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Item 8. Financial Statements and Supplementary Data

2023-03-10 compared with 2022-02-28 · 414 added, 378 removed, 660 unchanged (55% of the section changed)

Financial Statements and Supplementary Data

to Financial Statements Required by Article 8 of Regulation S-X:

Financial Statements and Supplementary

Index to Financial Statements Required by Article

8 of Regulation S-X:

Audited Financial Statements:

Reports of Independent Registered

Public Accounting Firm;

Report of Independent Registered Public Accounting Firm;

Consolidated Balance Sheets as of December 31, 2022 and 2021;

Consolidated Statements of Operations for the years

ended December 31, 2021 and 2020;

Consolidated Statement of Stockholders’ Equity

for the year ended December 31, 2021;

Consolidated Statement of Stockholders’ Equity

for the year ended December 31, 2020;

Consolidated Statements of Cash Flows for the years

ended December 31, 2021 and 2020;

Consolidated Statements of Operations for the years ended December 31, 2022 and 2021;

Consolidated Statement of Stockholders’ Equity for the year ended December 31, 2022;

Consolidated Statement of Stockholders’ Equity for the year ended December 31, 2021;

Consolidated Statements of Cash Flows for the years ended December 31, 2022 and 2021;

Notes to Consolidated Financial Statements

of Independent Registered Public Accounting Firm

the Shareholders and Board of Directors of

Report of Independent Registered Public Accounting

To the Shareholders and Board of Directors of

OptimizeRx Corporation

on the Financial Statements

have audited the accompanying consolidated balance sheets of OptimizeRx Corporation and Subsidiaries (the Company) as of December 31,

2021 and 2020, and the related consolidated statements of operations, stockholders’ equity and cash flows for the years then ended,

and the related notes (collectively referred to as the consolidated financial statements).

We have also audited the Company’s internal

control over financial reporting as December 31, 2021, based on criteria established in Internal Control – Integrated Framework

(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position

of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for the years then ended, in conformity

with accounting principles generally accepted in the United States of America.

Also, in our opinion, the Company maintained, in all material

respects, effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control

– Integrated Framework (2013) issued by COSO.

Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting,

and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report on Internal

Control over Financial Reporting.

Our responsibility is to express an opinion on the Company’s consolidated financial statements

and an opinion on the Company’s internal control over financial reporting based on our audits.

We are a public accounting firm

registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect

to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange

Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud,

and whether effective internal control over financial reporting was maintained in all material respects.

audits of the financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial

statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures include examining,

on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating

the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated

financial statements.

We believe that our audit provides a reasonable basis for our opinion.

audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting,

assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control

based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audits provide a reasonable basis for our opinions.

and Limitations of Internal Control over Financial Reporting

company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability

of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the

maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in

accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance

with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection

of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of

any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions,

or that the degree of compliance with the policies or procedures may deteriorate.

critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that

were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material

to the consolidated financial statements and (2) involved especially challenging, subjective, or complex judgments.

The communication

of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are

not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or

disclosures to which they related.

Audit Matter - Revenue Recognition

disclosed in Note 2 to the consolidated financial statements, the Company recognizes revenue upon transfer of control of promised products

or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or

judgment is exercised by the Company in determining revenue recognition for these customer agreements and includes the following:

(1) determining

whether services are considered distinct performance obligations that should be accounted for separately versus together (2) the pattern

and timing of delivery for each distinct performance obligation, and (3) identification and treatment of contract terms that may impact

the timing and amount of revenue recognized.

the Critical Audit Matter Was Addressed in the Audit

audit procedures we performed to address this critical audit matter included the following:

(1) obtaining an understanding of the design

and operating effectiveness of controls related to identifying distinct performance obligations, determining the timing of revenue recognition

and any estimation of variable consideration, (2) selection of a sample of customer agreements and testing management’s identification

and treatment of contract terms, and testing the mathematical accuracy of management’s calculations of revenue and the associated

timing of revenue recognized in the consolidated financial statements.

have served as the Company’s auditor since 2020.

Heights, Michigan

Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheets of OptimizeRx Corporation and Subsidiaries (the “Company”) as of December 31, 2022 and 2021, and the related

consolidated statements of operations, stockholders’ equity and cash flows for the years then ended, and the related notes (collectively

referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements

referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and

the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted

in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of Company’s

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.

are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the

standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated

financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we

engaged to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding

of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s

internal control over financial reporting.

Accordingly, we express no such opinion.

Our audit included performing procedures to assess

the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the

consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by

management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provides

a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is

a matter arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated

to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated financial statements and

(2) involved especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any

way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter

below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they related.

Critical Audit Matter - Revenue Recognition

As disclosed in Note 2 to the consolidated financial

statements, the Company recognizes revenue upon transfer of control of promised products or services to customers in an amount that reflects

the consideration the Company expects to receive in exchange for those products or services.

Significant judgment is exercised by the Company

in determining revenue recognition for these customer agreements and includes the following:

(1) determining whether services are considered

distinct performance obligations that should be accounted for separately versus together, (2) the pattern and timing of delivery for each

distinct performance obligation, and (3) identification and treatment of contract terms that may impact the timing and amount of revenue

How the Critical Audit Matter Was Addressed

The audit procedures we performed to address

this critical audit matter included the following:

(1) obtaining an understanding of the design and implementation of controls

related to identifying distinct performance obligations, determining the timing of revenue recognition and any estimation of

variable consideration, (2) selection of a sample of customer agreements and testing management’s identification and treatment

of contract terms, and (3) testing the mathematical accuracy of management’s calculations of revenue and the associated timing

of revenue recognized in the consolidated financial statements.

We have served as the Company’s auditor

Sterling Heights, Michigan

March 10, 2023

OPTIMIZERx CORPORATION

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Cash and cash equivalents

Short-term investments

Accounts receivable, net

Prepaid expenses

Prepaid expenses and other

Total Current Assets

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$ 134,651,185

$ 140,985,192

LIABILITIES AND STOCKHOLDERS’ EQUITY

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Current portion of lease liabilities

Contingent purchase price payable

Deferred revenue

5 unchanged sentences

Stockholders’ Equity

Preferred stock, $ 0.001 par value, 10,000,000 shares authorized, none issued and outstanding at December 31, 2021 and 2020,

Common stock, $ 0.001 par value, 166,666,667 shares authorized, 17,860,975 and 15,223,340 shares issued and outstanding at December 31, 2021 and 2020, respectively

Preferred stock, $ 0.001 par value, 10,000,000 shares authorized, none issued and outstanding at December 31, 2022 and 2021, respectively

Common stock, $ 0.001 par value, 166,666,667 shares authorized, 18,288,571 and 17,860,975 shares issued at December 31, 2022 and 2021, respectively

Treasury stock, $ 0.001 par value, 1,214,398 and none held at December

31, 2022 and 2021, respectively

Additional paid-in-capital

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$ 134,651,185

$ 140,985,192

The accompanying notes are an integral part of

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( 12,290,738 )

Other income (expense)

Interest income

Change in fair value of contingent consideration

Total other income (expense)

Income (loss) before provision for income taxes

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Ended December 31, 2022

Stockholders’

Treasury Stock

Balance, January 1, 2022

$ 166,615,514

$ ( 35,253,658 )

$ 131,379,717

Stock-based compensation expense

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Issuance of common stock:

For board compensation

For stock options exercised

Public offering of common shares, net of offering costs

Net income for the year

For acquisition

For restricted stock units vested, net of cancelled units

Repurchase of common stock

( 1,214,398 )

( 20,023,044 )

( 20,021,830 )

Net loss for the year

( 11,438,440 )

Balance, December 31, 2022

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$ ( 46,692,098 )

$ 126,110,777

The accompanying notes are an integral part of

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Ended December 31, 2021

Stockholders’

Balance, January 1, 2021

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For stock options exercised

For contingent purchase price and escrow hold back

Net loss for the year

Public offering of common shares, net of offering costs

For restricted stock units vested

Net income for the year

Balance, December 31, 2021

$ 166,615,514

$ ( 35,253,658 )

Balance, December 31, 2020

$ 131,379,717

2 unchanged sentences

OPTIMIZERx CORPORATION

Consolidated Statements of Cash Flows

Consolidated Statements

of Cash Flows

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss)

Net (loss) income

$ ( 11,438,440 )

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

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

Depreciation and amortization

Noncash lease expense

Increase in bad debt reserve

Stock-based compensation

Change in fair value of contingent consideration

Accounts receivable

( 6,994,880 )

( 10,667,680 )

Prepaid expenses and other assets

( 1,174,044 )

( 3,517,700 )

Accounts payable

Revenue share payable

Accrued expenses and other

Accrued expenses and other liabilities

Change in operating lease liabilities

Deferred revenue

NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES

( 1,225,598 )

CASH FLOWS FROM INVESTING ACTIVITIES:

NET CASH PROVIDED BY OPERATING ACTIVITIES

CASH FLOWS USED IN INVESTING ACTIVITIES:

Purchases of property and equipment

EvinceMed acquisition

( 2,000,000 )

Purchase of short-term investments

( 55,931,821 )

Acquisition of intangible assets, including intellectual property rights

1 unchanged sentence

NET CASH USED IN INVESTING ACTIVITIES

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of common stock, net of offering costs

Proceeds from exercise of stock options

Payment of contingent consideration

( 58,176,386 )

CASH FLOWS (USED IN ) / PROVIDED BY FINANCING ACTIVITIES:

Proceeds from public offering of common stock, net of offering costs

Repurchase of common stock

( 20,024,258 )

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES

Proceeds from exercise of stock options, net of cash paid for withholding taxes

Payment of contingent consideration

( 1,610,813 )

NET INCREASE (DECREASE IN) CASH AND CASH EQUIVALENTS

NET CASH (USED IN) / PROVIDED BY FINANCING ACTIVITIES

( 18,950,777 )

NET (DECREASE) / INCREASE IN CASH AND CASH EQUIVALENTS

( 66,473,085 )

CASH AND CASH EQUIVALENTS – BEGINNING OF PERIOD

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Cash paid for interest

Reduction of EvinceMed purchase price for amounts previously paid

Shares issued in connection with acquisition

Cash paid for income taxes

NON-CASH INVESTING AND FINANCING ACTIVITIES:

Acquisition liabilities paid in stock

The accompanying notes are an integral part of

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platform embedded within a proprietary point-of-care network, OptimizeRx helps patients start and stay on their medications.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING

Basis of Presentation

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OptimizeRx Corporation, a Michigan corporation,

RMDY Health, Inc., a Delaware corporation, CareSpeak Communications, Inc., a New Jersey corporation, Cyberdiet, a controlled foreign corporation

incorporated in Israel, and CareSpeak Communications D.O.O., a Controlled Foreign Corporation incorporated in Croatia.

Together, these

companies are referred to as “OptimizeRx” and “the Company.” All material intercompany transactions have been

CareSpeak Communications, Inc., a New Jersey corporation, Cyberdiet, a controlled foreign corporation incorporated in Israel, and CareSpeak

Communications D.O.O., a Controlled Foreign Corporation incorporated in Croatia.

Together, these companies are referred to as “OptimizeRx”

and “the Company.” All material intercompany transactions have been eliminated.

Reclassifications

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Foreign Currency

The Company’s

functional currency is the U.S.

dollar, however it pays certain expenses related to its two foreign subsidiaries in the local

currency, which is the sheckel for its subsidiary in Israel and the kuna for its Croatian subsidiary.

All transactions are recorded

at the exchange rate at the time of payment.

If there is a time lag between the time of recording the liability and the time of

payment, a gain or loss is recorded in the Consolidated Statement of Operations due to any fluctuations in the exchange rate.

The Company’s functional currency is the

dollar, however it pays certain expenses related to its two foreign subsidiaries in the local currency, which is the shekel for

its subsidiary in Israel and the kuna for its Croatian subsidiary.

All transactions are recorded at the exchange rate at the time of payment.

If there is a time lag between the time of recording the liability and the time of payment, a gain or loss is recorded in the Consolidated

Statement of Operations due to any fluctuations in the exchange rate.

Cash and Cash Equivalents

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less to be cash equivalents.

We account for marketable securities in accordance

with ASC 320, “Investments - Debt Securities”, which require that certain debt securities be classified into one of three categories:

held-to-maturity, available-for-sale, or trading securities, and depending upon the classification, value the security at amortized cost

or fair market value.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Fair Value of Financial Instruments

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value of liabilities should include consideration of non-performance risk including our own credit risk.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

In addition to defining fair value, the disclosure

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The Company’s stock options and warrants are valued using level 3 inputs.

The following tables present the fair values and

carrying values of the Company’s financial assets and liabilities measured on a recurring basis as of December 31, 2021 and 2020

and the valuation techniques used by the Company to determine those fair values.

Carrying Value

Contingent Purchase Price Payable

Carrying Value

Contingent Purchase Price Payable (1)

The contingent consideration is based off achieving certain revenue milestones in each of the next two years.

The Geometric-Brownian motion analysis was used to generate spot prices for use in an option pricing model.

For 2020, the final payout had been determined and was paid in 2021.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The following table provides a summary of changes

in fair value of the Company’s Level 3 financial instruments for the years ended December 31, 2021 and 2020.

Balance December 31, 2019

Payment of CareSpeak Communication contingent consideration

( 1,389,187 )

Payment of RMDY Health, Inc.

contingent consideration

( 3,860,390 )

Increase in the value of the RMDY Health, Inc.

contingent consideration

Balance December 31, 2020

Payment of CareSpeak Communication contingent consideration

( 1,610,813 )

Balance December 31, 2021

The Company’s carrying amounts of financial instruments

including cash and cash equivalents, accounts receivable, accounts payable, and other current liabilites approximate their fair values

due to their short maturities.

Accounts Receivable and Allowance for Doubtful

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$ 241,219 as of December 31, 2022 and 2021, respectively.

From time to time, we may record revenue based on our revenue recognition policies

described below in advance of being able to invoice the customer.

Included in accounts receivable are unbilled amounts of $ 2,110,865 and

$ 757,218 at December 31, 2021, and December 31, 2020, respectively.

From time to time, we may record revenue based on our revenue recognition

policies described below in advance of being able to invoice the customer.

Included in accounts receivable are unbilled amounts of $ 3,582,735 ,$ 2,110,865

and $ 757,218 at December 31, 2022, 2021 and 2020, respectively.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Property and Equipment

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assets are being amortized over their estimated useful lives of fifteen to seventeen years for patents, eight years for customer relationships,

fifteen years for tradenames, four years for covenants not to compete, and three to four years for software and websites, all using the

straight-line method.

fifteen years for tradenames, two to four years for covenants not to compete, and three to ten years for software and websites, all using

the straight-line method.

These assets are evaluated when there is a triggering event.

There was no impairment of our intangible assets in

either year presented.

There was no impairment of our intangible assets

in either year presented.

We evaluate goodwill for impairment during our

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of our goodwill.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Revenue Recognition

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recognized as services are performed.

The majority of our revenue is earned from life sciences companies,

such as pharmaceutical and biotech companies, or medical device makers.

A small portion of our revenue is earned from other sources, such

as associations and technology companies.

A break down is set forth in the table below.

Life Science Companies

Total Revenue

OPTIMIZERx CORPORATION

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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Revenues (cont.)

In some instances, we license certain of our software

applications in arrangements that do not include other performance obligations.

In those instances, we record license revenue when the

software is delivered for use to the license.

In instances where our contracts included Software as a service, the revenue is recognized

over the subscription period as services are delivered to the customer.

Disaggregation of Revenue

Consistent with ASC Topic 606, we have disaggregated our revenue by

timing of revenue recognition.

The majority of our revenue is recognized over time as solutions are provided.

A small portion of our revenue

related to program development, solution architect design, and other solutions is recognized at a point in time upon delivery to customers.

A break down is set forth in the table below.

Revenue recognized over time

Revenue recognized at a point in time

Total Revenue

Revenue Recognition (Continued)

In some instances, we license certain of our

software applications in arrangements that do not include other performance obligations.

In those instances, we record license

revenue when the software is delivered for use to the license.

In instances where our contracts included Software as a Service, the

revenue is recognized over the subscription period as services are delivered to the customer.

In some instances, the Company also resells messaging

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Cost of Revenues

The primary cost of revenue is revenue share expense.

The primary cost of revenue is revenue share

Cost of revenues does not include depreciation and amortization which is listed separately on the statements of operations.

Based on the volume of transactions that are delivered through the channel partner network, the Company provides a revenue share to compensate

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A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

recognizes the tax benefit from uncertain tax positions if it is more likely than not that the tax positions will be sustained on examination

by the tax authorities, based on the technical merits of the position.

The tax benefit is measured based on the largest benefit that has

a greater than 50 % likelihood of being realized upon ultimate settlement.

It is the Company’s policy to include interest and penalties

related to tax positions as a component of income tax expense.

The Company recognizes the tax benefit from uncertain

tax positions if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the

technical merits of the position.

The tax benefit is measured based on the largest benefit that has a greater than 50 % likelihood of being

realized upon ultimate settlement.

It is the Company’s policy to include interest and penalties related to tax positions as a component

of income tax expense.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Concentration of Credit Risks

5 unchanged sentences

2022 and 2021 the Company had $ 15,669,837 and $ 83,312,524 , respectively, in cash balances in excess of federally insured limits, primarily

at Bank of America/Merrill Lynch.

at Bank of America.

Research and Development

2 unchanged sentences

There was no research and development expense for the years ended December 31, 2022 and 2021.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Stock-based Compensation

24 unchanged sentences

Risk free interest rate

0.82 % - 4.38 %

0.19 % - 0.67 %

Expected option term

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during the year.

The number of common shares potentially issuable upon the exercise of certain options that were excluded from the diluted

The number of common shares potentially issuable upon the exercise of certain awards that were excluded from the diluted

loss per common share calculation in 2022 was 93,626 related to options, and 170,859 related to restricted stock units, for a total of

6 unchanged sentences

and the basic and diluted earnings per common share for the years ended December 31, 2022 and 2021 consisted of the following:

Per Share Amount

Year ended December 31, 2022

Per Share Amount

Year ended December 31, 2020

$ ( 11,438,440 )

Effect of dilutive securities

$ ( 11,438,440 )

Year ended December 31, 2021

Effect of dilutive securities

Impairment of Long-Lived Assets

25 unchanged sentences

and amends existing guidance.

ASU 2019-12 was effective for us as of January 1, 2021 The adoption of this standard did not have a material

ASU 2019-12 was effective for us as of January 1, 2021.

The adoption of this standard did not have a material

effect on our financial position, results of operations, or cash flows.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES (CONTINUED)

Not Yet Adopted

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year beginning January 1, 2023, with early adoption permitted.

The Company is currently evaluating the effect of this pronouncement on

its Consolidated Financial Statements, but it is not expected to have a material impact.

The adoption of this standard is not expected to have a material effect

on our financial position, results of operations, or cash flows.

NOTE 3 – ACQUISITIONS

On April 14, 2022, we completed the acquisition

of substantially all of the assets of EvinceMed Corp., a privately held leading provider of delivering end-to-end automation for specialty

pharmaceutical transactions.

We completed the acquisition to expand the breadth of the solutions we offer our customers, particularly

where specialty medications are involved, The acquisition included the full Market Access Management Platform for supporting pharma manufacturers,

hub providers and pharmacies to improve patient access, speed to therapy and activation of affordability programs.

With the EvinceMed

platform, OptimizeRx is able to help patients get access to the drugs they need by simplifying the prescribing process for specialty medications,

automating manual steps to determine drug eligibility and affordability, and introducing electronic enrollment and medical documentation

across the OptimizeRx network of electronic health record (EHR) systems, ePrescribing platforms,

and account-based marketing technologies.

The consideration was comprised of $ 2.0 million

in cash, the issuance of 240,741 shares of common stock valued at $ 9,374,455 , and $ 708,334 of amounts previously paid.

The total purchase

price was $ 12,082,789 .

Of the 240,741 shares of common stock, 185,185 were issued at closing and 55,556 were issued but held back to secure

potential adjustments to the purchase price that may result from the indemnification obligations of EvinceMed and the EvinceMed shareholder

The holdback amount will be released twelve months from the closing, subject to any adjustments for the payment by EvinceMed

and the shareholder indemnitors for its and their indemnification obligations.

The purchase price was allocated to acquired technology

totaling $ 4,149,000 with an estimated useful life of 8 years and the remaining $ 7,933,789 was allocated to goodwill.

Goodwill represents

the processes and synergies expected by integrating those processes with our own.

The full amount of goodwill will be deductible for tax

purposes using a 15 year life.

The increase in goodwill for the period is fully accounted for by this acquisition.

We determined pro forma

data was immaterial for financial reporting purposes.

The initial accounting is provisional and subject to change based on the completion

of formal valuations.

Acquisition costs of approximately $ 19,739 were

expensed as incurred.

OPTIMIZERx CORPORATION

1 unchanged sentence

DECEMBER 31, 2022

NOTE 4 – INVESTMENT SECURITIES

At December 31, 2022 the Company held $ 55.9 million in U.S.

and agency securities.

All securities have maturity dates of less than one year.

The Company reports them at amortized cost.

The amortized

cost approximates fair value at December 31, 2022 due to the short nature of the securities.

There were no securities held at December 31, 2021.

NOTE 5 – PREPAID EXPENSES

1 unchanged sentence

of December 31, 2022 and 2021:

Prepaid revenue share and exclusivity payments

EHR access fees

Revenue share and exclusivity payments

Total prepaid expenses

8 unchanged sentences

for the years ended December 31, 2022 and 2021, respectively.

NOTE 5 – INTANBIGLE ASSETS

NOTE 7 – INTANGIBLE ASSETS

Our goodwill is related to the acquisitions of

RMDY Health, Inc.

EvinceMed in 2022, RMDY Health, Inc.

in 2019 and CareSpeak Communications in 2018.

Goodwill is generally not amortizable for tax purposes and is not amortizable

for financial statement purposes.

Goodwill is not amortizable for financial statement

Changes in the carrying amount of goodwill on

the consolidated balance sheet consist of the following:

Balance at January 1, 2021

Balance January 1, 2022

Revenue recognized

Amount collected

Balance December 31, 2022

OPTIMIZERx CORPORATION

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DECEMBER 31, 2022

NOTE 5 – INTANBIGLE ASSETS (CONTINUED)

NOTE 7 – INTANGIBLE ASSETS (CONTINUED)

Intangible Assets

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Customer relationships

Total Intangibles

Total intangible assets

December 31, 2021

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Customer relationships

Total Intangibles

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 5 – INTANBIGLE ASSETS (CONTINUED)

Total intangible assets

Intangibles are being amortized on a straight-line

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Technology assets

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 7 – INTANGIBLE ASSETS (CONTINUED)

The Company recorded amortization expense of $ 1,936,304

and $ 1,859,965 in the years ended December 31, 2022 and 2021, respectively.

Expected future amortization expenses of the intangibles assets

as of December 31, 2021 is as follows:

Expected future amortization expense of the intangibles

assets as of December 31, 2022 is as follows:

Year ended December 31,

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Balance December 31, 2021

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 9 – RELATED PARTY TRANSACTIONS

During the year ended December 31, 2010,

the Company acquired the technical contributions and assignment of all exclusive rights to and for a key patent in process at the time

from a former CEO in exchange for a total payment in shares of common stock and options valued at $ 930,000 at the time of the acquisition

and recorded the patent at that cost.

During the year ended December 31, 2010, the Company

acquired the technical contributions and assignment of all exclusive rights to and for a key patent in process at the time from a former

CEO in exchange for a total payment in shares of common stock and options valued at $ 930,000 at the time of the acquisition and recorded

the patent at that cost.

That patent remains in Patents on the consolidated balance sheet as of December 31, 2022.

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from, such as agencies or resellers.

During the year ended December 31, 2021, we have recognized $ 218,333 in revenue from contracts engaged

with Eversana.

No revenues were recognized in 2020 related to contracts with Eversana.

These contracts were sourced by Eversana on behalf

of life science customers of theirs.

During the years ended December 31, 2022 and 2021, respectively, we have recognized $ 401,972

and $ 218,333 in revenue from contracts engaged with Eversana.

These contracts were sourced by Eversana on behalf of life science customers

The contracts are at market rates and were generated in the normal course of business.

NOTE 8 – CONTINGENT PURCHASE PRICE

Our purchase of CareSpeak Communications contained

a contingent element that would be paid only if the Company achieved certain patient engagement revenues in 2019 and 2020.

The total contingent

payment could have been up to $ 3.0 million.

The target patient engagement revenues were achieved in both 2019 and in 2020.

The calculated

fair value of the contingent payment was $ 3,000,000 at December 31, 2019 and $ 1,610,813 at December 31, 2020.

The final required payment

was made in 2021.

Our purchase of RMDY Health, Inc.

also contained

a contingent element that would be paid only if the Company achieves certain revenues in 2020 and 2021 related to the RMDY business.

total contingent payment could have been up to $ 30.0 million.

The minimum payment was $ 1.0 million in each of the two years.

The calculated

fair value of the contingent payment was $ 3,720,000 at December 31, 2019.

We determined the fair value of the Contingent Purchase Price

Payable at December 31, 2019 using a Geometric-Brownian motion analysis of the expected revenue and resulting earnout payment using inputs

that include the spot price, a risk free rate of return of 1.4 %, a term of 2 years, and volatility of 35 %.

During 2020, we reached agreement

with the former shareholders of RMDY to fix the liability at $ 3.75 million, payable in a combination of cash and stock.

Because of the

change in the share price between the date of agreement and the date of payment, the amount recorded for the stock amount varied from

the agreed amount.

The liability was paid in full during 2020 and was paid with a $ 3.0 million cash payment and the remainder in shares

of common stock.

There was no contingent purchase price payable

at December 31, 2021.

The total fair value of contingent purchase price

payable at December 31, 2020 is as follows.

CareSpeak Communications, Inc.

OPTIMIZERx CORPORATION

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Preferred Stock

The Company has 10,000,000 shares of preferred

001 par value per share, authorized as of December 31, 2021.

The Company had 10,000,000 shares of preferred

stock, $ 0.001 par value per share, authorized as of December 31, 2022.

No shares were issued or outstanding in either 2021 or 2022.

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$ 0.001 par value per share, authorized as of December 31, 2022.

There were 17,860,975 and 15,223,340 shares of common stock issued and

outstanding at December 31, 2021 and 2020, respectively.

During the quarter ended March 31, 2021, in an

underwritten primary offering, we issued 1,523,750 shares of our common stock for gross proceeds of $ 75,425,625 .

In connection with this

transaction, we incurred equity issuance costs of $ 4,754,089 related to payments to the underwriter, advisors and legal fees associated

with the transaction, resulting in net proceeds to the Company of $ 70,671,536 .

There were 17,074,173 and 17,860,975 shares of common stock outstanding,

net of shares held in treasury, at December 31, 2022 and 2021, respectively.

We issued 156,910 shares of common stock and received

proceeds of $ 1,205,881 in 2022 in connection with the exercise of options.

We also issued 1,105,822 shares of common stock and received

proceeds of $ 4,864,231 in 2021 in connection with the exercise of options.

We issued 29,945 shares of common stock in 2022

and 3,333 shares of common in stock in 2021 in connection with the vesting of restricted stock units and discussed in greater detail in

Note 11, Stock Based Compensation.

The Company had a Director Compensation plan covering

its independent non-employee Directors that was in effect through June 30, 2021.

A total of 4,730 and 28,809 shares were granted and issued

in the years ended December 31, 2021 and 2020, respectively, in connection with this compensation plan.

A total of 4,730 were granted and issued in the

year ended December 31, 2021 in connection with this compensation plan.

These shares were valued at $ 250,085 .

and $ 450,124 , respectively.

The plan was changed to grant restricted stock units under the Company’s 2021 Equity compensation plan

and those grants are reflected in the information in Note 10.

We issued 1,105,822 shares of common stock and

received proceeds of $ 4,864,231 in 2021 in connection with the exercise of options.

We also issued 414,705 shares of common stock and

received proceeds of $ 2,488,394 in 2020 in connection with the exercise of options.

We issued 3,333 shares of common stock in 2021

and 84,746 shares of common in stock in 2020 in connection with the vesting of restricted stock units and discussed in greater detail

in Note 10, Stock Compensation.

NOTE 10 – STOCK COMPENSATION

The plan was changed

to grant restricted stock units under the Company’s 2021 Equity Incentive Plan and those grants are discussed in Note 10, Stock

Based Compensation.

During the year ended December 31, 2021,

in an underwritten primary offering, we issued 1,523,750 shares of our common stock for gross proceeds of $ 75,425,625 .

In connection with

this transaction, we incurred equity issuance costs of $ 4,754,089 related to payments to the underwriter, advisors and legal fees associated

with the transaction, resulting in net proceeds to the Company of $ 70,671,536 .

During the year ended December 31, 2022,

the Board authorized a share repurchase program, under which the Company may repurchase up to $ 20.0 million of its outstanding common

Through December 31, 2022, we repurchased 1,214,398 shares of our common stock for a total of $ 20,024,258 , including commissions

paid on repurchases.

These shares were recorded as Treasury Shares using the par value method.

NOTE 11 – STOCK BASED COMPENSATION

The Company sponsors two stock-based incentive

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In connection with the adoption of a new plan in 2021, the Company froze the 2013 Plan.

At December 31, 2021, there

were no shares available for grant under the 2013 Plan.

At December 31,

2022, there were no shares available for grant under the 2013 Plan.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 11 – STOCK BASED COMPENSATION (CONTINUED)

In 2021, the Company adopted a new plan known

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underlying options and 660,484 shares of common stock underlying restricted stock unit awards were outstanding at December 31, 2022.

December 31, 2021, 2,133,276 shares were available for grant under the 2021 Plan.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 10 – STOCK COMPENSATION (CONTINUED)

The 2021 Plan allows the Company to grant incentive

stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards and

other stock-based awards.

Incentive stock options may only be granted to persons who are regular full-time employees of the Company at

the date of the grant of the option.

Non-qualified options may be granted to any person, including, but not limited to, directors, officers,

employees and consultants, who the Company’s Board or Compensation Committee determines.

The exercise price of options granted under

the 2021 Plan must be equal to at least 100 % of the fair market value of our common stock as of the date of the grant of the option.

granted under the 2021 Plan are exercisable as determined by the Compensation Committee and specified in the applicable award agreement.

In no event will an option be exercisable after ten years from the date of grant.

At December 31, 2022, 921,946 shares were available for grant under the 2021 Plan.

The 2021 Plan allows the Company to grant

incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units,

performance awards and other stock-based awards.

Incentive stock options may only be granted to persons who are regular full-time

employees of the Company at the date of the grant of the option.

Non-qualified options may be granted to any person, including, but

not limited to, directors, officers, employees and consultants, who the Company’s Board or Compensation Committee determines.

The exercise price of options granted under the 2021 Plan must be equal to at least 100 % of the fair market value of our common

stock as of the date of the grant of the option.

Options granted under the 2021 Plan are exercisable as determined by the

Compensation Committee and specified in the applicable award agreement.

In no event will an option be exercisable after ten years

from the date of grant.

Stock Options

The compensation cost that has been charged against

income related to options for the years ended December 31, 2022 and 2021, was $ 4,956,619 and $ 2,709,781 , respectively.

No income tax benefit

was recognized in the consolidated statements of income and no compensation was capitalized in any of the years presented.

tax benefit was recognized in the consolidated statements of income and no compensation was capitalized in any of the years presented.

During the year ended December 31, 2022, we granted certain performance based options, the expense for which will be recorded over

time once the achievement of the performance is deemed probable.

There was no expense related to these options recorded during the period.

The fair value of these instruments was calculated using the Black-Scholes option pricing model.

In the year ended December 31, 2021, certain participants

utilized a net withhold exercise method in which options were surrendered to cover payroll withholding tax.

Of the cumulative net options

exercised by participants were 31,243 options, valued at $ 100,290 , were surrendered and subsequently cancelled.

The Company had the following option activity

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Outstanding at January 1, 2021

( 1,105,822 )

Withheld and cancelled

Expired or forfeited

Outstanding at December 31, 2021

( 1,137,065 )

Expired or forfeited

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DECEMBER 31, 2022

NOTE 10 – STOCK COMPENSATION (CONTINUED)

NOTE 11 – STOCK BASED COMPENSATION (CONTINUED)

The table below reflects information for the total options outstanding

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DECEMBER 31, 2022

NOTE 10 – STOCK COMPENSATION (CONTINUED)

NOTE 11 – STOCK BASED COMPENSATION (CONTINUED)

Restricted Stock Units

The Company had the following restricted stock

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Number of RSUs

Grant date fair value

Weighted average grant date fair

Weighted average remaining contractual life (years)

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Outstanding at December 31, 2021

Shares issued

Vested and issued

Withheld and cancelled

Outstanding at December 31, 2022

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These restricted stock

units vest over a period of 1.6 to 5 years.

units vest over a period of 1 year to 5 years.

The Company recognized expense of $10,789,203 and $2,532,091 in 2022 and 2021, respectively,

related to these restricted stock units.

A total of $ 18,389,797 remains to be recognized at December 31, 2021 over a period of 3.0 years.

A total of $ 17,862,951 remains to be recognized at December 31, 2022 over a period of 2.0

In the year ended December 31, 2022, certain participants

utilized a net withhold settlement method, in which shares were surrendered to cover payroll withholding tax.

Of the cumulative net options

exercised by participants were 31,243 options, valued at $ 100,290 , were surrendered and subsequently cancelled.

Performance Stock Units

Of the restricted stock units issued in 2021,

2021, 182,938 are market-based awards that vest if the Company’s stock price hits certain price targets and maintains that

price for 30 days.

A total of 60,191, 60,191, and 62,016 units vest if the stock price hits $98.87, $131.82, $164.78, respectively.

As described in Note 2, these market-based restricted stock units were valued using a Monte Carlo simulation model, with expected

vesting in 1.6, 2.25, and 2.71 years, respectively, for the three price targets.

182,938 are market-based awards that vest if the Company’s stock price hits certain price targets and maintains that price for 30

A total of 60,191, 60,191, and 62,016 units vest if the stock price hits $98.87, $131.82, and $164.78, respectively.

in Note 2, these market-based restricted stock units were valued using a Monte Carlo simulation model, with expected vesting in 1.60,

2.25, and 2.71 years, respectively, for the three price targets.

During the year ended December 31, 2022, we granted certain performance

based stock units, the expense for which will be recorded over time once the achievement of the performance is deemed probable.

was no expense related to these options recorded during the period.

Non-employee Directors’ Compensation

Our previous director’s compensation plan

called for the issuance of fully-vested shares of common stock each quarter to each independent director.

In 2021, we issued 4,730 shares

valued at $ 250,085 that immediately vested.

Subsequent to these grants, we adopted a new directors compensation program that calls for

the grant of restricted stock units with a one year vesting period.

We granted 3,715 restricted stock units valued at $ 250,175 in the

second half of 2021 under the new plan.

These restricted stock units vested in 2022.

There were 26,470 restricted stock units, valued

at $ 750,130 , granted to the board of directors in 2022 that will vest in 2023, 12 months from the grant dates.

NOTE 12 – LEASES

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recognition of the lease-related assets and liabilities, as well as the related lease expense.

We have operating leases with terms greater than

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 12 – LEASES (CONTINUED)

We had operating leases with terms greater than

12 months for office space in three multitenant facilities, which are recorded as assets and liabilities.

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We have assumed renewal of the lease.

We also have a lease on office space in Cranbury, New Jersey, which expired

We also had a lease on office space in Cranbury, New Jersey, which expired

in January 2022 with a monthly payment of $3,158, as well as a lease of approximately $1,883 per month in Zagreb, Croatia expiring in

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 11 – LEASES (CONTINUED)

Lease-related assets, or right-of-use assets,

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For the years ended December 31, 2022 and

the Company’s lease cost consisted of the following components, each of which is included in operating expenses within the Company’s

consolidated statements of operations:

2021, the Company’s lease cost consisted of the following components, each of which is included in operating expenses within the

Company’s consolidated statements of operations:

Operating lease cost

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Total lease cost

(1) Short-term lease cost includes any lease with a term of less

than 12 months.

(1) Short-term lease cost includes

any lease with a term of less than 12 months.

The table below presents the future minimum lease

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Cash paid for amounts included in the measurement of lease liabilities was $ 89,111 .

For the year ended December 31, 2021, payments on

lease obligations were $ 142,284 and amortization on the right of use assets was $ 121,129 .

For the year ended December 31, 2022, payments

on lease obligations were $ 101,405 and amortization on the right of use assets was $ 101,433 .

For the year ended December 31, 2021,

payments on lease obligations were $ 142,284 and amortization on the right of use assets was $ 121,129 .

OPTIMIZERx CORPORATION

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No other customers accounted for more than 10 % of revenue in either year presented.

Our accounts receivable included 2 agencies that

represented multiple customers that individually made up more than 10 % of our accounts receivable at December 31, 2021 in the percentages

of 33.5 % and 12.2 %.

As of December 31, 2020, our accounts receivable included 4 entities, including agencies that represented multiple

customers that individually made up more than 10 % of our accounts receivable in the percentages of 19.7 %, 16.2 %, 15.8 % and 14.4 %.

Our accounts receivable included two entities,

including one agency that represented multiple customers, that individually made up more than 10 % of our accounts receivable at December 31,

2022 in the percentages of 13.3 % and 10.8 %.

As of December 31, 2021, our accounts receivable included two agencies that represented

multiple customers that individually made up more than 10 % of our accounts receivable in the percentages of 33.5 % and 12.2 %.

The Company generates its revenues through its

EHR and ePrescribe partners.

It had two key partners and/or vendors through which 10 % or greater of its revenue was generated in either

2021 or 2020 as set forth below.

There were three key partners and/or vendors through which 10 % or greater of its revenue was generated in

either 2022 or 2021 as set forth below.

The amounts in the table below reflect the amount of revenue generated through those partners.

NOTE 14 – INCOME TAXES

As of December 31, 2021, the Company had net operating

loss carry-forwards for federal income tax purposes of approximately $26.4 million, consisting of pre-2018 losses in the amount of approximately

$13.2 million that expire from 2021 through 2037, and post-2017 losses in the amount of approximately $13.2 million that will never expire.

As of December 31, 2022, the Company had

net operating loss (“NOLs”) carry-forwards for federal income tax purposes of approximately $21.5 million, consisting of pre-2018

losses in the amount of approximately $8.2 million that expire from 2022 through 2037, and post-2017 losses in the amount of approximately

$13.3 million that will never expire.

These net operating losses are available to offset future taxable income.

The Company was formed in 2006 as a limited liability company

and changed to a corporation in 2007.

The Company was formed

in 2008 as a Nevada Corporation.

Activity prior to incorporation is not reflected in the Company’s corporate tax returns.

the future, the cumulative net operating loss carry-forward for income tax purposes may differ from the cumulative financial statement

loss due to timing differences between book and tax reporting.

future, the cumulative net operating loss carry-forward for income tax purposes may differ from the cumulative financial statement loss

due to timing differences between book and tax reporting.

OPTIMIZERx CORPORATION

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State tax effect, net of federal benefit

State rate change

Change in fair value of contingent consideration

Option exercise benefits, net of Section 162M limitations

Other permanent items

Option exercise benefits (expenses), net of Section 162M limitations

Other adjustments

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( 2,900,000 )

( 3,006,000 )

Net provision for federal income tax

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Total tax benefit (expense) on income

The cumulative tax effect of significant

items comprising our net deferred tax amount at the expected rate of 21 % is as follows as of December 31, 2021 and 2020:

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 14 – INCOME TAXES

The cumulative tax effect of significant items

comprising our net deferred tax amount at the expected rate of 21 % is as follows as of December 31, 2022 and 2021:

Deferred tax asset attributable to:

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Operating lease liability

Section 174 Capitalized Expenses

Deferred tax asset

$ 10, 492,000

Deferred tax liabilities attributable to:

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Net deferred tax asset, net of valuation allowance

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021

NOTE 13 – INCOME TAXES (CONTINUED)

The ultimate realization of deferred tax assets

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audit by the Internal Revenue Service.

There are no uncertain tax positions as of December 31, 2020 or December 31, 2021, and none are

expected in the next 12 months.

There are no uncertain tax positions as of December 31, 2021 or December 31, 2022, and

none are expected in the next 12 months.

The Company’s foreign subsidiaries are cost centers that are primarily reimbursed for expenses,

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limitations can limit both the timing of usage of these laws, as well as the loss of the ability to use these net operating losses.

is likely that fundraising activities have resulted in such an ownership change.

Company had an ownership change as described in IRC Section 382 on March 18, 2014.

The Company NOL’s generated up until March 18, 2014

have been fully released.

OPTIMIZERx CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2022

NOTE 15 – COMMITMENTS AND CONTINGENT LIABILITIES

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health records systems and ePrescribe platforms, whereby we agree to share a portion of the revenue we generate for eCoupons distributed

through their networks.

These contracts grant audit rights related to the payments to our partners, and, in some cases would require us

to pay for the audit if the audit determined there was an underpayment and the underpayment meets certain thresholds, such as 10 %.

time to time the Company enters into arrangements with a partner to acquire minimum amounts of messaging capabilities.

As of December

31, 2021, the Company had commitments for future minimum payments of $ 3.4 million that will be reflected in cost of revenues during the

years from 2022 through 2023.

Minimum payments are due in 2022 and 2023, in the amounts of $ 2.65 million and $ 0.75 million, respectively.

and banners delivered through their networks.

These contracts grant audit rights related to the payments to our partners, and, in some

cases would require us to pay for the audit if the audit determined there was an underpayment and the underpayment meets certain thresholds,

such as 10 %.

From time to time the Company enters into arrangements with a partner to acquire minimum amounts of messaging capabilities.

As of December 31, 2022, the Company had commitments for future minimum payments of $ 16.4 million that will be reflected in

cost of revenues during the years from 2023 through 2025.

Minimum payments are due in 2023, 2024 and 2025, in the amounts of $ 6.2 million,

$ 5.2 million and $ 5.0 million, respectively.

NOTE 16 – RETIREMENT PLAN

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contributions to the plan.

Changes In and Disagreements with Accountants on Accounting

and Financial Disclosure

NOTE 17 – SUBSEQUENT EVENTS

Changes In and Disagreements with Accountants

on Accounting and Financial Disclosure

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-K

Item 8. Financial Statements and Supplementary Data