ABC Transaction and Held for Sale

12 Months Ended

Dec. 31, 2022

Transaction and Held-for-sale [Abstract]

ABC Transaction and Held for Sale

5. ABC Transaction and Held for Sale

During the year 2022, the Company started discussions regarding the potential liquidation process of Health through an assignment for the benefit of creditors (“ABC”), with a targeting 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.

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:

	December 31, 2022
	Pre ABC Adjustment			Adjustment			Post ABC Adjustment
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	)		-
Assets held for sale		-			4,480,344			4,480,344
Total current assets		1,052,465			3,427,879			4,480,344
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	)		-
Intercompany receivables		17,957,076			-			17,957,076
Other assets		96,419			(96,419	)		-
Total assets	$	25,359,378		$	(2,921,958	)	$	22,437,420
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	196,122		$	(196,122	)	$	-
Accrued liabilities		4,250,603			(4,250,603	)		-
Intercompany payables		59,404,839			-			59,404,839
Operating lease liability, current		33,619			(33,619	)		-
Liabilities held for sale		-			4,480,344			4,480,344
Total current liabilities		63,885,183			-			63,885,183
Total liabilities	$	63,885,183		$	-		$	63,885,183
STOCKHOLDERS’ EQUITY:
Accumulated deficit	$	(38,525,805	)	$	(2,921,958	)	$	(41,447,763	)
Total stockholders’ equity attributable to DocGo Inc. and Subsidiaries		(38,525,805	)		(2,921,958	)		(41,447,763	)
Noncontrolling interests		-			-			-
Total stockholders’ equity	$	(38,525,805	)	$	(2,921,958	)	$	(41,447,763	)
Total liabilities and stockholders’ equity	$	25,359,378		$	(2,921,958	)	$	22,437,420

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