the unused line of credit was $ 60,000,000 .

The Company incurred $ 449,099 and $ 0 in interest charges relating to its line of credit for the three months ended March 31, 2024 and 2023, respectively, which is reflected in interest income (expense) on the Company's unaudited Condensed Consolidated Statements of Operations and Comprehensive Income.

As of June 30, 2024, the outstanding balance of the Revolving Facility was $ 30,000,000 and the unused portion of the Revolving Facility was $ 60,000,000 .

The Company incurred $ 588,588 and $ 0 in interest charges relating to its Revolving Facility for the three months ended June 30, 2024 and 2023, respectively, and $ 1,037,687 and $ 0 for the six months ended June 30, 2024 and 2023, respectively, which is reflected in interest income (expense) on the Company's unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Standby Letter of Credit

On October 20, 2023, the Company obtained an unconditional and irrevocable letter of credit from a financial institution in the amount of $ 1,080,000 .

The letter of credit expires on the one-year anniversary of the closing date, or October 20, 2024, and is renewed automatically for successive one-year periods, unless earlier terminated by the institution.

As of June 30, 2024, no amounts had been drawn.

Notes Payable

8 unchanged sentences

Total non-current portion of notes payable $ 27,329 $ 41,586

Interest expense was $ 883 and $ 29,034 for the three months ended March 31, 2024 and 2023, respectively.

Future minimum annual maturities of notes payable as of March 31, 2024 are as follows:

Interest expense was $ 545 and $ 32,375 for the three months ended June 30, 2024 and 2023, respectively.

Interest expense was $ 1,428 and $ 61,409 for the six months ended June 30, 2024 and 2023, respectively.

Future minimum annual maturities of notes payable as of June 30, 2024 are as follows:

Notes Payable

14 unchanged sentences

The Company’s Chief Executive Officer and Chief Financial Officer evaluate the Company’s financial information and resources and assess the performance of these resources by revenue stream and by operating income or loss performance.

The accounting policies of the segments are the same as the accounting policies of the Company as a whole.

The Company evaluates the performance of its Mobile Health Services, Transportation Services and Corporate segments based primarily on results of operations.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The accounting policies of the segments are the same as the accounting policies of the Company as a whole.

The Company evaluates the performance of its Mobile Health Services, Transportation Services and Corporate segments based primarily on results of operations.

Operating results for the business segments of the Company are as follows:

2 unchanged sentences

Services Corporate Total

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Revenues $ 116,742,328 $ 48,207,388 $ — $ 164,949,716

5 unchanged sentences

Capital expenditures 127,595 3,822,946 868,312 4,818,853

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

Revenues $ 80,064,609 $ 45,422,151 $ — $ 125,486,760

5 unchanged sentences

Capital expenditures 806,681 3,268,147 720,659 4,795,487

Mobile Health

Services Transportation

Services Corporate Total

Six Months Ended June 30, 2024

Revenues $ 260,683,486 $ 96,353,759 $ — $ 357,037,245

Income (loss) from operations 58,236,268 ( 1,078,666 ) ( 31,133,086 ) 26,024,516

Total assets 378,083,028 66,508,021 43,574,638 488,165,687

Depreciation and amortization expense 2,384,079 4,142,403 1,857,957 8,384,439

Stock compensation 3,235,175 194,073 3,171,021 6,600,269

Long-lived assets 44,869,140 67,436,529 10,622,310 122,927,979

Capital expenditures 256,785 7,031,028 1,666,525 8,954,338

Six Months Ended June 30, 2023

Revenues $ 153,011,367 $ 85,478,096 $ — $ 238,489,463

Income (loss) from operations 31,159,245 433,522 ( 36,919,400 ) ( 5,326,633 )

Total assets 142,049,757 121,884,046 126,352,242 390,286,045

Depreciation and amortization expense 1,918,310 3,803,939 1,758,141 7,480,390

Stock compensation 299,822 475,605 11,025,711 11,801,138

Long-lived assets 48,454,044 66,188,807 11,418,092 126,060,943

Capital expenditures 26,539,244 13,632,633 2,467,347 42,639,224

Long-lived assets include property and equipment, goodwill, intangible assets, operating lease right-of-use assets and finance lease right-of-use assets.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Geographic Information

The following table summarizes long-lived assets by geographic location for the three months ended March 31, 2024 and 2023:

2024 March 31,

The following table summarizes long-lived assets by geographic location as of June 30, 2024 and December 31, 2023:

2024 December 31, 2023

Primary Geographical Markets

8 unchanged sentences

The 2022 Program, which did not obligate the Company to repurchase a specific number of shares, expired on November 24, 2023.

On January 31, 2024, the Company's Board of Directors authorized a new share repurchase program pursuant to which the Company may purchase up to $ 36,000,000 in shares of Common Stock during a six-month period ending July 30, 2024 (the "Repurchase Program").

The Repurchase Program does not obligate the Company to repurchase a specific number of shares.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Under the terms of the Repurchase Program, the Company may purchase shares of Common Stock on a discretionary basis from time to time through open market repurchases or privately negotiated transactions or through other means, including by entering into Rule 10b5-1 trading plans or accelerated share repurchase programs, in each case, during an “open window” and when the Company does not possess material non-public information.

The timing, manner, price and amount of shares repurchased under the Repurchase Program will depend on a variety of factors, including stock price, trading volume, market conditions, corporate and regulatory requirements and other general business considerations.

The Repurchase Program may be modified, suspended or discontinued at any time without prior notice.

Repurchases under the Repurchase Program may be funded from the Company’s existing cash and cash equivalents, future cash flow or proceeds of borrowings or debt offerings.

During the three months ended March 31, 2024, the Company repurchased and subsequently cancelled 1,255,614 shares of Common Stock for $ 4,877,559 .

On January 30, 2024, the Board of Directors authorized a new share repurchase program to purchase up to $ 36,000,000 in shares of Common Stock during a six-month period that ended July 30, 2024 (the “Repurchase Program”).

The Repurchase Program did not obligate the Company to repurchase a specific number of shares.

Under the terms of the Repurchase Program, the Company could purchase shares of Common Stock on a discretionary basis from time to time through open market repurchases or privately negotiated transactions or through other means, including by entering into Rule 10b5-1 trading plans or accelerated share repurchase programs, in each case, during an “open window” and when the Company did not possess material non-public information.

The timing, manner, price and amount of shares repurchased under the Repurchase Program depended on a variety of factors, including stock price, trading volume, market conditions, corporate and regulatory requirements and other general business considerations.

Prior to expiration, the Repurchase Program could be modified, suspended or discontinued at any time without prior notice.

Repurchases under the Repurchase Program could be funded from the Company’s existing cash and cash equivalents, future cash flow or proceeds of borrowings or debt offerings.

During the three months ended June 30, 2024, the Company repurchased and subsequently cancelled 1,395,957 shares of Common Stock for $ 4,904,452 .

There were no shares repurchased during the three months ended June 30, 2023.

During the six months ended June 30, 2024, the Company repurchased and subsequently cancelled 2,651,571 shares of Common Stock for $ 9,782,011 .

There were no shares repurchased during the six months ended June 30, 2023.

Stock-Based Compensation

6 unchanged sentences

Stock options granted have a maximum contractual term of 10 years.

As of March 31, 2024, approximately 5.1 million employee stock options had vested.

As of June 30, 2024, approximately 4.0 million employee stock options had vested.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model.

5 unchanged sentences

Expected dividend yield was zero based on the fact that the Company had not historically paid and does not intend to pay a dividend in the foreseeable future.

The following assumptions were used to compute the fair value of the stock option grants during the three months ended March 31, 2024 and 2023:

Three Months Ended March 31,

The following assumptions were used to compute the fair value of the stock option grants during the six months ended June 30, 2024 and 2023:

Six Months Ended

Risk-free interest rate 4.37 % 4.14 %

2 unchanged sentences

Dividend yield — % — %

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes the Company’s stock option activity under the Plan for the three months ended March 31, 2024:

The following table summarizes the Company’s stock option activity under the Plan during the six months ended June 30, 2024:

Shares Weighted

5 unchanged sentences

Cancelled ( 3,796,384 ) 7.72 — —

Balance as of March 31, 2024 11,788,985 7.38 8.05 49,866,336

Options vested and exercisable as of March 31, 2024 5,135,931 $ 6.89 7.53 $ 2,173,571

Balance as of June 30, 2024 8,423,800 7.07 7.64 1,260,897

Options vested and exercisable as of June 30, 2024 3,972,414 $ 6.63 6.90 $ 1,235,740

The aggregate intrinsic value in the above table is calculated as the difference between the fair value of the Common Stock price and the exercise price of the stock options.

The weighted average grant date fair value per share for stock option grants during the three months ended March 31, 2024 and the year ended December 31, 2023 was $ 3.66 and $ 7.93 , respectively.

For the three months ended March 31, 2024 and 2023, the total recorded stock-based compensation related to stock option awards granted was $ 2,455,143 , and $ 2,706,591 , respectively.

On March 31, 2024 and December 31, 2023, the total unrecognized compensation related to unvested stock option awards granted was $ 19,926,689 and $ 29,058,756 , respectively, which the Company expects to recognize over a weighted-average period of approximately 1.77 years.

The weighted average grant date fair value per share for stock option grants during the six months ended June 30, 2024 and the year ended December 31, 2023 was $ 2.54 and $ 7.93 , respectively.

For the three months ended June 30, 2024 and 2023, the total recorded stock-based compensation related to stock option awards granted was $ 785,703 , and $ 3,053,206 , respectively.

For the six months ended June 30, 2024 and 2023, the total recorded stock-based compensation related to stock option awards granted was $ 3,240,846 , and $ 5,759,798 , respectively.

On June 30, 2024 and December 31, 2023, the total unrecognized compensation related to unvested stock option awards granted was $ 15,153,439 and $ 29,058,756 , respectively, which the Company expects to recognize over a weighted-average period of approximately 1.59 years.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Restricted Stock Units

The fair value of restricted stock units (“RSUs”) is determined on the date of grant.

The Company records compensation expenses in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income on a straight-line basis over the vesting period for RSUs.

The Company records compensation expenses in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) on a straight-line basis over the vesting period for RSUs.

The vesting period for employees and members of the Board of Directors ranges from one to four years .

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Activity under RSUs during the three months ended March 31, 2024 was as follows:

Activity under RSUs during the six months ended June 30, 2024 was as follows:

RSUs Weighted-

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Forfeited ( 47,181 ) 5.49

Balance as of March 31, 2024 3,076,654 5.16

Vested and unissued as of March 31, 2024 58,434 5.85

Non-vested as of March 31, 2024 3,018,220 $ 5.16

The total grant-date fair value of RSUs granted during the three months ended March 31, 2024 was $ 2,999,432 .

For the three months ended March 31, 2024 and 2023, the Company recorded stock-based compensation expense related to RSUs of $ 1,184,394 and $ 429,675 , respectively.

On March 31, 2024, and December 31, 2023, the total unrecognized compensation related to unvested RSUs granted was $ 13,987,767 , and $ 12,602,662 , respectively, which is expected to be recognized over a weighted-average period of approximately 2.1 years.

Balance as of June 30, 2024 3,088,088 4.99

Vested and unissued as of June 30, 2024 — —

Non-vested as of June 30, 2024 3,088,088 $ 4.99

The total grant-date fair value of RSUs granted during the six months ended June 30, 2024 was $ 3,710,431 .

For the three months ended June 30, 2024 and 2023, the Company recorded stock-based compensation expense related to RSUs of $ 1,631,400 and $ 663,748 , respectively.

For the six months ended June 30, 2024 and 2023, the Company recorded stock-based compensation expense related to RSUs of $ 2,815,794 and $ 1,093,423 , respectively.

On June 30, 2024, and December 31, 2023, the total unrecognized compensation related to unvested RSUs granted was $ 13,067,369 , and $ 12,602,662 , respectively, which is expected to be recognized over a weighted-average period of approximately 2.0 years.

Performance-based Stock Units

The fair value of performance-based restricted stock units (“PSUs”) is determined on the date of grant.

The Company records compensation expense in the unaudited Condensed Consolidated Statement of Operations and Comprehensive Income on a straight-line basis over the vesting period for PSUs.

The vesting period for employees and members of the Board of Directors ranges from one to four years .

Activity under PSUs during the three months ended March 31, 2024 was as follows:

The Company records compensation expense in the unaudited Condensed Consolidated Statement of Operations and Comprehensive Income (Loss) on a straight-line basis over the vesting period for PSUs.

The vesting period for PSUs ranges from one to four years .

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Activity under PSUs during the six months ended June 30, 2024 was as follows:

PSUs Weighted-

1 unchanged sentence

Forfeited — —

Balance as of March 31, 2024 1,085,270 5.16

Vested and unissued as of March 31, 2024 — —

Non-vested as of March 31, 2024 1,085,270 $ 5.16

The total grant-date fair value of PSUs granted during the three months ended March 31, 2024 was $ 0 .

For the three months ended March 31, 2024 and 2023, the Company recorded stock-based compensation expense related to PSUs of $ 348,802 and $ 0 , respectively, which are included in accrued liabilities.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As of March 31, 2024, and December 31, 2023, the total unrecognized compensation related to unvested PSUs granted was $ 5,178,365 , and $ 5,527,166 , respectively, which is expected to be recognized over a weighted-average period of approximately 3.8 years.

Operating Leases

The Company is obligated to make rental payments under non-cancellable operating leases for office, dispatch station space and transportation equipment, expiring at various dates through 2032.

Under the terms of the leases, the Company is also obligated for its proportionate share of real estate taxes, insurance and maintenance costs of the property.

The Company is required to hold certain funds in restricted cash and cash equivalents accounts under some of these agreements.

Certain leases for property and transportation equipment contain options to purchase, extend or terminate the lease.

Performance adjustment ( 217,054 ) —

Balance as of June 30, 2024 868,216 5.16

Vested and unissued as of June 30, 2024 — —

Non-vested as of June 30, 2024 868,216 $ 5.16

There were no PSUs granted during the three and six months ended June 30, 2024.

For the three months ended June 30, 2024 and 2023, the Company recorded stock-based compensation expense related to PSUs of $ 194,827 and $ 0 , respectively, which are included in accrued liabilities.

For the six months ended June 30, 2024 and 2023, the Company recorded stock-based compensation expense related to PSUs of $ 543,629 and $ 0 , respectively, which are included in accrued liabilities.

As of June 30, 2024 and December 31, 2023, the total unrecognized compensation related to unvested PSUs granted was $ 3,863,538 and $ 5,527,166 , respectively, which is expected to be recognized over a weighted-average period of approximately 3.5 years.

The Company has lease arrangements for properties, vehicles and transportation equipment.

Certain leases contain options to purchase, extend or terminate the lease.

Determining the lease term and amount of lease payments to include in the calculation of the right-of-use asset and lease obligations for leases containing options requires the use of judgment to determine whether the exercise of an option is reasonably certain and whether the optional period and payments should be included in the calculation of the associated right-of-use asset and lease obligation.

In making such determination, the Company considers all relevant economic factors that would require whether to exercise or not exercise the option.

In making such determination, the Company considers all relevant economic factors.

The Company’s lease agreements generally do not provide an implicit borrowing rate.

1 unchanged sentence

The Company benchmarked itself against other companies of similar credit ratings and comparable quality and derived imputed rates, which were used to discount its real estate lease liabilities.

The Company used estimated borrowing rates of 6 % on January 1, 2019 for all leases that commenced prior to that date for office spaces and transportation equipment.

Loss on Lease Remeasurement

In March 2024, the Company reassessed the use of an office space for one entity.

As a result, the Company terminated the leased office space, which resulted in a loss of $ 7,306 recorded as loss from remeasurement of operating lease on the unaudited Condensed Consolidated Statement of Operations and Comprehensive Income during the three months ended March 31, 2024.

The table below comprises operating lease expenses for the three months ended March 31, 2024 and 2023:

The Company used estimated borrowing rates of 6 % on January 1, 2019 for all leases that commenced prior to that date for office spaces, vehicles and transportation equipment.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The table below comprises lease expenses for the three and six months ended June 30, 2024 and 2023:

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Components of total lease cost:

Operating lease expense $ 830,029 $ 865,987 $ 1,766,779 $ 1,622,232

Finance lease expense:

Amortization of right-of-use assets 1,141,130 826,180 2,197,620 1,627,163

Interest on lease liabilities 184,944 132,467 366,827 259,051

Finance lease expense 1,326,074 958,647 2,564,447 1,886,214

Short-term lease expense 420,583 368,030 889,457 704,348

Total lease cost - operating leases $ 1,405,624 $ 1,092,563

Total lease cost $ 2,576,686 $ 2,192,664 $ 5,220,683 $ 4,212,794

Lease Payments

The table below presents lease payments for the three and six months ended June 30, 2024 and 2023:

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Components of total lease payments:

Operating lease payment $ 849,696 $ 865,987 $ 1,778,682 $ 1,622,232

Finance lease payment 1,060,201 766,492 2,029,789 1,510,522

Total lease payments $ 1,909,897 $ 1,632,479 $ 3,808,471 $ 3,132,754

Operating Leases

The Company is obligated to make rental payments under non-cancellable operating leases for office, dispatch station space and transportation equipment, expiring at various dates through 2034.

Under the terms of the leases, the Company is also obligated for its proportionate share of real estate taxes, insurance and maintenance costs of the property.

Loss on Lease Remeasurement

During the year, the Company reassessed the use of an office space for one entity.

As a result, the Company terminated the leased office space, which resulted in a loss of $ 0 and $ 7,306 recorded as loss from remeasurement of operating lease on the unaudited Condensed Consolidated Statement of Operations and Comprehensive Income (Loss) during the three and six months ended June 30, 2024.

There were no gains or losses recorded relating to remeasurement of operating leases for the three and six months ended June 30, 2023.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Lease Position as of March 31, 2024

Lease Position as of June 30, 2024

Right-of-use assets and lease liabilities for the Company’s operating leases were recorded in the unaudited Condensed Consolidated Balance Sheets as follows:

March 31, 2024 December 31, 2023

2024 December 31, 2023

Lease right-of-use assets $ 9,372,463 $ 9,580,535

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Lease Terms and Discount Rate

The table below presents certain information related to the weighted average remaining lease term and the weighted average discount rate for the Company’s operating leases as of March 31, 2024:

The table below presents certain information related to the weighted average remaining lease term and the weighted average discount rate for the Company’s operating leases as of June 30, 2024:

Weighted average remaining lease term (in years) - operating leases 3.69

1 unchanged sentence

Undiscounted Cash Flows

Future minimum lease payments under the operating leases as of March 31, 2024 were as follows:

Future minimum lease payments under the operating leases as of June 30, 2024 were as follows:

2024, remaining $ 1,711,847

6 unchanged sentences

Present value of future minimum lease payments $ 9,777,316

Operating lease expense was approximately $ 936,750 and $ 756,245 for the three months ended March 31, 2024 and 2023, respectively.

For the three months ended March 31, 2024, the Company made $ 928,986 of fixed cash payments related to operating leases and $ 969,588 related to finance leases.

For the three months ended March 31, 2023, the Company made $ 756,245 of fixed cash payments related to operating leases and $ 744,030 related to finance leases.

Finance Leases

The Company leases vehicles under non-cancellable finance lease agreements with a liability of $ 13,384,715 and $ 11,430,465 as of June 30, 2024 and December 31, 2023, respectively, and accumulated depreciation of $ 12,433,325 and $ 11,679,823 as of June 30, 2024 and December 31, 2023, respectively.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Finance Leases

The Company leases vehicles under non-cancelable finance lease agreements with a liability of $ 12,585,389 and $ 11,430,465 as of March 31, 2024 and December 31, 2023, respectively, and accumulated depreciation of $ 11,469,799 and $ 11,679,823 as of March 31, 2024 and December 31, 2023, respectively.

Depreciation expense for the vehicles under non-cancelable finance lease agreements amounted to $ 1,056,490 and $ 801,083 for the three months ended March 31, 2024 and 2023, respectively.

Gain on Lease Remeasurement

In March 2024, the Company returned two leased vehicles.

As a result, the Company terminated these leased vehicles, which resulted in a gain of $ 2,609 recorded as gain from remeasurement of finance leases on the unaudited Condensed Consolidated Statement of Operations and Comprehensive Income during the three months ended March 31, 2024.

Lease Payments

The table below presents lease payments for the three months ended March 31, 2024 and 2023:

Three Months Ended

Components of total lease cost:

Finance lease payment $ 969,588 $ 744,030

Short-term lease payment — —

Total lease payments $ 969,588 $ 744,030

Lease Position as of March 31, 2024

Loss on Lease Remeasurement

During the year, the Company returned a number of leased vehicles.

As a result, the Company terminated these leased vehicles, which resulted in a loss of $ 21,192 and $ 18,583 recorded as loss from remeasurement of finance leases on the unaudited Condensed Consolidated Statement of Operations and Comprehensive Income (Loss) during the three and six months ended June 30, 2024.

There were no gains or losses recorded relating to remeasurement of finance leases for the three and six months ended June 30, 2023.

Lease Position as of June 30, 2024

Right-of-use assets and lease liabilities for the Company’s finance leases were recorded in the unaudited Condensed Consolidated Balance Sheets as follows:

7 unchanged sentences

Total lease liability $ 13,384,715 $ 11,430,465

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Lease Terms and Discount Rate

The table below presents certain information related to the weighted average remaining lease term and the weighted average discount rate for the Company’s finance leases as of March 31, 2024:

The table below presents certain information related to the weighted average remaining lease term and the weighted average discount rate for the Company’s finance leases as of June 30, 2024:

Weighted average remaining lease term (in years) - finance leases 3.51

1 unchanged sentence

Undiscounted Cash Flows

Future minimum lease payments under the finance leases as of March 31, 2024 are as follows:

Future minimum lease payments under the finance leases as of June 30, 2024 are as follows:

Finance Leases

3 unchanged sentences

2027 2,453,199

2028 1,316,126

Thereafter 260,725

5 unchanged sentences

Other income (expense)

The Company recognized $( 152,984 ) and $ 853,927 of other income (expense) for the three months ended March 31, 2024 and 2023, respectively, as set forth in the table below.

Three Months Ended

The Company recognized $( 581,655 ) and $( 587,389 ) of other income (expense) for the three months ended June 30, 2024 and 2023, respectively, as set forth in the table below.

The Company recognized $( 734,639 ) and $ 266,538 of other income (expense) for the six months ended June 30, 2024 and 2023, respectively, as set forth in the table below.

Three Months Ended Six Months Ended

June 30, June 30,

2024 2023 2024 2023

Other income (expense)

4 unchanged sentences

Gain (loss) on disposal of fixed assets 12,563 ( 98,630 ) 65,398 ( 153,469 )

ABC litigation — ( 1,000,000 ) — ( 1,000,000 )

Other income 337,276 79,942 581,883 294,822

9 unchanged sentences

The Company's payments to EDTSLS for Mr.

Tendler's services totaled $ 253,250 and $ 234,230 for the three months ended March 31, 2024 and 2023, respectively.

Included in accrued liabilities were $ 52,050 and $ 0 due to related parties as of March 31, 2024 and December 31, 2023 , respectively related to legal services.

Tendler's services totaled $ 367,670 and $ 126,600 for the three months ended June 30, 2024 and 2023, respectively and $ 620,920 and $ 470,270 for the six months ended June 30, 2024 and 2023, respectively.

Included in accounts payable were $ 48,415 and $ 0 due to related parties as of June 30, 2024 and December 31, 2023, respectively related to legal services.

There were no amounts included in accrued liabilities as of June 30, 2024 and December 31, 2023 related to legal services.

Subcontractor Services

1 unchanged sentence

PrideStaff is owned by a former operations manager of the Company and his spouse, and therefore, is a related party.

The Company made subcontractor payments to PrideStaff totaling $ 66,011 and $ 93,311 for the three months ended March 31, 2024 and 2023, respectively.

Included in accounts payable and accrued liabilities were $ 65,611 and $ 0 due to related parties as of March 31, 2024 and December 31, 2023 , respectively related to subcontractor services.

The Company made subcontractor payments to PrideStaff totaling $ 74,607 and $ 0 for the three months ended June 30, 2024 and 2023, respectively, and $ 140,619 and $ 93,311 for the six months ended June 30, 2024 and 2023, respectively.

There were no amounts included in accounts payable and accrued liabilities as of June 30, 2024 and December 31, 2023 related to subcontractor services.

Transition Services Agreement

On October 11, 2023, the Company and Anthony Capone, who resigned as Chief Executive Officer of the Company on September 15, 2023, entered into a separation and transition services agreement (the “Transition Agreement”).

Pursuant to the Transition Agreement, Mr.

Capone served as a consultant to the Company until March 15, 2024 (such period, the “Consulting Period”) to advise on matters relating to business continuity and processes and transition his institutional knowledge with respect to operational and other departmental functions.

As compensation for his services during the Consulting Period, and subject to his compliance with the Transition Agreement, including the execution and non-revocation of a general release of claims in favor of the Company, Mr.

Capone received a monthly consulting fee of $ 45,000 and subsidized premiums for continued group health plan coverage

On October 11, 2023, the Company and Anthony Capone, who resigned as Chief Executive Officer of the Company on

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

for the duration of the Consulting Period.

Capone will not receive new equity awards or incentive compensation under the Company’s equity incentive compensation program during the Consulting Period.

September 15, 2023, entered into a separation and transition services agreement (the “Transition Agreement”).

Pursuant to the Transition Agreement, Mr.

Capone served as a consultant to the Company until March 15, 2024 (such period, the “Capone Consulting Period”) to advise on matters relating to business continuity and processes and transition his institutional knowledge with respect to operational and other departmental functions.

As compensation for his services during the Capone Consulting Period, and subject to his compliance with the Transition Agreement, including the execution and non-revocation of a general release of claims in favor of the Company, Mr.

Capone received a monthly consulting fee of $ 45,000 and subsidized premiums for continued group health plan coverage for the duration of the Capone Consulting Period.

Capone did not receive new equity awards or incentive compensation under the Company’s equity incentive compensation program during the Capone Consulting Period.

The Transition Agreement further acknowledges and affirms that Mr.

Capone will be bound by and comply with certain restrictive covenants.

The Company made payments to Anthony Capone totaling $ 135,000 and $ 0 for the three months ended March 31, 2024 and 2023, respectively.

Included in accounts payable were $ 45,000 and $ 45,000 due to related parties as of March 31, 2024 and December 31, 2023 , respectively related to this Transition Agreement.

The Company made payments to Mr.

Capone under the Transition Agreement totaling $ 45,000 and $ 0 for the three months ended June 30, 2024 and 2023, respectively and $ 180,000 and $ 0 for the six months ended June 30, 2024 and 2023, respectively.

Included in accounts payable were $ 0 and $ 45,000 due to related parties as of June 30, 2024 and December 31, 2023, respectively related to this Transition Agreement.

There were no amounts included in accrued liabilities as of June 30, 2024 and December 31, 2023 related to the Transition Agreement.

Consulting Agreement

1 unchanged sentence

Pursuant to the Consulting Agreement, Mr.

Vashovsky will continue to serve as a consultant to the Company until March 31, 2025 (such period, the “Consulting Period”).

During the Consulting Period, Mr.

Vashovsky will provide advisory services as may be requested from time to time by the Company’s executive officers or the Board and assist with maintaining the Company’s existing customer and investor relationships and, as consideration for his services, receive an equity grant during each quarter of the Consulting Period having a grant date fair value of approximately $ 35,000 .

Vashovsky will continue to serve as a consultant to the Company until March 31, 2025 (such period, the “Vashovsky Consulting Period”).

During the Vashovsky Consulting Period, Mr.

Vashovsky will provide advisory services as may be requested from time to time by the Company’s executive officers or the Board of Directors and assist with maintaining the Company’s existing customer and investor relationships and, as consideration for his services, receive an equity grant during each quarter of the Vashovsky Consulting Period having a grant date fair value of approximately $ 35,000 .

In consideration for a release of claims, Mr.

Vashovsky will also be eligible to receive Company-subsidized healthcare coverage for the duration of the Consulting Period.

Vashovsky will also be eligible to receive Company-subsidized healthcare coverage for the duration of the Vashovsky Consulting Period.

The Consulting Agreement further acknowledges and affirms that Mr.

Vashovsky will be bound by and comply with certain restrictive covenants.

There were no amounts included in accounts payable and accrued liabilities as of March 31, 2024 and December 31, 2023, related to the Consulting Agreement.

The Company made no payments to Mr.

Vashovsky under the Consulting Agreement for the six months ended June 30, 2024.

There were no amounts included in accounts payable and accrued liabilities as of June 30, 2024 and December 31, 2023, related to the Consulting Agreement.

As a result of the Company’s history of net operating losses, the Company had historically provided for a full valuation allowance against its deferred tax assets for assets that were not more-likely-than-not to be realized.

The Company’s (provision for) benefit from income taxes for the three months ended March 31, 2024 and 2023 were $( 5,119,004 ) and $ 2,129,870 , respectively.

The Company’s (provision for) benefit from income taxes for the three months ended June 30, 2024 and 2023 were $( 3,708,920 ) and $ 355,054 , respectively, and $( 8,827,924 ) and $ 2,484,924 for the six months ended June 30, 2024 and 2023, respectively.

In determining the quarterly provision for income taxes, the Company uses an estimated annual effective tax rate adjusted for discrete items.

2 unchanged sentences

employees that complete two months of service with the Company are eligible to participate in the plan.

The Company did not make any employer contributions to this plan as of March 31, 2024.

The Company did not make any employer contributions to this plan as of June 30, 2024.

Legal Proceedings

From time to time, the Company may be involved as a defendant in legal actions that arise in the normal course of business.

In the opinion of management, the Company has adequate legal defense on all legal actions, and the results of any such proceedings would not materially impact the unaudited Condensed Consolidated Financial Statements of the Company.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company provides disclosure and records loss contingencies in accordance with the loss contingencies accounting guidance.

4 unchanged sentences

On January 17, 2024, the Court appointed the Genesee County Employees’ Retirement System as the Lead Plaintiff.

On March 18, 2024, the Lead Plaintiff filed an amended complaint against the Company, its now former

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Chairman and Chief Executive Officer, another former Chief Executive Officer and former Chief Financial Officer (who currently serves as Executive Vice President of Strategy).

On March 18, 2024, the Lead Plaintiff filed an amended complaint against the Company, its now former Chairman and Chief Executive Officer, another former Chief Executive Officer and former Chief Financial Officer (who currently serves as Executive Vice President of Strategy).

On June 21, 2024, the defendants moved to dismiss the amended complaint.

The parties anticipate those motions will be fully briefed in September 2024.

Due to the early stage of this proceeding, the Company cannot reasonably estimate the potential range of loss, if any.

The Company disputes the allegations of wrongdoing and intends to defend itself vigorously in this matter.

On May 30, 2024, and on July 15, 2024, two purported shareholder derivative actions were filed against certain current and former officers and directors of the Company.

The Company is named as a nominal defendant in both actions, and the complaints name the Company’s current board of directors, including its Chief Executive Officer and General Counsel, along with two former Chief Executive Officers, the Company’s Chief Financial Officer and Treasurer and its Executive Vice President of Strategy.

These actions were filed by Ryne Shetterly in U.S.

District Court for the Southern District of New York, and Salma Daboul in the Supreme Court for the State of New York, respectively.

Both actions purport to assert breach of fiduciary duty and other, related claims on behalf of the Company and make substantially similar factual allegations as those at issue in the securities class action matter discussed above, seeking various forms of monetary and injunctive relief.

At the time of this filing, no defendants have been served in either action.

Due to the early stage of this proceeding, the Company cannot reasonably estimate the potential range of loss, if any.

The Company believes there are substantial defenses to these lawsuits.

Risk and Uncertainties

9 unchanged sentences

Subsequent Events

The Company evaluated subsequent events through the date of this filing and concluded there were no material subsequent events requiring adjustment to or disclosure in these unaudited Condensed Consolidated Financial Statements.

Ambulnz CO, LLC

On July 1, 2024, the Company acquired the remaining noncontrolling interest in its Ambulnz CO, LLC joint venture from University of Colorado Health in exchange for $ 1,848,000 in cash.

Issuance of Common Stock

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

On July 19, 2024, in connection with the CRMS acquisition, the Company issued $ 1,814,345 in Common Stock, or 578,350 shares, constituting the remainder of the True-up Payment.

The True-up Payment was based on CRMS’ attainment of full-year EBITDA targets for 2023.

(See Note 4.)

Share Repurchase Program

Following the expiration of the previously authorized share repurchase program on July 30, 2024, on August 5, 2024, the Board effectively extended the prior program by authorizing a new share repurchase program (the “New Repurchase Program”) on the same terms and conditions as the prior program other than expiration, pursuant to which the Company may purchase up to $ 26,000,000 in shares of Common Stock, which was the approximate amount remaining under the prior program at its expiration.

The New Repurchase Program expires on December 31, 2024 and may be suspended, extended, modified or discontinued at any time without prior notice.

Under the terms of the New Repurchase Program, the Company may purchase shares of Common Stock on a discretionary basis from time to time through open market repurchases or privately negotiated transactions or through other means, including by entering into Rule 10b5-1 trading plans or accelerated share repurchase programs, in each case, during an “open window” and when the Company does not possess material non-public information.

The timing, manner, price and amount of shares repurchased under the New Repurchase Program will depend on a variety of factors, including stock price, trading volume, market conditions, corporate and regulatory requirements and other general business considerations.

The New Repurchase Program does not oblige the Company to repurchase a specific number of shares.

Repurchases under the New Repurchase Program may be funded from the Company’s existing cash and cash equivalents, future cash flow or proceeds of borrowings or debt offerings .

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

What changed 10-Q

Item 1. Financial Statements