What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-07 compared with 2024-08-07 · 359 added, 254 removed, 937 unchanged (40% of the section changed)

Financial Statements

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

Condensed Consolidated Balance Sheets as of Sep tember 30 , 2024 (Unaudited) and December 31, 2023

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2024 and 2023

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

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

Notes to Unaudited Condensed Consolidated Financial Statements

1 unchanged sentence

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

2024 December 31,

2 unchanged sentences

Cash and cash equivalents $ 89,458,388 $ 59,286,147

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

Accounts receivable, net of allowance for credit loss of $ 6,455,874 and $ 6,276,454 as of September 30, 2024 and December 31, 2023, respectively

233,712,723 262,083,462

29 unchanged sentences

Common stock ($ 0.0001 par value;

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)

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

101,980,995 and 104,055,168 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively)

10,198 10,406

Additional paid-in-capital 321,028,986 320,693,866

Accumulated deficit ( 3,637,258 ) ( 21,394,310 )

Retained earnings (accumulated deficit) 1,860,643 ( 21,394,310 )

Accumulated other comprehensive income 2,313,518 1,484,905

8 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

8 unchanged sentences

Total expenses 128,547,417 177,844,955 459,560,146 421,661,051

Income (loss) from operations 10,149,149 1,575,954 26,024,516 ( 5,326,633 )

Income from operations 10,137,397 8,707,955 36,161,913 3,381,322

Other income (expense):

2 unchanged sentences

Loss on equity method investments ( 82,742 ) ( 95,503 ) ( 229,923 ) ( 301,362 )

Loss on remeasurement of operating and finance leases ( 21,192 ) — ( 25,889 ) —

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

(Loss) gain on remeasurement of operating and finance leases ( 6,163 ) 4,834 ( 32,052 ) 4,834

(Loss) gain on disposal of fixed assets ( 28,681 ) ( 9,983 ) 36,717 ( 163,452 )

Other income (expense) ( 435,825 ) 43,353 146,058 ( 661,825 )

Total other income (expense) ( 1,103,016 ) 449,051 ( 1,837,655 ) 715,589

Net income (loss) before income tax provision 9,567,494 988,565 25,289,877 ( 5,060,095 )

(Provision for) benefit from income taxes ( 3,708,920 ) 355,054 ( 8,827,924 ) 2,484,924

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

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

Net income before income tax provision 9,034,381 9,157,006 34,324,258 4,096,911

Provision for income taxes ( 4,488,828 ) ( 4,526,767 ) ( 13,316,752 ) ( 2,041,843 )

Net income 4,545,553 4,630,239 21,007,506 2,055,068

Net (loss) income attributable to noncontrolling interests ( 952,348 ) ( 134,682 ) ( 2,247,447 ) 2,767,084

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

13 unchanged sentences

Common Stock Additional

Capital Accumulated

Deficit Accumulated

Capital Retained Earnings (Accumulated Deficit) Accumulated

Comprehensive

25 unchanged sentences

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

Exercise of stock options 88,837 8 425,995 — — — 426,003

Cashless exercise of options 6,374 1 ( 1 ) — — — —

Stock based compensation 30,650 3 3,335,707 — — — 3,335,710

Shares withheld for taxes ( 13,414 ) ( 1 ) ( 117,644 ) — — — ( 117,645 )

Net loss attributable to noncontrolling interests — — — — — ( 134,682 ) ( 134,682 )

Foreign currency translation — — — — ( 582,471 ) — ( 582,471 )

Net income attributable to stockholders of DocGo Inc.

and Subsidiaries

— — — 4,764,921 — — 4,764,921

Balance - September 30, 2023 103,874,539 $ 10,387 $ 315,745,338 $ ( 28,964,781 ) $ 808,171 $ 3,953,300 $ 291,552,415

Common Stock Additional

Capital Accumulated

Deficit Accumulated

Capital Retained Earnings (Accumulated Deficit) Accumulated

Comprehensive

24 unchanged sentences

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

Common stock repurchased ( 356,113 ) ( 35 ) ( 1,296,152 ) — — — ( 1,296,187 )

Stock-based compensation 112,100 11 2,874,416 — — — 2,874,427

Shares withheld for taxes ( 36,112 ) ( 4 ) ( 107,975 ) — — — ( 107,979 )

CRMS True-up Payment 578,350 58 1,814,287 — — — 1,814,345

Acquisition of Ambulnz CO — — 340,450 — — ( 2,188,450 ) ( 1,848,000 )

Net loss attributable to noncontrolling interests — — — — — ( 952,348 ) ( 952,348 )

Foreign currency translation — — — — 934,774 — 934,774

Net income attributable to stockholders of DocGo Inc.

and Subsidiaries

— — — 5,497,901 — — 5,497,901

Balance - September 30, 2024 101,980,995 $ 10,198 $ 321,028,986 $ 1,860,643 $ 2,313,518 $ ( 309,808 ) $ 324,903,537

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

1 unchanged sentence

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended

Nine Months Ended

September 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

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

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

Net income $ 21,007,506 $ 2,055,068

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

Depreciation of property and equipment 4,282,940 4,697,717

1 unchanged sentence

Amortization of finance lease right-of-use assets 3,394,696 2,822,982

(Gain) loss on disposal of assets ( 65,398 ) 153,469

(Gain) loss on disposal of fixed assets ( 36,717 ) 163,452

Deferred income tax ( 5,242,787 ) 1,049,236

2 unchanged sentences

Stock-based compensation 9,755,455 15,161,847

Loss on remeasurement of operating and finance leases 25,889 —

Gain on liquidation of business — 70,284

Loss (gain) on remeasurement of operating and finance leases 32,052 ( 4,834 )

Loss on liquidation of business — 70,284

Change in fair value of contingent consideration 370,712 ( 159,974 )

18 unchanged sentences

Due to seller ( 3,008,976 ) ( 8,417,936 )

Acquisition of noncontrolling interest ( 1,848,000 ) —

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

12 unchanged sentences

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended

Nine Months Ended

September 30,

Supplemental disclosure of cash and non-cash transactions:

7 unchanged sentences

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

Acquisition of CRMS $ — $ 1,000,000

Acquisition of CRMS through issuance of stock $ — $ 1,000,000

CRMS True-up Payment through issuance of stock $ 1,814,345 $ —

Receivable exchanged for trade credits $ — $ 1,500,000

Pre-acquisition receivables written off through due to seller $ 4,675,758 $ —

63 unchanged sentences

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

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.

Net income (loss) for the Company’s VIEs was $( 67,785 ) and $( 103,378 ) for the three months ended September 30, 2024 and 2023, respectively, and $( 425,668 ) and $ 16,839 for the nine months ended September 30, 2024 and 2023, respectively.

Total assets amounted to $ 11,844,062 and $ 4,364,274 as of September 30, 2024 and December 31, 2023, respectively.

Total liabilities were $ 12,717,312 and $ 4,811,857 as of September 30, 2024 and December 31, 2023, respectively.

The Company’s VIEs’ total stockholders’ deficit was $ 873,250 and $ 447,583 as of September 30, 2024 and December 31, 2023, respectively.

and Subsidiaries

5 unchanged sentences

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.

The resulting unrealized cumulative translation adjustment for the three months ended September 30, 2024 and 2023 were $ 934,774 and $( 582,471 ), respectively, and $ 828,613 and $ 66,965 for the nine months ended September 30, 2024 and 2023, respectively.

Use of Estimates

18 unchanged sentences

Major Customers

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.

The Company had one customer that accounted for approximately 41 % of revenues and 34 % of net accounts receivable and another customer that accounted for 21 % of revenues and 44 % of net accounts receivable for the three months ended September 30, 2024.

The Company had one customer that accounted for approximately 36 % of revenues and 34 % of net accounts receivable and another customer that accounted for 31 % of revenues and 44 % of net accounts receivable for the nine months ended September 30, 2024.

The Company had one customer that accounted for approximately 33 % of revenues and 36 % of net accounts receivable and another customer that accounted for approximately 32 % of revenues and 28 % of accounts receivable for the three months ended September 30, 2023.

The Company had one customer that accounted for approximately 37 % of revenues and

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.

28 % of net accounts receivable and another customer that accounted for approximately 17 % of revenues and 36 % of accounts receivables for the nine months ended September 30, 2023.

The Company had one vendor that accounted for approximatel y 19 % and 20 % of total cost for the three months ended September 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 had one vendor that accounted for approximately 18 % and 13 % of total cost for the nine months ended September 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.

7 unchanged sentences

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

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.

The Company had cash balances of approximate ly $ 5,064,084 and $ 3,699,793 with foreign financial institutions on September 30, 2024 and December 31, 2023, respectively.

Restricted Cash

20 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.

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.

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management as of September 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.

The notes payable are presented at their carrying value, which, based on borrowing rates currently available to the Company for loans with similar terms, approximates its fair values.

The notes payable are presented at their carrying value, which, based on borrowing rates currently available to the Company for loans with similar terms, approximates their fair values.

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.

2 unchanged sentences

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 $ 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).

The Company recorded a change in fair value of contingent consideration in the amount of $ 33,453 and $( 159,974 ) for the three months ended September 30, 2024 and 2023, respectively, and $ 86,056 and $( 159,974 ) for the nine months ended September 30, 2024 and 2023, respectively.

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 $ 1,907,074 and $ 1,821,018 as of September 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 $( 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).

The Company recorded a change in fair value of contingent consideration in the amount of $ 11,067 and $( 13,763 ) for the three and nine months ended September 30, 2024, respectively.

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

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 $ 265,538 and $ 279,301 as of September 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 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).

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

The Company made a payment of $ 600,029 during the nine months ended September 30, 2024.

The Company did no t record any foreign exchange movem ent for the three months ended September 30, 2024, but recorded a foreign exchange movement of $( 90,834 ) for the three months ended September 30, 2023.

The Company recorded foreign exchange movements of $( 4,798 ) and $ 20,730 for the nine months ended September 30, 2024 and 2023, respectively .

There was no remaining contingent liability bal ance as of September 30, 2024 and a contingent liability balance of $ 604,827 as of December 31, 2023 (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 (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

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CRMS’ attainment of full-year EBITDA targets.

The Company did no t record a change in fair value of contingent consideration for the three months ended September 30, 2024, but recorded a change in fair value of contingent consideration in the amount of $ 298,419 for the nine months ended September 30, 2024.

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

On May 29, 2024, the Company made a portion of the True-up Payment in the amount of $ 1,000,000 .

During the three and nine months ended September 30, 2024, the Company issued $ 1,814,345 in Common Stock, or 578,350 shares, constituting the remainder of the True-up Payment.

The estimated contingent consideration amount payable for CRMS was $ 14,571,909 and $ 17,087,835 as of September 30, 2024 and December 31, 2023, respectively (see Note 4).

Accounts Receivable

5 unchanged sentences

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 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 Condensed 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.

On a quarterly basis, in accordance with Federal Accounting Standards Board (“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.

6 unchanged sentences

The Company recognized an additional provision for credit losses of $ 3,270,217 and write offs of $( 3,090,797 ) during the year.

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

The Company’s balance in its allowance for credit losses amounted to $ 6,455,874 as of September 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 Income.

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

19 unchanged sentences

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 an asset are less than its carrying amount.

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.

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.

8 unchanged sentences

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

The costs associated with the Company’s line of credit are deferred and recognized over the term of the line of credit as interest expense.

Interest expense on outstanding balances is expensed as incurred.

Related Party Transactions

1 unchanged sentence

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.

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

Revenue Recognition

16 unchanged sentences

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 assumptions utilized in estimating variable

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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.

7 unchanged sentences

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

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.

Net revenue 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.

13 unchanged sentences

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

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In the following table, revenues are disaggregated as follows:

Revenue Breakdown Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

8 unchanged sentences

Stock-Based Compensation

The Company maintained stock incentive plans under which the Company may issue incentive and non-qualified stock options, restricted stock units and performance-based stock units.

The Company maintains a stock incentive plan under which the Company may issue incentive and non-qualified stock options, restricted stock units and performance-based stock units.

The Company accounts for stock-based compensation using the provisions of ASC 718, Stock-Based Compensation , which requires the recognition of the fair value of stock-based compensation.

2 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

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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

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 (Loss).

4 unchanged sentences

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.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table presents the calculation of basic and diluted net income per share to stockholders of DocGo Inc.

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

16 unchanged sentences

(“RND”) for $ 655,876 .

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

During the nine months ended September 30, 2024 and the year ended December 31, 2023, the Company made additional investments amounting to $ 310,450 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.

2 unchanged sentences

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

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

As of September 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 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).

Changes in value of NPA are recorded in “Loss on 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”).

2 unchanged sentences

The Company recognizes a single lease cost, so that the remaining cost of the lease is allocated over the remaining lease term on a straight-line basis.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company has lease arrangements for vehicles, equipment and facilities.

25 unchanged sentences

The Company is currently evaluating the impact of adopting ASU 2023-09 on its disclosures.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Property and Equipment, Net

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

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

September 30,

2024 December 31,

8 unchanged sentences

Property and equipment, net $ 15,284,753 $ 16,835,484

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.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

During the nine months ended September 30, 2024, the Company disposed of assets with a cost of $ 608,983 and accumulated depreciation of $ 400,349 for proceeds of $ 246,615 .

The Company recorded a gain on disposal of assets of $ 37,981 for the nine months ended September 30, 2024.

The Company recorded depreciation expense of $ 1,374,975 and $ 1,625,070 for the three months ended September 30, 2024 and 2023, respectively.

The Company recorded depreciation expense of $ 4,282,940 and $ 4,697,717 for the nine months ended September 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.

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 nine months ended September 30, 2024, the Company wrote off $ 1,315,691 pre-acquisition accounts receivable through due to seller, the liability established during acquisition.

Additionally, the Company paid $ 3,000,000 of the $ 6,000,000 remaining purchase price payable as of December 31, 2023 and paid the remaining $ 3,000,000 as of September 30, 2024.

There were no remaining purchase price payable as of September 30, 2024 and a purchase price payable of $ 3,000,000 as of December 31, 2023.

As of September 30, 2024 and December 31, 2023, there was remaining due to seller balance pertaining to pre-acquisition accounts receivable of $ 138,275 and $ 1,453,966 , respectively.

The Company recorded a change in fair value of contingent consideration in the amount of $ 11,067 and $( 13,763 ) for the three and nine months ended September 30, 2024, respectively.

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

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 $ 254,471 and $ 279,301 as of June 30, 2024 and December 31, 2023, respectively.

The estimated contingent consideration amount payable for Exceptional was $ 265,538 and $ 279,301 as of September 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 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 nine months ended September 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 payments in the amount of $ 8,976 on the remaining purchase price payable during the nine months ended September 30, 2024.

There was no remaining due to seller balance as of September 30, 2024 and a due to seller balance of $ 3,369,043 as of December 31, 2023.

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.

The estimated contingent consideration amount payable for Ryan Brothers was $ 1,907,074 and $ 1,821,018 as of September 30, 2024 and December 31, 2023, respectively.

Location Medical Services, LLC

3 unchanged sentences

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.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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

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.

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

The Company did no t record a change in fair value of contingent consideration for the three and nine months ended September 30, 2024 and 2023 but recorded foreign exchange movements of $ 0 and $( 90,834 ) for the three months ended September 30, 2024 and 2023, respectively, and $( 4,798 ) and $ 20,730 for the nine months ended September 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.

There was no remaining contingent liability balance as of September 30, 2024 and a contingent liability balance of $ 604,827 as of December 31, 2023.

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.

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 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 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.

1 unchanged sentence

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

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.

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

On May 29, 2024, the Company paid a portion of the True-up Payment in the amount of $ 1,000,000 .

During the three and nine months ended September 30, 2024, the Company issued $ 1,814,345 in Common Stock, or 578,350 shares, constituting the remainder of the True-up Payment.

The estimated contingent consideration amount payable for CRMS was $ 14,571,909 and $ 17,087,835 as of September 30, 2024 and December 31, 2023, respectively.

Ambulnz-FMC North America LLC

On April 1, 2023, the Company acquired the remaining outstanding shares of common stock of Ambulnz-FMC North America LLC (“FMC NA”), a prominent healthcare company that focuses on providing vital products and services for patients suffering from kidney diseases and renal failure, from its joint venture with Holdings in exchange for $ 4,000,000 in cash and $ 3,000,000 in Common Stock.

Acquisition costs are included in general and administrative expenses totaling approximately $ 35,560 for the year ended December 31, 2023.

Acquisition costs are included in general and administrative expenses totaling $ 35,560 for the year ended December 31, 2023.

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 in exchange for $ 1,385,156 in cash.

Ambulnz CO, LLC

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

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

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CRMS LMS Ryan Brothers Exceptional Total

Ambulnz CO FMC NA

Consideration:

20 unchanged sentences

Total purchase price $ 1,848,000 $ 7,000,000 $ 25,822,190 $ 34,670,190

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 and six months ended June 30, 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 nine months ended September 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.

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

The figures presented below for the three months ended September 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 September 30, 2023 Nine Months Ended September 30, 2023

Revenue $ 186,552,910 $ 428,155,992

Net income (loss)

4,630,239 3,093,862

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 during the six months ended June 30, 2024.

ABC Transaction and Held for Sale

12 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

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

The carrying value of goodwill amounted to $ 47,862,242 as of

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:

September 30, 2024.

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

Carrying Value

Balance as of December 31, 2023 $ 47,539,929

Currency translation adjustment ( 34,819 )

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

Foreign currency translation adjustment 322,313

Balance as of September 30, 2024 $ 47,862,242

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

September 30, 2024

Estimated Useful

2 unchanged sentences

Amortization Net Carrying

Patents 15 years $ 83,784 $ — $ ( 18,385 ) $ 65,399

Computer software 5 years $ 247,828 $ — $ ( 241,191 ) $ 6,637

8 unchanged sentences

Non-compete agreements 5 years 100,000 — ( 30,000 ) 70,000

100,000 — ( 25,000 ) 75,000

Trade credits 5 years 1,500,000 — — 1,500,000

5 unchanged sentences

Amortization Net Carrying

Patents 15 years $ 62,823 $ 20,961 $ ( 15,592 ) $ 68,192

Computer software 5 years $ 247,828 $ — $ ( 235,967 ) $ 11,861

6 unchanged sentences

Trademark 8 - 15 years

389,469 38,062 ( 62,141 ) 365,390

Non-compete agreements 5 years — 100,000 ( 15,000 ) 85,000

1 unchanged sentence

$ 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 $( 1,744 ) for the six months ended June 30, 2024.

The intangible assets include an immaterial foreign currency translation adjustment in the amount of $ 29,019 for the nine months ended September 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 $ 1,583,871 and $ 1,414,944 for the three months ended June 30, 2024 and 2023, respectively.

During the nine months ended September 30, 2024, the Company disposed of intangible assets with a cost of $ 1,540 and accumulated amortization of $ 276 .

The Company recorded a loss on disposal of intangible assets of $ 1,264 for the nine months ended September 30, 2024.

The Company also reclassified certain intangible assets with a cost of $ 30,361 and

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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:

accumulated amortization of $ 8,136 to “legal and regulatory” expenses within the unaudited Condensed Statements of Operations and Comprehensive Income (Loss) .

The Company recorded amortization expense of $ 1,605,483 and $ 1,515,378 for the three months ended September 30, 2024 and 2023, respectively.

The Company recorded amortization expense of $ 4,884,337 and $ 4,295,958 for the nine months ended September 30, 2024 and 2023, respectively.

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

2024, remaining $ 1,003,942

6 unchanged sentences

Accrued Liabilities

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

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

September 30,

2024 December 31,

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

Accrued general expenses $ 19,634,415 $ 27,001,232

Accrued workers' compensation and other insurance liabilities 19,349,940 12,881,902

Accrued subcontractors 10,165,705 37,858,755

17 unchanged sentences

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 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).

On March 4, 2024, the Company drew down $ 15,000,000 and made an

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

additional $ 15,000,000 draw on March 18, 2024 .

As of September 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 $ 587,721 and $ 0 in interest charges relating to its Revolving Facility for the three months ended September 30, 2024 and 2023, respectively, and $ 1,625,408 and $ 0 for the nine months ended September 30, 2024 and 2023, respectively, which is reflected in interest (expense) income on the Company’s unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Standby Letter of Credit

1 unchanged sentence

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.

As of September 30, 2024 , no am ounts had been drawn.

Notes Payable

2 unchanged sentences

The following table summarizes the Company’s notes payable:

September 30,

2024 December 31,

Equipment and financing loans payable, between 2.5 % and 7.5 % interest and maturing between June 2024 and August 2026

Equipment and financing loans payable, between 2.5 % and 4.8 % interest and maturing between May 2026 and August 2026

$ 47,710 $ 69,717

2 unchanged sentences

Total non-current portion of notes payable $ 21,336 $ 41,586

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:

Interest expense was $ 484 and $ 48,794 for the three months ended September 30, 2024 and 2023, respectively.

Interest expense was $ 1,912 and $ 110,203 for the nine months ended September 30, 2024 and 2023, respectively.

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

Notes Payable

10 unchanged sentences

Previously, these costs had been allocated almost entirely to the Transportation Services segment.

All of the Company’s revenues and cost of revenues continue to be reported within the Transportation Services and Mobile Health Services segments.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

of the Company’s revenues and cost of revenues continue to be reported within the Transportation Services and Mobile Health Services segments.

The Corporate segment contains operating expenses such as information technology costs, certain insurance costs and the compensation costs of senior and executive leadership.

1 unchanged sentence

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.

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.

4 unchanged sentences

Services Corporate Total

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Revenues $ 90,663,433 $ 48,021,381 $ — $ 138,684,814

5 unchanged sentences

Capital expenditures 640,499 3,054,429 536,262 4,231,190

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Revenues $ 139,340,467 $ 47,212,443 $ — $ 186,552,910

8 unchanged sentences

Services Corporate Total

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Revenues $ 351,346,919 $ 144,375,140 $ — $ 495,722,059

5 unchanged sentences

Capital expenditures 897,284 10,085,457 2,202,787 13,185,528

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Revenues $ 292,351,835 $ 132,690,538 $ — $ 425,042,373

5 unchanged sentences

Capital expenditures 28,109,057 16,460,730 3,159,172 47,728,959

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

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

Geographic Information

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

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

September 30,

2024 December 31, 2023

4 unchanged sentences

Revenues by geographic location are included in Note 2.

Unregistered Sales of Equity Securities

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

On May 24, 2022, the Company’s Board of Directors (the “Board of Directors”) authorized a share repurchase program to purchase up to $ 40,000,000 of Common Stock (the “2022 Program”).

On May 24, 2022, the Company’s Board of Directors (the “Board of Directors” or the “Board”) authorized a share repurchase program to purchase up to $ 40,000,000 of Common Stock (the “2022 Program”).

During the second and fourth quarter of 2022, the Company repurchased 536,839 shares of its Common Stock for $ 3,731,712 .

1 unchanged sentence

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

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.

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

On August 5, 2024, following the expiration of the previously authorized share repurchase program on July 30, 2024, the Board effectively extended the Prior Repurchase Program by authorizing a new share repurchase program (the “New Repurchase Program”) on the same terms and conditions as the Prior Repurchase 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 Repurchase 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 depends 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 may be modified, suspended or discontinued at any time without prior notice.

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.

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

During the three months ended September 30, 2024, the Company repurchased and subsequently cancelled 356,113 shares of Common Stock for $ 1,296,187 .

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

During the nine months ended September 30, 2024, the Company repurchased and subsequently cancelled 3,007,684 shares of Common Stock for $ 11,078,198 .

There were no shares repurchased during the nine months ended September 30, 2023.

Stock-Based Compensation

6 unchanged sentences

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

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

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As of September 30, 2024, approximately 3.9 million employee stock options had vested.

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

Before the consummation of the Business Combination, management took the average of several publicly traded companies that were representative of the Company’s size and industry in order to estimate its expected stock volatility.

Before the consummation of the Business Combination, the management of Ambulnz took the average of several publicly traded companies that were representative of Ambulnz’ size and industry in order to estimate its expected stock volatility.

Subsequent to the Business Combination, the Company utilized publicly available pricing.

3 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 six months ended June 30, 2024 and 2023:

Six Months Ended

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

Nine Months Ended

September 30,

Risk-free interest rate 4.19 % - 4.54 %

4.10 % - 4.87 %

Expected term (in years) 5.57 6.25

1 unchanged sentence

Dividend yield — % — %

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

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

Shares Weighted

5 unchanged sentences

Cancelled ( 4,016,371 ) 7.70 — —

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 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.

Balance as of September 30, 2024 8,203,813 7.06 7.48 1,487,826

Options vested and exercisable as of September 30, 2024 3,910,463 $ 6.66 6.86 $ 1,433,639

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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 nine months ended September 30, 2024 and the year ended December 31, 2023 was $ 2.54 and $ 7.93 , respectively.

For the three months ended September 30, 2024 and 2023, the total recorded stock-based compensation related to stock option awards granted was $ 1,448,151 , and $ 3,027,577 , respectively.

For the nine months ended September 30, 2024 and 2023, the total recorded stock-based compensation related to stock option awards granted was $ 4,688,997 and $ 8,787,375 , respectively.

On September 30, 2024 and December 31, 2023, the total unrecognized compensation related to unvested stock option awards granted was $ 13,027,394 and $ 29,058,756 , respectively, which the Company expects to recognize over a weighted-average period of approximately 1.49 years.

Restricted Stock Units

2 unchanged sentences

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

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

Activity under RSUs during the nine months ended September 30, 2024 was as follows:

RSUs Weighted-

3 unchanged sentences

Forfeited ( 151,880 ) 4.93

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

Balance as of September 30, 2024 2,891,176 5.04

Vested and unissued as of September 30, 2024 2,617 10.03

Non-vested as of September 30, 2024 2,888,559 $ 5.04

The total grant-date fair value of RSUs granted during the nine months ended September 30, 2024 was $ 3,780,430 .

For the three months ended September 30, 2024 and 2023, the Company recorded stock-based compensation expense related to RSUs of $ 1,426,271 and $ 25,000 , respectively.

For the nine months ended September 30, 2024 and 2023, the Company recorded stock-based compensation expense related to RSUs of $ 4,242,065 and $ 1,416,338 , respectively.

On September 30, 2024, and December 31, 2023, the total unrecognized compensation related to unvested RSUs granted was $ 11,711,097 and $ 12,602,662 , respectively, which is expected to be recognized over a weighted-average period of approximately 1.8 years.

Performance-based Restricted 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 (Loss) on a straight-line basis over the vesting period for PSUs.

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

The Company records compensation expense in the unaudited Condensed Consolidated Statement of Operations and Comprehensive

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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

Income (Loss) on a straight-line basis over the vesting period for PSUs.

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

Activity under PSUs during the nine months ended September 30, 2024 was as follows:

PSUs Weighted-

2 unchanged sentences

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.

Balance as of September 30, 2024 868,216 5.16

Vested and unissued as of September 30, 2024 — —

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

There were no PSUs granted during the three and nine months ended September 30, 2024.

For the three and nine months ended September 30, 2024, the Company recorded stock-based compensation expense related to PSUs of $ 280,764 and $ 824,393 , respectively, which are included in accrued liabilities.

For the three and nine months ended September 30, 2023, no stock-based compensation expense related to PSUs were recorded.

As of September 30, 2024 and December 31, 2023, the total unrecognized compensation related to unvested PSUs granted was $ 3,582,775 and $ 5,527,166 , respectively, which is expected to be recognized over a weighted-average period of approximately 3.2 years.

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

8 unchanged sentences

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:

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

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

8 unchanged sentences

Lease Payments

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

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

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

7 unchanged sentences

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.

During the year, the Company reassessed the use of some office spaces, resulting in the termination of two leased office spaces.

The Company recorded a loss from remeasurement of operating lease of $ 6,163 and $ 13,469 during the three and nine months ended September 30, 2024, respectively.

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

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Lease Position as of June 30, 2024

Lease Position as of September 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:

September 30,

2024 December 31, 2023

7 unchanged sentences

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 June 30, 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 September 30, 2024:

Weighted average remaining lease term (in years) - operating leases 3.90

1 unchanged sentence

Undiscounted Cash Flows

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

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

2024, remaining $ 1,109,227

2 unchanged sentences

2027 2,391,396

2028 1,765,274

Thereafter 1,277,710

3 unchanged sentences

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.

The Company leases vehicles under non-cancellable finance lease agreements with a liability of $ 13,990,018 and $ 11,430,465 as of September 30, 2024 and December 31, 2023, respectively, and accumulated depreciation of $ 9,896,278 and $ 11,679,823 as of September 30, 2024 and December 31, 2023, respectively.

and Subsidiaries

1 unchanged sentence

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

During the year, the Company returned a number of leased vehicles, resulting in the termination of contract of these leased vehicles.

The Company recorded a loss on remeasurement of finance lease of $ 0 and $ 18,583 during the three and nine months ended September 30, 2024, respectively.

For the three and nine months ended September 30, 2023, the Company terminated leased vehicles which resulted in a $ 4,834 gain on remeasurement of finance leases.

Lease Position as of September 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:

September 30,

2024 December 31,

7 unchanged sentences

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 June 30, 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 September 30, 2024:

Weighted average remaining lease term (in years) - finance leases 3.45

1 unchanged sentence

Undiscounted Cash Flows

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

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

Finance Leases

11 unchanged sentences

Other Income (Expense)

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,

The Company recognized $( 1,103,016 ) and $ 449,051 of other income (expense) for the three months ended September 30, 2024 and 2023, respectively, as set forth in the table below.

The Company recognized $( 1,837,655 ) and $ 715,589 of other income (expense) for the nine months ended September 30, 2024 and 2023, respectively, as set forth in the table below.

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

3 unchanged sentences

Loss on equity method investments ( 82,742 ) ( 95,503 ) ( 229,923 ) ( 301,362 )

Loss on remeasurement of operating and finance leases ( 21,192 ) — ( 25,889 ) —

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

(Loss) gain on remeasurement of operating and finance leases ( 6,163 ) 4,834 ( 32,052 ) 4,834

(Loss) gain on disposal of fixed assets ( 28,681 ) ( 9,983 ) 36,717 ( 163,452 )

ABC litigation — — — ( 1,000,000 )

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

Other income (expense) ( 435,825 ) 43,353 146,058 338,175

Total other income (expense) $ ( 1,103,016 ) $ 449,051 $ ( 1,837,655 ) $ 715,589

8 unchanged sentences

The Company's payments to EDTSLS for Mr.

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.

Tendler's services totaled $ 412,353 and $ 204,700 for the three months ended September 30, 2024 and 2023, respectively, and $ 1,033,273 and $ 674,970 for the nine months ended September 30, 2024 and 2023, respectively.

There were no amounts included in accounts payable and accrued liabilities as of September 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 $ 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.

The Company made subcontractor payments to PrideStaff totaling $ 7,685 and $ 148,304 for the three and nine months ended September 30, 2024, respectively.

There were no payments made for the three and nine months ended September 30, 2023, respectively.

Included in accounts payable were $ 1,679 and $ 0 due to related parties as of September 30, 2024 and December 31, 2023, respectively.

Included in accrued liabilities were $ 1,679 and $ 0 due to related parties as of September 30, 2024 and December 31, 2023 related to subcontractor services.

Transition Services Agreement

11 unchanged sentences

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

On March 7, 2024, the Company entered into a separation and consulting agreement (the “Consulting Agreement”) with Stan Vashovsky, who retired as a director and Chair of the Board effective March 31, 2024.

Pursuant to the Consulting Agreement, Mr.

Capone under the Transition Agreement totaling $ 0 and $ 180,000 for the three and nine months ended September 30, 2024, respectively.

There were no payments made for the three and nine months ended September 30, 2023 , respectively.

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

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

Consulting Agreement - Stan Vashovsky

On March 7, 2024, the Company entered into a separation and consulting agreement (the “Vashovsky Consulting Agreement”) with Stan Vashovsky, who retired as a director and Chair of the Board effective March 31, 2024.

Pursuant to the Vashovsky Consulting Agreement, Mr.

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

3 unchanged sentences

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.

The Vashovsky Consulting Agreement further acknowledges and affirms that Mr.

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

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.

The Company granted approximately $ 70,000 in RSUs to Mr.

Vashovsky under the Vashovsky Consulting Agreement for the three and nine months ended September 30, 2024.

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

Consulting Agreement - Steven Katz

On September 26, 2024, the Company entered into a transition consulting agreement (the “Katz Consulting Agreement”) with Steven Katz, who resigned as a director and independent Chair of the Board of Directors effective October 1, 2024.

Pursuant to the Katz Consulting Agreement, Mr.

Katz will serve as a consultant to the Company until December 31, 2024 (the “Katz Consulting Period”).

During the Katz Consulting Period, Mr.

Katz will provide transition advisory services relating to the Board and its committees as may be requested from time to time by the Company’s executive officers or the Board of Directors.

As compensation for his services during the Katz Consulting Period, and subject to his compliance with the Katz Consulting Agreement, Mr.

Katz will receive consulting fees in the amount of (i) $ 2,500 per month plus (ii) $ 400 for each hour of services rendered in excess of five hours during each month.

During the Katz Consulting Period, Mr.

Katz’s equity awards will also continue to vest under the Plan.

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

and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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 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.

The Company’s provision for income taxes for the three months ended September 30, 2024 and 2023 were $ 4,488,828 and $ 4,526,767 , respectively, and $ 13,316,752 and $ 2,041,843 for the nine months ended September 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 June 30, 2024.

The Company did not make any employer contributions to this plan as of September 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

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.

1 unchanged sentence

If the Company determines that a loss is reasonably possible and the loss or range of loss can be estimated, the Company discloses the possible loss in the unaudited Condensed Consolidated Financial Statements.

California Labor Actions

On March 30, 2023, Paul Lowe v.

Rapid Reliable Testing, LLC, et al.

was filed in the Los Angeles Superior Court (the “Lowe Action”).

The complaint alleges various wage and hour claims on behalf of the plaintiff and a putative class.

The complaint also alleges a derivative class claim for violations of California’s Unfair Competition Law and seeks to bring a representative action pursuant to California’s Private Attorneys General Act of 2004 (“PAGA”).

In addition, Corielyn Marie Hall v.

Rapid Reliable Testing, LLC, et al.

involves two separate actions filed in the Los Angeles Superior Court by plaintiff Corielyn Hall (collectively with the Lowe Action, the “California Labor Actions”).

The first action is a class complaint filed on December 14, 2023.

Similar to the Lowe Action, it alleges various wage and hour claims on behalf of the plaintiff and a putative class and asserts a derivative class claim for violations of California’s Unfair Competition Law.

The second action brought by Corielyn Hall was filed on February 20, 2024 and brings claims under PAGA.

At the time of this filing, the Company is participating in early mediation with the plaintiffs in the California Labor Actions.

Given the overlapping claims and time periods presented in the California Labor Actions, these actions will be mediated concurrently in an effort to reach a global resolution.

The Company believes there are substantial defenses to the claims alleged in California Labor Actions.

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

The Company intends to vigorously defend itself against these claims if they cannot be resolved during mediation.

Stockholder Actions

On October 27, 2023, Joe Naclerio, individually and purportedly on behalf of all others similarly situated, filed a putative class action complaint for violation of federal securities laws in the U.S.

1 unchanged sentence

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 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

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

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

The motion was 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.

3 unchanged sentences

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.

District Court for the Southern District of New York (the “Shetterly Action”), and Salma Daboul in the Supreme Court for the State of New York (the “Daboul Action”).

Both actions purport to assert claims for breach of fiduciary duty and other related claims on behalf of the Company.

Both assert factual allegations substantially similar to those asserted in the securities class action matter discussed above, seeking various forms of monetary and injunctive relief.

On August 29, 2024, the U.S.

District Court for the Southern District of New York issued an order to transfer the Shetterly Action to the United States District Court for the District of Delaware.

At the time of this filing, no defendants have been served in the Shetterly Action.

On September 6, 2024, the plaintiff in the Daboul Action voluntarily discontinued the 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.

The Company believes there are substantial defenses to these claims.

Cybersecurity Action

On August 22, 2024, Maria Ballesteros, individually and on behalf of others similarly situated, filed a complaint against Ambulnz NY, LLC, a subsidiary of the Company (“Ambulnz NY”), in the U.S.

District Court for the Southern District of New York arising from a data security incident that the Company experienced in April 2024 (the “Cybersecurity Action”).

The Cybersecurity Action alleges negligence, negligence per se, breach of fiduciary duty, breach of implied contract and violations of California’s Unfair Competition Law, the California Privacy Act and the California Consumer Records Act, and seeks various forms of monetary and injunctive relief.

At the time of this filing, Ambulnz NY still has time to respond to the complaint and is participating in early mediation with the plaintiff.

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

The Company maintains cybersecurity insurance coverage to limit its exposure to losses relating to cybersecurity incidents, including costs arising from litigation such as the Cybersecurity Action.

The Company intends to vigorously defend itself against these claims if they cannot be resolved during mediation.

Risk and Uncertainties

8 unchanged sentences

Furthermore, a loss of government contract work, if not offset by revenues from new or other existing customers, could have a material adverse effect on the Company’s business, financial condition, and results of operations.

Subsequent Events

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.

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 .

Subsequent Events

Line of Credit

On October 20, 2024, the Company’s unconditional and irrevocable letter of credit from a financial institution in the amount of $ 1,080,000 automatically renewed for a one-year period ending October 20, 2025.

The letter of credit renews automatically for successive one-year periods, unless earlier terminated by the institution.

Effective November 1, 2024, the Company converted its $ 15,000,000 base rate loan under the terms of the Revolving Facility to a 6-month term SOFR loan, maturing on May 1, 2025.

Series C Preferred Stock Purchase

On November 1, 2024, the Company made a $ 5,000,000 cash payment to Firefly Health, Inc., a Delaware corporation, in exchange for 798,305 shares of Series C preferred stocks, at a purchase price of $ 6.26327 per share.

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