UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended ~~September 30, 2022~~March 31, 2023

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

For the transition period from to

Commission File ~~Number:~~Number 001-39618

DocGo Inc.

(Exact Name of Registrant as Specified in Its Charter)

Delaware		85-2515483
(State or Other Jurisdiction of		(I.R.S. Employer
Incorporation or Organization)		Identification Number)

35 West 35^th Street, Floor 6
New York, New York		10001
(Address of Principal Executive Offices)		(Zip Code)

(844) 443-6246

(Registrant’s Telephone Number, Including Area Code)

N/A

(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, par value $0.0001 per share		DCGO		The Nasdaq Stock Market LLC

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

Large accelerated filer	☐	Accelerated filer	☐☒
Non-accelerated filer	☒☐	Smaller reporting company	☒☐
		Emerging growth company	☒

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

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

As of ~~November 3, 2022, 102,826,671~~May 5, 2023, 103,473,896 shares of Common Stock, par value $0.0001 per share, were issued and outstanding.

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Unaudited Condensed Consolidated Balance Sheets as of ~~September 30, 2022~~March 31, 2023 (Unaudited) and December 31, ~~2021~~2022		2

Unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~		3

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~		~~4-5~~4

Unaudited Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~		~~6-7~~5-6

Notes to Unaudited Condensed Consolidated Financial Statements		~~8-35~~7-34

DocGo Inc. and Subsidiaries

UNAUDITED CONDENSED CONSOLIDATED BALANCE ~~SHEET~~SHEETS

	September 30,			December 31,			March 31,			December 31,
	2022			2021			2023			2022
	Unaudited			Audited			Unaudited			Audited
ASSETS

Current assets:
Cash and cash equivalents	$	169,598,749		$	175,537,221		$	120,056,897		$	157,335,323
Accounts receivable, net of allowance of $7,376,957 and $7,377,389 as of September 30, 2022 and December 31, 2021, respectively		79,999,764			78,383,614
Accounts receivable, net of allowance of $3,780,545 and $7,818,702 as of March 31, 2023 and December 31, 2022, respectively								131,599,567			102,995,397
Assets held for sale								-			4,480,344
Prepaid expenses and other current assets		2,394,324			2,111,656			6,737,378			6,269,841

Total current assets		251,992,837			256,032,491			258,393,842			271,080,905

Property and equipment, net		17,577,830			12,733,889			21,729,460			21,258,175
Intangibles, net		20,647,790			10,678,049			38,939,054			22,969,246
Goodwill		34,533,363			8,686,966			47,668,654			38,900,413
Restricted cash		9,753,575			3,568,509			7,461,821			6,773,751
Operating lease right-of-use assets		8,185,547			4,195,682			9,375,132			9,074,277
Finance lease right-of-use assets		9,421,196			9,307,113			9,170,429			9,039,663
Equity method investment		712,718			589,058			482,691			597,977
Deferred tax assets								10,973,522			9,957,967
Other assets		3,095,354			3,810,895			3,350,571			3,625,254
Total assets	$	355,920,210		$	309,602,652		$	407,545,176		$	393,277,628

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable	$	12,153,337		$	15,833,970		$	19,028,065		$	21,582,866
Accrued liabilities		38,558,074			35,110,877			30,544,082			31,573,031
Line of credit		1,025,881			25,881
Notes payable, current		680,703			600,449			649,808			664,913
Due to seller		9,802,238			1,571,419			27,198,044			26,244,133
Contingent consideration		4,000,000			-			26,428,272			10,555,540
Operating lease liability, current		2,059,278			1,461,335			2,353,383			2,325,024
Liabilities held for sale								-			4,480,344
Finance lease liability, current		2,858,968			3,271,990			2,773,029			2,732,639
Total current liabilities		71,138,479			57,875,921			108,974,683			100,158,490

Notes payable, non-current		1,456,105			1,302,839			1,272,415			1,236,601
Operating lease liability, non-current		6,406,246			2,980,946			7,315,226			7,040,982
Finance lease liability, non-current		6,086,521			6,867,420			6,061,828			5,914,164
Warrant liabilities		-			13,518,502
Total liabilities		85,087,351			82,545,628			123,624,152			114,350,237

Commitments and Contingencies

STOCKHOLDERS’ EQUITY:
Common stock ($0.0001 par value; 500,000,000 shares authorized as of September 30, 2022 and December 31,2021; 102,824,878 and 100,133,953 shares issued and outstanding as of September 30, 2022 and December 31,2021, respectively		10,778			10,013
Common stock ($0.0001 par value; 500,000,000 shares authorized as of March 31, 2023 and December 31,2022; 102,932,174 and 102,411,162 shares issued and outstanding as of March 31, 2023 and December 31,2022, respectively)								10,293			10,241
Additional paid-in-capital		301,522,213			283,161,216			310,049,864			301,451,435
Accumulated deficit		(37,036,937	)		(63,556,714	)		(32,367,602	)		(28,972,216	)
Accumulated other comprehensive loss		(276,213	)		(32,501	)
Accumulated other comprehensive gain								984,864			741,206
Total stockholders’ equity attributable to DocGo Inc. and Subsidiaries		264,219,841			219,582,014			278,677,419			273,230,666
Noncontrolling interests		6,613,018			7,475,010			5,243,605			5,696,725
Total stockholders’ equity		270,832,859			227,057,024			283,921,024			278,927,391
Total liabilities and stockholders’ equity	$	355,920,210		$	309,602,652		$	407,545,176		$	393,277,628

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

~~DocGo Inc. and Subsidiaries~~

~~UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME~~

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021

Revenue, net $ 104,319,894 $ 85,838,988 $ 331,730,750 $ 197,394,379
Expenses:
Cost of revenues (exclusive of depreciation and amortization, which is shown separately below) 71,254,838 60,025,728 219,418,873 137,080,202
Operating expenses:
General and administrative 22,186,036 19,612,243 70,684,270 47,239,204
Depreciation and amortization 3,014,864 2,019,576 7,253,656 5,514,303
Legal and regulatory 2,200,964 813,204 6,610,223 2,646,573
Technology and development 1,373,146 854,618 3,663,299 1,980,899
Sales, advertising and marketing 90,856 994,401 2,348,917 3,029,182
Total expenses 100,120,704 84,319,770 309,979,238 197,490,363
Income (loss) from operations 4,199,190 1,519,218 21,751,512 (95,984 )

Other income (expenses):
Interest income (expense), net 334,221 (255,711 ) 296,891 (500,849 )
Gain/(loss) on remeasurement of warrant liabilities (1,831,947 ) - 1,137,070 -
Gain on initial equity method investments 93,371 - 99,840 -
Gain on remeasurement of finance leases - - 1,388,273 -
Gain from PPP loan forgiveness - 142,667 - 142,667
Gain/(loss) on disposal of fixed assets 42,667 - 42,667 (27,730 )
Other income 30,900 - 42,288 -
Total other (expense) income (1,330,788 ) (113,044 ) 3,007,029 (385,912 )

Net income (loss) before income tax benefit (expense) 2,868,402 1,406,174 24,758,541 (481,896 )
Income tax expense (401,916 ) (604,608 ) (1,163,755 ) (613,531 )
Net income (loss) 2,466,486 801,566 23,594,786 (1,095,427 )
Net loss attributable to noncontrolling interests (687,944 ) (2,705,954 ) (2,924,992 ) (1,278,363 )
Net income attributable to stockholders of DocGo Inc. and Subsidiaries 3,154,430 3,507,520 26,519,778 182,936
Other comprehensive income
Foreign currency translation adjustment 248,283 69,193 252,854 171,846
Total comprehensive gain $ 3,402,713 $ 3,576,713 $ 26,772,632 $ 354,782

Net income per share attributable to DocGo Inc. and Subsidiaries - Basic $ 0.03 $ 0.06 $ 0.26 $ 0.00
Weighted-average shares outstanding - Basic 98,960,538 58,388,866 100,725,697 58,388,866

Net income per share attributable to DocGo Inc. and Subsidiaries - Diluted $ 0.03 $ 0.04 $ 0.24 $ 0.00
Weighted-average shares outstanding - Diluted 107,403,135 83,701,783 109,168,293 83,701,783

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

~~DocGo Inc. and Subsidiaries~~

~~UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY~~

Series A
Preferred Stock Class A
Common Stock Class B
Common Stock Additional
Paid-in- Accumulated Accumulated
Other
Comprehensive Noncontrolling Total
Stockholders’
Shares Amount Shares Amount Shares Amount Capital Deficit Income Interests Equity
Balance - December 31, 2020 28,055 $ - 35,497 $ - 55,008 $ - $ 142,346,852 $ (87,300,472 ) $ (48,539 ) $ 11,949,200 $ 66,947,041
Effect of reverse acquisition 18,099,548 - 22,900,719 - 35,488,938 - - - - - -
Conversion of share due to merger recapitalization (18,099,548 ) - (22,900,719 ) 7,649 (35,488,938 ) - - - - - 7,649
Effect of reverse acquisition - - 76,489,205 7,649 - - 142,346,852 (87,300,472 ) (48,539 ) 11,949,200 66,954,690
Share issued for services 266 - 171,608 17 - - - - - - 17
Stock based compensation - - - - - - 391,534 - - - 391,534
Noncontrolling interest contribution - - - - - - - - - 333,025 333,025
Foreign currency translation - - - - - - - - 7,998 - 7,998
Net loss attributable to Noncontrolling interests - - - - - - - - - (320,632 ) (320,632 )
Net loss attributable to stockholders of DocGo Inc. and Subsidiaries - - - - - - - (1,678,364 ) - - (1,678,364 )
Balance - March 31, 2021 28,321 $ - 76,660,813 $ 7,666 - $ - $ 142,738,386 $ (88,978,836 ) $ (40,541 ) $ 11,961,593 $ 65,688,268
Stock based compensation - - - - - - 370,000 - - - 370,000
Foreign currency translation - - - - - - - - 94,655 - 94,655
Net income attributable to Noncontrolling interests - - - - - - - - - 1,748,223 1,748,223
Net loss attributable to stockholders of DocGo Inc. and Subsidiaries - - - - - - - (1,646,216 ) - - (1,646,216 )
Balance - June 30, 2021 28,321 - 76,660,813 $ 7,666 - $ - $ 143,108,386 $ (90,625,052 ) $ 54,114 $ 13,709,816 $ 66,254,930
UK Ltd. Shares purchase - - - - - - (280,772 ) - - (242,945 ) (523,717 )
Stock based compensation - - - - - - 463,046 - - - 463,046
Fees associated with equity raise (1,398 ) (1,398 )
Foreign currency translation - - - - - - - - 69,193 - 69,193
Net income attributable to Noncontrolling interests - - - - - - - - - (2,705,954 ) (2,705,954 )
Net income attributable to stockholders of Ambulnz, Inc. and Subsidiaries - - - - - - - 3,507,520 - - 3,507,520
Balance - September 30, 2021 28,321 $ - 76,660,813 $ 7,666 - $ - $ 143,289,262 $ (87,117,532 ) $ 123,307 $ 10,760,917 $ 67,063,620

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

DocGo Inc. and Subsidiaries

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF ~~CHANGES IN STOCKHOLDERS’ EQUITY~~OPERATIONS AND
~~(CONTINUED)~~COMPREHENSIVE (LOSS) INCOME

Series A
Preferred Stock Class A
Common Stock Class B
Common Stock Additional
Paid-in- Accumulated Accumulated
Other
Comprehensive Noncontrolling Total
Stockholders’
Shares Amount Shares Amount Shares Amount Capital Deficit Income Interests Equity
Balance - December 31, 2021       - $        - 100,133,953 $ 10,013 - $       - $ 283,161,216 $ (63,556,714 ) $ (32,501 ) $ 7,475,010 $ 227,057,024
Exercise of stock options - - 195,152 195 - - 374,149 - - - 374,344
Stock based compensation - - - - - - 1,422,937 - - - 1,422,937
Equity cost (19,570 ) (19,570 )
Noncontrolling interest contribution - - - - - - - - - 2,063,000 2,063,000
Foreign currency translation - - - - - - - - (5,863 ) - (5,863 )
Net loss attributable to Noncontrolling interests - - - - - - - - - (1,257,257 ) (1,257,257 )
Net income attributable to stockholders   of DocGo Inc. and Subsidiaries - - - - - - - 10,629,694 - - 10,629,694
Balance - March 31, 2022 - $ - 100,329,105 $ 10,208 - $ - $ 284,938,732 $ (52,927,020 ) $ (38,364 ) $ 8,280,753 $ 240,264,309
Common stock repurchased - - (70,000 ) (70 ) - - (497,829 ) - - - (497,899 )
Exercise of stock options - - 417,927 418 - - 778,648 - - - 779,066
Stock based compensation - - - - - - 1,999,619 - - - 1,999,619
UK Ltd. Restricted Stock - - 8,258 8 - - 82,297 - - - 82,305
Net loss attributable to Noncontrolling interests - - - - - - - - - (979,791 ) (979,791 )
Foreign currency translation - - - - - - - - 10,434 - 10,434
Net income attributable to stockholders of DocGo Inc. and Subsidiaries - - - - - - - 12,735,653 - - 12,735,653
Balance - June 30, 2022 - $ - 100,685,290 $ 10,564 - $ - $ 287,301,467 $ (40,191,367 ) $ (27,930 ) $ 7,300,962 $ 254,393,696
Common stock repurchased - - - - - - - - - - -
Exercise of stock options - - 378,941 38 - - 728,465 - - - 728,503
Cashless exercise of options - - 354,276 35 - - (354 ) - - - (319 )
Stock based compensation - - - - - - 1,015,660 - - - 1,015,660
UK Ltd. Restricted Stock - - - - - - 95,543 - - - 95,543
Share warrants conversion - - 1,406,371 141 - - 12,381,432 - - - 12,381,573
Acquisitions - - - - - - - - - - -
Net loss attributable to Noncontrolling interests - - - - - - - - - (687,944 ) (687,944 )
Foreign currency translation - - - - - - - - (248,283 ) - (248,283 )
Net income attributable to stockholders   of DocGo Inc. and Subsidiaries - - - -       - - - 3,154,430 - - 3,154,430
Balance - September 30, 2022 - $ - 102,824,878 $ 10,778 - $ - $ 301,522,213 $ (37,036,937 ) $ (276,213 ) $ 6,613,018 $ 270,832,859

~~DocGo Inc. and Subsidiaries~~

~~UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS~~

Nine Months Ended
September 30,
2022 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 23,594,786 $ (1,095,427 )
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation of property and equipment 2,592,244 1,697,380
Amortization of intangible assets 2,269,423 1,432,983
Amortization of finance lease right-of-use assets 2,391,989 2,383,940
(Gain) Loss on disposal of assets (42,667 ) 27,730
Gain from PPP loan forgiveness - (142,667 )
Gain from equity method investment (99,840 ) -
Bad debt expense 2,702,979 2,152,470
Stock based compensation 4,616,056 1,224,580
Gain on remeasurement of finance leases (1,388,273 ) -
Gain on remeasurement of warrant liabilities (1,137,070 ) -
Changes in operating assets and liabilities:
Accounts receivable 2,894,650 (28,794,602 )
Prepaid expenses and other current assets (282,668 ) (4,531,411 )
Other assets 882,432 (1,786,407 )
Accounts payable (3,983,383 ) 9,422,628
Accrued liabilities 2,596,887 24,861,804
Net cash provided by operating activities 37,607,545 6,853,001

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment (1,994,161 ) (2,824,916 )
Acquisition of intangibles (1,956,434 ) (1,571,959 )
Acquisition of businesses (33,843,373 ) (56,496 )
Proceeds from disposal of property and equipment - 6,000
Net cash used in investing activities (37,793,968 ) (4,447,371 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving credit line 1,000,000 8,000,000
Repayments of notes payable (585,711 ) (374,456 )
Due to seller (1,007,800 ) -
Noncontrolling interest contributions 2,063,000 333,025
Proceeds from exercise of stock options 1,880,568 -
Common stock repurchased (497,759 ) -
Equity costs (19,570 ) -
Payments on obligations under finance lease (2,146,857 ) (1,830,823 )

Net cash provided by financing activities 685,871 6,127,746

Effect of exchange rate changes on cash and cash equivalents (252,854 ) 171,846

Net increase in cash and restricted cash 246,594 8,705,222
Cash and restricted cash at beginning of period 179,105,730 34,457,273
Cash and restricted cash at end of period $ 179,352,324 $ 43,162,495

	Three Months Ended March 31,
	2023			2022

Revenue, net	$	113,002,703		$	117,891,552
Expenses:
Cost of revenues (exclusive of depreciation and amortization, which is shown separately below)		81,226,498			77,987,573
Operating expenses:
General and administrative		29,220,317			23,860,616
Depreciation and amortization		3,649,329			2,201,021
Legal and regulatory		3,638,321			1,347,983
Technology and development		1,863,579			1,141,833
Sales, advertising and marketing		307,246			1,257,961
Total expenses		119,905,290			107,796,987
(Loss) Income from operations		(6,902,587	)		10,094,565

Other income (expenses):
Interest income (expense), net		809,172			(135,606	)
Loss on remeasurement of warrant liabilities		-			(58,749	)
Loss on equity method investments		(115,286	)		(83,341	)
Loss on disposal of fixed assets		(54,839	)		-
Other income (expenses)		214,880			(4,253	)
Total other income (expenses)		853,927			(281,949	)

Net (loss) income before income tax benefit (expense)		(6,048,660	)		9,812,616
Income tax benefit (provision)		2,129,870			(440,179	)
Net (loss) income		(3,918,790	)		9,372,437
Net (loss) income attributable to noncontrolling interests		(453,120	)		(1,257,257	)
Net (loss) income attributable to stockholders of DocGo Inc. and Subsidiaries		(3,465,670	)		10,629,694
Other comprehensive (loss) income
Foreign currency translation adjustment		243,658			(5,863	)
Total comprehensive (loss) income	$	(3,222,012	)	$	10,623,831

Net (loss) income per share attributable to DocGo Inc. and Subsidiaries - Basic	$	(0.03	)	$	0.11
Weighted-average shares outstanding - Basic		102,579,291			100,177,082

Net (loss) income per share attributable to DocGo Inc. and Subsidiaries - Diluted	$	(0.03	)	$	0.09
Weighted-average shares outstanding - Diluted		102,579,291			115,652,049

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

DocGo Inc. and Subsidiaries

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(CONTINUED)CHANGES IN STOCKHOLDERS’ EQUITY

Nine Months Ended
September 30,
2022 2021
Supplemental disclosure of cash and non-cash transactions:

Cash paid for interest $ 102,203 $ 39,637

Cash paid for interest on finance lease liabilities $ 434,580 $ 381,937

Cash paid for income taxes $ 917,445 $ 613,531

Right-of-use assets obtained in exchange for lease liabilities $ 4,094,731 $ 3,569,276

Fixed assets acquired in exchange for notes payable $ 819,231 $ 271,194

Acquisition of remaining 20% of Ambulnz UK LTD $ - $ 228,518

Gain from PPP loan forgiveness $ - $ 142,667

Reconciliation of cash and restricted cash
Cash $ 169,598,749 $ 39,550,926

Restricted Cash 9,753,575 3,611,569

Total cash and restricted cash shown in statement of cash flows $ 179,352,324 $ 43,162,495

											Accumulated
	Common Stock				Additional Paid-in-			Accumulated			Other Comprehensive			Noncontrolling			Total Stockholders’
	Shares		Amount		Capital			Deficit			Income			Interests			Equity
Balance - December 31, 2021		100,133,953	$	10,013	$	283,161,216		$	(63,556,714	)	$	(32,501	)	$	7,475,010		$	227,057,024
Exercise of stock options		195,152		195		374,149			-			-			-			374,344
Stock based compensation		-		-		1,422,937			-			-			-			1,422,937
Equity cost						(19,570	)											(19,570	)
UK Ltd. Restricted Stock (Note 4)		146,853		-		-			-			-			-			-
Noncontrolling interest contribution		-		-		-			-			-			2,063,000			2,063,000
Foreign currency translation		-		-		-			-			(5,863	)		-			(5,863	)
Net loss attributable to noncontrolling interests		-		-		-			-			-			(1,257,257	)		(1,257,257	)
Net income attributable to stockholders of DocGo Inc. and Subsidiaries		-		-		-			10,629,694			-			-			10,629,694
Balance - March 31, 2022		100,475,958	$	10,208	$	284,938,732		$	(52,927,020	)	$	(38,364	)	$	8,280,753		$	240,264,309

										Accumulated
	Common Stock				Additional Paid-in-		Accumulated			Other Comprehensive		Noncontrolling			Total Stockholders’
	Shares		Amount		Capital		Deficit			Income		Interests			Equity
Balance - December 31, 2022		102,411,162	$	10,241	$	301,451,435	$	(28,972,216	)	$	741,206	$	5,696,725		$	278,927,391
Equity cost		-		-		-		-			-		-			-
Noncontrolling interest contribution		-		-		-		-			-		-			-
Common stock repurchased		-		-		-		-			-		-			-
Exercise of stock options		96,101		10		249,705		-			-		-			249,715
UK Ltd. Restricted Stock (Note 4)		-		-		167,175		-			-		-			167,175
Stock based compensation, including 45,704 vested RSUs		424,911		42		8,181,549		-			-		-			8,181,591
Ambulnz Health liquidation		-		-		-		70,284								70,284
Net loss attributable to noncontrolling interests		-		-		-		-			-		(453,120	)		(453,120	)
Foreign currency translation		-		-		-		-			243,658		-			243,658
Net loss attributable to stockholders of DocGo Inc. and Subsidiaries		-		-		-		(3,465,670	)		-		-			(3,465,670	)
Balance - March 31, 2023		102,932,174	$	10,293	$	310,049,864	$	(32,367,602	)	$	984,864	$	5,243,605		$	283,921,024

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

DocGo Inc. and Subsidiaries

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three Months Ended March 31,
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income	$	(3,918,790	)	$	9,372,437
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation of property and equipment		1,482,610			711,878
Amortization of intangible assets		1,365,636			633,363
Amortization of finance lease right-of-use assets		801,083			855,781
Loss on disposal of assets		54,839			-
Deferred tax asset		(1,015,555	)		-
Loss on equity method investment		115,286			68,995
Bad debt expense		(1,902,587	)		1,154,235
Stock based compensation		8,450,016			1,422,937
Loss on remeasurement of warrant liabilities		-			(58,749	)
Gain on liquidation of business		70,284			-
Changes in operating assets and liabilities:
Accounts receivable		(24,668,050	)		1,061,709
Prepaid expenses and other current assets		(174,059	)		(1,537,550	)
Other assets		274,683			2,188,242
Accounts payable		(2,581,796	)		(671,744	)
Accrued liabilities		(1,471,551	)		3,063,148
Net cash (used in) provided by operating activities		(23,117,951	)		18,264,682

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment		(1,976,075	)		(602,416	)
Acquisition of intangibles		(1,405,444	)		(534,624	)
Acquisition of businesses		1,574,604			-
Proceeds from disposal of property and equipment		117,420			-
Net cash used in investing activities		(1,689,495	)		(1,137,040	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving credit line		-			1,000,000
Repayments of notes payable		(129,370	)		(138,151	)
Due to seller		(11,494,549	)		(160,250	)
Noncontrolling interest contributions		-			2,063,000
Proceeds from exercise of stock options		416,890			374,344
Equity costs		-			(19,570	)
Payments on obligations under finance lease		(744,030	)		(622,575	)
Net cash (used in) provided by financing activities		(11,951,059	)		2,496,798

Effect of exchange rate changes on cash and cash equivalents		168,149			(5,863	)

Net (decrease) increase in cash and restricted cash		(36,590,356	)		19,618,577
Cash and restricted cash at beginning of period		164,109,074			179,105,730
Cash and restricted cash at end of period	$	127,518,718		$	198,724,307

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

DocGo Inc. and Subsidiaries

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(CONTINUED)

	Three Months Ended March 31,
	2023		2022
Supplemental disclosure of cash and non-cash transactions:

Cash paid for interest	$	32,827	$	68,222

Cash paid for interest on finance lease liabilities	$	126,584	$	153,327

Cash paid for income taxes	$	40,050	$	440,179

Right-of-use assets obtained in exchange for lease liabilities	$	926,468	$	722,716

Fixed assets acquired in exchange for notes payable	$	150,079	$	-

Reconciliation of cash and restricted cash
Cash	$	120,056,897	$	188,353,909

Restricted cash		7,461,821		10,370,398

Total cash and restricted cash shown in the statements of cash flows	$	127,518,718	$	198,724,307

Non-cash investing activities acquisition of business funded by acquisition payable	$	19,473,805	$	-

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

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Description of Organization and Business Operations

~~The Business~~

On November 5, 2021 (the “Closing Date”), DocGo Inc., a Delaware corporation (formerly known as Motion Acquisition ~~Corp) (prior~~Corp. prior to the Closing Date, “Motion” and after the Closing Date, “DocGo”), consummated the previously announced business combination (the “Closing”) pursuant to that certain Agreement and Plan of Merger dated March 8, 2021 (the “Merger Agreement”), by and among Motion Acquisition Corp., a Delaware corporation (“Motion”), Motion Merger Sub Corp., a Delaware corporation and a direct wholly owned subsidiary of Motion (“Merger Sub”), and Ambulnz, Inc., a Delaware corporation (“Ambulnz”). In connection with the Closing, the registrant changed its name from Motion Acquisition Corp. to DocGo Inc.

As contemplated by the Merger Agreement and as described in Motion’s definitive proxy statement/consent solicitation/prospectus filed with the U.S. Securities and Exchange Commission (the “SEC”) on October 14, 2021 (the “Prospectus”), Merger Sub was merged with and into Ambulnz, with Ambulnz continuing as the surviving corporation (the “Merger” and, together with the other transactions contemplated by the Merger Agreement, the “Business Combination”). As a result of the Merger, Ambulnz is a wholly-owned subsidiary of DocGo and each share of Series A preferred stock of Ambulnz, no par value (“Ambulnz Preferred Stock”), Class A common stock of Ambulnz, no par value (“Ambulnz Class A Common Stock”), and Class B common stock of Ambulnz, no par value (“Ambulnz Class B Common Stock,” together with Ambulnz Class A Common Stock, “Ambulnz Common Stock”) was cancelled and converted into the right to receive a portion of merger consideration issuable as common stock of DocGo, par value $0.0001 (“Common Stock”), pursuant to the terms and conditions set forth in the Merger Agreement.

In connection with the Business Combination, DocGo raised $158.0 million of net proceeds. This amount was comprised of $43.4 million of cash held in Motion’s trust account from its initial public offering, net of DocGo’s transaction costs and underwriters’ fees of $9.6 million, and $114.6 million of cash in connection with the concurrent PIPE private placement of shares of common stock to certain investors at a price of $10.00 per share (the “PIPE Financing”), net of $10.4 million in transaction costs in connection with the PIPE Financing. ~~The~~These transaction costs consisted of banking, legal, and other professional fees, which were recorded as a reduction to additional paid-in capital.

The Business

DocGo Inc. and its Subsidiaries (collectively, the “Company”) is a healthcare transportation and mobile health services (“Mobile Health”) company that uses proprietary dispatch and communication technology to provide quality healthcare transportation and healthcare services in major metropolitan cities in the United States ~~(“U.S.”)~~ and the United ~~Kingdom (“U.K.”).~~Kingdom. Mobile Health performs in-person care directly to patients in the comfort of their homes, workplaces and other non-traditional locations.

Ambulnz, LLC was originally formed in Delaware on June 17, 2015, as a limited liability company. On November 1, 2017, with an effective date of January 1, 2017, Ambulnz converted its legal structure from a limited liability company to a C-corporation and changed its name to Ambulnz, Inc. Ambulnz is the sole owner of Ambulnz Holdings, LLC (“Holdings”) which was formed in the state of Delaware on August 5, 2015, as a limited liability company. Holdings is the owner of multiple operating entities incorporated in various states in the ~~U.S.~~United States as well as within England and Wales, ~~U.K.~~United Kingdom.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and applicable rules and regulations of the ~~Securities and Exchange Commission (“SEC”)~~SEC regarding interim financial reporting. Certain information and disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. As such, the information included in this Quarterly Report on Form 10-Q should be read in conjunction with the ~~consolidated financial statements~~Consolidated Financial Statements and accompanying notes included in ~~our~~the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022.

~~DocGo Inc. and Subsidiaries~~

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The Consolidated Balance Sheet as of December 31, ~~2021~~2022 included herein was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by U.S. GAAP.

The ~~Unaudited~~unaudited Condensed Consolidated Financial Statements include the accounts and operations of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions are eliminated upon consolidation. Noncontrolling interests (“~~NCI”~~NCIs”) onin the ~~Unaudited~~unaudited Condensed Consolidated Financial Statements represent a portion of consolidated joint ventures and a variable interest entity (“VIE”) in which the Company does not have direct equity ownership. Accounts and transactions between consolidated entities have been eliminated. Certain amounts in the prior years’ ~~consolidated statements~~Consolidated Statements of ~~changes~~Changes in ~~stockholders’ equity~~Stockholders’ Equity and ~~statements~~Statements of ~~cash flows~~Cash Flows have been reclassified to conform to the current year presentation.

Pursuant to the Business Combination, the merger between Motion and Ambulnz, Inc. was accounted for as a reverse recapitalization in accordance with U.S. GAAP (the “Reverse Recapitalization”). Under this method of accounting, Motion was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Ambulnz, Inc. stock for the net assets of Motion, accompanied by a recapitalization. The net assets of Motion are stated at historical cost, with no goodwill or other intangible assets recorded. The consolidated assets, liabilities and results of operations prior to the Reverse Recapitalization are those of Ambulnz, Inc. The shares and corresponding capital amounts and earnings per share available for common stockholders, prior to the Business Combination, have been retroactively restated as shares reflecting the exchange ratio (645.1452 to 1) established in the Business Combination. Further, Ambulnz, Inc. was determined to be the accounting acquirer in the transaction, as such, the acquisition is considered a business combination under Accounting Standards Codification (“ASC”), Topic 805, Business Combinations, (“ASC 805”) and was accounted for using the acquisition method of accounting.

Principles of Consolidation

The accompanying ~~Unaudited~~unaudited Condensed Consolidated Financial Statements include the accounts of DocGo Inc. and its subsidiaries. All significant intercompany transactions and balances have been eliminated in these ~~Unaudited~~unaudited Condensed Consolidated Financial Statements.

The Company holds a variable interest in MD1 Medical Care P.C. (“MD1”), which contracts with physicians and other health professionals ~~in order to provide~~and provides services to the Company. MD1 is considered a ~~variable interest entity (“VIE”)~~VIE since it does not have sufficient equity to finance its activities without additional subordinated financial support. An enterprise having a controlling financial interest in a VIE must consolidate the VIE if it has both power and benefits—that is, it has (1) the power to direct the activities of a VIE that most significantly impacts the VIE’s economic performance (power) and (2) the obligation to absorb losses of the VIE that potentially could be significant to the VIE or the right to receive benefits from the VIE that potentially could be significant to the VIE (benefits). The Company has the power and rights to control all activities of MD1 and funds and absorbs all losses of the VIE and appropriately consolidates MD1.

Net loss for the VIE was ~~$207,368 and $321,079 as of September 30, 2022 and 2021, respectively.~~$186,637 for the three months ended March 31, 2023. The VIE’s total assets, all of which were current, amounted to ~~$301,503 and $220,081 on September 30, 2022 and 2021, respectively.~~$635,620 as of March 31, 2023. Total liabilities, all of which were current for the VIE, was ~~$933,977 on September 30, 2022.~~$532,127 as of March 31, 2023. The VIE’s total stockholders’ deficit was ~~$632,474 and $30,914 on September 30, 2022 and 2021, respectively.~~$103,493 as of March 31, 2023.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Foreign Currency

The Company’s functional currency is the U.S. dollar. The functional ~~currency~~currencies of ~~our~~the Company’s foreign ~~operation is~~operations are the respective local ~~currency.~~currencies. Assets and liabilities of foreign operations denominated in local currencies are translated at the spot rate in effect at the applicable reporting date, except for equity accounts which are translated at historical rates. The ~~Unaudited~~unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized cumulative translation adjustment isfor the three months ended March 31, 2023 was $243,658. For the same period of 2022, it was not material to the financial statements.

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses and the disclosure of contingent assets and liabilities in its financial statements and the reported amounts of expenses during the reporting period. The most significant estimates in the Company’s financial statements relate to revenue recognition, ~~related to~~ the allowance for doubtful accounts, stock based compensation, calculations related to the incremental borrowing rate for the Company’s lease agreements, estimates related to ongoing lease terms, software development costs, impairment of long-lived assets, goodwill and indefinite-lived intangible assets, business combinations, reserve for losses within the Company’s insurance deductibles, income taxes, and deferred income tax. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources.

Actual results may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected.

Self Insurance Reserves

The Company self-insures a number of risks, including, but not limited to, workers’ compensation, general liability, auto liability, and certain employee-related healthcare benefits. Standard actuarial procedures and data analysis are used to estimate the liabilities associated with these risks on an undiscounted basis. The recorded liabilities reflect the ultimate cost for claims incurred but not paid and any estimable administrative run-out expenses related to the processing of these outstanding claim payments. On a regular basis, the liabilities are evaluated for appropriateness with claims reserve valuations. To limit exposure to some risks, the Company maintains insurance coverage with varying limits and retentions, including stop-loss insurance coverage for workers’ compensation, general liability and auto liability.

Concentration of Credit Risk and Off-Balance Sheet Risk

The Company is potentially subject to concentration of credit risk with respect to its cash, cash equivalents and restricted cash, which the Company attempts to minimize by maintaining cash, cash equivalents and restricted cash with institutions of sound financial quality. At times, cash balances may exceed limits federally insured by the Federal Deposit Insurance Corporation (“FDIC”). The Company believes it is not exposed to significant credit risk due to the financial strength of the depository institutions in which the funds are held. The Company has no financial instruments with off-balance sheet risk of loss.

Major Customers

The Company ~~has~~had one customer that accounted for approximately ~~33%~~46% of sales and ~~35%~~62% of net accounts receivable, for the three months ended March 31, 2023.

The Company had one customer that accounted for approximately 34% of sales and 22% of net accounts receivable, and another customer that accounted for ~~11%~~19% of sales and ~~0.1%~~17% of net accounts receivable for the ~~nine month period~~three months ended ~~September 30,~~March 31, 2022.

Major Vendor

The Company ~~has~~had one ~~customer~~vendor that accounted for approximately ~~44%~~18% of ~~sales and 42% of net accounts receivable~~total cost for the ~~nine month period~~three months ended ~~September 30, 2021.~~March 31, 2023. The Company expects to maintain ~~these relationships~~this relationship with the ~~above-referenced customers.~~vendor and believes the services provided from this vendor are available from alternatives sources.

~~DocGo Inc. and Subsidiaries~~The Company had one vendor that accounted for approximately 10% of total cost for the three months ended March 31, 2022.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Emerging Growth Company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange ~~Act)~~Act of 1934, as amended (the “Exchange Act”)) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non- emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company, which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period, difficult or impossible because of the potential differences in accounting standards used.

Reclassifications

Certain reclassifications of amounts previously reported have been made to the accompanying unaudited Condensed Consolidated Financial Statements to maintain consistency between periods presented. The reclassifications had no impact on previously reported net income or retained earnings.

Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid investments with an original maturity of three months or less. The Company maintains most of its cash and cash equivalents with financial institutions in the ~~U.S.~~United States. The accounts at financial institutions in the ~~U.S.~~United States are insured by the ~~Federal Deposit Insurance Corporation (“FDIC”) and are in excess of FDIC limits.~~FDIC. At times, cash balances may exceed limits federally insured by the FDIC. The Company had cash balances of approximately ~~$433,000~~$4,880,746 and ~~$913,000~~$8,125,966 with foreign financial institutions on ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, respectively.

Restricted Cash and Insurance Reserves

Cash and cash equivalents subject to contractual restrictions and not readily available are classified as restricted cash in the unaudited Condensed Consolidated Balance Sheets. Restricted cash is classified as either a current or non-current asset depending on the ~~restriction~~restricted period. The Company is required to pledge or otherwise restrict a portion of cash and cash equivalents as collateral for its line of credit, transportation equipment leases and a standby letter of credit as required by its insurance carrier (see Notes 89 and ~~13)~~14).

The Company utilizes a combination of insurance and self-insurance programs, including a wholly-owned captive insurance entity, to provide for ~~the~~ potential liabilities for certain risks, including workers’ compensation, automobile liability, general liability and professional liability. Liabilities associated with the risks that are retained by the Company within its high deductible limits are not discounted and are estimated, in part, by considering claims ~~experience,~~history, exposure and severity ~~factors~~ and other actuarial assumptions. The Company has commercial insurance in place for catastrophic claims above its deductible limits.

ARM Insurance, Inc., a Vermont-based wholly-owned captive insurance subsidiary of the Company, charges the Company’s operating subsidiaries premiums to insure ~~the~~its retained workers’ compensation, automobile liability, general liability and professional liability exposures. Pursuant to Vermont insurance regulations, ARM Insurance, Inc. maintains certain levels of cash and cash equivalents related to its self-insurance exposures.

The Company also maintains certain cash balances related to its insurance programs, which are held in a self-depleting trust and restricted as to withdrawal or use by the Company other than to pay or settle self-insured claims and costs. These amounts are reflected in “Restricted cash” in the accompanying Condensed Consolidated Balance Sheets.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Fair Value of Financial Instruments

ASC 820, Fair Value Measurements, provides guidance on the development and disclosure of fair value measurements. Under this accounting guidance, fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability.

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

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Inputs other than Level 1 prices for similar assets or liabilities that are directly or indirectly observable in the marketplace.

Level 3: Unobservable inputs which 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 ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021.~~2022. For certain financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, restricted cash, accounts payable and accrued expenses, and due to seller, the carrying amounts approximate their fair values as ~~it is~~they are short term in nature. ~~The notes~~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~~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. Future changes in fair value of the contingent financial milestone consideration, as a result of changes in significant inputs such as the discount rate and estimated probabilities of financial milestone achievements, could have a material effect on the ~~statement~~unaudited Condensed Consolidated Statements of ~~operations~~Operations and ~~balance sheet~~Comprehensive (Loss) Income and Condensed Consolidated Balance Sheets in the period of the change.

During the ~~three months~~year ended ~~September 30,~~December 31, 2022, the Company recorded ~~$4.0 million of contingent~~$4,000,000 in Contingent consideration in connection with the Ryan Brothers Atkinson, LLC business acquisition, to be paid based on the completion of certain performance obligations over a 24-month ~~period~~period. In relation to the acquisition of Exceptional, the Company also agreed to pay up to $2,000,000 upon meeting certain performance conditions within two years of the Closing Date. The estimated Contingent consideration amount for Exceptional was $1,080,000 as of December 31, 2022.

During the year ended December 31, 2022, the Company also recorded $2,475,540 estimated Contingent consideration in relation to the Location Medical Services, LLC (LMS) acquisition to be paid upon LMS meeting certain performance conditions in 2023. For Government Medical Services (GMS), an amount of $3,000,000 was recorded in Contingent consideration to be paid upon GMS meeting certain performance conditions within a year of the Closing Date (see Note 4).

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Accounts Receivable

The Company contracts with hospitals, healthcare facilities, businesses, state and local government entities, and insurance providers to transport patients and to provide Mobile Health services at specified rates. Accounts receivable consist of billings for transportation and healthcare services provided to patients. The billings ~~will~~are expected to be either be paid or settled on the patient’s behalf by health insurance providers, managed care organizations, treatment facilities, government sponsored programs, businesses or patients directly. Accounts receivable are net of insurance provider contractual allowances which are estimated at the time of billing based on contractual terms or other arrangements. Accounts ~~receivable~~receivables are periodically evaluated for collectability based on past credit history with payors and their current financial condition. Changes in the estimated collectability of ~~accounts~~account receivable are recorded in the results of operations for the period in which the ~~estimate is~~estimates are revised. Accounts receivable deemed uncollectible are offset against the allowance for uncollectible accounts. The Company generally does not require collateral for accounts ~~receivable~~.receivable.

~~DocGo Inc. and Subsidiaries~~

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

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~~unaudited Condensed Consolidated Statement of Operations and Comprehensive (Loss) Income. The Company provides for depreciation and amortization using the straight-line method over the estimated useful lives of the respective assets. A summary of estimated useful lives is as follows:

Asset Category		Estimated Useful Life
Buildings		39 years
Office equipment and furniture		3 years
Vehicles		~~2-8~~5-8 years
Medical equipment		~~2-5~~5 years
Leasehold improvements		Shorter of useful life of asset or lease term

Expenditures for repairs and maintenance are expensed as incurred. Expenditures that improve an asset or extend its estimated useful life are capitalized.

Software Development Costs

Costs incurred during the preliminary project stage, maintenance costs and routine updates and enhancements of products are expensed as incurred. The Company capitalizes software development costs intended for internal use in accordance with ASC 350-40, Internal-Use Software. Costs incurred in developing the application of its software and costs incurred to upgrade or enhance product functionalities are capitalized when it is probable that the expenses would result in future economic benefits to the Company and the functionalities and enhancements are used for their intended purpose. Capitalized software costs are amortized over its useful life.

Estimated useful life of software development activities are reviewed annually or whenever events or changes in circumstances indicate that intangible assets may be impaired and adjusted as appropriate to reflect upcoming development activities that may include significant upgrades or enhancements to the existing functionality.

Business Combinations

The Company accounts for its business combinations under the provisions of ASC 805-10, Business Combinations (“ASC 805-10”), which requires that the purchase method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including NCI, are recorded at the date of acquisition at their respective fair values. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in a business combination. If the business combination provides for contingent consideration, the Company records the contingent consideration at fair value at the acquisition date and any changes in fair value after the acquisition date are accounted for as measurement-period adjustments. Changes in fair value of contingent consideration resulting from events after the acquisition date, such as earn-outs, are recognized as follows: (1) if the contingent consideration is classified as equity, the contingent consideration is not re-measured and its subsequent settlement is accounted for within equity, or (2) if the contingent consideration is classified as a liability, the changes in fair value are recognized in earnings. For transactions that are business combinations, the Company evaluates the existence of goodwill or a gain from a bargain purchase. The Company capitalizes acquisition-related costs and fees associated with asset acquisitions and immediately expenses acquisition-related costs and fees associated with business combinations.

~~DocGo Inc. and Subsidiaries~~

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The estimated fair value of net assets to be acquired, including the allocation of the fair value to identifiable assets and liabilities, is determined using established valuation techniques. Management uses assumptions based on historical knowledge of the business and projected financial information of the target. These assumptions may vary based on future events, perceptions of different market participants and other factors outside the control of management, and such variations may be significant to estimated values.

Impairment of Long-Lived Assets

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. 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. Assets targeted for disposal are reported at the lower of the carrying amount or fair value less cost to sell. ~~For~~

In 2022, the ~~periods ending September 30, 2022 and~~Company reassigned all the assets at Ambulnz Health, LLC (“Health”) to Assets held for sale as a result of an assignment for the benefit of creditors (“ABC”) transaction. The Company also recognized a non-cash charge of $2,921,958 for its Goodwill impairment for the year ended December 31, ~~2021, management determined that there was no impairment loss required to be recognized for~~2022 in the ~~carrying value~~Consolidated Statements of ~~long-lived assets.~~Operations.

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the total purchase ~~price of an acquired business~~consideration over the fair value of ~~amounts assigned to~~the identifiable assets acquired and liabilities ~~assumed.~~assumed in a business combination. Goodwill ~~and indefinite-lived intangible assets, consisting primarily of operating licenses, are~~is not amortized but ~~are evaluated~~is tested for impairment at the reporting unit level annually on ~~an annual basis,~~December 31 or ~~on an interim basis when~~more frequently if events or changes in circumstances indicate that it is more likely than not to be impaired. These events include: (i) severe adverse industry or economic trends; (ii) significant company-specific actions, including exiting an activity in conjunction with restructuring of operations; (iii) current, historical or projected deterioration of the carrying value may not be recoverable. In assessing the recoverability of goodwill and indefinite-lived intangible assets, the Company makes assumptions regarding the estimated future cash flows, including forecasted revenue growth, projected gross margin and the discount rate to determine the fair value of these assets. If these estimatesCompany’s financial performance; or ~~their related assumptions change~~(iv) a sustained decrease in the ~~future, the Company may be required to record impairment charges against these assets in the reporting period in which the impairment is determined.~~Company’s market capitalization, as indicated by its publicly quoted share price, below its net book value.

The Company tests goodwill for impairment at the reporting unit level, which is one level below the operating segment. The Company has the option of performing a qualitative assessment to determine whether further impairment testing is necessary before performing the one-step quantitative assessment. If as a result of the qualitative assessment, it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, a quantitative impairment test will be required. Otherwise, no further testing will be required. If a quantitative impairment test is performed, the Company compares the fair values of the applicable reporting units with their aggregate carrying values, including goodwill. Estimating the fair value of the reporting units requires significant judgment by management. If the carrying amount of a reporting unit exceeds the fair value of the reporting unit, goodwill impairment is recognized.

DocGo Inc. and Subsidiaries

Any excess in carrying value over the estimated fair value is recorded as impairment loss and charged to the results of operations in the period such determination is made. For the periods ended September 30, 2022 and 2021, management determined that there was no impairment loss required to be recognized in the carrying value of goodwill or other intangible assets. The Company selected December 31 as its annual testing date.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

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.

~~DocGo Inc. and Subsidiaries~~

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

~~Derivative Financial Instruments~~

The Company does not use derivative instruments to hedge exposures to interest rate, market, or foreign currency risks. The Company evaluates its financial instruments to determine if such instruments contain features that qualify as embedded derivatives.

Related Party Transactions

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

Related party transactions are recorded within operating expenses in the Company’s ~~Unaudited~~unaudited Condensed Consolidated ~~Statement~~Statements of Operations and Comprehensive (Loss) Income. For details regarding the related party transactions that occurred during the periods ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ refer to Note ~~15.~~16.

Revenue Recognition

On January 1, 2019, the Company adopted ASU 2014-09, Revenue from Contracts with Customers (“ASC 606”), as amended.

To determine revenue recognition for contractual arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (1) identify each contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when (or as) the relevant performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services the Company provides to the customer.

The Company generates revenues from the provision of (1) ambulance and medical transportation services (“Transportation Services”) and (2) Mobile Health services. The customer simultaneously receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, therefore the Company satisfies performance obligations immediately. The Company has utilized the “right to invoice” expedient which allows an entity to recognize revenue in the amount of consideration to which the entity has the right to invoice when the amount that the Company has the right to invoice corresponds directly to the value transferred to the customer. Revenues are recorded net of an estimated contractual allowances for claims subject to contracts with responsible paying entities. The Company estimates contractual allowances at the time of billing based on contractual terms, historical collections, or other arrangements. All transaction prices are fixed and determinable, ~~which~~and includes a fixed base rate, fixed mileage rate and an evaluation of historical collections by each payer.

~~DocGo Inc. and Subsidiaries~~

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Nature of Our Services

Revenue is primarily derived from:

Transportation Services: These services encompass both emergency response and non-emergency ~~ambulance~~ transport services. Non-emergency transport services include ambulance transports and wheelchair transports. Net revenue from transportation services is derived from the transportation of patients based on billings to third party payors and healthcare facilities.

ii.

Mobile Health Services: These services include services performed at home and offices, COVID-19 testing and vaccinations, and event services which include on-site healthcare support at sporting events and concerts. There is also an emphasis on providing total care management solutions to large population groups, which include healthcare services as well as ancillary services, such as shelter.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The Company concluded that Transportation Services and any related support activities are a single performance obligation under ASC 606. The transaction price is determined by ~~the~~ fixed rate usage-based fees or fixed fees which are agreed upon in the Company’s executed contracts. For Mobile Health, the performance of the services and any related support activities are a single performance obligation under ASC 606. Mobile Health services are typically billed based on a fixed rate (i.e., time and materials separately or combined) fee structure taking into consideration staff and materials utilized.

As the performance associated with such services is known and quantifiable at the end of a period in which the services occurred (i.e., monthly or quarterly), revenues are typically recognized in the respective period performed. The typical billing cycle for Transportation Services and Mobile Health services is same day to 5 days with payments generally due within 30 days. For large municipal customers in the Mobile Health segment, invoices are generally produced on a monthly basis, in arrears, and are generally due within 30-60 days of when they are submitted to the customer. For Transportation Services, the Company estimates the amount of revenue unbilled at month end and recognizes such amounts as revenue, based on available data and customer history. The Company’s Transportation Services and Mobile Health services each represent a single performance obligation. Therefore, allocation is not necessary as the transaction price (fees) for the services provided is standard and explicitly stated in the contractual fee schedule and/or invoice. The Company monitors and evaluates all contracts on a case-by-case basis to determine if multiple performance obligations are present in a contractual arrangement.

For Transportation Services, the customer simultaneously receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, therefore the Company satisfies performance obligations at the same time. For Transportation Services, where the customer pays fixed rate usage-based fees, the actual usage in the period represents the best measure of progress. Generally, for Mobile Health services, the customer simultaneously receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, therefore the Company satisfies performance obligations at the same time. For certain Mobile Health services that have a fixed fee arrangement, and the services are provided over time, revenue is recognized over time as the services are provided to the customer.

~~DocGo Inc. and Subsidiaries~~Disaggregation of revenue

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

In the following table, revenue is disaggregated ~~as follows:~~by geography and by service line:

									Three Months Ended March 31,
Revenue Breakdown	Three Months Ended September 30,				Nine Months Ended September 30,				2023		2022
	2022		2021		2022		2021
Primary Geographical Markets
United States	$	101,337,899	$	83,286,509	$	322,706,143	$	190,595,217	$	98,909,521	$	115,053,431
United Kingdom		2,981,995		2,552,479		9,024,607		6,799,162		14,093,182		2,838,121
Total revenue	$	104,319,894	$	85,838,988	$	331,730,750	$	197,394,379	$	113,002,703	$	117,891,552

Major Segments/Service Lines
Transportation Services	$	27,670,109	$	17,916,162	$	77,657,852	$	65,657,141	$	40,055,946	$	27,812,510
Mobile Health		76,649,785		67,922,826		254,072,898		131,737,238		72,946,757		90,079,042
Total revenue	$	104,319,894	$	85,838,988	$	331,730,750	$	197,394,379	$	113,002,703	$	117,891,552

Stock Based Compensation

The Company expenses stock-based compensation over the requisite service period based on the estimated grant-date fair value of the awards. The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model, and the assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. The Company accounts for forfeitures as they occur. All stock-based compensation costs are recorded in operating expenses in the ~~Unaudited~~unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Earnings per Share

Earnings per share represents the net income attributable to stockholders divided by the weighted-average number of shares outstanding during the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock of the Company during the reporting periods. Potential dilutive common stock equivalents consist of the incremental common stock issuable upon ~~exercise of warrants and the incremental shares issuable upon~~ conversion of stock options. 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.

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

	For the Three Months Ended March 31,
	2023			2022
Net (loss) income attributable to stockholders of DocGo Inc. and Subsidiaries:		(3,465,670	)		10,629,694
Weighted-average shares – basic		102,579,291			100,177,082
Effect of dilutive options		1,236,473			14,569,654
Weighted-average shares – dilutive		102,579,291			115,652,049
Net (loss) income share - basic		(0.03	)		0.11
Net (loss) income share - diluted		(0.03	)		0.09
Anti-dilutive employee share-based awards excluded		9,337,239			-

Equity Method Investment

On October 26, 2021, the Company acquired a 50% interest in RND Health Services Inc. (“RND”) for $655,876. The Company uses the equity method to account for investments in which the Company has the ability to exercise significant influence over the operating and financial policies of the investee, but does not exercise control. The Company’s carrying value in the equity method investee is reflected in the caption “Equity method investment” onin the unaudited Condensed Consolidated Balance Sheets. Changes in value of RND are recorded in “Gain ~~from~~(loss) on equity method investment” onin the ~~Unaudited~~unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income. The Company’s judgment regarding its level of influence over the equity method investee includes considering key factors, such as ownership interest, representation on the board of directors, and participation in policy-making decisions.

~~DocGo Inc. and Subsidiaries~~

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

On November 1, 2021, the Company acquired a 20% interest in National Providers Association, LLC (“NPA”) for $30,000. The Company uses the equity method to account for investments in which the Company has the ability to exercise significant influence over the operating and financial policies of the investee, but does not exercise control. The Company’s carrying value in the equity method investee is reflected in the caption “Equity method investment” onin the unaudited Condensed Consolidated Balance Sheets. Changes in value of NPA are recorded in ~~“Loss from~~“Gain (loss) on equity method investment” onin the ~~Unaudited~~unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income. The Company’s judgment regarding its level of influence over the equity method investee includes considering key factors, such as ownership interest, representation on the board of directors, and participation in policy-making decisions. Effective December 21, 2021, three members withdrew from NPA resulting in the remaining two members obtaining the remaining ownership percentage. OnSince December 31, 2021, ~~and September 30, 2022,~~ DocGo has owned 50% of NPA.

Under the equity method, the Company’s investment is initially measured at cost and subsequently increased or decreased to recognize the Company’s share of income and losses of the investee, capital contributions and distributions and impairment losses. The Company performs a qualitative assessment annually and recognizes an impairment if there are sufficient indicators that the fair value of the investment is less than carrying value.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

Leases

The Company categorizes leases at its inception as either operating or finance leases based on the criteria in FASB ASC 842, Leases, (“ASC 842”). The Company adopted ASC 842 on January 1, 2019, using the modified retrospective approach, and has established a Right-of-Use (“ROU”) Asset and a current and non-current lease liability for each lease arrangement identified. The lease liability is recorded at the present value of future lease payments discounted using the discount rate that approximates the Company’s incremental borrowing rate for the lease established at the commencement date, and the ROU asset is measured as the lease liability plus any initial direct costs, less any lease incentives received before commencement. 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.

The Company has lease arrangements for vehicles, equipment, and facilities. These leases typically have original terms not exceeding 10 years and, in some cases contain multi-year renewal options, none of which are reasonably certain of exercise. The Company’s lease arrangements may contain both lease and non-lease components. The Company has elected to combine and account for lease and non-lease components as a single lease component. The Company has incorporated residual value obligations in leases for which there is such occurrences. Regarding short-term leases, ASC 842-10-25-2 permits an entity to make a policy election not to apply the recognition requirements of ASC 842 to short-term leases. The Company has elected not to apply the ASC 842 recognition criteria to any leases that qualify as ~~short-term leases.~~Short-Term Leases.

Income Taxes

Income taxes are recorded in accordance with ASC 740, Income Taxes (“ASC 740”), which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or ~~the Company’s~~its tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. The Company recognizes any interest and penalties accrued related to unrecognized tax benefits as income tax expense.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

Recently Issued Accounting Standards Not Yet Adopted

~~None~~In March 2022, the FASB issued ASU 2022-02, Financial Instruments – Credit Losses Troubled Debt Restructurings and Vintage Disclosures (“ASU 2022-02”), that eliminates accounting guidance for troubled debt restructurings by creditors in Subtopic 310-40 Receivables—Troubled Debt Restructurings by Creditors, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. ASU 2022-02 also requires public business entities to disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20, Financial Instruments—Credit Losses—Measured at Amortized Cost. This ASU only affects entities that already adopted ASU 2016-13, which is effective for fiscal years beginning after December 15, 2022. The Company expects that this ASU will not have a material impact on the Company’s unaudited Condensed Consolidated Financial Statements.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

3. Property and Equipment, net

Property and equipment, net, as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021~~2022 are as follows:

	September 30, 2022			December 31, 2021			March 31, 2023			December 31, 2022

Transportation equipment							$	21,907,460		$	20,773,862
Medical equipment								5,835,273			5,177,520
Office equipment and furniture	$	2,749,874		$	1,977,808			2,860,756			2,686,065
Leasehold improvements								606,338			579,658
Buildings		527,283			527,284			527,283			527,283
Land		37,800			37,800			37,800			37,800
Transportation equipment		18,477,444			13,772,251
Medical equipment		5,764,863			3,949,566
Leasehold improvements		609,226			616,446
		28,166,490			20,881,155		$	31,774,910		$	29,782,188
Less: Accumulated depreciation		(10,588,660	)		(8,147,266	)		(10,045,450	)		(8,524,013	)
Property and equipment, net	$	17,577,830		$	12,733,889		$	21,729,460		$	21,258,175

The Company recorded depreciation ~~expense~~expenses of ~~$1,150,806~~$1,482,610 and ~~$598,188~~$711,878 for the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively.

~~The Company recorded depreciation expense of $2,592,244 and $1,697,380 for nine months ended September 30, 2022 and 2021, respectively.~~

4. Acquisition of Businesses and Asset Acquisitions

Government Medical Services, LLC

On July 6, 2022, Holdings acquired 100% of the outstanding shares of common stock of Government Medical Services, LLC (“GMS”), a provider of medical services. The aggregate purchase price consisted of ~~$20.3 million~~$20,338,789 in cash consideration. Holdings also agreed to pay GMS an additional ~~$3.0 million~~$3,000,000 upon GMS meeting certain performance conditions within a year of the Closing Date. Acquisition costs are included in general and administrative expenses and totaled $0$1,001,883 for the ~~three~~twelve months ended ~~September 30, 2022 and $800,000 for the nine months ended September 30,~~December 31, 2022.

The acquisition was accounted for under the acquisition method of accounting, with the Company identified as the acquirer. The Company’s unaudited condensed consolidated financial statements include the results of operations of GMS from the date of acquisition. The historical results of operations of GMS were not significant to the Company’s unaudited condensed consolidated results of operations for the periods presented. Under the acquisition method of accounting, the aggregate amount of consideration paid by the Company was allocated to GMS’s net tangible assets and intangible assets based on their estimated fair value on the acquisition date. The preliminary purchase price allocation, as set forth in the table below, reflects various preliminary fair value estimates and analysis prepared by the Company. Any change in the fair value of the net assets of GMS will change the amount of the purchase price allocable to goodwill. Final purchase accounting adjustments may differ materially from preliminary purchase price allocation presented here. The primary areas of the purchase price allocation that are not yet finalized relate to the valuation of the intangible assets acquired, fair value of right to use assets and associated operating lease liabilities assumed, and net working capital adjustments.

Exceptional Medical Transportation, LLC

On July 13, 2022, ~~the Company~~Holdings acquired 100% of the outstanding shares of common stock of Exceptional Medical Transportation, LLC (“Exceptional”) in exchange for ~~$13.7 million~~$13,708,333 consisting of ~~$7.7 million~~$7,708,333 in cash at closing and ~~$6 million~~$6,000,000 payable over a ~~24 month~~24-month period. Holdings also agreed to pay an estimated $1,080,000 Contingent consideration upon Exceptional meeting certain performance conditions in 2023. Exceptional is in the business of providing medical transportation services. Acquisition costs are included in general and administrative expenses totaled $0$56,571 for the ~~three~~twelve months ended ~~September 30, 2022 and $0 for the nine months ended September 30,~~December 31, 2022.

The acquisition was accounted for under the acquisition method of accounting, with the Company identified as the acquirer. The Company’s unaudited condensed consolidated financial statements include the results of operations of Exceptional from the date of acquisition. The historical results of operations of Exceptional were not significant to the Company’s unaudited condensed consolidated results of operations for the periods presented. Under the acquisition method of accounting, the aggregate amount of consideration paid by the Company was allocated to Exceptional’s net tangible assets and intangible assets based on their estimated fair value on the acquisition date. The preliminary purchase price allocation, as set forth in the table below, reflects various preliminary fair value estimates and analysis prepared by the Company. Any change in the fair value of the net assets of Exceptional will change the amount of the purchase price allocable to goodwill. Final purchase accounting adjustments may differ materially from preliminary purchase price allocation presented here. The primary areas of the purchase price allocation that are not yet finalized relate to the valuation of the intangible assets acquired, fair value of right to use assets and associated operating lease liabilities assumed, and net working capital adjustments.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

Ryan Brothers Fort Atkinson, LLC

On August 9, 2022, ~~the Company~~Holdings acquired 100% of the outstanding shares of common stock of Ryan Brothers Fort Atkinson, LLC (“~~RT”~~RB”) in exchange for ~~$11.4 million~~$11,422,252 consisting of ~~$7.4 million~~$7,422,252 in cash at closing and ~~$4.0 million~~$4,000,000 of estimated ~~contingent~~Contingent consideration to be paid out over 24 months based on performance of certain obligations. RTRB is in the business of providing medical transportation services. Acquisition costs are included in general and administrative expenses totaled $0$230,175 for the ~~three~~twelve months ended ~~September 30, 2022 and $0 for the nine months ended September 30,~~December 31, 2022.

The acquisition was accounted for under the acquisition method of accounting, with the Company identified as the acquirer. The Company’s unaudited condensed consolidated financial statements include the results of operations of RT ~~from the date of acquisition. The historical results of operations of~~ RT were not significant to the Company’s unaudited condensed consolidated results of operations for the periods presented. Under the acquisition method of accounting, the aggregate amount of consideration paid by the Company was allocated to RT’s net tangible assets and intangible assets based on their estimated fair value on the acquisition date. The preliminary purchase price allocation, as set forth in the table below, reflects various preliminary fair value estimates and analysis prepared by the Company. Any change in the fair value of the net assets of RT will change the amount of the purchase price allocable to goodwill. Final purchase accounting adjustments may differ materially from preliminary purchase price allocation presented here. The primary areas of the purchase price allocation that are not yet finalized relate to the valuation of the intangible assets acquired, fair value of right to use assets and associated operating lease liabilities assumed, and net working capital adjustments.Community Ambulance Services LTD

On October 12, 2022, Holdings through its indirect wholly owned subsidiary, Ambulnz U.K. Ltd., acquired Community Ambulance Service Ltd (“CAS”), a company located in United Kingdom, in exchange for approximately $5,541,269 in cash. The ~~following table presents the preliminary allocation of the~~net assets acquired through the CAS acquisition was $7,134,881 mainly from the vehicles with high fair market value, which directly lead to a Gain on bargain purchase of $1,593,612. CAS is engaged in providing emergency and ~~liabilities assumed:~~

Ryan Brothers Exceptional
Medical Transport GMS Total

Consideration:
Cash Consideration $ 7,422,252 $ 6,375,000 $ 20,338,789 $ 34,136,041
Due to Seller - 6,000,000 - 6,000,000
Contingent Consideration 4,000,000 - - 4,000,000
Amounts held under an escrow account - 1,333,333 - 1,333,333
Total consideration 11,422,252 13,708,333 20,338,789 45,469,374

Recognized amounts of identifiable assets acquired and liabilities assumed
Cash $ 620,548 $ 299,050 $ 1,005,453 $ 1,925,051
Accounts receivable - - 3,975,160 3,975,160
Other current assets 136,157 - 30,734 166,891
Property, plant and equipment 2,125,134 2,450,900 4,092 4,580,126
Intangible assets 387,550 125,000 9,794,000 10,306,550
Total identifiable assets acquired 3,269,389 2,874,950 14,809,439 20,953,778

Accounts payable 44,911 - 137,239 182,150
Due to Seller - 299,050 - 299,050
Other current liabilities 286,792 - 562,809 849,601
Total liabilities assumed 331,703 299,050 700,048 1,330,801

Goodwill 8,484,566 11,132,433 6,229,398 25,846,397

Total purchase price $ 11,422,252 $ 13,708,333 $ 20,338,789 $ 45,469,374

~~DocGo Inc.~~non-emergency transport services, including high dependency, urgent care, mental health and ~~Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

~~5. Goodwill~~

~~The Company recorded goodwill~~blue light transport services and diagnostics testing. We believe this acquisition will allow us to increase our presence in ~~connection with its acquisitions. The changes~~that market, while giving us improved access to municipal contracts. Acquisition costs are included in ~~the carrying value of goodwill for the period ended September 30, 2022 are as noted in the tables below:~~

Carrying Value
Balance at December 31, 2021 $ 8,686,966
Goodwill acquired during the period 25,846,397
Balance at September 30, 2022 34,533,363

~~6. Intangibles~~

~~Intangible assets consist of the following as of September 30, 2022~~general and ~~December 31, 2021:~~

September 30, 2022
Estimated Useful
Life (Years) Gross Carrying
Amount Additions Accumulated
Amortization Net Carrying
Amount
Patents 15 years $ 48,668 $ 13,655 $ (9,075 ) $ 53,248
Computer software 5 years $ 294,147 11,144 (263,192 ) $ 42,099
Operating licenses Indefinite $ 8,375,514 450,200 - $ 8,825,714
Internally developed software 4-5 years $ 6,013,513 1,907,616 (5,778,894 ) $ 2,142,235
Material Contracts Indefinite - 62,550 - 62,550
Customer Relationship 9 years - 9,794,000 (272,056 ) $ 9,521,944
$ 14,731,842 $ 12,239,165 $ (6,323,217 ) $ 20,647,790

December 31, 2021
Estimated Useful
Life (Years) Gross Carrying
Amount Additions Accumulated
Amortization Net Carrying
Amount
Patents 15 years $ 19,275 $ 29,393 $ (6,367 ) $ 42,301
Computer software 5 years 132,816 161,331 (219,388 ) 74,759
Operating licenses Indefinite 8,375,514 - - 8,375,514
Internally developed software 4-5 years 2,146,501 3,867,012 (3,828,038 ) 2,185,475
$ 10,674,106 $ 4,057,736 $ (4,053,793 ) $ 10,678,049

~~The Company recorded amortization expense of $990,345 and $552,999~~administrative expenses totaling $171,779 for the three and twelve months ended ~~September 30,~~December 31, 2022, ~~and 2021,~~ respectively.

~~The Company recorded amortization expense of $2,269,423 and $1,432,983 for the nine months ended September 30, 2022 and 2021, respectively.~~

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

~~(CONTINUED)~~

~~Future amortization expense at September 30, 2022 for the next five years and in the aggregate are as follows:~~Location Medical Services, LLC

Amortization
Expense
2022, remaining $ 680,930
2023 2,078,406
2024 1,510,563
2025 1,460,965
2026 1,094,588
Thereafter 4,934,074
Total $ 11,759,526

~~Amortization expense~~
~~As of September 30, 2022~~			~~2,269,423~~
~~As of September 30, 2021~~			~~1,432,983~~
~~As of December 31, 2021~~			~~1,845,193~~

~~7. Accrued Liabilities~~

On December 9, 2022, Holdings through its indirect wholly owned subsidiary, Ambulnz U.K. Ltd., closed acquiring 100% of the outstanding shares of common stock of Location Medical Services, LLC (“LMS”). The aggregate purchase price consisted of $302,450 in cash consideration. The Company also agreed to pay LMS an additional $11,279,201 deferred consideration and an estimated $2,475,540 Contingent consideration upon LMS meeting certain performance conditions in 2023. Acquisition costs are included in general and administrative expenses and totaled $4,200 for the three and twelve months ended December 31, 2022, respectively.

Cardiac RMS, LLC

On March 31, 2023, Holdings acquired 51% of the outstanding shares of common stock of Cardiac RMS, LLC (“CRMS”) in exchange for $10,000,000 closing consideration, consisting of $9,000,000 in cash and $1,000,000 worth of shares of DocGo common stock issued in a private placement transaction. A further probable consideration of $15,822,190 is to be paid out over 36 months for the remaining 49% equity of CRMS, based on CRMS’ attainment of full-year EBITDA targets. CRMS LLC provides cardiac implantable electronic device “CIED” remote monitoring and virtual care management services. Acquisition costs included in general and administrative expenses totaled $229,937 for the three months ended March 31, 2023.

The following table presents the assets acquired and liabilities assumed at the date of the acquisitions (preliminary for CRMS):

	Cardiac RMS LLC		Location Medical Services		Community Ambulance Service			Ryan Brothers		Exceptional Medical Transport		Government Medical Services		Total

Consideration:
Cash consideration	$	9,000,000	$	302,450	$	5,541,269		$	7,422,252	$	6,375,000	$	20,338,789	$	48,979,760
Stock consideration		1,000,000		-		-			-		-		-		1,000,000
Deferred consideration		-		11,279,201		-			-		6,000,000		-		17,279,201
Amounts held under an escrow account		-		-		-			-		1,333,333		-		1,333,333
Contingent consideration		15,822,190		2,475,540		-			4,000,000		1,080,000		3,000,000		26,377,730
Total consideration		25,822,190		14,057,191		5,541,269			11,422,252		14,788,333		23,338,789		94,970,024

Recognized amounts of identifiable assets acquired and liabilities assumed
Cash	$	1,574,604	$	5,404,660	$	892,218		$	620,248	$	299,050	$	1,005,453	$	9,796,233
Accounts receivable		2,033,533		623,635		7,002,325			5,844,494		3,785,490		3,975,160		23,264,637
Other current assets		293,478		134,216		1,167,326			136,157		-		30,734		1,761,911
Property, plant and equipment		-		519,391		4,548,956			2,125,134		2,450,900		4,092		9,648,473
Intangible assets		15,930,000		2,419,600		-			387,550		125,000		10,305,000		29,167,150
Total identifiable assets acquired		19,831,615		9,101,502		13,610,825			9,113,583		6,660,440		15,320,439		73,638,404

Accounts payable	$	28,978	$	40,447	$	2,036,714		$	44,911	$	-	$	137,239		2,288,289
Due to seller		2,448,460		-		-			5,844,494		4,084,540		-		12,377,494
Other current liabilities		174,177		1,012,992		4,439,230			286,792		-		562,809		6,476,000
Total liabilities assumed		2,651,615		1,053,439		6,475,944			6,176,197		4,084,540		700,048		21,141,783

Goodwill/(Gain on bargain purchase)		8,642,190		6,009,128		(1,593,612	)		8,484,866		12,212,433		8,718,398		42,473,403

Total purchase price	$	25,822,190	$	14,057,191	$	5,541,269		$	11,422,252	$	14,788,333	$	23,338,789	$	94,970,024

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

5. ABC Transaction and Held for Sale

During the fiscal year 2022, the Company started discussions regarding the potential liquidation process of Health through an assignment for the benefit of creditors (“ABC”), with a targeted timeline for the transaction to be fully closed in December 2022. The conversation involved operations, human resources, external legal counsel, and Amb, LLC (a California limited liability company, the “Assignee”). It was the management’s intention and decision that the ABC transaction will be commenced and completed by year end 2022. Due to operational processes, the filing was extended and finalized on February 3, 2023.

On February 3, 2023, Health commenced the ABC pursuant to California law. An ABC is a liquidation process governed by state law (California law in this instance) that is an alternative to a bankruptcy case under federal law. Prior to commencing the ABC, Health ceased business operations and all of its employees were terminated and treated in accordance with California law. In the ABC, all of Health’s assets were transferred to the Assignee who acts as a fiduciary for creditors and in a capacity equivalent to that of a bankruptcy trustee. The Assignee is responsible for liquidating the assets. Similar to a bankruptcy case, there is a claims process. Creditors of Health will receive notice of the ABC and a proof of claim form and are required to submit a proof of claim in order to participate in distribution of net liquidation proceeds by the Assignee.

As of December 31, 2022, Health met the criteria to be classified as held for sale. As the entity has met this criteria, the Company is required to record the respective assets and liabilities at the lower of carrying value or fair value less any costs to sell, and present the related assets and liabilities as separate line items in the Consolidated Balance Sheets.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The following table presents information related to the major classes of assets and liabilities that were classified as held for sale in the Company’s Consolidated Balance Sheets as of December 31, 2022:

	Pre ABC Adjustment			2022 Adjustments			December 31, 2022			1Q23 Adjustments			March 31, 2023
ASSETS

Current assets:
Cash and cash equivalents	$	(190,312	)	$	190,312		$	-		$	-		$	-
Accounts receivable, net		1,219,927			(1,219,927	)		-			-			-
Prepaid expenses and other current assets		22,850			(22,850	)		-			-			-
Total current assets		1,052,465			(1,052,465	)		-			-			-

Property and equipment, net		1,107,279			(1,107,279	)		-			-			-
Intangibles, net		30,697			(30,697	)		-			-			-
Goodwill		5,085,689			(5,085,689	)		-			-			-
Operating lease right-of-use assets		29,753			(29,753	)		-			-			-
Assets held for sale		-			4,480,344			4,480,344			(4,480,344	)		-
Other assets		18,053,495			(96,419	)		17,957,076			(17,957,076	)		-
Total assets	$	25,359,378		$	(2,921,958	)	$	22,437,420		$	(22,437,420	)	$	-

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable	$	196,122		$	(196,122	)	$	-		$	-		$	-
Accrued liabilities		63,655,442			(4,250,603	)		59,404,839			(59,404,839	)		-
Operating lease liability, current		33,619			(33,619	)		-			-			-
Liabilities held for sale		-			4,480,344			4,480,344			(4,480,344	)		-
Total current liabilities		63,885,183			-			63,885,183			(63,885,183	)		-
Total liabilities	$	63,885,183		$	-		$	63,885,183		$	(63,885,183	)	$	-

STOCKHOLDERS’ EQUITY:
Accumulated deficit	$	(38,525,805	)	$	(2,921,958	)	$	(41,447,763	)	$	41,447,763		$	-
Total stockholders’ equity attributable to DocGo Inc. and Subsidiaries		(38,525,805	)		(2,921,958	)		(41,447,763	)		41,447,763			-
Noncontrolling interests		-			-			-			-			-
Total stockholders’ equity	$	(38,525,805	)	$	(2,921,958	)	$	(41,447,763	)	$	41,447,763		$	-
Total liabilities and stockholders’ equity	$	25,359,378		$	(2,921,958	)	$	22,437,420		$	(22,437,420	)	$	-

The Intercompany receivables and Intercompany payables are eliminated in the Company’s Consolidated Balance Sheets.

6. Goodwill

In connection with the ABC transaction, the Company evaluated its Goodwill balances as of December 31, 2022 and determined that there was an impairment of Goodwill related to its Health reporting unit. The impairment was primarily due to the ABC filing.

As a result of this impairment, the Company recognized a non-cash charge of $2,921,958 in the year ended December 31, 2022 in the Consolidated Statements of Operations. The charge was recorded as part of Other income in the Company’s Consolidated Statements of Operations and has no impact on its cash flow, liquidity, or compliance with debt covenants.

Additionally, the Company recorded Goodwill in connection with its acquisitions, the total Goodwill acquired in 2022 was $35,299,136.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

The Company also updated the carrying value of the Goodwill in its unaudited Condensed Consolidated Balance Sheets to reflect the additional Goodwill and the impairment charge. The carrying value of Goodwill amounts $47,668,654, the changes in the carrying value of Goodwill for the period ended March 31, 2023 are as noted in the tables below:

	Carrying Value
Balance as of December 31, 2022	$	38,900,413
Goodwill acquired during the period		8,642,190
CTA		126,051
Balance as of March 31, 2023	$	47,668,654

7. Intangibles

Intangible assets consisted of the following as of March 31, 2023 and December 31, 2022:

	March 31, 2023
	Estimated Useful Life (Years)	Gross Carrying Amount		Additions		Accumulated Amortization			Net Carrying Amount
Patents	15 years	$	62,823	$	17,390	$	(11,454	)	$	68,759
Computer software	5 years		247,828		-		(229,313	)		18,515
Operating licenses	Indefinite		8,799,004		600,000		-			9,399,004
Internally developed software	4-5 years		8,284,058		740,298		(7,376,506	)		1,647,850
Material contracts	Indefinite		62,550		-		-			62,550
Customer relationship	8-9 years		12,397,954		15,872,732		(947,737	)		27,322,949
Trademark	8 years		326,646		6,669		(13,888	)		319,427
Non-compete agreements	5 years		-		100,000		-			100,000
		$	30,180,863	$	17,337,089	$	(8,578,898	)	$	38,939,054

	December 31, 2022
	Estimated Useful Life (Years)	Gross Carrying Amount		Additions			Accumulated Amortization			Net Carrying Amount
Patents	15 years	$	48,668	$	14,155		$	(10,116	)	$	52,707
Computer software	5 years		294,147		(46,319	)		(224,886	)		22,942
Operating licenses	Indefinite		8,375,514		423,490			-			8,799,004
Internally developed software	4-5 years		6,013,513		2,270,545			(6,378,911	)		1,905,147
Material contracts	Indefinite		-		62,550			-			62,550
Customer relationship	8-9 years		-		12,397,954			(594,301	)		11,803,653
Trademark	8 years		-		326,646			(3,403	)		323,243
		$	14,731,842	$	15,449,021		$	(7,211,617	)	$	22,969,246

The Company recorded amortization expenses of $1,365,636 and $633,363 for the three months ended March 31, 2023 and 2022, respectively.

The estimated future amortization expense of definite life intangible assets as of March 31, 2023 was as follows:

	Amortization Expense
2023	$	3,149,231
2024		3,796,183
2025		3,621,413
2026		3,240,049
2027		3,239,331
Thereafter		12,431,293
Total	$	29,477,500

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

8. Accrued Liabilities

Accrued liabilities consist of the following as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021:~~ 2022:

	September 30, 2022		December 31, 2021		March 31, 2023		December 31, 2022
Accrued subcontractors					$	8,889,201	$	8,101,150
Accrued general expenses						7,080,279		11,436,462
Accrued workers compensation and insurance liabilities						6,564,201		3,766,469
Accrued payroll						3,688,168		4,245,838
Accrued bonus	$	496,660	$	7,260,456		1,312,368		1,500,717
Other current liabilities						1,014,005		706,528
Accrued lab fees		1,363,138		4,885,539		706,351		584,203
Accrued payroll		7,068,616		3,539,301
Medicare advance		-		975,415
Accrued legal fees						629,694		344,417
Accrued fuel and maintenance						555,528		253,243
Credit card payable						84,623		78,838
FICA/Medicare liability		759,232		739,629		19,664		555,166
Accrued general expenses		7,393,906		3,497,418
Accrued subcontractors		11,259,341		9,564,833
Accrued fuel and maintenance		310,064		450,842
Accrued workers compensation		5,465,030		2,259,571
Other current liabilities		12,259		736,021
Accrued legal fees		2,447,997		1,143,629
Accrued insurance liabilities		1,840,420		-
Credit card payable		141,411		58,223
Total accrued liabilities	$	38,558,074	$	35,110,877	$	30,544,082	$	31,573,031

8.9. Line of Credit

On December 17, 2021, Ambulnz-FMC North America, LLC (“FMC NA”), entered into a revolving loan and bridge credit and security agreement with a subsidiary of one of its members with a maximum revolving advance amount of ~~$12,000,000.~~$12,000,000 (each, a “Revolving Advance”). Each Revolving Advance ~~shall bear~~would have borne interest at a per annum rate equal to the Wall Street Journal Prime Rate, ~~(6.25% at September 30, 2022),~~ as the same may ~~change~~have changed from time to time, plus one percent (1.00%), but in no event less than five percent (5.00%) per annum, calculated on the basis of a 360-day year for the actual number of days in the applicable period. The agreement iswas subject to certain financial covenants such as an unused fee, whereas the Company shall pay to the subsidiary of one of its members an unused fee in the amount of 0.5% of the average daily amount by which the Revolving Commitment Amount ($12 million) exceeds the principal balance of the aggregate outstanding advances.fee. All accrued and unpaid interest and unused fee shall be due and payable on the first anniversary of the date of the agreement (“Revolving Credit Maturity Date”). This loan is secured by all assets of entities owned 100% by DocGo Inc. ~~As of December 31, 2021, the outstanding balance of the line of credit was zero.~~ On January 26, 2022, the Company drew $1,000,000 to fund operations and meet short-term obligations. ~~As of September 30,~~In December 2022, the Company did not renew the agreement, and repaid the outstanding ~~balance~~balance.

On November 1, 2022, the Company entered into a revolving loan and security agreement with two banks, with one bank as the administrative agent (the “Lenders”), with a maximum revolving advance amount of $90,000,000. The revolving facility includes the ability for the Company to request an increase to the commitment by an additional up to $50,000,000, though no Lender (nor the Lenders collectively) are obligated to increase their respective commitments. Borrowings under the revolving facility bear interest at a per annum rate equal to, (i) at the Company’s option, the (x) the base rate or (y) the adjusted term SOFR rate, plus (ii) the applicable margin. The applicable margins are based on the Company’s consolidated net leverage ratio, adjusted on a quarterly basis. The Initial applicable margins are 1.25% for an adjusted term SOFR loan and 0.25% for a base rate loan and will be updated based on the consolidated net leverage ratio reported in the compliance certificate. The revolving facility matures on the five-year anniversary of the ~~line~~closing date, November 1, 2027. The revolving facility is secured by a first-priority lien on substantially all of ~~credit was $1,000,000.~~the Company’s present and future personal assets and intangible assets. The revolving facility is subject to certain financial covenants such as a net leverage ratio and interest coverage ratio, as defined in the agreement. The Company has not made any draws under the facility and as of March 31, 2023, there is no amount outstanding.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

~~(CONTINUED)~~

9.10. Notes Payable

The Company has various loans with finance companies with monthly installments aggregating ~~$64,855,~~$64,671, inclusive of interest ranging from 2.5% through 8%. The notes mature at various times through ~~2051~~2027 and are secured by transportation equipment.

The following table summarizes the Company’s notes payable:

	September 30, 2022		December 31, 2021		March 31, 2023		December 31, 2022
Equipment and financing loans payable, between 2.5% and 8% interest and maturing between January 2022 and May 2051	$	2,136,808	$	1,903,288
Equipment and financing loans payable, between 2.5% and 8% interest and maturing between January 2023 and March 2028					$	1,922,223	$	1,901,514
Loan received pursuant to the Payroll Protection Program Term Note		-		-		-		-
Total notes payable		2,136,808		1,903,288		1,922,223		1,901,514
Less: current portion of notes payable	$	680,703	$	600,449	$	649,808	$	664,913
Total non-current portion of notes payable	$	1,456,105	$	1,302,839	$	1,272,415	$	1,236,601

Interest ~~expense was $69,804~~expenses were $29,034 and ~~$61,324~~$22,559 for the ~~periods~~three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and December 31, 2021,~~ respectively.

Future minimum annual maturities of notes payable as of ~~September 30, 2022 are~~March 31, 2023 were as follows:

	Notes Payable			Notes Payable
2022, remaining		137,959
2023		582,722
2023, remaining				$	425,309
2024		446,812			478,492
2025		386,785			463,573
2026		311,769			384,627
2027					160,977
Thereafter		270,761			9,245
Total maturities	$	2,136,808		$	1,922,223
Current portion of notes payable		(680,703	)		(649,808	)
Long-term portion of notes payable	$	1,456,105		$	1,272,415

DocGo Inc. and Subsidiaries

~~10.~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

11. Business Segment Information

The Company conducts business ~~as two~~in three operating segments, Transportation Services, ~~and~~ Mobile Health ~~services.~~Services and Corporate. In accordance with ASC 280, Segment Reporting, operating segments are components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker, ~~who is~~ the ~~chief executive officer,~~Company’s Chief Executive Officer, in deciding how to allocate resources and assessing performance. ~~The Company’s business operates~~Prior to 2023, the Company reported in two ~~operating~~ segments, because the Company’s entities have two main revenue ~~streams,~~streams. Beginning with the first quarter of 2023, the Company is now reporting in three operating segments, adding a Corporate segment to allow for analysis of shared services and personnel that support both the Transportation Services and Mobile Health Services segments. Previously, these costs had been allocated almost entirely to the Transportation Services segment. All of the Company’s revenues and costs of goods sold 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. The segment reporting for the prior-year period has been adjusted to conform to the new methodology, for the purposes of allowing a clearer analysis of year-over-year performance. The Company’s chief operating decision maker evaluates the Company’s financial information and resources and assesses the performance of these resources by revenue ~~stream.~~stream and by operating income or loss performance.

The accounting policies of the segments are the same as the accounting policies of the Company as a whole. The Company evaluates the performance of its Transportation Services, ~~and~~ Mobile Health ~~services~~Services and Corporate segments based primarily on results of operations.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

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

	Transportation Services			Mobile Health Services		Total		Transportation Services			Mobile Health Services		Corporate			Total
Three Months Ended September 30, 2022
Three Months Ended March 31, 2023
Revenues	$	27,670,109		$	76,649,785	$	104,319,894	$	40,055,946		$	72,946,757	$	-		$	113,002,703

Income (loss) from operations		(4,213,156	)		8,412,346	$	4,199,190		1,083,040			13,188,159		(21,173,786	)		(6,902,587	)

Total assets	$	173,789,449		$	182,130,761	$	355,920,210		118,998,556			152,352,877		136,193,743			407,545,176

Depreciation and amortization expense	$	2,464,694		$	550,170	$	3,014,864		1,863,304			716,539		1,069,486			3,649,329

Stock compensation	$	373,641		$	737,562	$	1,111,203		259,693			116,934		8,073,389			8,450,016

Long-lived assets	$	19,584,744		$	53,174,239	$	72,758,983		67,461,536			30,920,781		9,954,851			108,337,168

Three Months Ended September 30, 2021
Three Months Ended March 31, 2022
Revenues	$	17,916,162			67,922,826	$	85,838,988	$	27,812,510		$	90,079,042	$	-		$	117,891,552

Income (loss) from operations		(11,308,739	)		12,827,957		1,519,218		(2,538,760	)		23,402,298		(10,768,973	)		10,094,565

Total assets	$	115,444,782		$	28,634,083	$	144,078,865		73,244,007			48,736,456		203,215,841			325,196,304

Depreciation and amortization expense	$	1,860,088		$	159,488	$	2,019,576		1,314,600			213,256		673,165			2,201,021

Stock compensation	$	458,346		$	4,700	$	463,046		386,101			45,073		991,763			1,422,937

Long-lived assets	$	25,641,586		$	2,252,650	$	27,894,236		27,510,779			3,224,955		1,154,969			31,890,703

Long-lived assets include Property, plant and equipment, Goodwill and Intangible assets.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

Transportation
Services Mobile Health
Services Total
Nine Months Ended September 30, 2022
Revenues $ 77,657,852 $ 254,072,898 $ 331,730,750

Income (loss) from operations (33,035,470 ) 54,786,982 $ 21,751,512

Total assets $ 173,789,449 $ 182,130,761 $ 355,920,210

Depreciation and amortization expense $ 6,271,952 $ 981,704 $ 7,253,656

Stock compensation $ 1,253,450 $ 3,280,309 $ 4,533,759

Long-lived assets $ 19,584,744 $ 53,174,239 $ 72,758,983

Nine Months Ended September 30, 2021
Revenues $ 65,657,142 131,737,237 $ 197,394,379

Income (loss) from operations (15,309,680 ) 15,213,696 (95,984 )

Total assets $ 115,444,782 $ 28,634,083 $ 144,078,865

Depreciation and amortization expense $ 5,214,607 $ 299,696 $ 5,514,303

Stock compensation $ 1,215,180 $ 9,400 $ 1,224,580

Long-lived assets $ 25,641,586 $ 2,252,650 $ 27,894,236

~~Long-lived assets include property, plant and equipment, goodwill and intangible assets.~~Geographic Information

~~Geographic Information~~

Revenues by geographic location are included in Note 2.

12. Equity

~~11. Equity~~

~~Preferred Stock~~

In November 2021, the Company’s Series A preferred stock was cancelled and converted into the right to receive a portion of merger consideration issuable as common stock of DocGo, par value $0.0001 (the “Common Stock”), pursuant to the terms and conditions set forth in the Merger Agreement. The Company’s Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity reflect the 2020 shares as if the Merger occurred in 2020.

Prior to the reverse merger, on May 23, 2019, the Series A preferred stock was formed, and 40,000 shares were authorized. Each share of Series A preferred stock was convertible into Class A common stock at a conversion price of $3,000 per share, subject to adjustment as defined in the articles of incorporation.

Series A preferred stockholders had voting rights equivalent to the number of common stock shares issuable upon conversion. The Series A preferred stockholders were entitled to a non-cumulative dividend equal to 8% of the original issue price as defined in the agreement when declared by the board of directors.

The holders of the Series A preferred stock had preferential liquidation rights and rank senior to the holders of common stock. If a liquidation were to occur, the holders of the Series A preferred stock would have been paid an amount equal to $3,000 per share, subject to adjustment as defined in the articles of incorporation, plus all accrued and unpaid dividends thereon. After the payment of the Series A preferred stockholders, the common stockholders would have been paid out on a pro-rata basis.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

~~Common Stock~~

On November 1, 2017, Ambulnz, Inc. converted its legal structure from a limited liability company to a corporation and converted its membership units into shares of common stock at a rate of 1,000 shares per membership unit. The total authorized number of shares of common stock converted was 100,000 shares, comprised of 35,597 shares of Class A common stock and 64,402 shares of Class B common stock.

Prior to the reverse merger, on May 23, 2019, the Ambulnz, Inc amended and restated its articles of incorporation and the total authorized common stock increased to 154,503 shares, comprised of 78,000 shares of Class A common stock and 76,503 shares of Class B common stock. The Class A common stockholders had voting rights equivalent to one vote per share of common stock and the Class B common stockholders have no voting rights. Dividends may be paid to the common stockholders out of funds legally available, when declared by the board of directors.

Share Repurchase Program

On May 24, 2022, the Company was authorized to purchase up to $40 million of the Company’s common stock under a share repurchase program (the “Program”). During the second and fourth quarter of 2022, the Company repurchased ~~70,000~~536,839 shares of its common stock for ~~$498,000.~~$3,731,712. These shares were subsequently cancelled. There were no shares repurchased during the ~~third~~first quarter of ~~2022.~~2023. The Program does not ~~obligate~~oblige the Company to acquire any specific number of shares and will expire on November 24, 2023. Under the Program, shares may be repurchased using a variety of methods, including privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as part of accelerated share repurchases, block trades and other methods. The timing, manner, price and amount of any common stock repurchases under the Program are determined by the Company in its discretion and depend on a variety of factors, including legal requirements, price and economic and market conditions.

~~Preacquisition Warrants~~

On February 15, 2018, the Company issued warrants to purchase 1,367 shares of Class B common stock at a purchase price of $0.01 per share to an investor in conjunction with a capital investment. The warrants had no expiration date. The fair value on the date of issuance was $5,400 per share, for a total fair value of $7,381,800. On May 23, 2019, the warrants were exchanged for warrants to purchase 2,461 shares of Series A preferred stock at a purchase price of $0.01 per share. The exchanged warrants have no expiration date and had a fair value on the date of issuance of $3,000 per share for a total fair value of $7,383,000. These warrants were cashless exercised in November 2021 for 1,587,700 shares of common DocGo Inc. common stock.

On June 5, 2019, the Company issued warrants to purchase 667 shares of Series A preferred stock at a purchase price of $3,000 per share to an investor in conjunction with a capital investment. The warrants would have expired on June 6, 2029. The fair value on the date of issuance was $2,078 per warrant for a total fair value of $1,386,026. These warrants were cashless exercised in November 2021 for 229,807 shares of common DocGo Inc. ~~common stock.~~and Subsidiaries

~~12.~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

13. Stock Based Compensation

Stock Options

In 2021, the Company established the DocGo Inc. Equity Incentive Plan (the “Plan”), which replaced Ambulnz, Inc’s 2017 Equity Incentive Plan. The Company reserved 16,607,894 shares of common stock for issuance under the Plan. The Company’s stock options generally vest on various terms based on continuous services ~~over periods ranging from three~~up to five years. The stock options are subject to time vesting requirements through ~~2032~~2026 and are nontransferable. Stock options granted have a maximum contractual term of 10 years. On ~~September 30, 2022,~~March 31, 2023, approximately ~~2.5~~3.2 million employee ~~stock~~ options ~~on a converted basis~~ 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~~Management took the ~~Company’s shares of stock were publicly traded, management took~~company specific volatility and 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. The expected term of the options ~~represented~~represents the period of time the instruments are expected to be outstanding. The Company ~~based~~bases the risk-free interest rate on the rate payable on the U.S. Treasury securities corresponding to the expected term of the awards at the date of grant. Expected dividend yield ~~was~~is zero based on the fact that the Company ~~had~~has not historically paid and does not intend to pay a dividend in the foreseeable future.

The Company utilized contemporaneous valuations in determining the fair value of its shares at the date of option grants. Prior to the Merger, each valuation utilized both the discounted cash flow and guideline public company methodologies to estimate the fair value of its shares on a non-controlling and marketable basis. The December 31, 2020 valuations also included an approach that took into consideration a pending non-binding letter of intent from Motion Acquisition Corp. The March 11, 2021 valuation report relied solely on the fair value of the Company’s shares implied by the March 8, 2021 Merger Agreement with Motion Acquisition Corp.

A discount for lack of marketability was applied to the non-controlling and marketable fair value estimates determined above. The determination of an appropriate discount for lack of marketability was based on a review of discounts on the sale of restricted shares of publicly traded companies and put-based quantitative methods. Factors that influenced the size of the discount for lack of marketability included (a) the estimated time it would take for a Company stockholder to achieve marketability, and (b) the volatility of the Company’s business.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

The following assumptions were used to compute the fair value of the stock option grants during the period ended ~~September 30, 2022~~March 31, 2023 and ~~2021:~~2022:

	Period Ended September 30, 2022						Three Months Ended March 31,
	2022			2021			2023		2022
Risk-free interest rate		.07% - 2.8	%		.15% - .62	%		0.71% - 4.31%		0.71%
Expected term (in years)		4			.5 - 2			6.25		4
Volatility		60% - 64	%		65	%		60% - 69%		60%
Dividend yield		0	%		0	%		0%		0%

The following table summarizes the Company’s stock option activity under the Plan for the period ended ~~September 30, 2022:~~March 31, 2023:

	Options Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life in Years		Aggregate Intrinsic Value
Balance as of, December 31, 2022		11,571,308		$	7.11		9.05	$	39,389,063
Granted/ Vested during the year		-			-		-		-
Exercised during the year		(96,101	)		2.60		-		-
Cancelled during the year		(267,539	)		7.74		-		-
Balance as of March 31, 2023		11,207,668			7.15		8.73	$	45,428,463
Options vested and exercisable at March 31, 2023		3,153,550		$	6.12		7.84	$	9,827,324

Options
Shares Weighted
Average
Exercise Price Weighted
Average
Remaining
Contractual
Life in Years Aggregate
Intrinsic
Value
Balance as of, December 31, 2021 8,422,972 $ 6.21 8.77 $ 24,706,020
Granted/ Vested during the year 2,183,026 5.92 9.07 -
Exercised during the year (1,637,159 ) 2.04 5.47 -
Cancelled during the year (706,642 ) 7.71 8.82 -
Balance as of September 30, 2022 8,262,197 7.04 8.72 $ 22,950,815
Options vested and exercisable at September 30, 2022 2,502,717 $ 6.11 8.30 $ 10,010,617

The aggregate intrinsic value in the above table is calculated as the difference between fair value of the Company’s 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 periods ended ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021~~2022 was ~~$5.92~~$7.15 and ~~$2.80,~~$7.04, respectively. ~~On September 30, 2022~~At March 31, 2023 and December 31, ~~2021,~~2022, the total unrecognized compensation related to unvested stock option awards granted was ~~$27,812,078~~$32,118,556 and ~~$20,792,804,~~$41,666,564, respectively, which the Company expects to recognize over a weighted-average period of approximately ~~3.73~~2 years.

Restricted Stock Units

The fair value of restricted stock units (“RSUs”) is determined on the date of grant. The Company records compensation expense in the ~~Unaudited~~unaudited Condensed Consolidated ~~Statement~~Statements of Operations and Comprehensive (Loss) Income on a straight-line basis over the vesting period for RSUs. The vesting period for employees and members of the Board of Directors ranges from one to four years.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

~~(CONTINUED)~~

Activity under RSUs was as follows:

RSUs Weighted-
Average
Grant Date
Fair Value
Per RSU
Balance as of, December 31, 2021 50,192 $ 9.97
Granted 146,853 7.15
Vested during the year (16,645 ) 9.97
Forfeited - -
Balance as of, September 30, 2022 180,400 7.67
Vested and unissued at September 30, 2022 -
Non-vested at September 30, 2022 180,400 7.67

	RSUs			Weighted- Average Grant Date Fair Value Per RSU

Balance as of December 31, 2022		305,587		$	8.35
Granted		-			-
Vested during the year		(80,008	)		7.71
Balance as of March 31, 2023		225,579			8.58
Vested and unissued as of March 31, 2023		136,250			7.71
Non-vested as of March 31, 2023		225,579			8.58

The total grant-date fair value of RSUs granted during the period ended ~~September 30, 2022~~March 31, 2023 was ~~$1,049,999.~~$0.

For the period ended ~~September 30, 2022,~~March 31, 2023, the Company recorded stock-based compensation expense related to RSUs of ~~$177,840.~~$429,675.

As of ~~September 30, 2022,~~March 31, 2023, the Company had ~~$1,241,163~~$1,934,998 in unrecognized compensation cost related to non-vested RSUs, which is expected to be recognized over a weighted-average period of approximately ~~3.1~~1.1 years.

~~13.~~14. Leases

Operating Leases

The Company is obligated to make rental payments under non-cancellable operating leases for office, dispatch station space, and transportation equipment, expiring at various dates through ~~2026~~2029. Under the terms of the leases, the Company is also obligated for its proportionate share of real estate taxes, insurance and maintenance costs of the property. The Company is required to hold certain funds in restricted cash and cash equivalents accounts under some of these agreements.

Certain leases for property and transportation equipment contain options to purchase, extend or terminate the lease. Determining the lease term and amount of lease payments to include in the calculation of the right-of-use (ROU) asset and lease obligations for leases containing options requires the use of judgment to determine whether the exercise of an option is reasonably certain and whether the optional period and payments should be included in the calculation of the associated ROU asset and lease obligation. In making such judgment, the Company considers all relevant economic factors that would require whether to exercise or not exercise the option.

The Company’s lease agreements generally do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach to derive an appropriate imputed discount rate. The Company benchmarked itself against other companies of similar credit ratings and comparable quality and derived imputed rates, which were used to discount its real estate lease liabilities. The Company used estimated borrowing rates of 6% on January 1, 2019, for all leases that commenced prior to that date, for office spaces and transportation equipment.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

~~(CONTINUED)~~

Lease Costs

The table below comprise lease expenses for the periods ended ~~September 30, 2022~~March 31, 2023 and ~~2021:~~2022:

	Three Months Ended				Nine Months Ended
Components of total lease cost:	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021		March 31, 2023		March 31, 2022

Operating lease expense	$	626,188	$	508,128	$	1,517,541	$	1,446,067	$	756,245	$	462,625
Short-term lease expense		334,619	$	62,653		863,316		256,448		336,318		255,096
Total lease cost	$	960,807	$	570,781	$	2,380,857	$	1,702,515	$	1,092,563	$	717,721

Lease Position as of ~~September 30, 2022~~March 31, 2023

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

	September 30, 2022		December 31, 2021		March 31, 2023		December 31, 2022
Assets
Lease right-of-use assets	$	8,185,547	$	4,195,682	$	9,375,132	$	9,074,277
Total lease assets	$	8,185,547	$	4,195,682	$	9,375,132	$	9,074,277

Liabilities
Current liabilities:
Lease liability - current portion	$	2,059,278	$	1,461,335	$	2,353,383	$	2,325,024
Noncurrent liabilities:
Lease liability, net of current portion		6,406,246		2,980,946		7,315,226		7,040,982
Total lease liability	$	8,465,524	$	4,442,281	$	9,668,609	$	9,366,006

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

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 September 30, 2022:~~

Weighted average remaining lease term (in years) - operating leases			4.86		5~~.22~~
Weighted average discount rate - operating leases				~~6.00~~5.99	%

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

Undiscounted Cash Flows

Future minimum lease payments under the operating leases ~~at September 30, 2022 are~~as of March 31, 2023 were as follows:

				Operating Leases
	Operating Leases
2022, remaining	$	676,878
2023		2,375,470
2023, remaining				$	2,170,565
2024		1,880,974			2,601,033
2025		1,897,247			2,592,944
2026		1,499,654			1,901,778
2027 and thereafter		1,418,692			1,692,393
Total future minimum lease payments		9,748,915			10,958,713
Less effects of discounting		(1,283,391	)	$	(1,290,104	)
Present value of future minimum lease payments	$	8,465,524		$	9,668,609

Operating lease ~~expense was~~expenses were approximately ~~$960,807~~$756,245 and ~~$570,781~~$462,625 for the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively.

~~Operating lease expense was approximately $2,380,857 and $1,702,515 for the nine months ended September 30, 2022 and 2021, respectively.~~

For the ~~three months~~quarter ended ~~September 30, 2022,~~March 31, 2023, the Company made ~~$626,188~~$756,245 of fixed cash payments related to operating leases and ~~$672,975~~$744,030 related to finance leases.

~~For the three months ended September 30, 2021, the Company made $519,716 of fixed cash payments related to operating leases and $725,233 related to finance leases.~~ Finance Leases

~~For the nine months ended September 30, 2022, the Company made $1,517,541 of fixed cash payments related to operating leases and $2,146,857 related to finance leases.~~

~~For the nine months ended September 30, 2021, the Company made $1,446,067 of fixed cash payments related to operating leases and $1,972,283 related to finance leases.~~

~~Finance Leases~~

The Company leases vehicles under a non-cancelable finance lease agreements with a liability of ~~$8,945,489~~$8,834,857 and ~~$10,139,410 as of September 30, 2022~~$8,646,803 for the quarter ended March 31, 2023 and December 31, ~~2021,~~2022, respectively. This includes accumulated depreciation expense of ~~$9,662,686~~$8,717,048 and ~~$7,095,242~~$7,906,966 as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, respectively.

Depreciation ~~expense~~expenses for the vehicles under non-cancelable lease agreements amounted to ~~$873,713~~$801,083 and ~~$752,313~~$855,781 for the ~~three months~~quarter ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ respectively.

~~Depreciation expense for the vehicles under non-cancelable lease agreements amounted to $2,391,989 and $2,109,770 for the nine months ended September 30, 2022 and 2021, respectively.~~

Gain on Lease Remeasurement

In June 2022, the Company reassessed its finance lease estimates relating to vehicle ~~milage~~mileage and residual value. As a result, the Company determined to purchase the vehicles at the end of the leases which resulted in a gain of $1.4 million recorded as gains from lease accounting onin the ~~Unaudited~~unaudited Condensed Consolidated ~~Statement~~Statements of Operations and Comprehensive (Loss) Income.

Lease Payments

The table below presents lease payments for the periods ended March 31, 2023 and 2022:

Components of total lease payment:	March 31, 2023		March 31, 2022

Finance lease payment	$	744,030	$	622,575
Short-term lease payment		-		-
Total lease payments	$	744,030	$	622,575

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

~~(CONTINUED)~~

~~Lease Payments~~

~~The table below presents lease payments for the periods ended September 30, 2022 and 2021:~~

Three Months Ended Nine Months Ended
Components of total lease payment: September 30,
2022 September 30,
2021 September 30,
2022 September 30,
2021

Finance lease payment $ 672,975 $ 717,891 $ 2,146,857 $ 1,972,283
Short-term lease payment - - -
Total lease payments $ 672,975 $ 717,891 $ 2,146,857 $ 1,972,283

Lease Position as of ~~September 30, 2022~~March 31, 2023

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

	September 30, 2022		December 31, 2021		March 31, 2023		December 31, 2022
Assets
Lease right-of-use assets	$	9,421,196	$	9,307,113	$	9,170,429	$	9,039,663
Total lease assets	$	9,421,196	$	9,307,113	$	9,170,429	$	9,039,663

Liabilities
Current liabilities:
Lease liability - current portion	$	2,858,968	$	3,271,990	$	2,773,029	$	2,732,639
Noncurrent liabilities:
Lease liability, net of current portion		6,086,521		6,867,420		6,061,828		5,914,164
Total lease liability	$	8,945,489	$	10,139,410	$	8,834,857	$	8,646,803

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 ~~September 30, 2022:~~March 31, 2023:

Weighted average remaining lease term (in years) - finance leases			~~3.92~~3.66
Weighted average discount rate - finance leases			~~6.01~~5.95	%

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

Undiscounted Cash Flows

~~Future minimum lease payments under the finance leases at September 30, 2022 are as follows:~~

Finance Leases
2022, remaining 878,626
2023 3,127,590
2024 2,398,030
2025 2,095,826
2026 1,185,433
2027 and thereafter 274,974
Total future minimum lease payments 9,960,479
Less effects of discounting (1,014,990 )
Present value of future minimum lease payments $ 8,945,489

Future minimum lease payments under the ~~operating~~finance leases ~~at September 30, 2022 are~~as of March 31, 2023 were as follows:

Operating
Leases
2022, remaining $ 676,878
2023 2,375,470
2024 1,880,974
2025 1,897,247
2026 1,499,654
2027 and thereafter 1,418,692
Total future minimum lease payments 9,748,915
Less effects of discounting (1,283,391 )
Present value of future minimum lease payments $ 8,465,524

	Finance Leases
2023, remaining		2,483,279
2024		2,678,787
2025		2,399,085
2026		1,617,995
2027 and thereafter		613,905
Total future minimum lease payments		9,793,051
Less effects of discounting		(958,194	)
Present value of future minimum lease payments	$	8,834,857

~~14.~~15. Other ~~Expense~~Income (Expenses)

The Company recognized $853,927 and ($281,949) of Other income (expenses) for the three months ended March 31, 2023 and March 31, 2022, respectively, as follows:

	Three Months Ended March 31
Other income (expenses):	2023			2022
Interest income (expense), net		809,172			(135,606	)
Loss on remeasurement of warrant liabilities		-			(58,749	)
Loss on equity method investments		(115,286	)		(83,341	)
Loss on disposal of fixed assets		(54,839	)		-
Other income (expenses)		214,880			(4,253	)
Total other income (expenses)	$	853,927		$	(281,949	)

As of ~~September 30, 2022,~~March 31, 2023, the Company ~~recorded a~~recognized other income of $214,880, net of $637 from realized foreign exchange loss offset by rental income of approximately $1.8 million from the remeasurement of warrant liabilities. The warrants are marked-to-market in each reporting period, and this loss reflected the increase in DocGo’s stock price relative to the beginning of the period. No gain or loss was recorded in relation to the remeasurement of warrant liabilities in the same period in 2021. The Company redeemed all of its outstanding warrants in September 2022.$8,496.

DocGo Inc. and Subsidiaries

~~15.~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

16. Related Party Transactions

Historically, the Company has been involved in transactions with various related parties.

Ely D. Tendler Strategic & Legal Services PLLC provides legal services for the Company. Ely D. Tendler Strategic & Legal Services PLLC is owned by the General Counsel of the Company, and therefore is a related party. The Company made legal payments to Ely D. Tendler Strategic & Legal Services PLLC totaling ~~$261,185~~$234,230 and ~~$186,075~~none for the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021, respectively, and $704,593 and $476,293 for the nine months ended September 30, 2022 and 2021,~~ respectively.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

~~Pride Staff also~~PrideStaff provides subcontractor services ~~for~~to the Company. ~~The Pride Staff~~PrideStaff is owned by ~~the~~an operations manager of the Company and his spouse, and therefore, is a related party. The Company made subcontractor payments to PrideStaff totaling ~~$118,645~~$93,311 and ~~$92,359~~$209,153 for the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021, respectively, and $364,844 and $592,417 for the nine months ended September 30, 2022 and 2021,~~ respectively.

Included in ~~accounts~~Accounts payable were ~~$118,604~~$125,539 and ~~$94,636~~$86,555 due to related parties as of ~~September 30, 2022~~March 31, 2023, and December 31, ~~2021,~~2022, respectively.

~~16.~~17. Income Taxes

As a result of the Company’s history of net operating losses (“NOL”), 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 income ~~expense~~tax benefit (expense) for the three months ended ~~September 30,~~March 31, 2023 and 2022 was $2,129,870 and ~~2021 were $401,906 and $604,608, respectively, and $1,163,755 and $613,531 for the nine months ended September 30, 2022 and 2021,~~($440,179) respectively. ~~In determining the quarterly provision for income taxes, we use an estimated annual~~Our effective tax rate ~~adjusted~~ for ~~discrete items. This rate is based on our expected annual income, statutory tax rates,~~the three months ended March 31, 2023 and ~~best estimates of non-taxable~~2022 was 38.21% and ~~non-deductible income and expense items.~~4.85%, respectively.

~~17.~~18. 401(K) Plan

The Company has established a 401(k) plan in January 2022 that qualifies as a deferred compensation arrangement under Section 401 of the Internal Revenue Code. All U.S. 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 ~~September 30, 2022.~~March 31, 2023.

~~18.~~19. 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~~unaudited Condensed Consolidated Financial Statements of the Company. The Company provides disclosure and records loss contingencies in accordance with ~~the~~ loss contingencies accounting guidance. In accordance with such guidance, the Company establishes accruals for such matters when potential losses become probable and can be reasonably estimated. 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~~unaudited Condensed Consolidated Financial Statements.

As of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, the Company recorded a liability of $1,000,000, which ~~represents~~represented an ~~amount for an agreed~~agreed-upon settlement ~~under the terms of a memorandum of understanding,~~ of various class-based claims, both actual and potential, under ~~Federal and~~ California state law, as described in detail below. ~~The settlement is subject to court approval.~~

Stephanie Zamora, Jascha Dlugatch, et al. v. Ambulnz Health, LLC, et al.al. was filed in the Los Angeles Superior Court on October 11, 2018, and the complaint alleged wage and hour violations pursuant to California’s Private Attorneys’ General Act of 2004 (“PAGA”). On February 24, 2020, this case was consolidated with Jascha Dlugatch, et. ~~Al.~~al. v. Ambulnz Health, LLC (the “Consolidated Compliant”), another lawsuit filed in the Los Angeles Superior Court. On May 6, 2021, the parties attended mediation and settled the claims pled in the Consolidated Complaint on a class-wide and PAGA basis in exchange for a proposed ~~$1 million~~$1,000,000 payment by ~~Ambulnz Health,~~the defendant parties, inclusive of administrative costs and fees. On September 9, 2022, the Court preliminarily approved the proposed settlement. A final approval hearing is currently scheduled for April 28, 2023.

DocGo Inc. and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)

~~(CONTINUED)~~

~~19.~~20. Risk and Uncertainties

COVID-19 Risks, Impacts and Uncertainties

On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus (the “COVID-19 Outbreak”) and the risks to the international community as the virus spreads globally. In March 2020, the WHO classified the COVID-19 Outbreak as a pandemic, based on the rapid increase in exposure globally.

The spread of COVID-19 and the related country-wide shutdowns and restrictions had a mixed impact on the Company’s business. In the ambulance transportation business, which predominantly comprises of non-emergency medical transportation, the Company saw a decline in volumes from historical and expected levels, as elective surgeries and other procedures were postponed. In some of the Company’s larger markets, such as New York and California, there were declines in trip volume. In addition, the Company experienced lost revenues associated with sporting, concerts and other events, as those events were cancelled or had a significantly restricted (or entirely eliminated) the number of permitted attendees. Ambulance transports and event-related revenues have both since recovered to pre-COVID levels or higher.

There are two areas where the Company has experienced positive business impacts from COVID-19. In April and May 2020, the Company participated in an emergency project with Federal Emergency Management Agency (“FEMA”) in the New York City area. This engagement resulted in incremental transportation revenue. In addition, in response to the need for widespread COVID-19 testing and available ~~Emergency Medical Technicians (“EMT”)~~EMT and Paramedics, the Company formed a new subsidiary, Rapid Reliable Testing, LLC (“RRT”), with the goal to perform COVID-19 tests at nursing homes, municipal sites, businesses, schools and other venues. RRT is part of the Mobile Health segment. Since early 2020, RRT has grown significantly, and its services have expanded beyond COVID-19 testing to a wide variety of tests, vaccinations and other procedures. While COVID-19 testing activity continued to grow throughout 2021 and into early 2022, such activity has slowed considerably over the past several months, as the pandemic has waned, and COVID-19 testing accounted for a relatively small proportion of the Company’s overall revenues during the third ~~quarter~~and fourth quarters of 2022. ~~We anticipate~~DocGo anticipates that COVID-19 will continue to account for a shrinking proportion of the Company’s revenues in ~~the fourth quarter of 2022~~2023 and beyond.

The Company’s current business plan assumes continued recovery of industry-wide transportation volumes to historical levels and beyond, plus an increased demand for mobile health services, a demand that was accelerated by the pandemic, but which is also being driven by longer-term secular factors, such as the increasing desire on the part of patients to receive treatments outside of traditional settings, such as doctor’s offices and hospitals. However, given the unpredictable, unprecedented, and fluid nature of the pandemic and its economic consequences, we are unable to predict the duration and extent to which the pandemic and its related positive and negative impacts will affect our business, financial condition, and results of operations in future periods. Likewise, we are unable to predict the emergence of future, unrelated pandemics, which would have some of the same impacts as those experienced with COVID-19.

~~DocGo Inc. and Subsidiaries~~

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(CONTINUED)~~

~~Medicare Accelerated Payments~~21. Subsequent Events

~~Medicare accelerated payments of approximately $2,397,024 were received by~~In April 2023, the Company purchased the remaining noncontrolling interest in ~~April 2020. Effective October 8, 2020, CMS is no longer accepting new applications~~FMC NA for ~~accelerated payments. Accordingly,~~$7,000,000. The Company issued $3,000,000 worth of equity in a private placement transaction, consisting of 360,145 shares of DocGo common stock. The remaining $4,000,000 will be paid in cash. As a result of this transaction, the Company does not expect to receive additional Medicare accelerated payments. Payments under the Medicare Accelerated and Advance Payment program are advances that must be repaid. Effective October 1, 2020, the program was amended such that providers are required to repay accelerated payments beginning one year after the payment was issued. After such one-year period, Medicare payments owed to providers will be recouped according to the repayment terms. The repayment terms specify that for the first 11 months after repayment begins, repayment will occur through an automatic recoupmentnow owns 100% of 25% of Medicare payments otherwise owed to the provider. At the end of the eleven-month period, recoupment will increase to 50% for six months. At the end of the six months (or 29 months from the receipt of the initial accelerated payment), Medicare will issue a letter for full repayment of any remaining balance, as applicable. In such event, if payment is not received within 30 days, interest will accrue at the annual percentage rate of four percent (4%) from the date the letter was issued and will be assessed for each full 30-day period that the balance remains unpaid. There were no Medicare accelerated payments reflected within accrued liabilities in the Condensed Consolidated Balance Sheets as of September 30, 2022, compared to $975,415 as of December 31, 2021. The Company’s estimate of the current liability is a function of historical cash receipts from Medicare and the repayment terms set forth above.FMC NA.

~~20. Subsequent Events~~

On October 12, 2022, the Company acquired Community Ambulance Service Ltd, a company located in United Kingdom, in exchange for approximately £4.8 million in cash. Community Ambulance Service Ltd is engaged in providing emergency and non-emergency transport services, including high dependency, urgent care, mental health and blue light transport services and diagnostics testing. We believe this acquisition will allow us to increase our presence in that market, while giving us improved access to municipal contracts. We are currently in the process of finalizing the accounting for this transaction and will have completed our preliminary allocation of the purchase consideration to the asset acquired and liabilities assumed as of the end of the fourth quarter of 2022.

On November 1, 2022, the Company entered into a revolving loan and security agreement with two banks, with one bank as the administrative agent (the “Lenders”), with a maximum revolving advance amount of $90,000,000. The revolving facility includes the ability for the Company to request an increase to the commitment by an additional up to $50,000,000, though no Lender (nor the Lenders collectively) are obligated to increase their respective commitments. Borrowings under the revolving facility bear interest at a per annum rate equal to, (i) at the Company’s option, the (x) the base rate or (y) the adjusted term SOFR rate, plus (ii) the applicable margin. The applicable margins are based on the Company’s consolidated net leverage ratio, adjusted on a quarterly basis. The initial applicable margins are 1.25% for an adjusted term SOFR loan and 0.25% for a base rate loan and will be updated based on the consolidated net leverage ratio reported in the compliance certificate. The revolving facility matures on the five-year anniversary of the closing date, November 1, 2027. The revolving facility is secured by a first-priority lien on substantially all of the Company’s present and future personal assets and intangible assets. The revolving facility is subject to certain financial covenants such as a net leverage ratio and interest coverage ratio, as defined in the agreement. The Company has not made any draws under the facility and there is no amount outstanding.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited Condensed Consolidated Financial Statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q. The discussion and analysis below contain certain forward-looking statements about our business and operations that are subject to the risks, uncertainties, and other factors described in the sections entitled “Risk Factors,” included in Part I, Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2022, and as may be updated in this and other subsequent Quarterly Reports on Form 10-Q. These risks, uncertainties, and other factors could cause our actual results to differ materially from those expressed in, or implied by, the forward-looking statements. Please refer to the section entitled “Cautionary Note Regarding Forward-Looking Statements.”

Unless the context requires otherwise, references to “DocGo,” “we,” “us,” “our” and ~~“the Company”~~the “Company” in this section are to the business and operations of DocGo Inc. ~~The following discussion~~ and ~~analysis should be read in conjunction with DocGo’s Unaudited Condensed Consolidated Financial Statements and related notes thereto included in this Quarterly Report on Form 10-Q. In addition~~its consolidated subsidiaries, including those periods prior to historical information, this discussion contains forward-looking statements that involve risks, uncertainties, and assumptions that could cause DocGo’s actual results to differ materially from management’s expectations. Factors that could cause such differences are discussed herein and under the ~~caption, “Cautionary Note Regarding Forward-Looking Statements.”~~

Business Combination. Certain figures, such as interest rates and other percentages, included in this section have been rounded for ease of presentation. Percentage figures included in this section have, ~~not~~ in ~~all~~some cases, been calculated on the basis of such rounded ~~figures but on the basis of such amounts prior to rounding.~~figures. For this reason, percentage amounts in this section may vary slightly from those obtained by performing the same calculations using the figures in DocGo’s ~~Unaudited~~unaudited Condensed Consolidated Financial Statements or in the associated notes. Certain other amounts that appear in this section may similarly not sum due to rounding.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), regarding, among other things, the plans, strategies, outcomes, and prospects, both business and financial, of the Company. These statements are based on the beliefs and assumptions of our management. Although the Company believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, the Company cannot assure you that it will achieve or realize these plans, intentions, outcomes or expectations. ~~Generally,~~Forward-looking statements ~~that~~are inherently subject to substantial risks, uncertainties and assumptions, many of which are beyond our control, and which may cause actual results to differ materially from those contained in our forward-looking statements. Accordingly, you should not place undue reliance on such statements. All statements other than statements of historical fact are forward-looking. Forward-looking statements include, but are not ~~historical facts, including~~limited to, statements concerning possible or assumed future actions, business strategies, plans, goals, future events, future revenues or performance, financing needs, business trends, results of operations, ~~are forward-looking statements. These~~objectives and intentions with respect to future operations, services and products, including our transition to non-COVID related services, geographic expansion, our normalization initiative, new and existing contracts, M&A activity, workforce growth, leadership transition, cash position, share repurchase program, impacts of financial institution instability, our competitive position and opportunities, including our ability to realize the benefits from our operating model, and others. In some cases, these statements may be preceded by, followed by or include the words “believes,” “estimates,” “expects,” “projects,” “forecasts,” “may,” “might,” “will,” “should,” “could,” “can,” “would,” “design,” “potential,” “seeks,” “plans,” “scheduled,” “anticipates,” “intends” or the negative of these terms or similar expressions.

Forward-looking statements are ~~inherently subject to risks, uncertainties~~not guarantees of performance and ~~assumptions. Additional information regarding~~speak only as of the ~~risks and uncertainties and other~~date the statements are made. While DocGo believes that these forward-looking statements are reasonable, there can be no assurance that DocGo will achieve or realize these plans, intentions, outcomes or expectations. You should understand that the following important factors, ~~that could cause actual results~~in addition to ~~differ materially from~~ those ~~in the forward-looking statements is set forth~~discussed under the ~~heading~~sections entitled “Risk ~~Factors”~~Factors,” included in Part I, Item ~~1A.~~1A in ~~DocGo’s~~our Annual Report on Form 10-K for the year ended December 31, ~~2021,~~2022, and as ~~filed with the Securities and Exchange Commission (the “SEC”) on March 15, 2022 (the “2021 Form 10-K”), and~~ may be updated in this and other subsequent Quarterly Reports on Form ~~10-Q. Forward-looking~~10-Q, could affect the future results and prospects of DocGo and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements ~~are not guarantees of future performance and speak only as of the date hereof.~~ in this Quarterly Report on Form 10-Q.

We undertake no intent or obligation to publicly update or revise ~~publicly~~ any forward-looking statements, whether because of new information, future events, or ~~otherwise, except as required by law.~~otherwise.

~~Overview~~

Overview

DocGo, ~~incorporated~~which was originally formed in 2015, is a healthcare transportation and mobile services company that uses proprietary dispatch and communication technology to help provide quality healthcare transportation and mobile, in-person medical treatment directly to patients in the comfort of their homes, workplaces and other non-traditional locations, in major metropolitan cities in the ~~U.S.~~United States and the ~~U.K.~~United Kingdom.

The Company derives revenue primarily from ~~its~~ two operating segments: Transportation Services and Mobile Health ~~services.~~Services.

●

Transportation Services: The services offered by this segment encompass both emergency response and non-emergency ~~ambulance~~ transport services. Non-emergency transport services include ambulance transports and wheelchair transports. Net revenue from Transportation Services is derived from the transportation of patients based on billings to ~~third-party~~third party payors and healthcare facilities.

●

Mobile Health Services: The services offered by this segment include services performed at home and offices, COVID-19 testing, and event services which include on-site healthcare support at sporting events and concerts. There is also an emphasis on providing total care management solutions to large population groups, which include healthcare services as well as ancillary services, such as shelter.

In addition, beginning with the first quarter of 2023, the Company is reporting in three operating segments, adding a Corporate segment to allow for analysis of shared services and personnel that support both the Transportation Services and Mobile Health Services segments. Previously, these costs had been allocated almost entirely to the Transportation Services segment. All of the Company’s revenues and costs of goods sold 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. The segment reporting for the prior-year period has been adjusted to conform to the new methodology, for the purposes of allowing a clearer analysis of year-over-year performance. See Note ~~10,~~11, “Business Segment Information” to the ~~Unaudited~~unaudited Condensed Consolidated Financial Statements for additional information regarding DocGo’s ~~segments.~~segments and “Operating Expenses” below.

For the three months ended ~~September 30, 2022,~~March 31, 2023, the Company recorded ~~net income~~a loss of ~~$2.5~~$3.9 million, compared to net income of ~~$0.8~~$9.4 million in the three months ended ~~September 30, 2021.~~

~~For the nine months ended September 30, 2022, the Company recorded net income of $23.6 million, compared to a net loss of $1.1 million in the nine months ended September 30, 2021.~~March 31, 2022.

COVID-19

~~COVID-19~~

The spread of COVID-19 and the related shutdowns and restrictions had a mixed impact on our business. In the ~~ambulance transportation business,~~Transportation Services segment, which comprises primarily of non-emergency medical transport, in 2020, the Company ~~initially~~ saw a decline in volumes from historical and expected levels, as elective surgeries and other non-emergency surgical procedures were postponed. In addition, in the Mobile Health segment, in 2020, the Company experienced lost revenue associated with sporting, concerts and other events, as those events were cancelled or had a significantly restricted (or entirely eliminated) number of permitted attendees. Ambulance transports and event-related revenues have both since recovered to pre-COVID levels or higher.

There are two areas where the Company experienced positive business impacts from COVID-19. In April and May 2020, the Company participated in an emergency project with Federal Emergency Management Agency in the New York City area. This engagement resulted in incremental transportation revenue that partially offset some of the lost non-emergency transport revenues. In addition, in response to the need for widespreadWhile COVID-19 testing ~~and available EMTs and paramedics,~~has become a minor part of this segment’s business, since the ~~Company expanded its operations to include Rapid Reliable Testing (“RRT”), with the goal~~second half of ~~performing COVID-19 tests at nursing homes, municipal sites, businesses, schools and other venues. RRT is part of~~2022, the Mobile Health ~~business segment.~~segment has continued to grow. We have expanded our service offerings in this segment to offer a wider range of testing, vaccination and other services to a broader customer group. During the first quarter of 2023, Mobile Health generated approximately ~~$76.6 and $254.1~~$72.9 million in revenue, ~~in the three and nine months ended September 30, 2022, respectively, as~~ compared to ~~$67.9 and $131.7~~$90.1 million in the ~~three and nine months ended September 30, 2021, respectively.~~first quarter of 2022.

~~During 2020 and~~As the early part of 2021, the Company continued to operate with several back-office employees working remotely. To date, the Company has not witnessed any degradation in productivity from these employees, the large majority of whom have now returned to their respective offices, and our operations have proceeded without major interruption. By early 2021, nearly all remote employees had returned to work in their respective offices and other locations. DocGo also utilized several government programs in 2020 related to theCOVID-19 pandemic receiving approximately $1.0 million in payments through the Public Health and Social Services Emergency Fund authorized under the Coronavirus Aid, Relief and Economic Security Act and related legislation as well as various state and local programs, net of amounts that will be repaid. DocGo also received accelerated Medicare payments of approximately $2.4 million that were repaid in 2022.

~~While it is very difficult to accurately predict~~reaches endemic stages, the future ~~direction~~impacts of ~~the effects of COVID-19~~it or other pandemics on DocGo remain highly uncertain and subject to numerous factors, including the severity of any new outbreaks, resurgences and variants, actions taken to contain resurgences or variants or to address their impact, and other effects, and its related impact on medical transportation levels ~~the revenue from the Transportation Services segment during 2021 exceeded that of 2020 by approximately 33%. Since the beginning of 2021,~~remain uncertain. However, trip volumes in most of our markets ~~have~~ returned to more normal historical levels in 2021, and this trend ~~has~~ continued throughout 2022. The Company generated, during 2021, COVID-19 testing revenue, included in its Mobile Health services segment, above the levels projected, and this persisted through the second quarter of 2022. However, as expected, COVID-19 testing revenues declined in the third quarter of 2022 and ~~are expected~~declined further in the fourth quarter of 2022 and the first quarter of 2023, to ~~remain at these lower levels~~the point where, as of the date of the filing of this Quarterly Report on Form 10-Q, they account for ~~the foreseeable future.~~an insignificant proportion of total revenues. Given the nature of the Company’s contracts with most of its customers, which include multiple procedures for which the Company is paid per hours worked, per vehicles and related equipment utilized and on a per-procedure basis (such procedures including both testing and several other procedures), it is difficult to determine the revenues that are directly attributable to COVID-19 testing. However, the Company estimates that COVID-19 testing revenue will continue to account for ~~a declining~~an insignificant proportion of Mobile Health segment and overall consolidated revenues ~~over~~in 2023 and beyond, as COVID-19 enters the ~~remainder of 2022 and into 2023.~~endemic phase. In a broader, strategic sense, the consumer focus on Mobile Health services and the formation of RRT, and its emergence as a significant contributor to overall revenues, have accelerated the diversification in the Company’s business by a more rapid expansion of the Mobile Health segment, which has now become our larger operating segment, both in terms of revenues and personnel.

The Company’s current business plan assumes ~~continued recovery of industry-wide transportation volumes to historical levels and beyond, plus~~ an increased demand for ~~mobile health~~Mobile Health services, a demand that was accelerated by the pandemic, but which we believe is also being driven by longer-term secular factors, such as the increasing desire on the part of patients to receive treatments outside of traditional settings, such as doctor’s offices and hospitals. ~~However, given~~In the ~~unpredictable, unprecedented,~~Transportation Services segment, volumes are expected to continue to rise, reflecting an aging population in the U.S. and ~~fluid nature of~~U.K., which tends to drive demand for the ~~pandemic and its economic consequences, we are unable to predict~~non-emergent medical transportation services provided by the ~~duration and extent to which the pandemic and its related positive and negative impacts will affect our business, financial condition, and results of operations in future periods.~~Company.

Factors Affecting Our Results of Operations

Our operating results and financial performance are influenced by a variety of factors, including, among others, ~~obtaining~~our ability to obtain or maintain operating ~~licenses, acquisitions,~~licenses; the success of our acquisition strategy; conditions in the healthcare transportation and mobile health services ~~markets~~markets; our competitive environment; overall macroeconomic and ~~economic~~geopolitical conditions, including rising interest rates, the inflationary environment, the potential recessionary environment, regional conflict and tensions and financial institution instability; availability of healthcare ~~professionals,~~professionals; changes in the cost of ~~labor,~~labor; and production schedules of our suppliers. Some of ~~the more~~these important factors are briefly discussed below. Future revenue growth and improvement in operating results will be largely contingent on DocGo’s ability to penetrate new markets and further penetrate existing markets, which is subject to a number of uncertainties, many of which are beyond DocGo’s control. The COVID-19 pandemic has also significantly impacted DocGo’s business, as discussed above. While the direct impact of the pandemic itself is waning, other impacts, such as supply chain disruptions and the cost and availability of labor are expected to persist.

Operating Licenses

DocGo has historically pursued a strategy of applying for ambulance operating licenses in the states, counties and cities, identified for future new market entry. The approval of a new operating license may take an extended period of time. DocGo reduces this risk through its acquisition strategy by identifying businesses and/or underlying licenses in these new markets that may be for sale.

Acquisitions

Historically, DocGo has pursued an acquisition strategy to obtain ambulance operating licenses from small operators. Future acquisitions may also include larger companies that may help drive revenue, profitability, cash flow and stockholder value. During the ~~nine~~three months ended ~~September 30, 2022, DocGo~~March 31, 2023, the Company completed ~~three acquisitions,~~one acquisition, for ~~an aggregate payment~~a purchase price of ~~$34.1 million, excluding $1.3 million held in escrow.~~$25.8 million.

~~During~~DocGo did not complete any acquisitions during the 12three months ended ~~December~~March 31, ~~2021, DocGo completed one acquisition, for a purchase price of $2.3 million.~~

On July 6, 2022, the Company acquired Government Medical Services, LLC (“GMS”) in exchange for $20.3 million in cash. GMS is in the business of providing licensed healthcare clinicians. We believe this acquisition will allow us to increase our presence in that market, while giving us improved access to governmental and municipal contracts. We have completed our preliminary allocation of the purchase consideration to the asset acquired and liabilities assumed as of the end of the third quarter of 2022.

On July 13, 2022, the Company acquired Exceptional Medical Transportation, LLC (“Exceptional”) in exchange for $6.4 million in cash paid at closing, plus $1.3 million held in escrow. Exceptional is in the business of providing medical transportation services in New Jersey. We believe this acquisition will allow us to increase our presence in that market. We have completed our preliminary allocation of the purchase consideration to the assets acquired and liabilities assumed as of the end of the third quarter of 2022.

On August 9, 2022, the Company acquired Ryan Brothers Ambulance Inc. (“Ryan Brothers”), in exchange for $7.4 million of cash (and a total of $4 million in future contingent consideration). Ryan Brothers is in the business of providing medical transportation services in Wisconsin. We believe this acquisition will allow us to increase our presence in that market. We have completed our preliminary allocation of the purchase consideration to the assets acquired and liabilities assumed as of the end of the third quarter of 2022.

Healthcare Services Market

The transportation services market is highly dependent on patients requiring transportation after surgeries and other medical procedures and treatments. During the pandemic, DocGo experienced a decrease in transportation volumes as a result of fewer elective surgeries. However, these volumes were recovered in 2021since 2021, and since the first half of 2022, the Company ~~was able to reallocate assets to locations where~~has seen increased demand ~~increased~~and trip volumes in nearly all of its Transportation services markets, as ~~a result of~~ the ~~pandemic.~~Company expanded its customer base.

Overall Economic Conditions in the Markets ~~In Which We~~in which we Operate

Economic changes both nationally and locally in our markets may impact our financial performance. Unfavorable changes in demographics, health care coverage of transportation and mobile health services, interest rates, ambulance manufacturing, a weakening of the national economy or of any regional or local economy in which we operate and other factors beyond our control could adversely affect our business.

Trip Volumes and Average Trip Price

A “trip” is defined as an instance where the Company completes the transportation of a patient to a specific destination, for which we are able to charge a fee. This metric does not include instances where a trip is ordered and subsequently either canceled (by the customer) or declined (by the Company). As trip volume represents the most basic unit of transportation service provided by the Company, it is the best measure of the level of demand for the Company’s Transportation Services and is used by management to monitor and manage the scale of the business.

The average trip price is calculated by dividing the aggregate revenue from completed transports (“trips”) by the total number of transports and is an important indicator of the effective rate at which the Company is being compensated for its provision of Transportation ~~Services.~~services.

Revenues generated from programs under which DocGo is paid a fixed ~~hourly or daily~~ rate for the use of a fully staffed and equipped ambulance do not factor in the trip counts or average trip prices mentioned above. We anticipate that these fixed rate, “leased hour” programs will account for an increasing proportion of the Transportation segment’s revenues in the future.

Our Ability to Control Expenses

We pay close attention to the management of our working capital and operating expenses. Some of our most significant operating expenses are labor costs, medical supplies and vehicle-related costs, such as fuel, maintenance, repair and insurance. Insurance costs include premiums paid for coverage as well as reserves for estimated losses within the Company’s insurance policy deductibles. We employ our proprietary technology to drive improvements in productivity per transport. We regularly analyze our workforce productivity ~~to achieve~~with a goal of balancing the optimum, cost-efficient labor mix for our locations. This involves managing the mix of company-employed labor and subcontracted labor as well as full-time and part-time employees.

Inflation

Beginning in ~~April~~ 2021, the inflation rate in the US, as measured by the Consumer Price Index ~~(CPI)~~(“CPI”) has ~~steadily increased. In 2019, the inflation rate was approximately 1.8%, while it dropped to approximately 1.2% in 2020.~~generally trended higher. This data is reported monthly, showing year-over-year changes in prices across a basket of goods and services. ~~For 2021,~~Though the inflation ~~increased from the 1.4%-2.6% range~~rate has seemingly moderated in the first quarter ~~to 4.2% in April, and was in the 5.0%-6.0% range through the end~~ of the third quarter of 2021, before increasing to the 6.0%-7.0% range in the fourth quarter. For the full year, the inflation rate was 4.7% in 2021, the highest annual rate since the 5.4% rate recorded in 1990. The inflation rate continued to increase throughout the first nine months of 2022, reaching approximately 9.1% in June 2022 and amounting to 8.2% in September 2022.2023, it remains well above historical averages. The increased inflation rate has had an impact on the Company’s expenses in several areas, including wages, fuel and medical and other supplies. This has had the impact of compressing gross profit margins, as the Company is generally unable to pass these higher costs on to its customers, particularly in the short term. In an attempt to dampen inflation, the U.S. Federal Reserve ~~has already~~ implemented ~~six~~two interest rate ~~increases~~hikes to date in ~~2022,~~2023, raising its benchmark rate (the “federal funds rate”) ~~from near 0.00% at the beginning of the year~~ to the current level of ~~3.75%-4.00%. The federal funds rate was raised in March, May, June, July, September and November, with~~4.75%-5.00% as of the ~~last four rate increases at 0.75% each.~~date of the filing of this Quarterly Report on Form 10-Q. Looking to the ~~fourth quarter~~remainder of ~~2022 and into~~ 2023, we anticipate a continued moderation of the inflation rate when compared to the ~~first half of the year,~~levels seen in 2022, as a result of these recent interest rate ~~increases~~hikes, but expect that inflation will remain well above the levels seen in the previous 10 ~~years, when the annual inflation rate ranged from 0.1% to 2.4%, and above the Federal Reserve’s “target” inflation rate of 2.0%.~~years. If inflation is above the levels that the Company anticipates, gross margins could be below plan and our business, operating results and cash flows may be adversely affected.

Investing in R&D and Enhancing Our Customer Experience

Our performance is dependent on the investments we make in research and development, including our ability to attract and retain highly skilled research and development personnel. We intend to continually develop and introduce innovative new software services, integrate with third-party products and services, mobile applications and other new offerings. If we fail to innovate and enhance our brand and our products, our market position and revenue will likely be adversely affected.

Regulatory Environment

DocGo is subject to federal, state and local regulations including healthcare and emergency medical services laws and regulations and tax laws and regulations. The Company’s current business plan assumes no material change in these laws and regulations. In the event that any such change occurs, compliance with new laws and regulations may significantly affect the Company’s operations and cost of doing business.

Components of Results of Operations

Our business consists of ~~two~~three reportable segments — Transportation Services, Mobile Health Services and Corporate. All revenue and cost of goods sold are contained within the Transportation Services and Mobile Health ~~services.~~Services segments. Accordingly, revenues and cost of goods sold are discussed below on a consolidated level and are also broken down between Transportation Services and Mobile Health Services. Operating expenses are discussed on a consolidated level and broken down among all three segments. The Company evaluates the performance of ~~both~~each of its segments based primarily on results of its operations. Accordingly, other income and expenses not included in results from operations are only included in the discussion of consolidated results of operations.

Revenue

The Company’s revenue consists of services provided by its ~~ambulance~~ Transportation Services segment and its Mobile Health segment.

Cost of Revenues

Cost of revenues consists primarily of revenue generating wages paid to employees, vehicle insurance costs (including insurance premiums and costs incurred under the insurance deductibles), maintenance, ~~and~~ fuel related to Transportation Services, ~~and~~ laboratory fees, facility rent, medical supplies and subcontractors. We expect cost of revenue to continue to rise ~~in proportion to~~along with the expected increase in revenue.

Operating Expenses

General and ~~Administrative Expenses~~administrative expenses

General and administrative expense consists primarily of salaries, bad debt expense, insurance expense, consultant fees, and professional fees for accounting ~~and legal~~ services. We expect our general and administrative expense to increase as we ~~continue to~~ scale up headcount with the growth of our business, and as a result of operating as a public company, including our compliance with SEC rules and regulations, audit, additional insurance expenses, ~~(such as Directors and Officers insurance),~~ investor relations activities, and other administrative and professional services.

Depreciation and Amortization

DocGo depreciates its assets using the straight-line method over the estimated useful lives of the respective assets. Amortization of intangibles consists of amortization of definite-lived intangible assets over their respective useful lives.

Legal and Regulatory Expenses

Legal and regulatory expenses include legal fees, consulting fees related to healthcare compliance, claims processing fees and legal settlements.

Technology and Development Expenses

Technology and development ~~expense,~~expenses, net of capitalization, consists primarily of ~~cost~~costs incurred in the design and development of DocGo’s proprietary technology, third-party software and technologies. We expect technology and development ~~expense~~expenses to increase in future periods to support our growth, including ~~our intent to continue investing~~as we invest in the optimization, accuracy and reliability of our platform ~~and~~to help drive efficiency in our operations. These expenses may vary from period to period as a percentage of revenue, depending primarily upon when we ~~may~~ choose to make more significant investments, ~~particularly~~which is in turn, dependent on numerous factors, including when ~~entering~~we plan to enter into new business lines or customer sales channels.

Sales, Advertising and Marketing ~~Expenses~~

Our sales, advertising and marketing expenses consist of costs directly associated with our sales, advertising and marketing activities, which primarily include sales commissions, marketing programs, trade shows, and promotional materials. We expect that our sales, advertising and marketing expenses will continue to increase over time as we increase our marketing activities, grow our domestic and international operations, and continue to build brand awareness. As the Company expands its sales efforts to include the direct-to-consumer channel, marketing expenses are likely to increase as a percentage of revenues, given the marketing-intensive nature of that sales channel.

Interest Expense

Interest expense consists primarily of interest on our outstanding borrowings under our outstanding notes payable ~~lines of credit~~ and financing obligations.

Results of Operations

Comparison of the ~~three months ended September 30,~~Three Months Ended March 31, 2023 and March 31, 2022 ~~and 2021~~

	Three Months Ended September 30,						Change			Change			Three Months Ended March 31,						Change			Change
$ in Millions	2022			2021			$			%			2023			2022			$			%

Revenue, net	$	104.3		$	85.8		$	18.5			22	%	$	113.0		$	117.9		$	(4.9	)		(4	%)

Cost of revenues		71.3			60.0			11.3			19	%		81.2			78.0			3.2			4	%
Operating expenses:
General and administrative		22.1			19.6			2.5			13	%		29.2			23.9			5.3			22	%
Depreciation and amortization		3.0			2.0			1.0			50	%		3.6			2.2			1.4			64	%
Legal and regulatory		2.2			0.8			1.4			175	%		3.6			1.3			2.3			177	%
Technology and development		1.4			0.9			0.5			56	%		1.9			1.1			0.8			73	%
Sales, advertising and marketing		0.1			1.0			(0.9	)		(90	)%		0.3			1.3			(1.0	)		(77	%)
Total expenses		100.1			84.3			15.8			19	%		119.8			107.8			12.0			11	%
Income (loss) from operations		4.2			1.5			2.5			173	%
(Loss) Income from operations														(6.8	)		10.1

Other income (expenses):
Interest income (expense), net		0.3			(0.3	)		0.6						0.8			(0.1	)		0.9			900	%
Gain on remeasurement of warrant liabilities		(1.8	)		-			(1.8	)
Gain (loss) on initial equity method investments		0.1			-			0.1
Gain (loss) from Lease Accounting		-			-			-
Loss on remeasurement of warrant liabilities														-			(0.1	)		0.1
Loss on equity method investments														(0.1	)		(0.1	)		-
Loss on disposal of fixed assets		0.1			-			0.1						(0.1	)		-			(0.1	)
Other income (loss)		0.0			0.2			-
Total other income (expense)		(1.3	)		(0.1	)		(1.1	)
Other income														0.2			-			0.2
Total other income (expenses)														0.8			(0.3	)		1.1			367	%

Net income (loss) before income tax benefit (expense)		2.9			1.4
Income tax expense		(0.4	)		(0.6	)		0.2
Net income (loss)		2.5			0.8
Net (loss) income before income tax benefit (provision)														(6.0	)		9.8
Income tax benefit (provision)														2.1			(0.4	)		2.5
Net (loss) income														(3.9	)		9.4
Net loss attributable to noncontrolling interests		(0.7	)		(2.7	)		2.0						(0.5	)		(1.3	)		0.8			62	%
Net income (loss) attributable to stockholders of DocGo Inc. and Subsidiaries	$	3.2		$	3.5
Net (loss) income attributable to stockholders of DocGo Inc. and Subsidiaries													$	(3.4	)	$	10.7

Consolidated

For the three months ended ~~September 30, 2022,~~March 31, 2023, total revenues were ~~$104.3~~$113.0 million, ~~an increase~~a decline of ~~$18.5~~$4.9 million, or ~~22%~~4.2%, from the total revenues recorded in the three months ended ~~September 30, 2021.~~March 31, 2022.

Mobile Health

For the three months ended March 31, 2023, Mobile Health revenue totaled $72.9 million, a decline of $17.2 million, or 19.1%, as compared with the three months ended March 31, 2022. The decrease in revenues was due to a significant decline in COVID-19 related testing services when compared to the prior year period. The Company estimates that revenues from mass COVID-19 testing programs amounted to approximately $1.0 million in the first quarter of 2023, compared to approximately $38.0 million in first quarter of 2022. The decline in COVID-19 testing revenue was partially offset by the expansion of the services offered by the Mobile Health segment. This expansion has accelerated through 2022 and into 2023 as the Company increased its customer base and geographic reach, while extending several large customer contracts and introducing a broader range of services.

Transportation Services

For the three months ended ~~September 30, 2022,~~March 31, 2023, Transportation Services revenue totaled ~~$27.7~~$40.1 million and increased by ~~$9.8~~$12.3 million, or ~~55%~~44%, as compared with the three months ended ~~September 30, 2021. The~~March 31, 2022. This increase was due to increases in both transportation ~~services revenue reflected higher~~ trip volumes and the average ~~trip prices.~~price per trip. Volumes increased by approximately ~~29%~~21%, from ~~45,532~~48,110 trips for the three months ended ~~September 30, 2021,~~March 31, 2022, to ~~58,751~~58,176 trips for the three months ended ~~September 30, 2022.~~March 31, 2023. The increase in trip volumes is due to a combination of growth in the customer base in certain core markets, ~~entry~~further penetration of markets that were entered into ~~new markets~~ in 2021 and the early part of 2022 and acquisitions made during the ~~third quarter~~second half of 2022. Our average trip price increased from ~~$303~~$353 in the three months ended ~~September 30, 2021,~~March 31, 2022, to ~~$374~~$415 in the three months ended ~~September 30, 2022.~~March 31, 2023. The increase in the average trip price in ~~2022 reflected~~the 2023 period reflects a shift in mix toward higher-priced transports with existing customers, as well as the acquisition of licenses to provide higher acuity transports, resulting in higher prices per trip. The average trip price also benefited from ~~a 5.1%~~an 8.7% increase in the average Medicare reimbursement rate for ambulance transports. ~~In October 2022, the Centers for Medicare and Medicaid Services (CMS) announced that the Medicare ambulance fee schedule would be increasing by a further 8.7%, effective January 1, 2023.~~

~~Mobile Health~~

For the three months ended September 30, 2022, Mobile Health revenue totaled $76.6 million, an increase of $8.7 million, or 13%, as compared with the three months ended September 30, 2021. This increase was mainly due to the expansion of the services offered by this segment. This expansion accelerated through 2021 and into 2022 as the Company increased its customer base, primarily in the municipal and cruise line customer segments, and its geographic reach, while extending several large customer contracts and introducing a broader range of services. Compared to the prior year period, the third quarter of 2022 featured significantly less COVID-19 testing revenue, which was outweighed by the substantial increase in other Mobile Health services.

Cost of Revenue

For the three months ended ~~September 30, 2022,~~March 31, 2023, total cost of revenue (exclusive of depreciation and amortization) ~~increased~~was $81.2 million an increase of by ~~19%~~4.1%, as compared to the three months ended ~~September 30, 2021, while revenue increased by approximately 22%.~~March 31, 2022. Cost of revenue as a percentage of revenue ~~decreased~~increased to ~~68.3%~~71.9% in the ~~third~~first quarter of ~~2022~~2023 from ~~69.9%~~66.2% in the ~~third~~first quarter of ~~2021.~~2022. For the remainder of 2023, we expect cost of revenues to account for a smaller percentage of revenue than in the first quarter, as the Company’s ongoing margin enhancement projects provide a larger impact. Areas of focus include subcontracted labor, overtime hours for field staff and vehicle costs, particularly in the area of rental vehicles.

In absolute dollar terms, total cost of revenue in the three months ended ~~September 30, 2022~~March 31, 2023 increased by ~~$11.3~~$3.2 million ~~compared to~~from the ~~same period in 2021.~~levels of the three months ended March 31, 2022. This was primarily attributable to ~~a $22.7~~an $15.7 million increase in total compensation, ~~due to~~reflecting higher headcount for both the Transportation Services and Mobile Health ~~segments~~segments; and ~~higher average hourly wages;~~ a ~~$2.8~~$0.6 million increase in vehicle costs, ~~driven by a continued increase in~~reflecting the expansion of the Company’s ~~vehicle~~ fleet over the past year; and ~~higher fuel and maintenance costs, as well as costs incurred to rent vehicles to provide Mobile Health services; a $0.5 million increase in facilities and related costs; and approximately~~ $0.4 million in increases across a variety of ~~other~~ cost of revenue ~~categories relating to the Company’s increased scale and geographic presence.~~categories. These ~~items~~factors were ~~partially~~largely offset by a ~~$9.1~~$1.9 million decline in subcontracted labor, as the Company more aggressively transitioned to internal employees toward the latter part of the first quarter; an $8.2 million decrease in ~~lab fees related to COVID-19 testing activity, reflecting lower reduced testing activity, lower per-test lab fees~~medical supplies and a shift toward rapid tests; a $5.3 million decrease in subcontracted labor, driven mostly by the Mobile Health segment, where the Company continues to transition away from external labor sources towards its own hired personnel; a $0.4$3.4 million decline in ~~medical supplies,~~lab fees, both reflecting athe significant decline in COVID-19 testing activity and improved sourcing of various supplies and a $0.3 million decline in travel costs, as there were fewer field personnel and other clinicians who traveled out of their home regions to provide Mobile Health services.

~~For the Transportation Services segment, cost of revenues (exclusive of depreciation and amortization)~~ in the ~~three months ended September 30, 2022 amounted to $21.3 million, up $4.6 million, or 28%, from the three months ended September 30, 2021. Cost~~first quarter of revenues as a percentage of revenues decreased to 76.8% from 92.9% in prior year quarter, due to increased volumes and higher average trip prices, as described above, combined with lower average hourly wages, as recent market wage pressures began to subside, and as the Company more effectively managed its staff to reduce overtime hours for field employees. These factors outweighed the effects of increased fuel costs. Gasoline prices moderated somewhat during the third quarter, as2023 compared to the ~~levels witnessed in the second~~first quarter of ~~2022, but remained well above the levels of the second quarter of 2021. We anticipate that fuel prices will remain at elevated levels for the remainder of~~ 2022.

For the Mobile Health segment, cost of revenues (exclusive of depreciation and amortization) in the three months ended ~~September 30, 2022~~March 31, 2023 amounted to ~~$50.0~~$52.7 million ~~up 15%~~a decline of $3.8 million, or 6.7% from ~~$43.4 million in~~ the three months ended ~~September 30, 2021.~~March 31, 2022. Cost of revenues as a percentage of revenues increased to ~~65.2%~~72.3% in the first quarter of 2023 from ~~63.9%~~62.7% in the first quarter of 2022, due to the decline in COVID-testing revenues and significantly higher compensation expenses, reflecting headcount growth, which outweighed the impact of reduced lab fees and other medical supplies. In absolute dollar terms, subcontracted labor costs declined, but these costs were higher in the first quarter of 2023 as a percentage of Mobile Health revenues than in the first quarter of 2022.

For the Transportation Services segment, cost of revenues (exclusive of depreciation and amortization) in the three months ended March 31, 2023 amounted to $28.5 million, up $7.0 million, or 33%, ~~despite~~from the three months ended March 31, 2022. Cost of revenues as a percentage of revenues declined to 71.1% in the first quarter of 2023, from 77.3% in the first quarter of 2022, reflecting the impact of higher per-trip prices, increased number of standby contracts (for which we are paid a daily or hourly rate) and the overall increase in ~~revenues and~~revenue, as well as a decline in the ~~continued shift away from higher-cost subcontracted labor toward Company personnel during 2022, reflecting higher compensation costs associated with some of the Company’s newer projects.~~average fuel price.

Operating Expenses

For the three months ended ~~September 30, 2022,~~March 31, 2023, the Company recorded ~~$28.8~~$38.7 million of operating expenses, an increase of $8.9 million, or 30%, compared to ~~$24.4 million for~~ the three months ended ~~September 30, 2021, an increase of 18%.~~March 31, 2022. As a percentage of revenue, operating expenses ~~declined~~increased from ~~28.3%~~25.3% in the ~~third quarter of 2021 to 27.7% in the third~~first quarter of 2022 ~~due primarily~~ to 34.3% in the ~~increase in overall revenues described above, coupled with the semi-fixed nature~~first quarter of ~~the cost of corporate infrastructure.~~2023. The increase of ~~$4.4~~$8.9 million related primarily to a ~~$2.0~~$6.9 million increase in ~~legal, accounting and other professional fees related~~total compensation due to ~~increased revenue and related contract generation and SEC filing-related costs; a $1.2 million increase~~investments in ~~insurance costs reflecting the growth~~ and expansion of ~~the Company, as well as the inclusion of directors and officers (D&O) insurance;~~corporate overhead to support revenue growth, largely driven by higher stock compensation expense; a ~~$1.1~~$1.4 million increase in depreciation and amortization due to an increase in assets to support revenue growth, ~~and~~ capitalized software amortization ~~including from recently acquired companies;~~and assets that were added as part of acquisitions that the Company completed in the second half of 2022; a ~~$0.3~~$2.3 million increase in ~~office-related expenses, due~~legal, accounting, regulatory and other professional fees related to ~~the Company’s ongoing growth~~increased revenue and ~~geographic expansion;~~related contract generation, audit fees, Sarbanes-Oxley (SOX) compliance consulting fees and SEC filing-related costs; a ~~$0.6~~$1.2 million increase in insurance costs, reflecting higher headcount and expanded operations; a $1.0 million increase in IT infrastructure, driven by the Company’s business and headcount expansion and acquisitions; and a $0.8 million increase in rent and utilities, relating to the Company’s ongoing geographic expansion. These ~~items~~increased expenses were partially offset by a ~~$0.8~~$3.0 million decline in bad debt expense, as allowances for doubtful accounts were adjusted to better reflect the aging and collection history of the Company’s accounts receivable; a $0.5 million decline in commissions, in the absence of certain per-test and per-vaccination commissions that were paid in relation to certain mass COVID-19 testing and vaccination projects in the first half of 2022; and a $0.5 million decline in marketing costs, reflecting the cessation of certain marketing programs that were run in conjunction with Mobile Health projects that have since expired; and a $0.7 million across various operating expense categories, including travel and entertainment, general office expenses and dues and subscriptions. We anticipate that operating costs over the remainder of 2023, as a percentage of total revenue, will decline from the levels seen in the first quarter of 2023, primarily due to lower total compensation ~~which includes salaries, benefits, bonuses and commissions for both direct and subcontracted labor, reflecting savings from~~costs as a percentage of total revenue.

For the ~~outsourcing of certain administrative functions. The Company anticipates that~~Mobile Health segment, operating expenses ~~will continue to increase in line with the Company’s revenue growth remain~~ in the ~~range~~three months ended March 31, 2023 were $7.2 million, compared to operating expenses of ~~25%-30% of revenue~~$10.2 million in the ~~coming quarters.~~three months ended March 31, 2022. Operating expenses as a percentage of Mobile Health revenues decreased to 9.8% from 11.3% in the first quarter of 2022. The decrease in operating expenses was a result of a reduction in non-field headcount in the Mobile Health segment, driven in part by the movement of Mobile Health management personnel into centralized corporate functional areas.

For the Transportation Services segment, operating expenses in the three months ended ~~September 30, 2022~~March 31, 2023 were ~~$10.6~~$10.5 million, ~~down $2.2~~up $1.72.0 million, or ~~17%~~18.8%, from the three months ended ~~September 30, 2021.~~March 31, 2022. Operating expenses as a percentage of revenues decreased to ~~38.6%~~26.1% from ~~71.3% for~~31.9% in the ~~three months ended September 30, 2021,~~prior year period, reflecting the ~~increase~~increased revenues in ~~revenues and overhead cost-cutting activities undertaken during~~ the ~~earlier part of 2022, as well as lower insurance costs, due to the establishment earlier this year of the Company’s captive insurance program.~~ current period.

For the Corporate segment, which represents primarily shared services that are not contained within the entities which comprise either the Mobile Health ~~segment,~~Services or Transportation Services segments, operating expenses in the three months ended ~~September 30, 2022~~March 31, 2023 were ~~$18.2~~$21.12 million, ~~up 56% from operating expenses of $12.8~~compared to $10.8 million in the three months ended ~~September 30, 2021. Operating expenses~~March 31, 2022. The increase was driven by higher headcount, as the Company built out its corporate infrastructure, including areas such as Business Development, Product Development and Corporate Development; as well as significantly higher stock compensation expenses. As a percentage of total consolidated revenues, ~~increased~~Corporate expenses amounted to ~~23.8% from 17.2%~~approximately 18.7% of revenues in the ~~third~~first quarter of ~~2021, despite the increase in Mobile Health revenues, reflecting significant expenditures that were made~~2023, compared to 9.2% in the 2022 period in the expansion of services and geographic areas of operation, as well as the continued buildout of the Mobile Health management infrastructure and the costs of developing the Company’s “on-demand” direct-to-consumer offering. three months ended March 31, 2022.

Interest Income/(Expense), Net

For the three months ended ~~September 30, 2022,~~March 31, 2023, the Company recorded ~~$0.3 million~~$809,172 of net interest income compared to ~~$0.3 million~~$135,606 of ~~net~~ interest expense in the three months ended ~~September 30, 2021.~~March 31, 2022. This was due to a significantly higher amount of interest earned in the ~~third quarter of 2022, resulting from~~three months ended March 31, 2023, due to an increase in the Company’s cash balances in ~~interest-bearing~~income-bearing accounts, coupled with higher rates of interest earned on balances in these ~~accounts.~~

~~Gain from PPP Loan Forgiveness~~

During the three months ended September 30, 2021, the Company recorded a gain of $142,667 due to the forgiveness of a loan that one of its subsidiaries had obtained via the government’s Paycheck Protection Program (PPP) in 2020. No gain from loan forgiveness was recorded during the three months ended September 30, 2022.accounts, which reflected significantly higher market interest rates.

Gain/(loss) on Remeasurement of Warrant Liabilities

During the three months ended ~~September 30,~~March 31, 2023, there were no gains or losses recorded relating to remeasurement of warrant liabilities, as warrants were redeemed during the third quarter of 2022. During the three months ended March 31, 2022, the Company recorded a loss of ~~approximately $1.8 million~~$58,749 from the remeasurement of warrant liabilities. The warrants ~~are~~were marked-to-market in each reporting period, and this loss reflected the ~~increase~~decrease in DocGo’s stock price relative to the beginning of the ~~period. There were no warrant liabilities in the same period in 2021. On August 15, 2022, the Company announced the redemption~~first quarter of all of its outstanding warrants under the Warrant Agreement, dated as of October 14, 2020, by and between Motion Acquisition Corp. (“Motion”) and Continental Stock Transfer & Trust Company, as warrant agent, as part of the units sold in Motion’s initial public offering, on the redemption date of September 16, 2022 (the “Redemption Date”). Warrants surrendered for exercise on a cashless basis resulted in the issuance of 1,406,371 shares. A total of 68,514 warrants were not surrendered on the Redemption Date and were redeemed for $0.10 per warrant.2022.

Gain/(Loss) on Equity Method Investment

During the three months ended ~~September 30, 2022,~~March 31, 2023, the Company recorded a ~~gain~~loss on equity method investments of ~~$93,371, representing~~$115,286, which represented its share of the losses incurred by an entity in which the Company ~~has~~had a minority interest, which iswas accounted for under the equity method. ~~This investment was made in the fourth quarter of 2021, and as such, no gain or loss was recorded in relation to an equity method investment in the same period in 2021.~~

~~Income Tax (Expense)/Benefit~~

During the three months ended ~~September 30, 2022, the Company recorded income tax expense of $0.4 million, compared to an income tax expense of $0.6 million in the three months ended September 30, 2021.~~

~~Noncontrolling Interest~~

For the three months ended September 30, 2022, the Company had a net loss attributable to noncontrolling interest of approximately $0.7 million, compared to a net loss attributable to noncontrolling interest of $2.7 million for the three months ended September 30, 2021. The loss reflected ongoing investments in new markets that were entered into during 2021 and 2022, partially offset by income generated by other markets.

~~Comparison of the nine months ended September 30, 2022 and 2021~~

Nine Months Ended
September 30, Change Change
$ in Millions 2022 2021 $ %

Revenue, net $ 331.7 $ 197.4 $ 134.3 68 %

Cost of revenues 219.4 137.1 82.3 60 %
Operating expenses:
General and administrative 70.7 47.2 23.5 50 %
Depreciation and amortization 7.3 5.5 1.8 33 %
Legal and regulatory 6.6 2.6 4.0 154 %
Technology and development 3.7 2.0 1.7 85 %
Sales, advertising and marketing 2.3 3.0 (0.7 ) -23 %
Total expenses 310.0 197.5 112.6 57 %
Income (loss) from operations 21.8 (0.1) 21.9

Other income (expenses):
Interest income (expense), net 0.3 (0.5 ) �� 0.8
Gain on remeasurement of warrant liabilities 1.1 - 1.1
Gain (loss) on initial equity method investments 0.1 - 0.1
Gain on remeasurement of finance leases 1.4 - 1.4
Gain/(loss) on disposal of fixed assets 0.1 - -
Other income (loss) 0.0 0.2 -
Total other income (expense) 3.0 (0.4 ) 3.4

Net income (loss) before income tax benefit (expense) 24.8 (0.5 )
Income tax expense (1.2 ) (0.6 ) (0.3 )
Net income (loss) 23.6 (1.1 )
Net loss attributable to noncontrolling interests (2.9 ) (1.3 ) (1.6 )
Net income (loss) attributable to stockholders of DocGo Inc. and Subsidiaries $ 26.5 $ 0.2 26.6

~~Consolidated~~

~~For the nine months ended September 30, 2022, total revenues were $331.7 million, an increase of $134.3 million, or 68%, from the total revenues recorded in the nine months ended September 30, 2021.~~

~~Transportation Services~~

For the nine months ended September 30, 2022, Transportation Services revenue totaled $77.6 million, an increase of $12.0 million, or 18%, as compared with the nine months ended September 30, 2021. This increase was due to a rise in both transportation trip volumes and the average price per trip. Volumes increased by approximately 13%, from 137,136 trips for the nine months ended September 30, 2021, to 154,534 trips for the nine months ended September 30, 2022. The increase in trip volumes is due to a combination of growth in the customer base in certain core markets and entry into new markets in 2022, as well as acquisitions made during the third quarter of 2022. Average trip price increased from $297 in the nine months ended September 30, 2021, to $362 the nine months ended September 30, 2022. The increase in the average trip price in the 2022 period was due to a shift in mix toward higher-priced transports with existing customers, as well as the acquisition of licenses to provide higher acuity transports, resulting in higher prices per trip. The average trip price also benefited from a 5.1% increase in the average Medicare reimbursement rate for ambulance transports.

~~Mobile Health~~

For the nine months ended September 30, 2022, Mobile Health revenue totaled $254.1 million, an increase of $122.3 million, or 93%, as compared with the nine months ended September 30, 2021. This significant increase was mainly due to the expansion of the services offered by this segment, particularly with respect to COVID-19 related testing and vaccination and other healthcare services revenues included in the Mobile Health segment. This expansion accelerated through 2021 and into 2022 as the Company increased its customer base and geographic reach, while extending several large customer contracts and introducing a broader range of services. However, during the third quarter of 2022, COVID-19 testing revenue declined significantly, as expected, but these declines were outweighed by an expansion of the Company’s Mobile Health customer base and broadening of the range of services provided.

~~Cost of Revenue~~

For the nine months ended September 30, 2022, total cost of revenue (exclusive of depreciation and amortization) increased by 60% as compared to the nine months ended September 30, 2021, while revenue increased by approximately 68%. Cost of revenue as a percentage of revenue decreased to 66.1% in the first nine months of 2022 from 69.4% in the first nine months of 2021.

In absolute dollar terms, total cost of revenue in the nine months ended September 30, 2022 increased by $82.3 million from the prior year period. This was primarily attributable to a $52.5 million increase in total compensation, reflecting higher headcount for both the Transportation Services and Mobile Health segments, coupled with higher average hourly wages; a $26.3 million increase in subcontracted labor, driven mostly by the Mobile Health segment, where revenue increases outpaced the Company’s ability to service such revenue solely with internal resources, temporarily causing the Company to rely increasingly on subcontracted labor, particularly in the first six months of 2022; an $8.0 million increase in medical supplies, due to the purchase of COVID-19 test kits and the need for increased PPE and related supplies, and the increased cost thereof as a result of increased demand during the pandemic; a $9.9 million increase in vehicle costs, driven by a continued increase in the Company’s vehicle fleet and higher fuel and maintenance costs; a $1.1 million increase in facilities and related expenses, due to the Company’s geographic expansion; a $2.1 million increase in travel expenses, relating to field personnel and other clinicians who traveled out of their home regions to provide Mobile Health services; and an increase of $0.9 million distributed among a variety of other cost of revenue items. These items were partially offset by an $18.5 million decrease in lab fees related to COVID-19 testing activity, reflecting lower per-test lab fees, and a shift toward rapid tests.

For the Transportation Services segment, cost of revenues (exclusive of depreciation and amortization) in the nine months ended September 30, 2022 amounted to $ 60.4 million, up $11.8 million, or 24.4%, from the nine months ended September 30, 2021. Cost of revenues as a percentage of revenues increased to 77.8% in the first nine months of 2022 from 74.1% in the prior year period, due to the decline in higher-margin, project-based standby revenue, combined with the impact of higher hourly wages in certain markets and increased overtime for field employees during the first half of 2022 and increased fuel costs, as described above.

For the Mobile Health segment, cost of revenues (exclusive of depreciation and amortization) in the nine months ended September 30, 2022 amounted to $159.0 million, up 79.7%, from $ 88.5 million in the nine months ended September 30, 2021. Cost of revenues as a percentage of revenues decreased to 62.6% from 67.1%, due to the increase in revenues, lower average per-test lab fees and the increased number of higher-margin, hourly-based programs in the first half of 2022, which outweighed the increased use of higher cost subcontracted labor and significant increases in medical and general supply costs, as described above. During the third quarter of 2022, subcontracted labor costs declined, reflecting the ongoing transition of the company’s human resources base to Company-employed staff, reducing the reliance on higher-cost subcontracted labor.

~~Operating Expenses~~

For the nine months ended September 30, 2022, the Company recorded $90.5 million of operating expenses compared to $60.5 million for the nine months ended September 30, 2021, an increase of 49.5%. As a percentage of revenue, operating expenses decreased from 30.6% in the first nine months of 2021 to 27.3% in the first nine months 2022, due primarily to the significant increase in overall revenues described above, coupled with the semi-fixed nature of the cost of corporate infrastructure. The increase of $30.0 million related primarily to a $16.7 million increase in total compensation, which includes costs for both direct and subcontracted staff, due to investments in and expansion of corporate infrastructure to support the revenue growth; a $0.8 million increase in travel and entertainment expenses, reflecting both the growth of the overall employee base, as well as increased business development related activities for both the Transportation Services and Mobile Health segments; a $1.9 million increase in depreciation and amortization due to an increase in assets to support revenue growth and capitalized software amortization, as well as recently acquired companies; a $5.8 million increase in legal, accounting and other professional fees related to increased revenue and related contract generation and SEC filing-related costs; a $0.9 million increase in office-related expenses, owing to the Company’s ongoing growth and geographic expansion; a $1.5 million increase in IT infrastructure, driven by the Company’s business and headcount expansion; a $0.4 million increase in marketing expenses, primarily owing to the ongoing expansion of Mobile Health services; a $0.6 million increase in bad debt expense, in line with the increase in overall revenues during the period; and approximately $1.4 million in other increases spread across a variety of other operating expense lines.

For the Transportation Services segment, operating expenses in the nine months ended September 30, 2022 were $50.2 million, up $16.9 million, or 50.8%, from the nine months ended September 30, 2021. Operating expenses as a percentage of revenues increased to 64.6% from 50.8% for the nine months ended September 30, 2021, despite the increase in Transportation Services revenues, due to a significant increase in corporate infrastructure, the bulk of which is allocated to the Transportation Services segment. The increased operating expenses, in dollar terms, in the nine months ended September 30, 2022 primarily reflected higher costs for payroll, travel and entertainment, professional fees and depreciation, as described above.

For the Mobile Health segment, operating expenses in the nine months ended September 30, 2022 were $40.3 million, up 48.2%, from operating expenses of $27.2 million in the nine months ended September 30, 2021. Operating expenses as a percentage of revenues decreased to 15.9% from 20.6% in the first nine months of 2021, despite significant expenditures made in the expansion of services and geographic areas of operation, as well as the buildout of the Mobile Health management infrastructure throughout 2021 and the first nine months of 2022, due to the faster rate of increase in Mobile Health revenues. The increased operating expenses, in dollar terms, in 2022 were primarily driven by higher costs for payroll, subcontracted labor costs, travel and entertainment, marketing and IT infrastructure, and facilities costs, as described above.

~~Interest Income/(Expense), Net~~

For the nine months ended September 30, 2022, the Company recorded $0.3 million of net interest income compared to $0.5 million of net interest expense in the nine months ended September 30, 2021. The shift from net interest expense in the prior year period to interest income in the current year period was due to a significantly higher amount of interest earned in the first nine months of 2022, resulting from an increase in the Company’s cash balances in interest-bearing accounts, coupled with higher rates of interest earned on balances in these accounts. This was partially offset by an increase in payments made for new leased vehicles, as the Company’s fleet expanded.

~~Gain from PPP Loan Forgiveness~~

During the nine months ended September 30, 2021, the Company recorded a gain of $142,667 due to the forgiveness of a loan that one of its subsidiaries had obtained via the government’s Paycheck Protection Program (PPP) in 2020. No gain from loan forgiveness was recorded during the three months ended September 30, 2022.

~~Gain/(loss) on Remeasurement of Warrant Liabilities~~

~~During the nine months ended September 30,~~March 31, 2022, the Company recorded a ~~gain~~loss on equity method investments of ~~approximately $1.1 million from the remeasurement of warrant liabilities. The warrants are marked-to-market in each reporting period, and this gain was due~~$83,341 related to the ~~decline in DocGo’s stock price relative to the beginning of the period. No warrant liabilities were outstanding in the prior year period.~~same entity.

~~Gain/(Loss) on Equity Method Investment~~

During the three months ended September 30, 2022, the Company recorded a gain of $99,840, representing its share of the losses incurred by an entity in which the Company has a minority interest, which is accounted for under the equity method. This investment was made in the fourth quarter of 2021, and as such, no gain or loss was recorded in relation to an equity method investment in the same period in 2021.

~~Gain/(loss) from Remeasurement of Finance Leases~~

During the nine months ended September 30, 2022, the Company recorded a gain of approximately $1.4 million, resulting from a change in estimated remaining liabilities under the terms of its leases. No such gain or loss was recorded in the prior year period.

Gain/(loss) on Disposal of Fixed Assets

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2023, the Company recorded a loss ~~of $27,730~~ on the disposal of fixed ~~assets. During~~assets of $54,839. No such gain or loss was recorded during the ~~nine~~three months ended ~~September 30, 2022, the Company recorded a gain of $42,667 on the disposal of fixed assets.~~March 31, 2022.

Income Tax Benefit/(Expense)~~/Benefit~~

During the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, the Company recorded income tax ~~expense~~benefit of ~~$1.2 million, compared to~~$2.1 million. For the three months ended March 31, 2022, the Company recorded an income tax expense of ~~$0.6 million~~$0.4 million. The income tax benefit reflects a pretax loss recorded during the three months ended March 31, 2023, compared to pretax income in the ~~nine months ended September 30, 2021.~~prior year period. The ~~increase in~~ income tax ~~expense resulted from~~benefit in the ~~higher level of pretax~~current year period includes income as well as state income taxes in jurisdictions the Company entered during the past ~~year.~~year and current period.

Net Loss Attributable to Noncontrolling Interest

For the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, the Company had a net loss attributable to noncontrolling interest of approximately ~~$ 2.9~~$0.5 million, compared to a net loss attributable to noncontrolling interest of $1.3 million for the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022. The ~~increased~~decreased loss reflected improved performance in most of the ~~first nine months of 2022 reflected~~Company’s joint venture ongoing investments in new markets ~~that were entered into during 2021 and 2022.~~in the three months ended March 31, 2023.

Liquidity and Capital Resources

Since inception, DocGo has completed three equity financing transactions ~~that served~~ as ~~the Company’s~~its principal source of ~~liquidity, with minimal debt incurred.~~liquidity. Generally, the Company has utilized equity raised to finance operations, ~~during its development phase,~~ investments in assets, ambulance operating licenses and ~~funding working capital.~~to fund accounts receivable. The Company has also funded these activities through operating ~~cashflows.~~cash flows. In November 2021, upon the completion of the merger between Motion ~~Acquisition Corp.~~ and Ambulnz, ~~Inc.,~~ the Company received proceeds of approximately $158.1 million, net of transaction expenses. ~~Although~~However, even when the Company ~~generated~~generates positive net income, ~~in the three and nine months ended September 30, 2022,~~ operating cash flows ~~may~~are not bealways sufficient to meet immediate obligations arising from current operations. For example, as the business has grown, the Company’s expenditures for human capital and supplies has expanded accordingly, and the timing of the payments for payroll and to associated vendors, compared to the timing of receipts of cash from customers, frequently results in the ~~Company using~~need to use existing cash balances to fund these working capital needs. The Company’s working capital needs depend on many factors, including the overall growth of the ~~company~~Company and the various payment terms that are negotiated with customers and vendors. As the Company’s customer base increasingly features large municipal entities, who tend to demand longer payment terms than do other customer segments, the Company’s working capital requirements are expected to increase. In addition, the Company might seek to take advantage of opportunities to secure favorable pricing for supplies and services from its vendors by agreeing to shorter payment terms, or prepaying. Future capital requirements depend on many factors, including potential acquisitions, ~~our~~DocGo’s level of investment in technology and ongoing technology development, and rate of growth in existing markets and into new markets. ~~The cost of ongoing technology development is another factor that is considered.~~ Capital requirements ~~might~~may also be affected by factors ~~which~~outside of the ~~Company cannot~~Company’s control, such as interest rates, rising inflation, financial institution instability or failure and other monetary and fiscal policy changes to the manner in which the Company currently operates. Additionally, as the impact of the COVID-19 ~~pandemic~~ on the economy and on the Company’s market environment and operations evolves, the Company ~~will continuously assess~~routinely assesses its liquidity needs. If the Company’s growth rate is higher than is currently anticipated, resulting in greater-than-anticipated capital requirements, the Company ~~may~~might need to, or choose to, raise additional capital through debt or equity financings.

On November 1, 2022, ~~subsequent to the end of the third quarter of 2022,~~ the Company entered into a revolving loan and security agreement with two banks, with one bank acting as the administrative agent (the “Lenders”), with aan initial maximum ~~revolving advance~~commitment amount of $90,000,000. The revolving facility includes the ability for the Company to request an increase to the commitment by an additional amount of up to $50,000,000, though no Lender (nor the Lenders collectively) are obligated to increase their respective commitments. Borrowings under the revolving facility bear interest at a per annum rate equal to (i) at the Company’s option, the (x) the base rate or (y) the adjusted term SOFR rate, plus (ii) the applicable margin. The applicable margins are based on the Company’s consolidated net leverage ratio, adjusted on a quarterly basis. The initial applicable margins are 1.25% for an adjusted term SOFR loan and 0.25% for a base rate loan and will be updated based on the Company’s consolidated net leverage ~~ratio reported in the compliance certificate.~~ratio. The revolving facility matures on ~~the five-year anniversary of the closing date,~~ November 1, 2027. The revolving facility is secured by a first-priority lien on substantially all of the Company’s present and future personal assets and intangible assets. The revolving facility is subject to certain financial covenants, such as a net leverage ratio and interest coverage ratio, as defined in the agreement. ~~The~~As of the date of the filing of this Quarterly Report on Form 10-Q, the Company has not made any draws under the facility and there isare no ~~amount~~amounts outstanding.

Considering the foregoing, DocGo anticipates that existing balances of cash and cash equivalents, future expected cash flows generated from our operations and an available line of credit (as discussed in Note 8,9, “Line of Credit” ~~and Note 20 “Subsequent Events”~~ to the ~~Unaudited~~unaudited Condensed Consolidated Financial Statements) will be sufficient to satisfy operating requirements for at least the next twelve months.

Capital Resources

~~Working Capital~~Comparison as of ~~September 30,~~March 31, 2023 and March 31, 2022 ~~and 2021~~

	As of September 30,				Change		Change			As of March 31,				Change			Change
$ in Millions	2022		2021		$		%			2023		2022		$			%
Working capital
Current assets	$	252.0	$	96.7	$	155.7		161	%	$	258.4	$	268.2	$	(9.8	)		(4	%)
Current liabilities		71.1		66.9		4.2		6	%		109.0		61.0		48.0			79	%
Total working capital	$	180.9	$	29.8	$	151.1		507	%	$	149.4	$	207.2	$	(57.8	)		(28	%)

As of ~~September 30, 2022,~~March 31, 2023, available cash totaled ~~$169.6~~$120.1 million, which represented ~~an increase~~a decrease of ~~$130.0~~$68.3 million as compared to ~~September 30, 2021, reflecting~~March 31, 2022, as acquisitions made during the ~~receipt~~second half of 2022 and in the ~~proceeds from the merger described above, as well as positive~~first quarter of 2023 outweighed cash flow ~~generated by operations, partially offset by cash used for acquisitions in the third quarter of 2022.~~from operations. As of ~~September 30, 2022,~~March 31, 2023, working capital amounted to ~~$180.9~~$149.4 million, which represented ~~an increase~~a decrease of ~~$151.1~~$57.8 million as compared to ~~September 30, 2021,~~March 31, 2022, primarily reflecting the ~~increased~~reduced cash balance. Increased accounts receivable ~~reflecting the growth of the business~~ in the ~~second half of 2021 and the first nine~~three months ~~of 2022, were partially offset by increases in current liabilities,~~ended March 31, 2023, which reflected the growth of the business and ~~resulted from extended~~a shift towards higher credit quality customers, who have longer payment terms, outweighed the increase in current liabilities in the first quarter of 2023, which reflected the growth of the business and amounts due to the seller and contingent consideration resulting from ~~vendors.~~acquisitions.

Cash Flows

Three months ended March 31, 2023 and 2022

	Three Months Ended March 31,						Change			Change
$ in Millions	2023			2022			$			%
Cash flow summary
Net cash provided by/(used in) operating activities	$	(23.1	)	$	18.3		$	(41.4	)		(226	%)
Net cash provided by/(used in) investing activities		(1.7	)	$	(1.1	)		(0.6	)		(55	%)
Net cash provided by/(used in) financing activities		(12.0	)	$	2.5			(14.5	)		(580	%)
Effect of exchange rate changes		0.2		$	-			0.2			0	%
Net (decrease) increase in cash	$	(36.6	)	$	19.7		$	(56.3	)		(286	%)

Operating Activities

During the three months ended March 31, 2023, operating activities used $23.1 million of cash, driven by a net loss of $3.9 million. Non-cash charges amounted to $9.4 million and included $2.3 million in depreciation of property and equipment and right-of-use assets, $1.4 million from amortization of intangible assets, $8.5 million of stock compensation expense, and a $0.1 million loss on an equity investment. These were partially offset by a $1.9 million reduction in bad debt expense related to an adjustment in the provision for potential uncollectible accounts receivable, and a $1.0 gain from a deferred tax asset. Changes in assets and liabilities resulted in approximately $28.6 million in negative cash flow, as a $24.7 million increase in accounts receivable, a $2.6 million decrease in accounts payable, a $1.5 million decrease in accrued liabilities and a $0.2 million increase in prepaid expenses outweighed a $0.3 million reduction in other assets.

During the three months ended March 31, 2022, operating activities provided $18.2 million of cash, aided by net income of $9.4 million. Non-cash charges amounted to $4.8 million and included $1.6 million in depreciation of property and equipment and right-of-use assets, $0.6 million from amortization of intangible assets, $1.2 million in bad debt expense primarily related to a provision for potential uncollectible accounts receivable and $1.4 million of stock compensation expense. Changes in assets and liabilities resulted in approximately $4.1 million in additional operating cash flow, as a $1.1 million decrease in accounts receivable, a $2.2 million decrease in other assets and a $3.1 increase in accrued liabilities outweighed the effect of a $1.5 million increase in prepaid expenses and a $0.7 million decline in accounts payable. Operating cash flow in the first quarter of 2022 was aided by collections of large accounts receivable from invoices generated in the fourth quarter of 2021.

Investing Activities

During the three months ended March 31, 2023, investing activities used $1.7 million of cash and consisted of the acquisition of property and equipment totaling $2.0 million and the acquisition of intangibles in the amount of $1.4 million, partially offset by $1.6 million in cash added via an acquisition and $0.1 million in proceeds from the disposal of property and equipment.

During the three months ended March 31, 2022, investing activities used $1.1 million of cash and primarily consisted of the acquisition of property and equipment totaling $0.5 million and the acquisition of intangibles in the amount of $0.6 million to support the ongoing growth of the business.

Financing Activities

During the three months ended March 31, 2023, financing activities used $12.0 million of cash, due to a reduction of $11.5 million in amounts due to seller, as deferred payments were made under the terms of previously-closed acquisitions, $0.8 million in payments under the terms of finance leases, and $0.1 million in repayments of notes payable. These items were partially offset by $0.4 million in proceeds from the exercise of stock options.

During the three months ended March 31, 2022, financing activities provided $2.5 million of cash, due to $1.0 million in proceeds from the Company’s revolving credit line, $2.1 million in noncontrolling interest contributions and $0.4 million in proceeds from the exercise of stock options, which were partly offset by $0.6 million in payments on obligations under the terms of finance leases, $0.1 million in repayments of notes payable, a reduction of $0.2 million in amounts due to seller and $0.1 million of equity cost.

Future minimum annual maturities of notes payable as of March 31, 2023 were as follows:

	Notes Payable
2023, remaining		0.4
2024		0.5
2025		0.5
2026		0.4
2027		0.1
Thereafter		0.0
Total maturities	$	1.9
Current portion of notes payable		(0.6	)
Long-term portion of notes payable	$	1.3

Future minimum lease payments under operating leases as of March 31, 2023, and for the following four fiscal years and thereafter are as follows:

	Operating Leases
2023, remaining	$	2.2
2024		2.6
2025		2.6
2026		1.9
2027 and thereafter		1.7
Total future minimum lease payments		11.0
Less effects of discounting		(1.3	)
Present value of future minimum lease payments	$	9.7

Future minimum lease payments under finance leases as of March 31, 2023, and for the following four fiscal years and thereafter are as follows:

	Finance Leases
2023, remaining	$	2.5
2024		2.7
2025		2.4
2026		1.6
2027 and thereafter		0.6
Total future minimum lease payments		9.8
Less effects of discounting		(1.0	)
Present value of future minimum lease payments	$	8.8

Critical Accounting Policies

Basis of Presentation

The Company’s unaudited Condensed Consolidated Financial Statements are presented in conformity with accounting principles generally accepted in the United States of America (“U (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited Condensed Consolidated Financial Statements include the accounts and operations of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions are eliminated upon consolidation. Noncontrolling interests (“NCI”) in the unaudited Condensed Consolidated Financial Statements represent the portion of consolidated joint ventures and a variable interest entity (“VIE”) in which the Company does not have direct equity ownership. Accounts and transactions between consolidated entities have been eliminated.

Principles of Consolidation

The Company’s unaudited Condensed Consolidated Financial Statements include the accounts of DocGo Inc and its subsidiaries. All significant intercompany transactions and balances have been eliminated in these unaudited Condensed Consolidated Financial Statements.

The Company holds a variable interest in MD1 Medical Care P.C. (“MD1”), which contracts with physicians and other health professionals in order to provide services to the Company. MD1 is considered a VIE since it does not have sufficient equity to finance its activities without additional subordinated financial support. An enterprise having a controlling financial interest in a VIE must consolidate the VIE if it has both power and benefits—that is, it has (1) the power to direct the activities of a VIE that most significantly impacts the VIE’s economic performance (power) and (2) the obligation to absorb losses of the VIE that potentially could be significant to the VIE or the right to receive benefits from the VIE that potentially could be significant to the VIE (benefits). The Company has the power and rights to control all activities of MD1 and funds and absorbs all losses of the VIE and appropriately consolidates MD1.

Net loss for the VIE was $186,637 for the three months ended March 31, 2023. The VIE’s total assets, all of which were current, amounted to $635,620 as of March 31, 2023. Total liabilities, all of which were current for the VIE, was $532,127 as of March 31, 2023. The VIE’s total stockholders’ deficit was $103,493 as of March 31, 2023.

Business Combinations

The Company accounts for its business combinations under the provisions of ASC 805-10, Business Combinations (“ASC 805-10”), which requires that the acquisition method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including NCI, are recorded at the date of acquisition at their respective fair values. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill.

The estimated fair value of net assets to be acquired, including the allocation of the fair value to identifiable assets and liabilities, is determined using established valuation techniques. Management uses assumptions on the basis of historical knowledge of the business and projected financial information of the target. These assumptions may vary based on future events, perceptions of different market participants and other factors outside the control of management, and such variations may be significant to estimated values.

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the total purchase consideration over the fair value of the identifiable assets acquired and liabilities assumed in a business combination. Goodwill is not amortized but is tested for impairment at the reporting unit level annually on December 31 or more frequently if events or changes in circumstances indicate that it is more likely than not to be impaired. These events include: (i) severe adverse industry or economic trends; (ii) significant company-specific actions, including exiting an activity in conjunction with restructuring of operations; (iii) current, historical or projected deterioration of our financial performance; or (iv) a sustained decrease in our market capitalization, as indicated by our publicly quoted share price, below our net book value.

On February 3, 2023, Ambulnz Health, LLC (“Health”), commenced an assignment for the benefit of creditors (“ABC”) pursuant to California law. An ABC is a liquidation process governed by state law (California law in this instance) that is an alternative to a bankruptcy case under federal law. Prior to commencing the ABC, Health ceased business operations and all of its employees were terminated and treated in accordance with California law. In the ABC, all of Health’s assets were transferred to an assignee (the “Assignee”) who acts as a fiduciary for creditors and in a capacity equivalent to that of a bankruptcy trustee. The Assignee is responsible for liquidating the assets. Similar to a bankruptcy case, there is a claims process. Creditors of Health will receive notice of the ABC and a proof of claim form and are required to submit a proof of claim in order to participate in distribution of net liquidation proceeds by the Assignee.

Based on such filing for Health, the Company impaired the goodwill assigned to that reporting unit as of December 31, 2022 by approximately $5.1 million.

Revenue Recognition

On January 1, 2019, the Company adopted ASU 2014-09, Revenue from Contracts with Customers (“ASC 606”), as amended.

The Company generates revenues from the provision of (1) Transportation Services and (2) Mobile Health Services. The customer simultaneously receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, therefore the Company satisfies performance obligations immediately. The Company has utilized the “right to invoice” expedient which allows an entity to recognize revenue in the amount of consideration to which the entity has the right to invoice when the amount that the Company has the right to invoice corresponds directly to the value transferred to the customer. Revenues are recorded net of an estimated contractual allowances for claims subject to contracts with responsible paying entities. The Company estimates contractual allowances at the time of billing based on contractual terms, historical collections, or other arrangements. All transaction prices are fixed and determinable which includes a fixed base rate, fixed mileage rate and an evaluation of historical collections by each payor.

~~Cash Flows~~Income Taxes

~~Nine months ended September 30, 2022~~Income taxes are recorded in accordance with ASC 740, Income Taxes (“ASC 740”), which provides for deferred taxes using an asset and ~~2021~~

As of September 30, Change Change
$ in Millions 2022 2021 $ %
Cash flow summary
Net cash provided by/(used in) operating activities $ 37.6 $ 6.9 $ 30.7 445 %
Net cash provided by/(used in) investing activities (37.8 ) (4.4 ) (33.4 ) 759 %
Net cash provided by/(used in) financing activities 0.7 6.0 (5.3 ) (88 )%
Effect of exchange rate changes (0.3 ) 0.2 (0.5 )
Net (decrease) increase in cash $ 0.2 $ 8.7 $ (8.5 ) (98 )%

~~Operating Activities~~liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or its tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. The Company recognizes any interest and penalties accrued related to unrecognized tax benefits as income tax expense.

~~During the nine months ended September 30, 2022, operating activities provided $37.6 million~~Please see Note 2, “Summary of cash, aided by net income of $23.6 million. Non-cash charges amounted to $11.9 million and included $5.0 million in depreciation of property and equipment and right-of-use assets, $2.2 million from amortization of intangible assets, $2.7 million in bad debt expense primarily related to a provision for potential uncollectible accounts receivable and $4.6 million of stock compensation expense. These were partially offset by non-cash gains of $1.4 million relatingSignificant Accounting Policies” to the remeasurement of finance lease liabilities, $1.1 million from the remeasurement of warrant liabilities and a gain of $0.1 from an investment that is accounted for under the equity method. Changes in assets and liabilities resulted in approximately $2.1 million in increase to operating cash flow, as a $2.9 million decrease in accounts receivable, a $0.9 million decrease in other assets and a $2.6 million increase in accrued liabilities outweighed the effect of a $0.3 million increase in prepaid expenses and a $4.0 million decline in accounts payable..

During the nine months ended September 30, 2021, operating activities provided $6.9 million of cash, despite a net loss of $1.1 million. Non-cash charges amounted to $8.8 million and included $4.1 million resulting from the depreciation of property and equipment and right-of-use assets, $1.4 million from amortization of intangible assets, $1.2 million of stock compensation expense, $2.2 million of bad debt expense primarily related to a provision for potential uncollectible accounts receivable, partially offset by a non-cash gain of $0.1 million from the forgiveness of a PPP loan. Changes in assets and liabilities resulted in approximately $0.8 million in negative operating cash flow and were primarily driven by a $28.8 million increase in accounts receivable and a $4.5 million increase in prepaid expenses and other current assets, as well as a $1.8 million increase in other assets, which were partially offset by a $9.4 million increase in accounts payable and a $24.9 million increase in accrued expenses.

~~Investing Activities~~

During the nine months ended September 30, 2022, investing activities used $37.8 million of cash and consisted of the acquisition of property and equipment totaling approximately $2.0 million, the acquisition of intangibles in the amount of $2.0 million and $33.8 million in the acquisition of businesses, primarily relating to acquisitions the Company completed in the third quarter of 2022.

During the nine months ended September 30, 2021, investing activities used $4.4 million of cash and primarily consisted of the acquisition of property and equipment totaling $2.8 million and the acquisition of intangibles in the amount of $1.6 million to support growth of new transportation and mobile health markets.

~~Financing Activities~~

During the nine months ended September 30, 2022, financing provided $0.7 million, including $2.0 million in non-controlling interest contributions, $1.9 million in proceeds from the exercise of stock options and proceeds of $1.0 million from a revolving credit line. These factors were partially offset by a $1.0 million decrease in amounts due to seller, $0.6 million in repayments of notes payable, $0.5 million in common stock repurchased, and $2.1 in payments on obligations under the terms of finance leases.

During the nine months ended September 30, 2021, financing activities provided $6.0 million of cash, primarily due to proceeds of $8.0 million from a revolving credit line, as well as $0.3 million in non-controlling interest contributions. These factors were partially offset by $1.8 million in payments on obligations under the terms of finance leases and $0.5 in repayments of notes payable.

~~Future minimum annual maturities of notes payable as of the nine months ended September 30, 2022 are as follows:~~

Notes
Payable
2022, remaining 0.1
2023 0.6
2024 0.4
2025 0.4
2026 0.3
Thereafter 0.3
Total maturities $ 2.1
Current portion of notes payable (0.7 )
Long-term portion of notes payable $ 1.5

~~Future minimum lease payments under finance leases as of the nine months ended September 30, 2022, and for the following five fiscal years and thereafter are as follows:~~

Finance
Leases
2022, remaining $ 0.9
2023 3.1
2024 2.4
2025 2.1
2026 1.2
2027 and thereafter 0.3
Total future minimum lease payments 10.0
Less effects of discounting (1.0 )
Present value of future minimum lease payments $ 9.0

~~Future minimum lease payments under operating leases as of the nine months ended September 30, 2022, and for the following five fiscal years and thereafter are as follows:~~

Operating
Leases
2022, remaining $ 0.7
2023 2.4
2024 1.9
2025 1.9
2026 1.5
2027 and thereafter 1.4
Total future minimum lease payments 9.8
Less effects of discounting (1.3 )
Present value of future minimum lease payments $ 8.5

~~Share Repurchases~~

On May 24, 2022, the Board approved a share repurchase program to purchase up to $40 million of the Company’s common stock (the “Program”). The Program does not obligate the Company to acquire any specific number of shares and will expire on November 24, 2023, and the Program may be suspended, extended, modified or discontinued at any time. Under the Program, repurchases can be made using a variety of methods, which may include open market purchases, block trades, privately negotiated transactions and/or a non-discretionary trading plan, all in compliance with the rules of the SEC and other applicable legal requirements. The timing, manner, price and amount of any common stock repurchases under the Program are determined by the Company in its discretion and depend on a variety of factors, including legal requirements, price and economic and market conditions. As of September 30, 2022, $39.5 million remained available for share repurchases pursuant to the Program. No shares were repurchased by the Company during the three months ended September 30, 2022.

~~Critical Accounting Estimates~~

~~For a discussion of our critical accounting policies, refer to the section entitled “Critical Accounting Policies” in our Annual Report on Form 10-K for the year ended December 31, 2021.~~unaudited Condensed Consolidated Financial Statements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk and Foreign Exchange Risk

Cash equivalents that are subject to interest rate volatility represent our principal market risk. We ~~are~~do not expect cash flows to be affected to any significant degree by a ~~smaller reporting company,~~sudden change in market interest rates as ~~defined by Rule 12b-2~~our notes payable bear fixed interest rates. We do not enter into investments for trading or speculative purposes. Additionally, the Company has not made any draws under the ~~Exchange Act~~facility and as of March 31, 2023, there is no amount outstanding.

We operate our business primarily within the United States and currently execute majority of our transactions in U.S. dollars. The foreign exchange gain amounted to $243,658 to the Company in the first quarter of 2023 ($5,863 in the first quarter of 2022). We have not utilized hedging strategies with respect to such foreign exchange exposure. This limited foreign currency translation risk is not expected to have a material impact on our consolidated financial statements.

Concentrations of Risk and Significant Clients

Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments and accounts receivable. Although we deposit our cash with multiple financial institutions in the U.S. and in ~~Item 10(f)(1)~~foreign countries, our deposits, at times, may exceed federally insured limits.

One customer accounted for approximately 46% of ~~Regulation S-K,~~sales and ~~are not required to provide~~62% of net accounts receivable, for the ~~information under this item.~~three months ended March 31, 2023.

One customer accounted for approximately 34% of sales and 22% of net accounts receivable, and another customer that accounted for 19% of sales and 17% of net accounts receivable for the three months ended March 31, 2022.

Item 4. Controls and Procedures

Management’s Evaluation of Disclosure Controls and Procedures

Based on our management’s evaluation (with the participation of our principal executive officer and principal financial officer), as of the end of the period covered by this report, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”)) are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission’s rules and forms and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended ~~September 30, 2022~~March 31, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We and other participants in the healthcare industry are subject to legal proceedings, claims and litigation arising in the ordinary course of our business. Descriptions of certain legal proceedings to which we are a party are contained in Note ~~18,~~19, “Legal Proceedings” of the Notes to our ~~Unaudited~~unaudited Condensed Consolidated Financial Statements.

From time to time, in the ordinary course of business and like others in our industry, we receive requests for information from government agencies in connection with their regulatory or investigational authority. These requests can include subpoenas or demand letters for documents to assist the government in audits or investigations. We review such requests and notices and take what we believe to be appropriate action. We have been subject to certain requests for information and investigations in the past and could be subject to such requests for information and investigations in the future.

Item 1A. Risk Factors

Factors that could materially and adversely affect our business, financial condition and/or results of operations are described in the ~~2021~~Annual Report on Form ~~10-K.~~10-K for the year ended December 31, 2022. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business, financial condition and/or results of operations. As of the date of this Quarterly Report on Form 10-Q, there have been no material changes to the risk factors disclosed in our ~~2021~~most recent Annual Report on Form ~~10-K, other than the inflation rate risk and share repurchase risk discussed below.~~10-K.

~~Inflation Rate Risk~~

Beginning in April 2021, the inflation rate in the US, as measured by the Consumer Price Index (CPI) has steadily increased. In 2019, the inflation rate was approximately 1.8%, while it dropped to approximately 1.2% in 2020. This data is reported monthly, showing year-over-year changes in prices across a basket of goods and services. For 2021, inflation increased from the 1.4%-2.6% range in the first quarter, to 4.2% in April, and was in the 5.0%-6.0% range through the end of the third quarter of 2021, before increasing to the 6.0%-7.0% range in the fourth quarter. For the full year, the inflation rate was 4.7% in 2021, the highest annual rate since the 5.4% rate recorded in 1990. The inflation rate continued to increase throughout the first nine months of 2022, reaching approximately 9.1% in June 2022 and amounting to 8.2% in September 2022. In an attempt to dampen inflation, the U.S. Federal Reserve has already implemented six interest rate increases in 2022, raising its benchmark rate (the “federal funds rate”) from near 0.00% at the beginning of the year to the current level of 3.75%-4.00%, The federal funds rate was raised in March, May, June, July, September and November, with the last four rate increases at 0.75% each. Looking to the fourth quarter of 2022, we anticipate a moderation of the inflation rate when compared to the first half of the year, as a result of these recent rate increases, but expect that inflation will remain well above the levels seen in the previous 10 years, when the annual inflation rate ranged from 0.1% to 2.4%. If inflation is above the levels that the Company anticipates, gross margins could be below plan and our business, operating results and cash flows may be adversely affected.

~~Share Repurchase Program Risk~~

We have adopted a share repurchase program to repurchase shares of our common stock; however, any future decisions to reduce or discontinue repurchasing our common stock pursuant to our share repurchase program could cause the market price for our common stock to decline.

Although our Board has authorized the share repurchase program, any determination to execute our share repurchase program will be subject to, among other things, our financial position and results of operations, available cash and cash flow, capital requirements and other factors, as well as our Board’s continuing determination that the repurchase program is in the best interests of our stockholders and is in compliance with all laws and agreements applicable to the repurchase program. Our share repurchase program does not obligate us to acquire any common stock. If we fail to meet any expectations related to share repurchases, the market price of our common stock could decline, and could have a material adverse impact on investor confidence. Additionally, price volatility of our common stock over a given period may cause the average price at which we repurchase our common stock to exceed the stock’s market price at a given point in time.

We may further increase or decrease the amount of repurchases of our common stock in the future. Any reduction or discontinuance by us of repurchases of our common stock pursuant to our current share repurchase program could cause the market price of our common stock to decline. Moreover, in the event repurchases of our common stock are reduced or discontinued, our failure or inability to resume repurchasing common stock at historical levels could result in a lower market valuation of our common stock.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Equity Securities

On March 31, 2023, Holdings acquired 51% of the outstanding shares of common stock of Cardiac RMS, LLC (“CRMS”) in exchange for $10,000,000 closing consideration, consisting of $9,000,000 in cash and $1,000,000 worth of shares of DocGo common stock issued in a private placement transaction. A further probable consideration of $15,822,190 is to be paid out over 36 months for the remaining 49% equity of CRMS, based on CRMS’ attainment of full-year EBITDA targets. CRMS provides cardiac implantable electronic device (“CIED”) remote monitoring and virtual care management services.

The foregoing transaction did not involve any underwriters, underwriting discounts or commissions, or any public offering. Under the terms of the agreement, the Company issued and sold the shares of DocGo common stock in a private placement to four accredited investors, in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended. The Company relied on this exemption from registration based in part as each accredited investor was aware of the terms of the transaction, the securities issued contained restrictive legends regarding resale and transfer, and the transaction was not publicly solicited or advertised.

Share Repurchases

On May 24, 2022, the ~~Board approved a share repurchase program~~Company was authorized to purchase up to $40 million of the Company’s common stock under a share repurchase program (the “Program”). During the second and fourth quarter of 2022, the Company repurchased 536,839 shares of its common stock for $3,731,712. These shares were subsequently cancelled. There were no shares repurchased during the first quarter of 2023. The Program does not ~~obligate~~oblige the Company to acquire any specific number of shares and will expire on November 24, ~~2023, and the Program may be suspended, extended, modified or discontinued at any time.~~2023. Under the Program, ~~repurchases can~~shares may be ~~made~~repurchased using a variety of methods, ~~which may include~~including privately negotiated and/or open market ~~purchases,~~transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as part of accelerated share repurchases, block trades ~~privately negotiated transactions and/or a non-discretionary trading plan, all in compliance with the rules of the SEC~~ and other ~~applicable legal requirements.~~methods. The timing, manner, price and amount of any common stock repurchases under the Program are determined by the Company in its discretion and depend on a variety of factors, including legal requirements, price and economic and market conditions. ~~No shares were repurchased during the three months ended September 30, 2022. As of September 30, 2022, $39.5 million remained available for share repurchases pursuant to the Program.~~

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

Exhibit Number		Description
3.1		Second Amended and Restated Certificate of Incorporation of DocGo Inc., dated November 5, 2021 (incorporated by reference to Exhibit 3.1 of DocGo’s Form 8-K, filed with the SEC on November 12, 2021).
3.2		Amended and Restated Bylaws of DocGo Inc. (incorporated by reference to Exhibit 3.2 of DocGo’s Form 8-K, filed with the SEC on November 12, 2021).
~~10.1~~10.1*		~~Credit Agreement, dated November 1, 2022, among~~Offer Letter by and between DocGo Inc.~~, the lender parties thereto,~~ and ~~Citibank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of DocGo’s Form 8-K, filed with the SEC on November 2, 2022).~~Lee Bienstock.
31.1*		Certification of the Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act
31.2*		Certification of the Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act
32.1**		Certification of the Principal Executive Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**		Certification of the Principal Financial Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

Filed herewith.

Furnished ~~herewith.~~herewith

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	DocGo Inc.

Date: ~~November 8, 2022~~May 9, 2023	By:	/s/ ~~Andre Oberholzer~~Anthony Capone
		~~Andre Oberholzer~~Anthony Capone
		Chief Executive Officer

Date: May 9, 2023	By:	/s/ Norman Rosenberg
		Norman Rosenberg
		Chief Financial Officer ~~(Principal Financial and Accounting Officer and Authorized Signatory)~~

5750

~~2026 false --12-31 Q3~~ 0001822359 srt:MinimumMember 2022-01-01 2022-03-31 iso4217:USD xbrli:shares

		Page
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements		1
Item 2. Management’s Discussion and Analysis of Financial Condition and Result of Operations		3633
Item 3. Quantitative and Qualitative Disclosures About Market Risk		5347
Item 4. Controls and Procedures		5347

PART II - OTHER INFORMATION

Item 1. Legal Proceedings		48
Item 1A. Risk Factors		5448
~~Item 1A. Risk Factors~~		54
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		5548
Item 3. Defaults Upon Senior Securities		48
Item 4. Mine Safety Disclosures		5548
Item ~~4. Mine Safety Disclosures~~5. Other Information		5548
Item ~~5. Other Information~~6. Exhibits		5549
~~Item 6. Exhibits~~Signatures		56
~~Signatures~~		5750

	Series A Preferred Stock					Class A Common Stock					Class B Common Stock					Additional Paid-in-			Accumulated			Accumulated Other Comprehensive			Noncontrolling			Total Stockholders’
	Shares			Amount		Shares			Amount		Shares			Amount		Capital			Deficit			Income			Interests			Equity
Balance - December 31, 2020		28,055		$	-		35,497		$	-		55,008		$	-	$	142,346,852		$	(87,300,472	)	$	(48,539	)	$	11,949,200		$	66,947,041
Effect of reverse acquisition		18,099,548			-		22,900,719			-		35,488,938			-		-			-			-			-			-
Conversion of share due to merger recapitalization		(18,099,548	)		-		(22,900,719	)		7,649		(35,488,938	)		-		-			-			-			-			7,649
Effect of reverse acquisition		-			-		76,489,205			7,649		-			-		142,346,852			(87,300,472	)		(48,539	)		11,949,200			66,954,690
Share issued for services		266			-		171,608			17		-			-		-			-			-			-			17
Stock based compensation		-			-		-			-		-			-		391,534			-			-			-			391,534
Noncontrolling interest contribution		-			-		-			-		-			-		-			-			-			333,025			333,025
Foreign currency translation		-			-		-			-		-			-		-			-			7,998			-			7,998
Net loss attributable to Noncontrolling interests		-			-		-			-		-			-		-			-			-			(320,632	)		(320,632	)
Net loss attributable to stockholders of DocGo Inc. and Subsidiaries		-			-		-			-		-			-		-			(1,678,364	)		-			-			(1,678,364	)
Balance - March 31, 2021		28,321		$	-		76,660,813		$	7,666		-		$	-	$	142,738,386		$	(88,978,836	)	$	(40,541	)	$	11,961,593		$	65,688,268
Stock based compensation		-			-		-			-		-			-		370,000			-			-			-			370,000
Foreign currency translation		-			-		-			-		-			-		-			-			94,655			-			94,655
Net income attributable to Noncontrolling interests		-			-		-			-		-			-		-			-			-			1,748,223			1,748,223
Net loss attributable to stockholders of DocGo Inc. and Subsidiaries		-			-		-			-		-			-		-			(1,646,216	)		-			-			(1,646,216	)
Balance - June 30, 2021		28,321			-		76,660,813		$	7,666		-		$	-	$	143,108,386		$	(90,625,052	)	$	54,114		$	13,709,816		$	66,254,930
UK Ltd. Shares purchase		-			-		-			-		-			-		(280,772	)		-			-			(242,945	)		(523,717	)
Stock based compensation		-			-		-			-		-			-		463,046			-			-			-			463,046
Fees associated with equity raise																	(1,398	)											(1,398	)
Foreign currency translation		-			-		-			-		-			-		-			-			69,193			-			69,193
Net income attributable to Noncontrolling interests		-			-		-			-		-			-		-			-			-			(2,705,954	)		(2,705,954	)
Net income attributable to stockholders of Ambulnz, Inc. and Subsidiaries		-			-		-			-		-			-		-			3,507,520			-			-			3,507,520
Balance - September 30, 2021		28,321		$	-		76,660,813		$	7,666		-		$	-	$	143,289,262		$	(87,117,532	)	$	123,307		$	10,760,917		$	67,063,620

	Ryan Brothers		Exceptional Medical Transport		GMS		Total

Consideration:
Cash Consideration	$	7,422,252	$	6,375,000	$	20,338,789	$	34,136,041
Due to Seller		-		6,000,000		-		6,000,000
Contingent Consideration		4,000,000		-		-		4,000,000
Amounts held under an escrow account		-		1,333,333		-		1,333,333
Total consideration		11,422,252		13,708,333		20,338,789		45,469,374

Recognized amounts of identifiable assets acquired and liabilities assumed
Cash	$	620,548	$	299,050	$	1,005,453	$	1,925,051
Accounts receivable		-		-		3,975,160		3,975,160
Other current assets		136,157		-		30,734		166,891
Property, plant and equipment		2,125,134		2,450,900		4,092		4,580,126
Intangible assets		387,550		125,000		9,794,000		10,306,550
Total identifiable assets acquired		3,269,389		2,874,950		14,809,439		20,953,778

Accounts payable		44,911		-		137,239		182,150
Due to Seller		-		299,050		-		299,050
Other current liabilities		286,792		-		562,809		849,601
Total liabilities assumed		331,703		299,050		700,048		1,330,801

Goodwill		8,484,566		11,132,433		6,229,398		25,846,397

Total purchase price	$	11,422,252	$	13,708,333	$	20,338,789	$	45,469,374

	Carrying Value
Balance at December 31, 2021	$	8,686,966
Goodwill acquired during the period		25,846,397
Balance at September 30, 2022		34,533,363

	September 30, 2022
	Estimated Useful Life (Years)	Gross Carrying Amount		Additions		Accumulated Amortization			Net Carrying Amount
Patents	15 years	$	48,668	$	13,655	$	(9,075	)	$	53,248
Computer software	5 years	$	294,147		11,144		(263,192	)	$	42,099
Operating licenses	Indefinite	$	8,375,514		450,200		-		$	8,825,714
Internally developed software	4-5 years	$	6,013,513		1,907,616		(5,778,894	)	$	2,142,235
Material Contracts	Indefinite		-		62,550		-			62,550
Customer Relationship	9 years		-		9,794,000		(272,056	)	$	9,521,944
		$	14,731,842	$	12,239,165	$	(6,323,217	)	$	20,647,790

	December 31, 2021
	Estimated Useful Life (Years)	Gross Carrying Amount		Additions		Accumulated Amortization			Net Carrying Amount
Patents	15 years	$	19,275	$	29,393	$	(6,367	)	$	42,301
Computer software	5 years		132,816		161,331		(219,388	)		74,759
Operating licenses	Indefinite		8,375,514		-		-			8,375,514
Internally developed software	4-5 years		2,146,501		3,867,012		(3,828,038	)		2,185,475
		$	10,674,106	$	4,057,736	$	(4,053,793	)	$	10,678,049

	Amortization Expense
2022, remaining	$	680,930
2023		2,078,406
2024		1,510,563
2025		1,460,965
2026		1,094,588
Thereafter		4,934,074
Total	$	11,759,526

	Options Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life in Years		Aggregate Intrinsic Value
Balance as of, December 31, 2021		8,422,972		$	6.21		8.77	$	24,706,020
Granted/ Vested during the year		2,183,026			5.92		9.07		-
Exercised during the year		(1,637,159	)		2.04		5.47		-
Cancelled during the year		(706,642	)		7.71		8.82		-
Balance as of September 30, 2022		8,262,197			7.04		8.72	$	22,950,815
Options vested and exercisable at September 30, 2022		2,502,717		$	6.11		8.30	$	10,010,617

	RSUs			Weighted- Average Grant Date Fair Value Per RSU
Balance as of, December 31, 2021		50,192		$	9.97
Granted		146,853			7.15
Vested during the year		(16,645	)		9.97
Forfeited		-			-
Balance as of, September 30, 2022		180,400			7.67
Vested and unissued at September 30, 2022		-
Non-vested at September 30, 2022		180,400			7.67

	Finance Leases
2022, remaining		878,626
2023		3,127,590
2024		2,398,030
2025		2,095,826
2026		1,185,433
2027 and thereafter		274,974
Total future minimum lease payments		9,960,479
Less effects of discounting		(1,014,990	)
Present value of future minimum lease payments	$	8,945,489

	As of September 30,						Change			Change
$ in Millions	2022			2021			$			%
Cash flow summary
Net cash provided by/(used in) operating activities	$	37.6		$	6.9		$	30.7			445	%
Net cash provided by/(used in) investing activities		(37.8	)		(4.4	)		(33.4	)		759	%
Net cash provided by/(used in) financing activities		0.7			6.0			(5.3	)		(88	)%
Effect of exchange rate changes		(0.3	)		0.2			(0.5	)
Net (decrease) increase in cash	$	0.2		$	8.7		$	(8.5	)		(98	)%