What changed in this filing

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Item 1. Financial Statements

2022-08-11 compared with 2022-05-13 · 652 added, 518 removed, 845 unchanged (58% of the section changed)

1 unchanged sentence

CONSOLIDATED BALANCE SHEETS

March 31, 2022

June 30, 2022

December 31, 2021

29 unchanged sentences

Series B Preferred Stock, $ 0.0001 par value;

5,000 shares authorized, 3,500 and 3,500 shares issued and outstanding, liquidation value approximately, $ 1,207 and $ 1,175 per share as of March 31, 2022 and December 31, 2021, respectively

5,000 shares authorized, 3,500 and 3,500 shares issued and outstanding, liquidation value approximately $ 1,239 and $ 1,175 per share as of June 30, 2022 and December 31, 2021, respectively

Stockholders’ Equity

Series A Preferred Stock, $ 0.0001 par value;

1,610,000 shares authorized, 1,400,000 shares issued and outstanding, liquidation value approximately, $ 26.17 and $ 25.62 per share as of March 31, 2022 and December 31, 2021, respectively

1,610,000 shares authorized, 1,400,000 shares issued and outstanding, liquidation value approximately, $ 26.72 and $ 25.62 per share as of June 30, 2022 and December 31, 2021, respectively

Common stock, $ 0.01 par value;

100,000,000 shares authorized, 30,899,469 and 30,704,434 shares issued, 30,796,429 and 30,601,394 outstanding as of March 31, 2022 and December 31, 2021, respectively

100,000,000 shares authorized, 30,989,869 and 30,704,434 shares issued, 30,886,829 and 30,601,394 outstanding as of June 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

12 unchanged sentences

Consolidated STATEMENTS OF OPERATIONS

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Telehealth revenue, net

7 unchanged sentences

General and administrative expenses

Goodwill impairment charge

Other operating expenses

5 unchanged sentences

( 16,126,763 )

( 28,746,140 )

( 28,045,100 )

Interest expense, net

( 1,041,373 )

Change in fair value of contingent consideration

Gain on debt forgiveness

1 unchanged sentence

( 17,028,673 )

( 26,247,910 )

( 28,901,559 )

Net income (loss) attributable to non-controlling interest

2 unchanged sentences

( 16,830,700 )

( 26,318,637 )

( 28,433,083 )

Preferred stock dividends

( 1,553,125 )

Net loss attributable to LifeMD, Inc.

2 unchanged sentences

$ ( 16,830,700 )

$ ( 27,871,762 )

$ ( 28,433,083 )

Basic loss per share attributable to LifeMD, Inc.

5 unchanged sentences

Consolidated STATEMENTS of CHANGES IN STOCKHOLDERS’ EQUITY

Series A Preferred Stock

Additional Paid-in

Non-controlling

January 1, 2021

Balance, January 1, 2021

$ ( 80,151,905 )

3 unchanged sentences

$ ( 4,477,586 )

Stock issued for service

Cashless exercise of stock options

Exercise of stock options

of stock options

of stock in private placement, net

to non-controlling interest

of additional membership interest of WSS

of noncontrolling interest for additional investment

Sale of stock in private placement, net

Distribution to non-controlling interest

Purchase of additional membership interest of WSS

Adjustment of noncontrolling interest for additional investment

( 1,636,875 )

3 unchanged sentences

( 11,872,886 )

March 31, 2021

Balance, March 31, 2021

$ ( 91,754,288 )

2 unchanged sentences

$ ( 841,427 )

Stock issued for service

Exercise of stock options

Cashless exercise of stock options

Exercise of warrants

Warrants issued for debt instruments

Distribution to non-controlling interest

( 16,830,700 )

( 17,028,673 )

Balance, June 30, 2021

$ 101,450,858

$ ( 108,584,988 )

$ ( 163,701 )

$ ( 7,031,472 )

$ ( 1,001,869 )

$ ( 8,033,341 )

Series A Preferred

Additional Paid-in

Non-controlling

January 1, 2022

Balance, January 1, 2022

$ 164,517,634

2 unchanged sentences

$ ( 1,031,745 )

Stock issued for service

Cashless exercise of stock options

Exercise of warrants

Series A Preferred Stock Dividend

Distribution to non-controlling interest

Net (loss) income

( 13,299,675 )

( 13,274,949 )

Balance, March 31, 2022

$ 169,026,965

$ ( 155,997,323 )

$ ( 163,701 )

$ ( 1,043,019 )

Stock compensation

Exercise of stock options

A Preferred Stock Dividend

to non-controlling interest

(loss) income

Series A Preferred Stock Dividend

Distribution to non-controlling interest

Net (loss) income

( 13,018,962 )

1 unchanged sentence

( 12,972,961 )

March 31, 2022

Net income(loss)

( 13,018,962 )

1 unchanged sentence

( 12,972,961 )

Balance, June 30, 2022

$ 173,157,467

$ ( 169,792,847 )

$ ( 163,701 )

$ ( 1,033,018 )

accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Consolidated STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES

5 unchanged sentences

Amortization of intangibles

Accretion of consideration payable

Depreciation of fixed assets

Gain on forgiveness of debt

Gain on debt forgiveness

Change in fair value of contingent consideration

( 2,735,000 )

Goodwill impairment charge

Operating lease payments

2 unchanged sentences

Accounts receivable

( 1,533,572 )

( 1,084,174 )

Product deposit

( 1,341,474 )

Other current assets

3 unchanged sentences

Accrued expenses

( 2,152,511 )

Net cash used in operating activities

13 unchanged sentences

Cash proceeds from private placement offering, net

Proceeds from issuance of debt instruments

Cash proceeds from exercise of options

1 unchanged sentence

Preferred stock dividends

( 1,553,125 )

Contingent consideration payment for ResumeBuild acquisition

Proceeds from notes payable

Repayment of notes payable

( 1,119,950 )

Purchase of membership interest of WSS

1 unchanged sentence

Net cash (used in) provided by financing activities

( 1,527,475 )

Net (decrease) increase in cash

5 unchanged sentences

Non-cash investing and financing activities

Cashless exercise of warrants

Cashless exercise of options

1 unchanged sentence

Consideration payable for ResumeBuild acquisition

Warrants issued for debt instruments

Principal of Paycheck protection Program loans forgiven

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revenue streams for the Company.

Company believes that brand innovation, customer acquisition, and service excellence form the heart of its business.

As is exemplified

with its first brand, Shapiro MD, it has built a full line of proprietary OTC products for male and female hair loss, Food and Drug Administration

(“FDA”) approved OTC minoxidil, an FDA-cleared medical device, and now a personalized telehealth platform offering that gives

consumers access to virtual medical treatment from their providers and, when appropriate, a full line of oral and topical prescription

medications for hair loss.

The Company’s men’s brand, RexMD, currently offers access to provider-based treatment for erectile

dysfunction, as well as treatment for other common men’s health issues, including premature ejaculation and hair loss.

quarter of 2021, the Company launched its newest brand, NavaMD, a tele-dermatology and skincare brand for women.

The Company has built

a platform that allows it to efficiently launch telehealth and wellness product lines wherever it determines there is a market need.

believes that brand innovation, customer acquisition, and service excellence form the heart of its business.

As is exemplified with its

first brand, Shapiro MD, it has built a full line of proprietary OTC products for male and female hair loss—including Food and Drug

Administration (“FDA”) approved OTC minoxidil and an FDA-cleared medical device—and now a personalized telehealth platform

offering that gives consumers access to virtual medical treatment from their providers and, when appropriate, a full line of oral and

topical prescription medications for hair loss.

The Company’s men’s brand, RexMD, currently offers access to provider-based

treatment for erectile dysfunction, as well as treatment for other common men’s health issues, including premature ejaculation and

In the first quarter of 2021, the Company launched its newest brand, NavaMD, a tele-dermatology and skincare brand for women.

The Company has built a platform that allows it to efficiently launch telehealth and wellness product lines wherever it determines there

is a market need.

and Subsidiary History

June 2018, Conversion Labs closed the strategic acquisition of 51 % of WorkSimpli, which operates a SaaS application for converting, editing,

signing and sharing PDF documents called PDFSimpli.

In addition to WorkSimpli’s growth business model, this acquisition added deep

search engine optimization and search engine marketing expertise to the Company.

The Company subsequently increased its ownership stake

in WorkSimpli to its current 85.6 %.

early 2019, the Company had launched a service-based business under the name Conversion Labs Media LLC (“CVLB Media”), a

Puerto Rico limited liability company, which was to be used to run e-commerce marketing campaigns for other online businesses.

this business initiative was terminated in early 2019 in order to focus on its core business as well as the expansion of our telehealth

opportunities.

In May 2019, Conversion Labs RX, LLC (“CVLB Rx”), a Puerto Rico limited liability company, signed a strategic

partnership agreement with GoGoMeds.com (“GoGoMeds”).

June 2018, Conversion Labs closed the strategic acquisition of 51 %

of WorkSimpli, which operates a SaaS application for converting, editing, signing, and sharing PDF documents called PDFSimpli.

addition to WorkSimpli’s growth business model, this acquisition added deep search engine optimization and search engine

marketing expertise to the Company.

The Company subsequently increased its ownership stake in WorkSimpli to its current 85.6 %.

In early 2019, the Company had

launched a service-based business under the name Conversion Labs Media LLC (“CVLB Media”), a Puerto Rico limited liability

company, which was to be used to run e-commerce marketing campaigns for other online businesses.

However, this business initiative was

terminated in early 2019 in order to focus on its core business, as well as the expansion of our telehealth opportunities.

Conversion Labs Rx, LLC (“CVLB Rx”), a Puerto Rico limited liability company, signed a strategic partnership agreement with

Specialty Medical Drugstore, Inc.

(doing business as “GoGoMeds”).

GoGoMeds is a nationwide pharmacy licensed to dispense prescription

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Additionally, Conversion Labs Asia Limited (“Conversion Labs Asia”),

a Hong Kong company, had no activity during the three months ended March 31, 2022 and 2021.

a Hong Kong company, had no activity during the three months and six months ended June 30, 2022 and 2021.

January 18, 2022, the Company acquired Cleared, a rapidly growing nationwide allergy telehealth platform that provides personalized treatments

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The Company also agreed to a performance-based

earnout based on Cleared’s future net sales, payable in cash or shares at the Company’s discretion.

February 2022, WorkSimpli closed on an Asset Purchase Agreement (the “ResumeBuild APA”) with East Fusion FZCO, a Dubai, UAE

corporation (the “Seller”), whereby WorkSimpli acquired substantially all of the assets associated with the Seller’s

business offering subscription-based resume building software through SaaS online platforms (the “Acquisition”).

paid to the Seller a purchase price $ 4,000,000 .

The Seller is also entitled to a minimum of $ 500 thousand to be paid out in quarterly

payments equal to the greater of 15 % of net profits (as defined in the ResumeBuild APA) or $ 62,500 , for a two-year period ending on the

two-year anniversary of the closing of the Acquisition.

WorkSimpli borrowed the purchase price from the Company pursuant to a promissory

note with the obligation secured by an equity purchase guarantee agreement and a stock option pledge agreement from Fitzpatrick Consulting,

LLC and its sole member Sean Fitzpatrick, who is Co-Founder and President of WorkSimpli.

(See Note 3).

otherwise indicated, the terms “LifeMD,” “Company,” “we,” “us,” and “our”

refer to LifeMD, Inc.

(formerly known as Conversion Labs, Inc.), our wholly subsidiary LifeMD PR, LLC (formerly Immudyne PR LLC, and

“Conversion Labs PR”), a Puerto Rico limited liability company (“Conversion Labs PR”, or “CLPR”),

our recent acquisition, Cleared, a Delaware public benefit corporation and our majority-owned subsidiary, WorkSimpli.

The affiliated

network of medical Professional Corporations and medical Professional Associations administratively led by LifeMD Southern Patient Medical

Care, P.C., is the Company’s variable interest entity in which we hold a controlling financial interest (“LifeMD PC”).

Unless otherwise specified, all dollar amounts are expressed in United States dollars.

earnout based on Cleared’s future net sales, payable in cash or shares at the Company’s discretion (See Note 3).

February 2022, WorkSimpli closed on an Asset Purchase Agreement (the “ResumeBuild APA”) with East Fusion FZCO, a Dubai,

UAE corporation (the “Seller”), whereby WorkSimpli acquired substantially all of the assets associated with the

Seller’s business, offering subscription-based resume building software through SaaS online platforms (the

“Acquisition”).

WorkSimpli paid to the Seller a purchase price $ 4,000,000 .

The Seller is also entitled to a minimum of $ 500,000 to be paid out in quarterly payments equal to the greater of 15 %

of net profits (as defined in the ResumeBuild APA) or $ 62,500 ,

for a two-year period ending on the two-year anniversary of the closing of the Acquisition.

WorkSimpli borrowed the purchase price

from the Company pursuant to a promissory note with the obligation secured by an equity purchase guarantee agreement and a stock

option pledge agreement from Fitzpatrick Consulting, LLC and its sole member Sean Fitzpatrick, who is Co-Founder and President of

WorkSimpli (See Note 3).

otherwise indicated, the terms “LifeMD,” “Company,” “we,” “us,” and

“our” refer to LifeMD, Inc.

(formerly known as Conversion Labs, Inc.), our wholly subsidiary LifeMD PR LLC (formerly

Immudyne PR LLC, and “Conversion Labs PR”), a Puerto Rico limited liability company (“Conversion Labs PR”,

or “CLPR”), our recent acquisition, Cleared, a Delaware public benefit corporation and our majority-owned subsidiary,

The affiliated network of medical Professional Corporations and medical Professional Associations administratively led

by LifeMD Southern Patient Medical Care, P.C., is the Company’s affiliated, variable interest entity in which we hold a

controlling financial interest (“LifeMD PC”).

Unless otherwise specified, all dollar amounts are expressed in United

States dollars.

July 13, 2021, the Company, on behalf of its customers, entered into an agreement to engage Quest Diagnostics Incorporated (“Quest

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their home or office, or at any one of Quest Diagnostics’ 2,000 facilities .

July 14, 2021, the Company entered into an agreement to engage Axle Health Inc.

(“Axle Health”) to assist the Company in

establishing a platform to enable patients of the Company’s medical practice clients (“MP Clients”) to schedule certain

nursing services, including blood draws, injections, and other basic healthcare services, and to furnish operational support services

to medical practices using the platform.

In connection therewith, Axle Health granted the Company a revocable, nontransferable, non-exclusive

right and license, with the right to grant sublicenses, to install and use the software and other technology relating to the platform

developed, owned, or with the right to grant sublicenses to install and use the software and/or other technology developed, owned, or

licensed by Axle Health, including the platform, to facilitate the scheduling and provision of certain nursing services to patients of

August 4, 2021, the Company entered into a partnership agreement with Particle Health, a state-of-the-art, digital health company with

a HIPAA-compliant technology platform that converts electronic medical records data into a user-friendly Fast Healthcare Interoperability

Resource (“FHIR”) format.

Particle Health enables healthcare companies by offering simple, secure access to vital medical

With Particle Health’s platform, and patient consent, licensed medical providers on the LifeMD primary care platform gain

instant access to comprehensive patient health records, therefore enabling best-in-class, personalized care through a deeper understanding

of their patients’ medical histories .

August 30, 2021, the Company signed a letter of intent with Prescryptive Health (“Prescryptive”), a healthcare technology

company empowering consumers by improving the way healthcare is delivered.

The partnership is expected to accelerate growth for both

companies by combining LifeMD’s expanding direct-to-patient telehealth brands and LifeMD primary care platform with Prescryptive’s

best-in-class digital pharmacy fulfillment and e-prescribing technology platform.

August 4, 2021, the Company entered into a partnership agreement with Particle Health, a state-of-the-art, digital health company

with a HIPAA-compliant technology platform that converts electronic medical records data into a user-friendly, Fast Healthcare

Interoperability Resource (“FHIR”) format.

Health enables healthcare companies by offering simple, secure access to vital medical data.

With Particle Health’s platform

and patient consent, licensed affiliated medical providers on the LifeMD primary care platform gain instant access to comprehensive

patient health records, therefore enabling best-in-class, personalized care through a deeper understanding of their patients’

medical histories .

Company has funded operations in the past through the sales of its products, issuance of common and preferred stock, and through loans

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There were no shares of common stock sold under the ATM Sales Agreement during the

three months ended March 31, 2022 and 2021.

Under the 2021 Shelf, the Company had the ability to raise up to $ 150 million, of which $ 58.5

million was utilized as of March 31, 2022.

six months ended June 30, 2022 and 2021.

Under the 2021 Shelf, the Company has the ability to raise up to $ 150 million, of which $ 58.5

million was utilized as of June 30, 2022.

The Company has approximately $ 59.5 million available under the ATM Sales Agreement and $ 32

million available under the 2021 Shelf as of March 31, 2022.

million available under the 2021 Shelf as of June 30, 2022.

September 2021, the Company entered into two underwriting agreements (the “Preferred Underwriting Agreement” and “the

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Company will pay cumulative distributions on the Series A Preferred Stock, from the date of original issuance, in the amount of $ 2.21875

per share each year, which is equivalent to 8.875 %

of the $ 25.00 liquidation

preference per share.

Dividends on the Series A Preferred Stock will be payable quarterly in arrears, on or about the 15th day of January,

April, July, and October of each year.

The second quarterly dividend on the Series A Preferred Stock was declared on March 25, 2022 to

holders of record as of April 5, 2022 and was paid on April 15, 2022.

The dividend is included in the Company’s results

of operations for the three months ended March 31, 2022.

of March 31, 2022, the Company has an accumulated deficit approximating $ 156 million and has experienced significant losses from its

Although the Company is showing significant positive revenue trends, the Company expects to incur further losses through

the third quarter of 2022.

Additionally, the Company expects its burn rate of cash to continue through the third quarter of 2022;

the Company expects this burn rate to improve and become cash flow positive by the fourth quarter of 2022.

To date, the Company has been

funding operations primarily through the sale of equity in private placements and securities purchased by a financial institution.

is unable to predict if and when the Company will be able to generate significant positive cash flow or achieve profitability.

can be no assurances that we will be successful in increasing revenues, improving operational efficiencies or that financing will be

available or, if available, that such financing will be available under favorable terms.

Company has a current cash balance of approximately $ 20.1

million as of the filing date, which includes

the $ 13.5 million

of net proceeds from the February 2021 Offering and the $ 55.3

million of net proceeds from the October 4, 2021

The Company reviewed its forecasted operating results and sources and uses of cash used in management’s assessment,

which included the available financing and consideration of positive and negative evidence impacting management’s forecasts, market,

and industry factors.

Positive indicators that lead to its conclusion that the Company will have sufficient cash over the next 12 months

following the date of this report include:

(1) its continued strengthening of the Company’s revenues and improvement of operational

efficiencies across the business, (2) the expected improvement in its cash burn rate over the next 12 months, (3) $ 59.5

million available under the ATM Sales Agreement

and $ 32 million

available under the 2021 Shelf, (4) management’s ability to curtail expenses, if necessary, and (5) the overall market value of

the telehealth industry and how it believes that will continue to drive interest in the Company.

per share each year, which is equivalent to 8.875 % of the $ 25.00 liquidation preference per share.

Dividends on the Series A Preferred

Stock will be payable quarterly in arrears, on or about the 15th day of January, April, July, and October of each year.

The second quarterly

dividend on the Series A Preferred Stock was declared on March 25, 2022 to holders of record as of April 5, 2022 and was paid on April

The third quarterly dividend on the Series A Preferred Stock was declared on June 27, 2022 to holders of record as of July

5, 2022 and was paid on July 15, 2022.

The dividends are included in the Company’s results of operations for the three and six

months ended June 30, 2022.

Concern Evaluation

of June 30, 2022, the Company has an accumulated deficit approximating $ 170 million and has experienced significant losses from its operations.

Although the Company is showing significant positive revenue trends, the Company expects to incur further losses through the third quarter

To date, the Company has been funding operations primarily through the sale of equity in private placements and securities purchased

by a financial institution.

There can be no assurances that we will be successful in increasing revenues, improving operational efficiencies

or that financing will be available or, if available, that such financing will be available under favorable terms.

Company has a current cash balance of approximately $ 4.2 million as of the filing date.

The Company reviewed its forecasted operating

results and sources and uses of cash used in management’s assessment, which included the available financing and consideration

of positive and negative evidence impacting management’s forecasts, market, and industry factors.

The Company’s continuance

as a going concern is highly dependent on its future profitability and on the on-going support of its shareholders, affiliates, and creditors.

Based on these circumstances, management has determined that these conditions raise substantial doubt about the Company’s ability

to continue as a going concern.

The accompanying financial statements do not include any adjustments that might result from the outcome

of this uncertainty.

order to mitigate the going concern issues, the Company has begun to implement strategies to strengthen revenues and improve operational

efficiencies across the business and is significantly curtailing expenses.

Additionally, the Company has $ 59.5 million available under

the ATM Sales Agreement and $ 32 million available under the 2021 Shelf.

Management believes that the overall market value of the telehealth

industry is positive and that it will continue to drive interest in the Company.

2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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The results of operations

for the three months ended March 31, 2022 are not necessarily indicative of the results for the year ending December 31, 2022 or for

any future period.

for the three and six months ended June 30, 2022 are not necessarily indicative of the results for the year ending December 31, 2022

or for any future period.

of Consolidation

1 unchanged sentence

810, Consolidation .

consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, CLPR, its recent acquisition,

Cleared, its majority owned subsidiary, WorkSimpli, in addition to LifeMD PC, the Company’s variable interest entity in which we

hold a controlling financial interest.

During the year ended December 31, 2021, the Company purchased an additional 34.6 % of WorkSimpli

for a total equity interest of approximately 85.6 % as of December 31, 2021 (see Note 7).

consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, LifeMD PR, its recent

acquisition, Cleared, its majority owned subsidiary, WorkSimpli, in addition to LifeMD PC, the Company’s affiliated, variable

interest entity in which we hold a controlling financial interest.

During the year ended December 31, 2021, the Company purchased an

additional 34.6 %

of WorkSimpli for a total equity interest of approximately 85.6 %

as of December 31, 2021 (See Note 7).

significant intercompany transactions and balances have been eliminated in consolidation.

1 unchanged sentence

liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents.

As of March 31, 2022

As of June 30, 2022

and December 31, 2021, there were no cash equivalents.

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criterion is the obligation to absorb losses from, or right to receive benefits from, the VIE that could potentially be significant to

Company determined that the LifeMD PC entity, the Company’s affiliated medical professional corporation, is a VIE and subject to

Company determined that the LifeMD PC entity, the Company’s affiliated network of medical Professional Corporations and

medical Professional Associations administratively led by LifeMD Southern Patient Medical Care, P.C., is a VIE and subject to

consolidation.

LifeMD PC and the Company do not have any shareholders in common.

LifeMD PC is owned by licensed physicians, and the Company

maintains a service agreement with LifeMD PC whereby we provide all non-clinical services to LifeMD PC.

The Company determined that it

is the primary beneficiary of LifeMD PC and must consolidate, as we have both the power to direct the activities of LifeMD PC that most

significantly impact the economic performance of the entity and we have the obligation to absorb the losses.

As a result, the Company

presents the financial position, results of operations, and cash flows of LifeMD PC as part of the consolidated financial statements

of the Company.

LifeMD PC is owned by licensed physicians, and the

Company maintains a managed service agreement with LifeMD PC whereby we provide all non-clinical services to LifeMD PC.

determined that it is the primary beneficiary of LifeMD PC and must consolidate, as we have both the power to direct the activities

of LifeMD PC that most significantly impact the economic performance of the entity and we have the obligation to absorb the losses.

As a result, the Company presents the financial position, results of operations, and cash flows of LifeMD PC as part of the

consolidated financial statements of the Company.

There is no non-controlling interest upon consolidation of LifeMD PC.

net loss for LifeMD PC was approximately $ 1.5 million for the three months ended March 31, 2022.

net loss for LifeMD PC was approximately $ 1.4 million and $ 2.9 million for the three and six months ended June 30, 2022, respectively.

Company prepares its unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted

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The reclassifications include:

(1) $ 6,538 of reimbursable expenses reclassified from cost

of revenues to other operating expenses, (2) $ 157,662 of taxes and licensing fees reclassified from other operating expenses to general

and administrative expenses, (3) $ 45,659 of software development costs reclassified from cost of revenues to development costs and (4)

$ 73,170 of development services costs reclassified from other operating expenses to development costs for the three months ended March

(1) $ 34,914 and $ 41,452 of reimbursable expenses reclassified

from cost of revenues to other operating expenses, (2) $ 87,491 and $ 245,153 of taxes and licensing fees reclassified from other operating

expenses to general and administrative expenses, (3) $ 20,896 and $ 66,555 of software development costs reclassified from cost of revenues

to development costs, (4) $ 56,293 and $ 129,463 of development services costs reclassified from other operating expenses to development

costs, (5) $ 3,669 and $ 49,639 of investor relations costs reclassified from general and administrative expenses to selling and marketing

expenses and (6) $ 23,976 and $ 23,976 of regulatory costs reclassified from cost of telehealth revenue to general and administrative expenses

for the three and six months ended June 30, 2021, respectively.

Company records revenue under the adoption of ASC 606, Revenue from Contracts with Customers , by analyzing exchanges with its

customers using a five-step analysis:

performance obligations

the transaction price

Identify the contract

Identify performance obligations

Determine the transaction

Allocate the transaction

Recognize revenue

the Company’s product-based contracts with customers, the Company has determined that there is one performance obligation, which

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fulfillment service provider;

in limited cases, title does not pass until the product reaches the customer’s delivery site, in

in limited cases, title does not pass until the product reaches the customer’s delivery site;

these limited cases, recognition of revenue should be deferred until that time, however the Company does not have a process to properly

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Customer discounts, returns,

and rebates on telehealth revenues approximated $1.5 million and $1.2 million, respectively, during the three months ended March 31,

2022 and 2021.

and rebates on telehealth revenues approximated $ 1.6 million and $ 1.4 million for the three months ended June 30, 2022 and 2021, respectively.

Customer discounts, returns, and rebates on telehealth revenues approximated $ 3.1 million and $ 2.6 million for the six months ended June

30, 2022 and 2021, respectively.

Company, through its majority-owned subsidiary WorkSimpli, offers a subscription-based service providing a suite of software applications

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offers a discount for the monthly or yearly subscriptions being purchased, which is deducted at the time of payment at the initiation

of the contract term, therefore the Contract price is fixed and determinable at the contract initiation.

of the contract term;

therefore the Contract price is fixed and determinable at the contract initiation.

Monthly and annual subscriptions

for the service are recorded net of the Company’s known discount rates.

As of March 31, 2022 and December 31, 2021, the Company

As of June 30, 2022 and December 31, 2021, the Company

has accrued contract liabilities, as deferred revenue, of approximately $ 2.0 million and $ 1.5 million, respectively, which represent

1 unchanged sentence

trial period collections.

Customer discounts and allowances on WorkSimpli revenues approximated $ 448 thousand and $ 554 thousand, respectively,

during the three months ended March 31, 2022 and 2021.

the three months ended March 31, 2022 and 2021, the Company had the following disaggregated revenue:

OF DISAGGREGATED REVENUE

Three Months Ended March 31,

Customer discounts and allowances on WorkSimpli revenues approximated $ 580 thousand and $ 668 thousand for the

three months ended June 30, 2022 and 2021, respectively.

Customer discounts and allowances on WorkSimpli revenues approximated $ 1.0 million

and $ 1.2 million for the six months ended June 30, 2022 and 2021, respectively.

the three and six months ended June 30, 2022 and 2021, the Company had the following disaggregated revenue:

SCHEDULE OF DISAGGREGATED REVENUE

Three Months Ended June 30,

Six Months Ended June 30,

Telehealth revenue

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OF CONTRACT WITH CUSTOMER LIABILITY

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Beginning of period

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( 6,141,336 )

( 13,728,565 )

( 10,745,661 )

End of period

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and current economic conditions in its evaluation of an allowance for future refunds and chargebacks.

As of March 31, 2022 and December

As of June 30, 2022 and December

31, 2021, the reserve for sales returns and allowances was approximately $ 493 thousand and $ 477 thousand, respectively.

For all periods

presented, as noted above, the sales returns and allowances were recorded in accounts payable and accrued expenses on the unaudited condensed

consolidated balance sheets.

of March 31, 2022 and December 31, 2021, inventory primarily consisted of finished goods related to the Company’s OTC products

included in the telehealth revenue section of the table above.

Inventory is maintained at the Company’s third-party warehouse location

in Wyoming and at various Amazon fulfillment centers.

presented, as noted above, the sales returns and allowances were recorded in accrued expenses on the unaudited condensed consolidated

balance sheets.

of June 30, 2022 and December 31, 2021, inventory primarily consisted of finished goods related to the Company’s OTC products included

in the telehealth revenue section of the table above.

Inventory is maintained at the Company’s third-party warehouse location in

Wyoming and at various Amazon fulfillment centers.

The Company also maintains inventory at a company owned warehouse in Pennsylvania.

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inventory with the net realizable value and an allowance is made for writing down inventory to net realizable, if lower.

As of both March

31, 2022 and December 31, 2021, the Company recorded an inventory reserve in the amount of $ 57,481 .

of March 31, 2022 and December 31, 2021, the Company’s inventory consisted of the following:

As of both June

30, 2022 and December 31, 2021, the Company recorded an inventory reserve in the amount of $ 57 thousand.

of June 30, 2022 and December 31, 2021, the Company’s inventory consisted of the following:

SUMMARY OF INVENTORY

Finished Goods - Products

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previously paid.

As of March 31, 2022 and December 31, 2021, the Company has approximately $ 615 thousand and $ 204 thousand, respectively,

As of June 30, 2022 and December 31, 2021, the Company has approximately $ 441 thousand and $ 204 thousand, respectively,

of product deposits with multiple vendors for the purchase of raw materials or finished goods.

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of the product deposit.

As of March 31, 2022 and December 31, 2021, the Company approximates its implicit purchase commitments to be

As of June 30, 2022 and December 31, 2021, the Company approximates its implicit purchase commitments to be $ 1.9

million and $ 511 thousand, respectively.

As of March 31, 2022 and December 31, 2021, the vast majority of these product deposits

are with one vendor that manufacturers the Company’s finished goods inventory for its Shapiro hair care product line.

As of June 30, 2022 and December 31, 2021, the vast majority of these product deposits are with

one vendor that manufacturers the Company’s finished goods inventory for its Shapiro hair care product line.

Software Costs

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for capitalization, in accordance with ASC 350-40 , Internal-Use Software , are expensed as incurred.

As of March 31, 2022 and December

As of June 30, 2022 and December

31, 2021, the Company capitalized $ 8.1 million and $ 3.6 million, respectively, related to internally developed software costs which are

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and Intangible Assets

and intangible assets include those acquired in conjunction with the Cleared acquisition for which the purchase accounting is preliminary

(see Note 3).

Other amortizable intangible assets include:

(1) intangible assets acquired related to the ResumeBuild brand (with original

cost of approximately $ 4.5 million) with an estimated useful life of five years , (2) a customer relationship asset (with original cost

of approximately $ 1,007,000 ) with an estimated useful life of three years , (3) a purchased license (with original cost of $ 200,000 ) with

an estimated useful life of ten years and (4) purchased domain names (with original costs of $ 22,731 ) with estimated useful lives of

three years .

Intangible assets are amortized over their estimated lives using the straight-line method.

Costs incurred to renew or extend

the term of recognized intangible assets are capitalized and amortized over the useful life of the asset.

represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination.

Goodwill is not amortized but is tested for impairment annually or more frequently, if events or changes in circumstances indicate that

the asset may be impaired.

Goodwill in the amount of $ 9.5 million was acquired in conjunction with the Cleared acquisition during

the three months ended March 31, 2022, for which the purchase accounting is preliminary (see Note 3).

The Company recorded a $ 2.7

million goodwill impairment charge during the three months ended June 30, 2022 related to

a decline in the estimated fair value of Cleared as a result of a decline in the Cleared financial projections .

amortizable intangible assets include:

(1) intangible assets acquired related to the ResumeBuild brand (with original cost of approximately

$ 4.5 million) with an estimated useful life of five years, (2) a customer relationship asset (with original cost of approximately $ 1,007,000 )

with an estimated useful life of three years , (3) a purchased license (with original cost of $ 200,000 ), with an estimated useful life

of ten years and (4) purchased domain names (with original costs of $ 22,731 ) with estimated useful lives of three years .

Intangible assets

are amortized over their estimated lives using the straight-line method.

Costs incurred to renew or extend the term of recognized intangible

assets are capitalized and amortized over the useful life of the asset.

of Long-Lived Assets

assets are evaluated for impairment whenever events or changes in circumstances have indicated that an asset may not be recoverable and

are grouped with other assets to the lowest level for which identifiable cash flows are largely independent of the cash flows of other

groups of assets and liabilities (asset group).

If the sum of the projected undiscounted cash flows (excluding interest charges) of an

asset group is less than its carrying value and the fair value of an asset group is also less than its carrying value, the assets will

be written down by the amount by which the carrying value of the asset group exceeded its fair value.

However, the carrying amount of

a finite-lived intangible asset can never be written down below its fair value.

Any loss would be recognized in income from continuing

operations in the period in which the determination is made.

assets include equipment, capitalized software, and intangible assets subject to amortization.

Long-lived assets are reviewed for impairment

whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

If such assets are

considered to be impaired, an impairment is recognized as the amount by which the carrying amount of the assets exceeds the estimated

fair values of the assets.

As of June 30, 2022 and December 31, 2021, the Company determined that no events or changes in circumstances

existed that would indicate any impairment of its long-lived assets.

Protection Program

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if the borrower terminates employees or reduces salaries during the eight-week period.

unforgiven portion of the PPP loan is payable over two years at an interest rate of 1 %, with a deferral of payments for the first six

The Company intends to use the proceeds for purposes consistent with the PPP.

While the Company currently believes that its use

of the loan proceeds will meet the conditions for forgiveness of the loan, we cannot assure you that we will not take actions that could

cause the Company to be ineligible for forgiveness of the loan, in whole or in part.

the three months ended March 31, 2021, the Company had a total of $ 184,914 of its PPP loans forgiven by the U.S.

Small Business Administration

(“SBA”) (see Note 6).

As of both March 31, 2022 and December 31, 2021, the PPP loan balance was $ 63,400 and is reflected

on the Company’s unaudited condensed consolidated balance sheet as current liabilities, within notes payable, net.

The unforgiven portion of the PPP loan is payable

over two years at an interest rate of 1 %, with a deferral of payments for the first six months.

The Company used the proceeds for purposes

consistent with the PPP.

the six months ended June 30, 2022 and 2021, the Company had a total of $ 63,400 and $ 184,914 , respectively, of its PPP loans forgiven

Small Business Administration (“SBA”) (See Note 6).

As of June 30, 2022, the Company had no remaining PPP loan

As of December 31, 2021, the PPP loan balance was $ 63,400 and is reflected on the Company’s unaudited condensed consolidated

balance sheet as current liabilities, within notes payable, net.

Company files corporate federal, state, and local tax returns.

Conversion Labs PR and WorkSimpli file tax returns in Puerto Rico.

LifeMD PR and WorkSimpli file tax returns in Puerto Rico.

are limited liability companies and file separate tax returns with any tax liabilities or benefits passing through to its members.

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this guidance, a company may recognize the tax benefit from an uncertain tax position in its financial statements only if it is more

likely-than-not (i.e., a likelihood of more than 50%) that the tax position will be sustained on examination by the taxing authorities,

likely-than-not ( i.e.

, a likelihood of more than 50%) that the tax position will be sustained on examination by the taxing authorities,

based on the technical merits of the position.

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could be less than the average market price of the common shares:

OF POTENTIALLY DILUTIVE SECURITIES

Three Months Ended March 31,

SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES

June 30, 2022

June 30, 2021

June 30, 2022

June 30, 2021

Series B Preferred Stock

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Value of Financial Instruments

carrying value of the Company’s financial instruments, including cash, accounts receivable, accounts payable and accrued expenses

carrying value of the Company’s financial instruments, including cash, accounts receivable, accounts payable, accrued expenses,

and the face amount of notes payable approximate fair value for all periods presented.

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current manufacturers or pharmacies cease to perform adequately.

As of March 31, 2022, we utilized four (4) suppliers for fulfillment

As of June 30, 2022, we utilized four (4) suppliers for fulfillment

services, seven (7) suppliers for manufacturing finished goods, four (4) suppliers for packaging, bottling, and labeling, and two (2) suppliers

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manufacturing finished goods and four (4) suppliers for packaging, bottling, and labeling.

We purchased 100 % of our finished goods from

six (6) OTC manufacturers for both the three months ended March 31, 2022 and for the year ended December 31, 2021.

Adopted Accounting Pronouncements

Issued Accounting Pronouncements

October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

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statements commencing on the acquisition date.

preliminary purchase price was approximately $ 9.1 million, including cash paid upfront of approximately $ 1.0 million and payable

in the future of approximately $ 3.0 million, and contingent consideration of $ 5.1 million.

The purchase agreement includes up

to $ 72.8 million of potential earn-out payable in cash or stock upon achievement of revenue targets, which is recognized as contingent

consideration.

The Company, with the assistance of a

third-party valuation expert, estimated the preliminary fair value of the acquired tangible and identifiable intangible assets using

significant estimates such as revenue projections.

The allocation of the consideration transferred to the assets acquired and the liabilities

assumed is preliminary.

This can be revised as a result of additional information obtained due to the finalization of the valuation inputs

and assumptions as well as completing the assessment of the tax attributes of the business combination.

Additional adjustments that could

have a material impact on the Company’s results of operations and financial position may be recorded within the measurement period,

which will not exceed one year from the acquisition date.

preliminary purchase price was approximately $ 9.1 million, including cash paid upfront of approximately $ 1.0 million and payable in the

future of approximately $ 3.0 million, and contingent consideration of $ 5.1 million.

The purchase agreement includes up to $ 72.8 million

of potential earn-out payable in cash or stock upon achievement of revenue targets, which is recognized as contingent consideration.

The Company, with the assistance of a third-party valuation

expert, estimated the fair value of the acquired tangible and identifiable intangible assets using significant estimates such as revenue

The allocation of the consideration transferred to the assets acquired and the liabilities assumed is preliminary.

can be revised as a result of additional information obtained due to the finalization of the valuation inputs and assumptions as well

as completing the assessment of the tax attributes of the business combination.

Additional adjustments that could have a material impact

on the Company’s results of operations and financial position may be recorded within the measurement period, which will not exceed

one year from the acquisition date.

following table summarizes the preliminary acquisition date fair values of assets acquired and liabilities assumed:

OF FAIR VALUE OF ASSETS AND LIABILITIES

SCHEDULE OF FAIR VALUE OF ASSETS AND LIABILITIES

Preliminary purchase price, net of cash acquired

Accounts payable and other current liabilities

Goodwill and intangible assets

amount allocated to goodwill and intangible assets reflects the benefits the Company expects to realize from the growth of the acquisition’s

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and, accordingly, have not been presented.

the three months ended June 30, 2022, the Company recorded a reduction of $ 2.7 million to the Cleared contingent consideration as a result

of the remeasurement of the fair value.

The decline in the estimated fair value of the Cleared contingent consideration is a result of

a decline in the Cleared financial projections through the earnout period.

During the three months ended June 30, 2022, the Company also

recorded a $ 2.7 million goodwill impairment charge based on the decline in the Cleared financial projections (See Note 4).

February 2022, WorkSimpli closed on the ResumeBuild APA to purchase the related intangible assets associated with the ResumeBuild brand.

WorkSimpli paid to the Seller a purchase price of $ 4,500,000 , including cash paid upfront and contingent

consideration of $ 500 thousand .

In accordance with ASC 805, Business Combinations , the Company accounted for the ResumeBuild

APA as an acquisition of assets as substantially all the fair value of the gross assets acquired is concentrated in a group of similar

The Company has elected to group the complementary intangible assets acquired as a single brand intangible asset.

Additionally,

the Seller is entitled to quarterly payments equal to the greater of 15 % of net profits (as defined in the ResumeBuild APA) or $ 62,500 ,

WorkSimpli paid to the Seller a purchase price of $ 4,500,000 ,

including cash paid upfront and contingent consideration of $ 500,000 .

In accordance with

ASC 805, Business Combinations , the Company accounted for the ResumeBuild APA as an acquisition of assets as substantially all

the fair value of the gross assets acquired is concentrated in a group of similar assets.

The Company has elected to group the complementary

intangible assets acquired as a single brand intangible asset.

Additionally, the Seller is entitled to quarterly payments equal to the

greater of 15 %

of net profits (as defined in the ResumeBuild APA) or $ 62,500 ,

for a two-year period ending on the two-year anniversary of the closing of the Acquisition.

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4 – GOODWILL AND INTANGIBLE ASSETS

of March 31, 2022 and December 31, 2021, the Company has the following amounts related to goodwill and intangible assets:

OF GOODWILL AND INTANGIBLE ASSETS

of June 30, 2022 and December 31, 2021, the Company has the following amounts related to goodwill and intangible assets:

SCHEDULE OF GOODWILL AND INTANGIBLE ASSETS

Goodwill and Intangible Assets as at:

Preliminary Goodwill – Cleared Acquisition

Goodwill – Cleared Acquisition

Other Amortizable Intangible Assets:

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Total net goodwill and amortizable intangible assets

aggregate amortization expense of the Company’s intangible assets for the three months ended March 31, 2022 and 2021 was approximately

the three months ended June 30, 2022, the Company recorded a $ 2.7 million goodwill impairment charge related to a decline in the estimated

fair value of Cleared as a result of a decline in the Cleared financial projections.

aggregate amortization expense of the Company’s intangible assets for the three months ended June 30, 2022 and 2021 was approximately

$ 226,893 and $ 255,937 , respectively.

The aggregate amortization expense of the Company’s intangible assets for the six months ended

June 30, 2022 and 2021 was approximately $ 341,287 and $ 339,840 , respectively.

Total amortization expense for the remainder of 2022 is

Total amortization expense for

2023 through 2026 is approximately $ 900,000 per year and $ 112,500 for 2027.

Total amortization expense for 2023 through 2026 is approximately $ 900,000 per year and $ 112,500 for 2027.

5 – ACCRUED EXPENSES

of March 31, 2022 and December 31, 2021, the Company has the following amounts related to accrued expenses:

OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES

of June 30, 2022 and December 31, 2021, the Company has the following amounts related to accrued expenses:

SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accrued selling and marketing expenses

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Company satisfies applicable employee headcount and compensation requirements.

The Company currently believes that a majority of the

PPP Loan proceeds will qualify for debt forgiveness;

however, there can be no assurance that the Company will qualify for forgiveness

from the SBA until it occurs.

During the three months ended March 31, 2021, the Company had a total of $ 184,914 of its PPP loans forgiven

by the SBA which is included in gain on debt forgiveness on the accompanying unaudited condensed consolidated statement of operations.

As of both March 31, 2022 and December 31, 2021, the PPP loan balance was $ 63,400 and is reflected on the Company’s unaudited condensed

consolidated balance sheet as current liabilities, within notes payable, net.

During the six months ended June 30, 2022 and 2021, the

Company had a total of $ 63,400 and $ 184,914 , respectively, of its PPP loans forgiven by the SBA which is included in gain on debt forgiveness

on the accompanying unaudited condensed consolidated statement of operations.

As of June 30, 2022, the Company had no remaining PPP loan

As of December 31, 2021, the PPP loan balance was $ 63,400 and is reflected on the Company’s unaudited condensed consolidated

balance sheet as current liabilities, within notes payable, net.

interest expense on notes payable, inclusive of amortization of debt discounts, amounted to $ 0 and $ 229,351 for the three months ended

March 31, 2022 and 2021, respectively.

June 30, 2022 and 2021, respectively.

Total interest expense on notes payable, inclusive of amortization of debt discounts, amounted

to $ 0 and $ 368,814 for the six months ended June 30, 2022 and 2021, respectively.

7 – STOCKHOLDERS’ EQUITY

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The Company has approximately $ 59.5 million available under the ATM Sales Agreement and $ 32 million available under the 2021 Shelf as

of March 31, 2022.

the three months ended March 31, 2022, the Company issued an aggregate of 25,535 shares of common stock related to the cashless exercise

the three months ended March 31, 2022, the Company issued an aggregate of 22,000 shares of common stock related to the exercise of warrants

of June 30, 2022.

the six months ended June 30, 2022, the Company issued an aggregate of 25,535 shares of common stock related to the cashless exercise

the six months ended June 30, 2022, the Company issued an aggregate of 90,400 shares of common stock related to the exercise of options

for gross proceeds of $ 90,400 .

the six months ended June 30, 2022, the Company issued an aggregate of 22,000 shares of common stock related to the exercise of warrants

for gross proceeds of $ 38,500 .

Interest Purchase Agreement

July 31, 2019 the Company entered into a certain membership interest purchase agreement (the “MIPA”) by and between the Company,

Conversion Labs PR, a majority owned subsidiary, Taggart International Trust, an entity controlled by the Company’s Chief Executive

Justin Schreiber, and American Nutra Tech LLC, a company controlled by its Chief Innovation and Marketing Officer, Mr.

Galluppi (“Mr.

July 31, 2019 the Company entered into a certain membership interest purchase agreement (the “MIPA”) by and between the

Conversion Labs PR (now “LifeMD PR”), a majority owned subsidiary;

Taggart International Trust, an entity

controlled by the Company’s Chief Executive Officer, Mr.

Justin Schreiber;

and American Nutra Tech LLC, a company controlled

by its Chief Innovation and Marketing Officer, Mr.

Stefan Galluppi (“Mr.

Schreiber, Taggart International Trust, Mr.

Galluppi and American Nutra Tech LLC each a “Related Party”

and collectively, the “Related Parties”).

Pursuant to the MIPA, the Company purchased 21.83333 % of the membership interests

(the “Remaining Interests”) of Conversion Labs PR from the Related Parties, bringing the Company’s ownership of Conversion

Labs PR to 100 % .

and American Nutra Tech LLC each a “Related Party” and collectively, the “Related Parties”).

Pursuant to the

MIPA, the Company purchased 21.83333 %

of the membership interests (the “Remaining Interests”) of Conversion Labs PR from the Related Parties, bringing the

Company’s ownership of Conversion Labs PR to 100 % .

consideration for the Company’s purchase of the Remaining Interests from the Related Parties, Mr.

Schreiber and Mr.

Galluppi agreed

to cancel all potential issuances of restricted stock and or options related to their employment with the Company, in exchange for the

immediate issuance of 500,000 shares of the Company’s restricted common stock to each of Mr.

agreed to cancel all potential issuances of restricted stock and or options related to their employment with the Company, in

exchange for the immediate issuance of 500,000

shares of the Company’s restricted common stock to each of Mr.

Schreiber and Mr.

Galluppi (the “Initial

Issuances”) (equal to 1,000,000 shares in the aggregate).

Issuances”) (equal to 1,000,000

shares in the aggregate).

Schreiber and Mr.

Galluppi were also entitled to additional issuances

pursuant to certain milestones as follows:

(i) 500,000 shares of the Company’s Common Stock to each of Mr.

Galluppi were also entitled to additional issuances pursuant to certain milestones

shares of the Company’s Common Stock to each of Mr.

Schreiber and Mr.

( 1,000,000 shares in the aggregate) on the business day following a consecutive ninety (90) day period, during which the Company’s

Common Stock shall have traded at an average price per share equal to or higher than $ 2.50 (the “First Milestone”), and (ii)

an additional 500,000 shares of the Company’s Common Stock to each of Mr.

Galluppi ( 1,000,000

shares in the aggregate) on the business day following a consecutive ninety (90) day period, during which the Company’s Common

Stock shall have traded at an average price per share equal to or higher than $ 2.50

(the “First Milestone”), and (ii) an additional 500,000

shares of the Company’s Common Stock to each of Mr.

Schreiber and Mr.

Galluppi ( 1,000,000 shares in the aggregate)

following a consecutive ninety (90) day period during which the Common Stock shall have traded at an average price per share equal to

or higher than $ 3.75 (the “Second Milestone” and, together with the First Milestones, the “Milestones”).

achieved the Milestones, the Company, on December 9, 2020, issued an aggregate of 1,000,000 shares of the Company’s Common Stock

to each of Mr.

Galluppi ( 1,000,000

shares in the aggregate) following a consecutive ninety (90) day period during which the Common Stock shall have traded at an

average price per share equal to or higher than $ 3.75

(the “Second Milestone” and, together with the First Milestones, the “Milestones”).

Having achieved the

Milestones, the Company, on December 9, 2020, issued an aggregate of 1,000,000

shares of the Company’s Common Stock to each of Mr.

Schreiber and Mr.

Galluppi (the “Milestone Shares”) ( 2,000,000 shares in the aggregate).

The Milestone Shares

are subject to the previously disclosed 180-day Lock-Up Agreement each of Mr.

Galluppi (the “Milestone Shares”) ( 2,000,000

shares in the aggregate).

The Milestone Shares are subject to the previously disclosed 180-day Lock-Up Agreement, each of which Mr.

Schreiber and Mr.

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30, 2020 for the issuance of these 2,000,000 shares, of which 1,200,000 shares were issued during the three months ended March 31, 2021.

Stock Transactions During the Three Months Ended March 31, 2022

the three months ended March 31, 2022, the Company issued an aggregate of 147,500 shares of common stock for services expensed in prior

Stock Transactions During the Six Months Ended June 30, 2022

the six months ended June 30, 2022, the Company issued an aggregate of 147,500 shares of common stock for services expensed in prior

Noncontrolling

the three months ended March 31, 2022, net income attributed to the non-controlling interest amounted to $ 24,726 and for the three months

ended March 31, 2021, net loss attributed to the non-controlling interest amounted to $ 270,503 .

During both the three months ended March

the three months ended June 30, 2022, net income attributed to the non-controlling interest amounted to $ 46,001 and for the three months

ended June 30, 2021, net loss attributed to the non-controlling interest amounted to $ 197,973 .

During both the three months ended June

30, 2022 and 2021, the Company paid distributions to non-controlling shareholders of $ 36,000 .

For the six months ended June 30, 2022,

net income attributed to the non-controlling interest amounted to $ 70,727 and for the six months ended June 30, 2021, net loss attributed

to the non-controlling interest amounted to $ 468,476 .

During both the six months ended June 30, 2022 and 2021, the Company paid distributions

to non-controlling shareholders of $ 72,000 .

Software Restructuring Transaction

January 22, 2021 (the “WSS Effective Date”), the Company consummated the WSS Restructuring.

To effect the WSS Restructuring

the Company’s wholly-owned subsidiary Conversion Labs PR, entered into a series of membership interest exchange agreements, pursuant

to which, Conversion Labs PR exchanged that certain promissory note, dated May 8, 2019 with an outstanding balance of $ 375,823 (the “CVLBPR

Note”), issued by WSS in favor of Conversion Labs PR, for 37,531 newly issued membership interests of WSS (the “Exchange”).

Upon consummation of the Exchange the CVLBPR Note was extinguished.

To effect the WSS

Restructuring the Company’s wholly-owned subsidiary Conversion Labs PR (now “LifeMD PR”), entered into a series of

membership interest exchange agreements, pursuant to which, Conversion Labs PR exchanged that certain promissory note, dated May 8,

2019 with an outstanding balance of $ 375,823

(the “CVLB PR Note”), issued by WSS in favor of Conversion Labs PR, for 37,531

newly issued membership interests of WSS (the “Exchange”).

Upon consummation of the Exchange the CVLB PR Note was

extinguished.

Concurrently,

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January 1, 2022, the Plan provided for the issuance of up to 3,300,000 shares of Common Stock.

Remaining authorization under the 2020

Plan was 276,052 shares as of March 31, 2022.

June 16, 2022, at the Annual Meeting of Stockholders, the stockholders of the Company approved an amendment to the 2020 Plan to increase

the maximum number of shares of the Company’s common stock available for issuance under the 2020 Plan by 1,500,000 shares.

June 30, 2022, the Plan provided for the issuance of up to 4,800,000 shares of Common Stock.

Remaining authorization under the 2020 Plan

was 1,787,885 shares as of June 30, 2022.

forms of award agreements to be used in connection with awards made under the 2020 Plan to the Company’s executive officers and

non-employee directors are:

of Non-Qualified Option Agreement (Non-Employee Director Awards)

of Non-Qualified Option Agreement (Employee Awards);

of Restricted Stock Award Agreement.

Form of Non-Qualified Option

Agreement (Non-Employee Director Awards)

Form of Non-Qualified Option

Agreement (Employee Awards);

Form of Restricted Stock

Award Agreement.

the Company had granted service-based stock options and performance-based stock options separate from the 2020 Plan.

the three months ended March 31, 2022, the Company issued an aggregate of 238,500 stock options to employees under the 2020 Plan and

the prior plan.

These stock options have a contractual term of 4 to 5 years and vest in increments which fully vest the options over

a three-year period, dependent on the specific agreements’ terms.

following is a summary of outstanding options activity under our 2020 Plan for the three months ended March 31, 2022:

the six months ended June 30, 2022, the Company issued an aggregate of 288,500 stock options to employees under the 2020 Plan and the

These stock options have a contractual term of 4 to 5 years and vest in increments, which fully vest the options over a two

to three-year period, dependent on the specific agreements’ terms.

following is a summary of outstanding options activity under our 2020 Plan for the six months ended June 30, 2022:

OF OPTION ACTIVITY

Number of Shares

Exercise Price

Balance, December 31, 2021

$ 4.57 – 21.02

Cancelled/Forfeited/Expired

Balance at March 31, 2022

$ 3.28 – 21.02

Balance at June 30, 2022

Exercisable at December 31, 2021

$ 4.57 – 21.02

Exercisable at March 31, 2022

$ 3.28 – 21.02

total fair value of the options granted was approximately $ 142,247 , which was determined by the Black-Scholes Pricing Model with the

following assumptions:

Exercisable at June 30, 2022

total fair value of the options granted was $ 711,312 , which was determined by the Black-Scholes Pricing Model with the following assumptions:

dividend yield of 0 % , expected term of 4 years, volatility of 135.65 % – 465.55 % , and risk-free rate of 0.90 % – 1.62 % .

Total compensation expense under the 2020 Plan options above was approximately $ 1,644,490 and $ 1,181,505 for the three months ended March

31, 2022 and 2021, respectively, with unamortized expense remaining of approximately $ 11,916,040 as of March 31, 2022.

following is a summary of outstanding service-based options activity (prior to the establishment of our 2020 Plan above) for the three

months ended March 31, 2022:

compensation expense under the 2020 Plan options above was $ 1,840,116 and $ 1,239,421 for the three months ended June 30, 2022 and 2021,

respectively, with unamortized expense remaining of $ 9,225,969 as of June 30, 2022.

Total compensation expense under the 2020 Plan options

above was $ 3,484,606 and $ 2,196,074 for the six months ended June 30, 2022 and 2021, respectively.

following is a summary of outstanding service-based options activity (prior to the establishment of our 2020 Plan above) for the six

months ended June 30, 2022:

SCHEDULE OF OPTION ACTIVITY

Options Outstanding Number of Shares

Exercise Price per Share

Weighted Average Remaining Contractual Life

Weighted Average Exercise Price per Share

Outstanding Number of Shares

Price per Share

Average Remaining Contractual Life

Average Exercise Price per Share

Balance, December 31, 2021

Balance at March 31, 2022

Balance at June 30, 2022

Exercisable December 31, 2021

Exercisable at March 31, 2022

total fair value of the options granted was approximately $ 205,995 , which was determined by the Black-Scholes Pricing Model with the

following assumptions:

Exercisable at June 30, 2022

total fair value of the options granted was $ 205,995 , which was determined by the Black-Scholes Pricing Model with the following assumptions:

dividend yield of 0 % , expected term of 4 years, volatility of 420.16 % and risk-free rate of 1.37 % .

Total compensation

expense under the above service-based option plan was approximately $ 550,400 and $ 406,534 for the three months ended March 31, 2022 and

2021, respectively, with unamortized expense remaining of approximately $ 4,349,079 as of March 31, 2022.

All of the service-based options

exercised during the three months ended March 31, 2022, were exercised on a cashless basis which resulted in 25,535 shares issued.

following is a summary of outstanding performance-based options activity for the three months ended March 31, 2022:

Total compensation expense under the

above service-based option plan was $ 547,381 and $ 529,508 for the three months ended June 30, 2022 and 2021, respectively, with unamortized

expense remaining of $ 3,801,698 as of June 30, 2022.

Total compensation expense under the above service-based option plan was $ 1,097,781

and $ 936,493 for the six months ended June 30, 2022 and 2021, respectively.

Of the total service-based options exercised during the six

months ended June 30, 2022, 40,000 options were exercised on a cashless basis, which resulted in 25,535 shares issued and 90,400 options

were exercised for cash.

following is a summary of outstanding performance-based options activity for the six months ended June 30, 2022:

OF OPTION ACTIVITY

Options Outstanding Number of Shares

Exercise Price per Share

Weighted Average Remaining Contractual Life

Weighted Average Exercise Price per Share

Outstanding Number of Shares

Price per Share

Average Remaining Contractual Life

Average Exercise Price per Share

Balance at December 31, 2021

Balance at March 31, 2022

Balance at June 30, 2022

Exercisable December 31, 2021

Exercisable at March 31, 2022

total fair value of the options granted was approximately $ 617,980 , which was determined by the Black-Scholes Pricing Model with the

following assumptions:

Exercisable at June 30, 2022

total fair value of the options granted was $ 617,980 , which was determined by the Black-Scholes Pricing Model with the following assumptions:

dividend yield of 0 % , expected term of 3.5 years, volatility of 444 % and risk-free rate of 1.37 % .

Total compensation

expense under the above performance-based option plan was approximately $ 105,797 for the three months ended March 31, 2022, with unamortized

expense remaining of approximately $ 317,391 .

No compensation expense was recognized on the performance-based option plan above for the

three months ended March 31, 2021 as the performance terms had not been met or were not probable.

Total compensation expense under the

above performance-based option plan was $ 105,797 and $ 173,397 for the three months ended June 30, 2022 and 2021, respectively, with unamortized

expense remaining of $ 211,594 .

Total compensation expense under the above performance-based option plan was $ 211,594 and $ 173,397 for

the six months ended June 30, 2022 and 2021, respectively.

Stock Units (RSUs) (under the 2020 Plan)

summary of outstanding RSU activity under our 2020 Plan is as follows:

SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE

RSU Outstanding

following is a summary of outstanding RSU activity under our 2020 Plan for the six months ended June 30, 2022:

OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE

RSUs Outstanding

Number of Shares

Balance at December 31, 2021

Balance at March 31, 2022

total fair value of the 547,500 RSUs granted was approximately $ 1,713,025 which was determined using the fair value of the quoted market

price on the date of grant.

Total compensation expense under the 2020 Plan RSUs above was approximately $ 976,120 and $ 12,163 for the

three months ended March 31, 2022 and 2021, respectively, with unamortized expense remaining of approximately $ 4,800,769 as of March

During the three months ended March 31 2022, 60,375 RSUs vested, of which 47,500 RSUs were issued.

Balance at June 30, 2022

total fair value of the 563,000 RSUs granted was $ 1,751,235 which was determined using the fair value of the quoted market price on the

date of grant.

Total compensation expense under the 2020 Plan RSUs above was $ 595,038 and $ 0 for the three months ended June 30, 2022

and 2021, respectively, with unamortized expense remaining of $ 4,243,941 as of June 30, 2022.

Total compensation expense under the 2020

Plan RSUs above was $ 1,571,158 and $ 357,163 for the six months ended June 30, 2022 and 2021, respectively.

During the six months ended

June 30, 2022, 87,625 RSUs vested, of which 47,500 RSUs were issued.

(outside of 2020 Plan)

Company granted 620,000 RSUs outside of the 2020 Plan during the year ended December 31, 2021.

The total fair value of these RSUs was

approximately $ 6,867,600 .

Total compensation expense for RSUs outside of the 2020 Plan was $ 591,000 and $ 120,600 for the three months

ended March 31, 2022 and 2021, respectively, with unamortized expense remaining of approximately $ 5,430,000 as of March 31, 2022.

the three months ended March 31, 2022, 50,000 RSUs vested and were issued.

As of March 31, 2022, 550,000 RSUs outside of the 2020 Plan

remain outstanding.

following is a summary of outstanding and exercisable warrants activity during the three months ended March 31, 2022:

following is a summary of outstanding RSU activity outside of the 2020 Plan for the six months ended June 30, 2022:

OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE

Warrants Outstanding Number of Shares

Exercise Price per Share

Weighted Average Remaining Contractual Life

Weighted Average Exercise Price per Share

RSUs Outstanding

Number of Shares

Balance at December 31, 2021

Balance at June 30, 2022

total fair value of the 60,000 RSUs granted was $ 215,400 which was determined using the fair value of the quoted market price on the

date of grant.

Total compensation expense for RSUs outside of the 2020 Plan was $ 347,700 and $ 0 for the three months ended June 30, 2022

and 2021, respectively, with unamortized expense remaining of $ 5,297,700 as of June 30, 2022.

Total compensation expense for RSUs outside

of the 2020 Plan was $ 938,700 and $ 0 for the six months ended June 30, 2022 and 2021, respectively.

During the six months ended June

30, 2022, 65,000 RSUs vested, of which 50,000 were issued.

following is a summary of outstanding and exercisable warrants activity during the six months ended June 30, 2022:

OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE

Outstanding Number of Shares

Price per Share

Average Remaining Contractual Life

Average Exercise Price per Share

Balance at December 31, 2021

Cancelled/Forfeited/Expired

Balance at March 31, 2022

Balance at June 30, 2022

Exercisable December 31, 2021

Exercisable March 31, 2022

compensation expense on the above warrants for services was approximately $ 604,974 for both the three months ended March 31, 2022 and

2021 with unamortized expense remaining of approximately $ 1,042,253 .

Exercisable June 30, 2022

compensation expense on the above warrants for services was $ 604,974 for both the three months ended June 30, 2022 and 2021, with unamortized

expense remaining of $ 437,279 as of June 30, 2022.

Total compensation expense on the above warrants for services was $ 1,209,948 for both

the six months ended June 30, 2022 and 2021.

total stock-based compensation expense related to common stock issued for services, service-based stock options, performance-based stock

options, warrants and RSUs amounted to approximately $ 4,472,781 and $ 2,325,775 for the three months ended March 31, 2022 and 2021, respectively.

Such amounts are included in general and administrative expenses in the unaudited condensed consolidated statement of operations.

expense remaining related to service-based stock options, performance-based stock options, warrants and RSUs was approximately $ 27,855,532

as of March 31, 2022.

options, warrants and RSUs amounted to $ 4,041,006 and $ 2,547,300 for the three months ended June 30, 2022 and 2021, respectively.

total stock-based compensation expense related to common stock issued for services, service-based stock options, performance-based stock

options, warrants and RSUs amounted to $ 8,513,787 and $ 4,873,075 for the six months ended June 30, 2022 and 2021, respectively.

amounts are included in general and administrative expenses in the unaudited condensed consolidated statement of operations.

expense remaining related to service-based stock options, performance-based stock options, warrants and RSUs was $ 23,218,181 as of June

February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which supersedes all existing guidance on accounting for leases

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table below reconciles the undiscounted future minimum lease payments under the above noted operating leases to the total operating lease

liabilities recognized on the consolidated balance sheet as of March 31, 2022:

OF MATURITY OF OPERATING LEASE LIABILITIES

liabilities recognized on the consolidated balance sheet as of June 30, 2022:

SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES

Remainder of fiscal year 2022

4 unchanged sentences

Present value of operating lease liabilities

lease expenses were $ 202,412 and $ 93,410 for the three months ended March 31, 2022 and 2021, respectively, and were included in other

operating expenses in our consolidated statement of operations.

lease expenses were $ 201,279 and $ 97,093 for the three months ended June 30, 2022 and 2021, respectively, and $ 403,691 and $ 190,503 for

the six months ended June 30, 2022 and 2021, respectively, and were included in other operating expenses in our consolidated statement

of operations.

cash flow information related to operating lease liabilities consisted of the following:

OF CASH FLOW RELATED TO OPERATING LEASE LIABILITIES

SCHEDULE OF CASH FLOW RELATED TO OPERATING LEASE LIABILITIES

Cash paid for operating lease liabilities

balance sheet information related to operating lease liabilities consisted of the following:

OF BALANCE SHEETS RELATED TO OPERATING LEASE LIABILITIES

March 31, 2022

SCHEDULE OF BALANCE SHEETS RELATED TO OPERATING LEASE LIABILITIES

June 30, 2022

December 31, 2021

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sold – advertising and operating expenses directly related to the marketing of the licensed products.

As of March 31, 2022 and

December 31, 2021, no amount was included in accounts payable and accrued expenses in regard to this agreement.

As of June 30, 2022 and December

31, 2021, no amount was included in accounts payable and accrued expenses in regard to this agreement.

2018, the Company entered into a license agreement (the “Alphabet Agreement”) with M.ALPHABET, LLC (“Alphabet”),

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Alphabet a royalty equal to 13 % of Gross Receipts (as defined in the Agreement) realized from the sales of Licensed Products.

were earned or owed as of March 31, 2022 .

were earned or owed as of June 30, 2022.

execution of the Alphabet Agreement, Alphabet was granted a 10 -year stock option to purchase 20,000 shares of the Company’s common

13 unchanged sentences

equaling the total expected product acceptance cost in excess of the product deposit.

As of March 31, 2022 and December 31, 2021, the

As of June 30, 2022 and December 31, 2021, the

Company approximates its implicit purchase commitments to be $ 1.9 million and $ 511 thousand, respectively.

the normal course of business operations, the Company may become involved in various legal matters.

As of March 31, 2022, other than

as set forth below, the Company’s management does not believe that there are any potential legal matters that could have an adverse

As of June 30, 2022, other than as

set forth below, the Company’s management does not believe that there are any potential legal matters that could have an adverse

effect on the Company’s consolidated financial position.

4 unchanged sentences

The Harborside Complaint alleges, among other things, that the Company

breached a Consulting Services Agreement dated as of June 5, 2019, and Harborside was entitled to 1

million shares ( i.e ., 200,000

shares post 5-for-1

reverse stock split ) in the Company if the Conversion

Labs Rx business achieved a topline revenue of $ 10

million and an additional 1

million shares ( i.e ., 200,000

shares post 5-for-1

reverse stock split ) for each additional $ 5

million in topline revenue up to a maximum of

million shares ( i.e.

shares post 5-for-1

reverse stock split ).

breached a Consulting Services Agreement dated as of June 5, 2019, and Harborside was entitled to 1 million shares ( i.e ., 200,000

shares post 5-for-1 reverse stock split) in the Company if the Conversion Labs Rx business achieved a topline revenue of $ 10 million

and an additional 1 million shares ( i.e ., 200,000 shares post 5-for-1 reverse stock split) for each additional $ 5 million in topline

revenue up to a maximum of 5 million shares ( i.e.

, 1,000,000 shares post 5-for-1 reverse stock split).

The Complaint further alleges

4 unchanged sentences

The Harborside Complaint

implies between $ 5,020,000

and $ 33,020,000

in alleged damages related to failure to award

the aforementioned stock but only specifically states that “Harborside has incurred damages in excess of $ 75,000 ,

with the exact amount to be determined with specificity at trial” for each of the 5 counts.

On February 11, 2022, the Company filed

a Motion to Dismiss the Harborside Complaint, which Harborside opposed.

The Company replied on April 4, 2022 and is currently

awaiting a decision from the Court on whether the case will be fully or partially dismissed.

The Company intends to continue to vigorously

defend against this action.

As this action is in its preliminary phase, a potential loss cannot yet be estimated.

implies between $ 5,020,000 and $ 33,020,000 in alleged damages related to failure to award the aforementioned stock but only specifically

states that “Harborside has incurred damages in excess of $ 75,000 , with the exact amount to be determined with specificity at trial”

for each of the 5 counts.

On February 11, 2022, the Company filed a Motion to Dismiss the Harborside Complaint, which Harborside opposed.

The Company replied on April 4, 2022 and was awaiting a decision from the Court on whether the case will be fully or partially dismissed.

In the meantime, the parties agreed to mediate both cases ( Harborside Advisors LLC v.

21-cv-10593, and Specialty Medical Drugstore, LLC D/B/A GoGoMeds v.

21-cv-10599, noted below)

together (without prejudice that it will be one mediation nor used to support consolidation should mediation fail), with a target

completion date of on or before August 26, 2022.

The parties have discussed potential mediators.

The court granted a 60-day stay

in the Specialty Medical Drugstore, LLC D/B/A GoGoMeds v.

LifeMD, Inc., Case No.

21-cv-10599, and the parties were amenable in

the Harborside Advisors LLC v.

21-cv-10593, to the Court foregoing any decision on our motion to dismiss

until after mediation.

The Company intends to continue to vigorously defend against this action.

As of June 30, 2022, the Company

has accrued all amounts it deems appropriate for this matter.

December 10, 2021, a purported breach of contract, unjust enrichment, quantum meruit, and account stated lawsuit, captioned Specialty

4 unchanged sentences

a Strategic Partnership Agreement (dated May 27, 2019) (the “SPA”) by the Company not paying two invoices (#3269 and 3270)

totaling $ 273,859 , and, therefore, “LifeMD has been unjustly enriched in an amount in excess of $ 273,859 , with the exact amount

to be determined with specificity at trial.” Further, GoGoMeds alleges that “to the extent that the SPA is inapplicable,

GoGoMeds is entitled to recover from LifeMD from quantum meruit” because “GoGoMeds conferred a benefit on LifeMD by fulfilling

over 17,000 prescriptions and over the counter drug orders for LifeMD’s clients.” On February 11, 2022, the Company filed

its Answer and Counterclaim to the GoGoMeds Complaint, pleading the affirmative defenses that the claims are barred, in whole or in part:

totaling $ 273,859 ,

and, therefore, “LifeMD has been unjustly enriched in an amount in excess of $ 273,859 ,

with the exact amount to be determined with specificity at trial.” Further, GoGoMeds alleges that “to the extent that the

SPA is inapplicable, GoGoMeds is entitled to recover from LifeMD from quantum meruit” because “GoGoMeds conferred a benefit

on LifeMD by fulfilling over 17,000 prescriptions and over the counter drug orders for LifeMD’s clients.” On February 11,

2022, the Company filed its Answer and Counterclaim to the GoGoMeds Complaint, pleading the affirmative defenses that the claims are

barred, in whole or in part:

(i) because they fail to state claims upon which relief can be granted;

(ii) by breach of contract by plaintiff;

(iii) by offset, recoupment,

and/or unjust enrichment to plaintiff;

(iii) by offset, recoupment, and/or unjust enrichment to plaintiff;

(iv) by accord and satisfaction;

(v) for failure of condition precedent;

(vi) because adequate

remedies at law exist;

(vi) because adequate remedies at law exist;

(vii) by failure to mitigate;

(viii) by the doctrine of unclean hands;

and (ix) by consent ratification, waiver,

excuse, and/or estoppel, (x) as well as that attorney fees and costs, as well as special, indirect, incidental, and/or consequential

damages are not recoverable.

and (ix) by consent

ratification, waiver, excuse, and/or estoppel, (x) as well as that attorney fees and costs, as well as special, indirect, incidental,

and/or consequential damages are not recoverable.

Further, the Company counterclaimed against GoGoMeds for:

(a) breach of contract for failing to:

adequate customer service and related pharmacy services;

(ii) charge LifeMD actual costs for prescription and over the counter drugs

(including shipping), as was contractually required;

and (iii) provide regular reports and allow audits for review to establish adequate

service and accurate costs;

(b) trade secret misappropriation of the LifeMD Information, Data, and Materials, as defined therein;

unjust enrichment of GoGoMeds through its retention of such LifeMD Information, Data, and Materials, and for the benefit of the creation

of the GoGoCare telehealth company;

(d) conversion by GoGoMeds by exercising unauthorized dominion and control over the LifeMD Information,

Data, and Materials;

(a) breach of contract for

(i) provide adequate customer service and related pharmacy services;

(ii) charge LifeMD actual costs for prescription and

over the counter drugs (including shipping), as was contractually required;

and (iii) provide regular reports and allow audits for review

to establish adequate service and accurate costs;

(b) trade secret misappropriation of the LifeMD Information, Data, and Materials, as

defined therein;

benefit of the creation of the GoGoCare telehealth company;

(d) conversion by GoGoMeds by exercising unauthorized dominion and control

over the LifeMD Information, Data, and Materials;

and (f) an accounting.

GoGoMeds’ responded to the counterclaims on March 4, 2022 and the parties

have commenced fact discovery.

The Company intends to continue to vigorously defend against this action.

As this action is in its preliminary

phase, a potential loss cannot yet be estimated.

February 28, 2022, a purported breach of contract lawsuit (with six counts of alleged breach, and indemnity reliance concerning reasonable

costs and expenses), captioned William Blair LLC v.

2022L001978, was filed in the Circuit Court of Cook

County, Illinois County Department, Law Division against the Company (the “Blair Complaint”).

The Blair Complaint alleges,

among other things, that LifeMD breached an engagement letter agreement entered into on January 7, 2021 with Blair that concerned potential

debt financing.

In particular, Blair alleges that the Company breached its obligations by, inter alia :

(i) failing to advise Blair

of, and ultimately completing, a debt financing transaction with a different investment banking firm on or about June 3, 2021;

(ii) reproducing

several pages from a Confidential Information Brochure used in the Company’s debt financing transaction with a different investment

banking firm;

(iii) failing to provide Blair with a right of first refusal to be its joint active bookrunning manager for a common stock

sales agreement that it executed on or about June 3, 2021, through a different investment banking firm;

(iv) failing to provide Blair

with a right of first refusal to be its joint active bookrunning manager for a common stock sales agreement that it executed on or about

September 28, 2021, through a different investment banking firm (despite the Company having formally terminated the engagement letter

with Blair on or about July 16, 2021);

(v) failing to provide Blair with a right of first refusal to be its joint active bookrunning

manager for a preferred stock offering that it executed on or about September 28, 2021, through two different investment banking firms

as bookrunning co-managers (despite the Company having formally terminated the engagement letter with Blair on or about July 16, 2021);

and (vi) purchasing a convertible note from a pharmaceutical investor in connection with its acquisition of all outstanding shares of

allergy telehealth platform, Cleared.

The Blair Complaint seeks damages adequate to compensate Blair for the aforementioned alleged breaches

, which implicitly meets or exceeds the purported $ 1,000,000 minimum fee in the engagement letter), as well as reasonable

costs and expenses incurred in this action.

The Company’s response to the Blair Complaint is due on May 20, 2022.

GoGoMeds’ responded to the counterclaims

on March 4, 2022 and the parties have commenced fact discovery.

In the meantime, the parties agreed to mediate both cases ( Harborside

Advisors LLC v.

21-cv-10593, and Specialty Medical Drugstore, LLC D/B/A GoGoMeds v.

21-cv-10599) together (without prejudice that it will be one mediation nor used to support consolidation should mediation fail),

with a target completion date of on or before August 26, 2022.

The court granted a 60-day stay in the Specialty Medical Drugstore,

LLC D/B/A GoGoMeds v.

LifeMD, Inc., Case No.

21-cv-10599, and the parties were amenable in the Harborside Advisors LLC v.

21-cv-10593, to the court foregoing any decision on our motion to dismiss until after mediation.

The Company intends

to vigorously defend against this action.

to continue to vigorously defend against this action.

As this action is in its preliminary phase, a potential loss cannot yet be estimated.

February 28, 2022, a purported breach of contract lawsuit (with six counts of alleged breach, and indemnity reliance concerning

reasonable costs and expenses), captioned William Blair LLC v.

2022L001978, was filed in the Circuit

Court of Cook County, Illinois County Department, Law Division against the Company (the “Blair Complaint”).

Complaint alleges, among other things, that LifeMD breached an engagement letter agreement entered into on January 7, 2021 with

Blair that concerned potential debt financing.

In particular, Blair alleges that the Company breached its obligations by, inter

(i) failing to advise Blair of, and ultimately completing, a debt financing transaction with a different investment

banking firm on or about June 3, 2021;

(ii) reproducing several pages from a Confidential Information Brochure used in the

Company’s debt financing transaction with a different investment banking firm;

(iii) failing to provide Blair with a right of

first refusal to be its joint active bookrunning manager for a common stock sales agreement that it executed on or about June 3,

2021, through a different investment banking firm;

(iv) failing to provide Blair with a right of first refusal to be its joint

active bookrunning manager for a common stock sales agreement that it executed on or about September 28, 2021, through a different

investment banking firm (despite the Company having formally terminated the engagement letter with Blair on or about July 16, 2021);

(v) failing to provide Blair with a right of first refusal to be its joint active bookrunning manager for a preferred stock offering

that it executed on or about September 28, 2021, through two different investment banking firms as bookrunning co-managers (despite

the Company having formally terminated the engagement letter with Blair on or about July 16, 2021);

and (vi) purchasing a

convertible note from a pharmaceutical investor in connection with its acquisition of all outstanding shares of allergy telehealth

platform, Cleared.

The Blair Complaint seeks damages adequate to compensate Blair for the aforementioned alleged breaches

, which implicitly meets or exceeds the purported $ 1,000,000 minimum

fee in the engagement letter), as well as reasonable costs and expenses incurred in this action.

June 28, 2022, Blair served its first set of document requests.

Per court order, the Company's responses are due August 31, 2022.

Further, the Company is required to provide initial written discovery requests on plaintiff by August 17, 2022.

management conference concerning the status of completion of written discovery and document production is scheduled for

October 6, 2022.

The court intends to enter a case management schedule and trial date at that conference.

The Company intends to

vigorously defend against this action.

As this action is in its preliminary phase, a potential loss cannot yet be

10 – RELATED PARTY TRANSACTIONS

Executive Officer

Labs PR utilizes office space in Puerto Rico, which is subleased from Fried LLC, and incurs expense of approximately $ 3,000 a month for

this office space.

The Company previously made payments to JLS Ventures, an entity wholly owned by our Chief Executive Officer (“CEO”),

for rent on Conversion Labs PR’s Puerto Rico office space which was $ 0 and $ 22,500 for the three months ended March 31, 2022 and

2021, respectively.

Labs PR utilizes BV Global Fulfillment (“BV Global”), previously owned by a related person of the Company’s CEO, to

warehouse a portion of the Company’s finished goods inventory and for fulfillment services.

On December 31, 2021, the Company entered

into an Asset Purchase Agreement (the “APA”) with BV Global and the owner (the “Owner”), whereby BV Global and

the Owner agreed to sell to the Company certain purchased assets of BV Global in exchange for approximately $ 9 thousand.

Prior to entering

into the APA, the Company paid a monthly fee of $ 13,000 to $ 16,000 for fulfillment services and reimbursed BV Global for their direct

costs associated with shipping the Company’s products.

The Company reimbursed BV Global a total of $ 99,082 during the three months

ended March 31, 2021.

As of December 31, 2021, the Company owed BV Global $ 61,824 , which is included in accounts payable and accrued

liabilities on the accompanying unaudited condensed consolidated balance sheets.

the three months ended March 31, 2022 and 2021, WorkSimpli utilized LegalSubmit Pvt.

(“LegalSubmit”), a company owned

by WorkSimpli’s Chief Software Engineer, to provide software development services.

Labs PR utilizes office space in Puerto Rico, which is subleased from Fried LLC, a third party, and incurs expense of approximately $ 3,000

a month for this office space.

The Company previously made payments to JLS Ventures, an entity wholly owned by our Chief Executive Officer

(“CEO”), for rent on Conversion Labs PR’s Puerto Rico office space which was $ 0 and $ 22,500 for the three months ended

June 30, 2022 and 2021, respectively, and $ 0 and $ 45,000 for the six months ended June 30, 2022 and 2021, respectively.

Labs PR utilizes BV Global Fulfillment (“BV Global”), previously owned by a related person (the “Owner”) of the

Company’s CEO, to warehouse a portion of the Company’s finished goods inventory and for fulfillment services.

31, 2021, the Company entered into an Asset Purchase Agreement (the “APA”) with BV Global and the Owner, whereby BV Global

and the Owner agreed to sell to the Company certain purchased assets of BV Global in exchange for approximately $ 9 thousand.

entering into the APA, the Company paid a monthly fee of $ 13,000 to $ 16,000 for fulfillment services and reimbursed BV Global for their

direct costs associated with shipping the Company’s products.

The Company reimbursed BV Global a total of $ 319,444 and $ 418,526

during the three and six months ended June 30, 2021, respectively.

As of December 31, 2021, the Company owed BV Global $ 61,824 , which

is included in accounts payable on the accompanying unaudited condensed consolidated balance sheets.

the six months ended June 30, 2022 and 2021, WorkSimpli utilized LegalSubmit Pvt.

(“LegalSubmit”), a company owned by

WorkSimpli’s Chief Software Engineer, to provide software development services.

WorkSimpli paid LegalSubmit a total of $ 351,953

and $ 172,837 during the three months ended March 31, 2022 and 2021, respectively, for these services.

There were no amounts owed to LegalSubmit

as of both March 31, 2022 and December 31, 2021.

and $ 186,503 during the three months ended June 30, 2022 and 2021, respectively, and $ 651,323 and $ 359,340 during the six months ended

June 30, 2022 and 2021, respectively, for these services.

There were no amounts owed to LegalSubmit as of both June 30, 2022 and December

Officer Employment Agreements

April 1, 2022, Justin Schreiber, the Company’s CEO, entered into an Employment Agreement (the “Schreiber Employment Agreement”)

with the Company.

The Schreiber Employment Agreement is for an indefinite term and may be terminated with or without cause.

to the Schreiber Employment Agreement, Mr.

Schreiber will receive an annual base salary of $ 300,000 and shall be eligible to earn a performance

bonus in such amount, if any, as determined in the sole discretion of the Board, with a target amount of 75 % of the base salary.

January 27, 2022, the Company and Marc Benathen, our Chief Financial Officer (“CFO”), entered into the First Amendment to

5 unchanged sentences

key revenue, EBITDA and share price appreciation milestones.

January 27, 2022, the Company and our Chief Compliance Officer (“CCO”) entered into the First Amendment to his employment

agreement to provide that our CCO receive 37,500 RSUs, with 12,500 of the RSUs vesting on the grant date and the first and second anniversaries

of the grant date.

Additionally, the First Amendment to his employment agreement provided that our CCO is eligible to receive up to 105,000

PSUs, which will vest subject to the Company achieving certain key revenue, EBITDA and share price appreciation milestones.

January 27, 2022, the Company and Eric H.

Yecies, our General Counsel (“GC”) and Chief Compliance Officer

(“CCO”), entered into the First Amendment to his employment agreement to provide that our CCO receive 37,500

RSUs, with 12,500

of the RSUs vesting on the grant date and the first and second anniversaries of the grant date.

Additionally, the First Amendment to

his employment agreement provided that our CCO is eligible to receive up to 105,000

PSUs, which will vest subject to the Company achieving certain key revenue, EBITDA and share price appreciation

February 4, 2022, Maria Stan was appointed as Controller and Principal Accounting Officer of the Company.

10 unchanged sentences

within our segments complement one another and position us well for future growth.

Relevant segment data for the three months ended March

31, 2022 and 2021 is as follows:

OF RELEVANT SEGMENT DATA

Three Months Ended March 31,

Relevant segment data for the three and six months

ended June 30, 2022 and 2021 is as follows:

SCHEDULE OF RELEVANT SEGMENT DATA

Three Months Ended June 30,

Six Months Ended June 30,

Operating loss

1 unchanged sentence

$ ( 14,782,474 )

$ ( 29,217,656 )

$ ( 24,897,459 )

Operating income (loss)

$ ( 1,344,289 )

$ ( 3,147,641 )

Operating loss

1 unchanged sentence

$ ( 16,126,763 )

segment data as of March 31, 2022 and December 31, 2021 is as follows:

March 31, 2022

$ ( 28,746,140 )

$ ( 28,045,100 )

segment data as of June 30, 2022 and December 31, 2021 is as follows:

June 30, 2022

December 31, 2021

1 unchanged sentence

Company has evaluated subsequent events through the date these consolidated financial statements were issued and has identified the following:

April 1, 2022, Justin Schreiber, the Company’s CEO, entered into an Employment Agreement (the “Schreiber Employment Agreement”)

with the Company.

The Schreiber Employment Agreement is for an indefinite term and may be terminated with or without cause.

to the Schreiber Employment Agreement, Mr.

Schreiber will receive an annual base salary of $ 300,000 and shall be eligible to earn a performance

bonus in such amount, if any, as determined in the sole discretion of the Board, with a target amount of 75 % of the base salary.

April 25, 2022, the Board approved, subject to stockholder approval, an amendment to the 2020 Plan to increase the maximum number of

shares of common stock available for issuance under the 2020 Plan by 1,500,000 shares.

The amendment is being presented as Proposal 2

at the Annual Meeting of Stockholders, to be held on June 16, 2022.

August 2022, the Company issued an aggregate of 63,750 shares of common stock for services rendered.

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

What changed 10-Q

Item 1. Financial Statements