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

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

~~Florida~~

Florida

46-3390293

(State or other jurisdiction

~~(State or other jurisdiction~~ of incorporation or organization)

(I.R.S. Employer

Identification No.)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

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

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

Indicate by check mark whether the registrant is a shell company (as defined in ~~Rule12b-2~~Rule 12b-2 of the Act).

At ~~August 15, 2022~~November 13, 2023, the registrant had ~~1,097,138~~2,473,859 shares of common stock, par value $0.086 per share, ~~outstanding (after giving effect to the 1-for-15 reverse stock split that became effective on February 23, 2023).~~outstanding.

Reliance Global Group, Inc. (the “Company”) filed its Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, with the Securities and Exchange Commission (“SEC”) on August 15, 2022 (the “Original Form 10-Q”). This Amendment No. 1 on Form 10-Q/A (“Amendment No. 1” or “Form 10-Q/A”) is being filed to:

The Restatement is due to the Company performing an evaluation of its accounting in connection with the calculation of its basic and diluted EPS for the three and six months ended June 30, 2022, and identification of errors in such calculations. On May 12, 2023, management concluded its evaluation and determined that the identified errors require the filing of Amendment No. 1, as further discussed in Notes 1 and 7 to the unaudited condensed consolidated financial statements included in this Form 10-Q/A.

Except as described above, no other changes have been made to the Original Form 10-Q, and Amendment No. 1 does not modify, amend or update in any way revenue, expenses, net income (loss), or any of the financial or other information contained in the Original Form 10-Q. Amendment No. 1 does not reflect events that may have occurred subsequent to the filing date of the Original Form 10-Q other than adjusting, in the Items amended herein, common stock share and price per share information for the 1-for-15 reverse stock split that became effective February 23, 2023.

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

Reliance Global Group, Inc., formerly known as Ethos Media Network, Inc. (“RELI”, “Reliance”, or the “Company”), was incorporated in Florida on August 2, 2013.

The accompanying unaudited ~~Condensed Consolidated Financial Statements~~condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of recurring accruals) necessary for a fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto, set forth in the Company’s ~~annual report~~Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022, as the same may be amended from time to time. Certain prior period amounts in the condensed consolidated financial statements and notes thereto have been reclassified to conform to the current period’s presentation.

The accompanying unaudited condensed consolidated financial statements include the accounts of Reliance Global Group, Inc. and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Subsequent to the Company’s filing of its Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, with the Securities and Exchange Commission on August 15, 2022, the Company performed an evaluation of its accounting in connection with the calculations of its basic Earnings Per Share (“EPS”) and diluted EPS for the three and six month periods ended June 30, 2022, which concluded on May 12, 2023, and identified errors in such calculations. The errors resulted from improper application of sequencing rules, a miscalculation of the numerator used in the determination of diluted EPS, and a miscalculation of the denominator used in the determination of weighted average shares outstanding for both basic EPS and diluted EPS, and the Company determined that the errors required adjustments of the previously issued financial statements for the three and six months ended June 30, 2022. Accordingly, the Company restates its consolidated financial statements for the identified periods in this Form 10-Q/A as outlined further below and in Note 7 ~~Earnings (Loss) Per Share.~~

The following table sets forth the effects of the adjustments on affected items within the Company’s previously reported consolidated statements of operations for the three months ended June 30, 2022, and includes an increase to basic earnings per share in the amount of $~~1.42, an increase to diluted earnings per share in the amount of $10.11, a decrease to weighted average number of shares outstanding – basic of~~ ~~180,062~~ ~~shares, and a decrease to weighted average number of shares outstanding - diluted of~~ ~~180,062~~ ~~shares.~~

The following table sets forth the effects of the adjustments on affected items within the Company’s previously reported consolidated statements of operations for the six months ended June 30, 2022, and includes an increase to basic earnings per share in the amount of $~~1.34, an increase to diluted loss per share in the amount of $3.99, a decrease to weighted average number of shares outstanding – basic of~~ ~~124,111~~ ~~shares, and a decrease to weighted average number of shares outstanding - diluted of~~ ~~274,080~~ ~~shares.~~

~~Additionally, please refer to Note 7.~~ ~~Earnings (Loss) Per Share~~~~, where the Company has corrected and replaced that Note in its entirety.~~

As of ~~June~~September 30, ~~2022,~~2023, the Company’s reported cash and restricted cash aggregated balance was approximately $~~4,397,000~~3,187,000, current assets were approximately $~~6,101,000~~4,699,000, while current liabilities were approximately $~~9,470,000~~3,904,000. As of ~~June~~September 30, ~~2022,~~2023, the Company had apositive working capital ~~deficit~~ of approximately $~~3,369,000~~795,000 and stockholders’ equity of approximately $~~21,928,000~~13,863,000. For the ~~six~~nine months ended ~~June~~September 30, ~~2022,~~2023, the Company reported loss from operations of approximately $~~4,343,000~~4,278,000, a non-cash, non-operating gain on the recognition and change in fair value of warrant liabilities of approximately $~~24,479,000~~4,389,000, resulting in net loss from continuing operations of approximately $1,137,000, a net loss from discontinued operations of approximately $1,846,000, resulting in an overall net ~~income~~loss of approximately $~~19,836,000. For the six months ended June 30, 2022, the Company reported negative cash flows from operations of approximately $1,311,000~~2,983,000. The Company completed a capital offering in ~~January 2022 that raised~~March 2023, raising net proceeds of approximately $~~17,853,000~~3,446,000. ~~Management~~

Although there can be no assurance that debt or equity financing will be available on acceptable terms, the Company believes ~~the Company’s~~its financial position and its ability to raise capital to be reasonable and sufficient. Based on our assessment, we do not believe there are conditions or events that, in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern within one year of filing these financial statements with the Securities and Exchange Commission (“SEC”).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures in the financial statements and accompanying notes. Management bases its estimates on historical experience and on assumptions believed to be reasonable under the circumstances. Actual results could differ materially from those estimates.

Cash and restricted cash reported on our ~~Condensed Consolidated Balance Sheets~~condensed consolidated balance sheets are reconciled to the total shown on our ~~Condensed Consolidated Statements~~condensed consolidated statements of ~~Cash Flows~~cash flows as follows:

Level 1 — Observable inputs reflecting quoted prices (unadjusted) in active markets for identical assets and liabilities;

Level 2 — Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly for substantially the full term of the asset or liability; and

Level 3 — Unobservable inputs for the asset or liability, which include management’s own assumption about the assumptions market participants would use in pricing the asset or liability, including assumptions about risk.

Warrant Liabilities: The Company re-measures the fair value of its Level 3 warrant liabilities at the balance sheet date, using a binomial option pricing model. The following summarizes the significant unobservable ~~inputs not adjusting for any reverse stock splits:~~inputs:

Earn-out liabilities: The Company ~~generally values~~utilizes two valuation methods to value its Level 3 earn-out liabilities, ~~using~~a) the income valuation ~~approach.~~approach and b) the Monte Carlo simulation method. Key valuation and unobservable inputs for the income valuation approach include contingent payment arrangement terms, projected revenues and cash flows, ~~rate~~rates of return, discount rates and probability assessments. ~~The following table summarizes the significant~~Key unobservable inputs ~~used~~for the Monte Carlo simulation methods are summarized by the following (some presented in ~~the fair value measurements:~~ranges):

The Company values its Level 3 earn-out liability related to the Barra Acquisition using a Monte Carlo simulation in a risk-neutral framework (a special case of the Income Approach). The following summarizes the significant unobservable inputs:

Undiscounted remaining earn out payments ~~are~~were approximately $~~4,697,644~~847,854 as of ~~June~~September 30, ~~2022.~~2023. The following table reconciles fair value of earn-out liabilities for the ~~period ending June~~periods ended September 30, 2023, and December 31, 2022:

The following table disaggregates the Company’s revenue by line of business, showing commissions earned:

No other single ~~Customer~~customer accounted for more than 10% of the Company’s commission ~~revenues.~~revenues during the three and nine months ended September 30, 2023 and 2022. The loss of any significant customer ~~including Priority Health, BlueCross BlueShield and LTC Global~~ could have a material adverse effect on the Company. Customers from 2022 were adjusted to reflect percentages of revenue from continued operations.

The Company recorded no income tax expense for the three and ~~six~~nine months ended ~~June~~September 30, ~~2022~~2023 and ~~2021~~2022 because the estimated annual effective tax rate was zero. In determining the estimated annual effective income tax rate, the Company analyzes various factors, including projections of the Company’s annual earnings and taxing jurisdictions in which the earnings will be generated, the impact of state and local income taxes, the ability to use tax credits and net operating loss carry forwards, and available tax planning alternatives.

As of ~~June~~ September 30, ~~2022~~ 2023 and December 31, ~~2021,~~2022, the Company provided a full valuation allowance against its net deferred tax assets since the Company believes it is more likely than not that its deferred tax assets will not be realized.

The Company’s board of directors approved the discontinuation and abandonment of Medigap Healthcare Insurance Company, ~~identified certain immaterial adjustments impacting prior reporting periods. Specifically,~~LLC (“Medigap”), a subsidiary of the Company, ~~identified adjustments~~effective April 17, 2023, due to ~~correct certain asset, liability~~Medigap’s sustained recurring losses stemming from amongst other factors, greater than anticipated revenue chargebacks. The Company was unable to divest its interest in Medigap for value, and ~~equity~~accordingly, operations were wound down in an orderly manner. In doing so, the Company transferred to its operating entity, Medigap’s customer relationships and internally developed and purchased software intangible assets, with net of amortization combined value of approximately $4,300,000, as well as, its short-term financing arrangement of $29,500, and each are respectively classified at their adjusted book values in the intangible assets and short term financing agreements accounts in ~~relation~~the condensed consolidated balance sheets for the periods ended September 30, 2023 and December 31, 2022. These assets have continued value to ~~historical purchase price allocation accounting, historical accrued revenues~~the Company and ~~true ups~~have not been impaired as the fair value exceeds carrying cost. Medigap’s remaining assets were considered to have no remaining asset value and were fully impaired. Certain liabilities and estimated liabilities as outlined in the tables herein, were discharged and/or written-off in conjunction with the Settlement Agreement (as defined below) because of them having a net zero dollar estimated liability value. Accordingly, the Company recognized a net of estimated liability adjustments gain/loss of approximately $0, and an impairment loss of approximately $4,400,000, presented in income (loss) from discontinued operations in the consolidated statements of operations for the three and nine months ended September 30, 2023, respectively. As part of the ~~common stock issuable account.~~abandonment, the Company cancelled third party contracts, settled outstanding vendor and other third-party obligations, ceased to enter new customer contracts via Medigap, and no further customer performance obligations existed. The Company does not expect further continuing involvement with Medigap, and in accordance with ASC 205-20-45-9, no corporate overhead has been allocated to discontinued operations.

On June 30, 2023, the Company entered into a confidential settlement agreement and mutual release (the “Settlement Agreement”) with certain Medigap affiliated entities and persons, and the former owners of Medigap, whereby the Company would receive a settlement payment of $2,900,000 and was released from all past and future Medigap obligations and liabilities. The settlement payment was received in full by the Company in July 2023 and is recorded as income from discontinued operations in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023.

The ~~Company assessed~~following tables present the ~~materiality~~major components of assets and liabilities included in discontinued operations on the ~~adjustments to prior period financial statements in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. (SAB) 99,~~ ~~Materiality~~~~, and SAB 108,~~ ~~Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements~~~~, and ASC 250,~~ ~~Accounting Changes and Error Corrections~~.condensed consolidated balance sheets.

~~Accordingly, the Company’s comparative condensed consolidated financial statements and impacted notes have been revised from amounts previously reported to reflect these adjustments.~~ SCHEDULE OF DISCONTINUED OPERATIONS ON CONDENSED CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF OPERATIONS

The following table ~~illustrates~~rolls forward Medigap’s assets and liabilities from their carrying values pre-abandonment to their values post abandonment, and presents the impact ~~on previously reported amounts~~of reclassifications, impairments, and ~~adjusted balances~~write-offs:

The following tables disaggregate the major classes of pretax gain and loss as presented in discontinued operations in the condensed consolidated ~~financial~~ statements ~~for the period ended June 30, 2022.~~of operations.

We do not expect any recently issued accounting pronouncements to have a material effect on our financial statements.

On January 10, 2022, pursuant to an asset purchase agreement, dated December 21, 2021, the Company completed the acquisition of all of the assets of Medigap Healthcare Insurance Company, LLC (“Medigap”) for a purchase price of $~~20,096,250, consisting of: (i) payment to Medigap of $18,138,750~~ ~~in cash and (ii) the issuance to Medigap of~~ ~~40,402~~ shares of the Company’s restricted common stock in a transaction exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. The purchase price is subject to post-closing adjustment to reconcile certain pre-closing credits and liabilities of the parties. The shares issued to Medigap as part of the purchase price are further subject to lock up arrangements pursuant to which 50% of the shares may be sold after the one-year anniversary of the date of closing of the transaction and the balance of the shares may be sold after the second-year anniversary of the date of closing of the transaction.

The acquisition of Medigap was accounted for as a business combination in accordance with the acquisition method pursuant to FASB Topic No. 805, Business Combination (ASC 805). Accordingly, the total purchase consideration was allocated to the assets acquired, and liabilities assumed based on their respective estimated fair values. The acquisition method of accounting requires, among other things, that assets acquired, and liabilities assumed, if any, in a business purchase combination be recognized at their fair values as of the acquisition date. The process for estimating the fair values of identifiable intangible assets and certain tangible assets requires the use of significant estimates and assumptions, including estimating future cash flows, developing appropriate discount rates, estimating the costs, and timing.

~~The preliminary allocation of the purchase price in connection with the acquisition of Medigap was calculated as follows:~~

Trade name was measured at fair value using the relief-from-royalty method under the income approach. Significant inputs used to measure the fair value include an estimate of projected revenue from the trade name, a pre-tax royalty rate of ~~0.5% and a discount rate of~~ ~~11.0~~%.

Customer relationships were measured at fair value using the multiple-period excess earnings method under the income approach. Significant inputs used to measure the fair value include an estimate of projected revenue and costs associated with existing customers, and a discount rate of ~~11.0~~%.

Technology was measured at fair value using the cost replacement method of the cost approach. Significant inputs used to measure the fair value include an estimate of cost to replace, an obsolescence rate of ~~40.3~~%.

The value assigned to backlog acquired was estimated based upon the contractual nature of the backlog as of the acquisition date, using the income approach to discount back to present value the cash flows attributable to the backlog, using a discount rate of ~~11.0~~%.

~~Goodwill of $19,199,008~~ arising from the acquisition of Medigap consisted of the value of the employee workforce and the residual value after all identifiable intangible assets were valued. Goodwill recognized pursuant to the acquisition of Medigap is currently expected to be deductible for income tax purposes. Total acquisition costs for the acquisition of Medigap incurred were $~~94,065~~ ~~recorded as a component of General and administrative expenses.~~

~~The approximate revenue and net profit or loss for the acquired business as a standalone entity per ASC 805 from January 10, 2022 to June 30, 2022 was $2,537,061~~ ~~and a loss of $412,943, respectively.~~

~~Pro Forma Information~~

The results of operations of Medigap will be included in the Company’s consolidated financial statements as of the date of acquisition through the current period end. The following supplemental pro forma financial information approximate combined financial information assumes that the acquisition had occurred at the beginning of the six months ended June 30, 2022 and 2021:

~~SCHEDULE OF PRO FORMA INFORMATION RELATED TO ACQUISITION~~

June 30, June 30,
2022 2021
Revenue $ 8,809,482 $ 7,071,329
Net Income (Loss) $ 19,849,175 $ (1,796,767 )
Earnings (Loss) per common share, basic $ 11.25 $ 2.85 )
Earnings (Loss) per common share, diluted $ 8.85 ) $ 2.85 )

~~Barra~~ ~~& Associates, LLC~~ ~~Transaction~~

On April 26, 2022, the Company entered into an asset purchase agreement (the “APA”) with Barra & Associates, LLC (“Barra”) pursuant to which the Company purchased all of the assets of Barra & Associates, LLC on April 26, 2022 for a purchase price in the amount of $~~7,725,000~~ ~~in cash, with $6,000,000~~ ~~paid to Barra at closing, $1,125,000~~ ~~payable in six months from closing, and a final estimated earnout of $600,000~~ ~~payable over two years from closing, based upon meeting stated milestones. The source of the cash payment was $6,520,000~~ in funds borrowed from Oak Street Lending (“Loan”), the Company’s existing lender pursuant to a Fifth Amendment to Credit Agreement and Promissory Note, of even date. The purchase price is subject to post-closing adjustment to reconcile certain pre-closing credits and liabilities of the parties.

The acquisition of Barra was accounted for as a business combination in accordance with the acquisition method pursuant to FASB Topic No. 805, Business Combination (ASC 805). Accordingly, the total purchase consideration was allocated to the assets acquired, and liabilities assumed based on their respective estimated fair values. The acquisition method of accounting requires, among other things, that assets acquired, and liabilities assumed, if any, in a business purchase combination be recognized at their fair values as of the acquisition date. The process for estimating the fair values of identifiable intangible assets and certain tangible assets requires the use of significant estimates and assumptions, including estimating future cash flows, developing appropriate discount rates, estimating the costs, and timing.

~~The preliminary allocation of the purchase price in connection with the acquisition of Barra was calculated as follows:~~

~~SCHEDULE OF ALLOCATION OF PURCHASE PRICE~~

Description Fair Value Weighted Average Useful Life (Years)
Acquired accounts receivable $ 92,585
Property, plant and equipment 8,593 7
Right-of-use asset 122,984
Trade names 22,000 4
Customer relationships 550,000 10
Agency relationships 2,585,000 10
Developed technology 230,000 5
Lease liability (122,984 )
Goodwill 4,236,822 Indefinite
$ 7,725,000

Customer and Agency relationships were measured at fair value using the multiple-period excess earnings method under the income approach. Significant inputs used to measure the fair value include an estimate of projected revenue and costs associated with existing customers, and a discount rate of ~~19.5~~%.

Developed technology was measured at fair value using the cost replacement method of the cost approach. Significant inputs used to measure the fair value include an estimate of cost to replace, an obsolescence rate of ~~28.6~~%.

~~Goodwill of $4,236,822~~ arising from the acquisition of Barra consisted of the value of the employee workforce and the residual value after all identifiable intangible assets were valued. Goodwill recognized pursuant to the acquisition of Barra is currently expected to be deductible for income tax purposes. Total acquisition costs incurred through June 30, 2022 for the acquisition of Barra were $~~72,793~~ ~~recorded as a component of General and administrative expenses.~~

~~The approximate revenue and net profit or loss for the acquired business as a standalone entity per ASC 805 from April 26, 2022 to June 30, 2022 was $270,321~~ ~~and a loss of $38,698, respectively.~~

~~Pro Forma Information~~

The results of operations of Barra will be included in the Company’s consolidated financial statements as of the date of acquisition through the current period end. The following supplemental pro forma financial information approximate combined financial information assumes that the acquisition had occurred at the beginning of the six months ended June 30, 2022 and 2021:

~~SCHEDULE OF PRO FORMA INFORMATION RELATED TO ACQUISITION~~

June 30, June 30,
2022 2021
Revenue $ 8,990,529 $ 5,364,335
Net Income (Loss) $ 20,070,124 $ (1,527,038 )
Earnings (Loss) per common share, basic $ 11.40 $ (2.40 )
Earnings (Loss) per common share, diluted $ (8.70 ) $ (2.40 )

NOTE 3.2. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table rolls forward the Company’s goodwill balance for the periods ~~ending June~~ended September 30, ~~2022~~2023, and December 31, ~~2021.~~ ~~As discussed in Note 1 -~~ ~~Prior Period Adjustments~~~~, a~~ $~~(503,345) adjustment was identified~~2022, adjusted for goodwill which impacted the closing December 31, 2020 balance in the same amount. Accordingly, the December 31, 2020 balance is adjusted in the following table from the originally reported balance of $~~9,265,070~~ ~~to $8,761,725~~.discontinued operations.

SCHEDULE OF IMPAIRMENT OF GOODWILL

Goodwill
December 31, 2020 $ 8,761,725
Goodwill recognized in connection with Kush acquisition on May 1, 2021 $ 1,288,552
December 31, 2021 $ 10,050,277
Goodwill recognized in connection with Medigap acquisition on January 10, 2022 $ 19,199,008
Goodwill recognized in connection with Barra acquisition on April 26, 2022 4,236,822
June 30, 2022 $ 33,486,107

	Goodwill
December 31, 2021	$	10,050,277
Goodwill recognized in connection with Barra acquisition on April 26, 2022		4,236,822
December 31, 2022		14,287,099
September 30, 2023	$	14,287,099

For the year ended December 31, 2022, due to a declining market capitalization attributed to Medigap’s performance, the Company performed a goodwill impairment test utilizing the Market Approach – Traded Market Value Method, concluding that the Company’s fair value and resultant net assets, implied a goodwill balance of $19,100,000 versus our goodwill balance prior to write-down of $33,400,000. Thus, the Company recognized a goodwill impairment loss of $14,373,374. As of June 30, 2023, the Company recognized an additional goodwill impairment of $4,825,634 upon the abandonment of Medigap.

The following table rolls forward the Company’s goodwill balance for the periods ended September 30, 2023, and December 31, 2022 inclusive of discontinued operations.

	Goodwill
December 31, 2021	$	10,050,277
Goodwill recognized in connection with Medigap acquisition		19,199,008
Goodwill recognized in connection with Barra acquisition		4,236,822
Goodwill impairment (Medigap) during the year-ended December 31, 2022		(14,373,374	)
December 31, 2022		19,112,733
Goodwill impairment (Medigap) during the nine months ended September 30, 2023		(4,825,634	)
September 30, 2023	$	14,287,099

The following table sets forth the major categories of the Company’s intangible assets and the weighted-average remaining amortization period as of ~~June~~September 30, ~~2022:~~2023:

SCHEDULE OF INTANGIBLE ASSETS AND WEIGHTED-AVERAGE REMAINING AMORTIZATION PERIOD

Weighted Average Remaining Amortization period (Years)
Gross
Carrying
Amount
Accumulated Amortization
Net
Carrying Amount

Trade name and trademarks 4.9 $ 2,142,858 $ (804,020 ) $ 1,338,838
Internally developed software 4.5 1,326,158 (131,655 ) 1,194,503
Customer relationships 9.53 11,922,290 (1,517,174 ) 10,405,116
Purchased software - 562,327 (562,327 ) -
Video Production Assets 0.6 50,000 (23,242 ) 26,758
Non-competition agreements 2.4 3,504,810 (1,827,590 ) 1,677,220
Contracts Backlog 0.5 210,000 (100,684 ) 109,316
$ 19,718,443 $ (4,966,692 ) $ 14,751,751

	Weighted Average Remaining Amortization Period (Years)		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Trade name and trademarks		3.6	$	1,807,187	$	(1,232,982	)	$	574,205
Internally developed software		3.4		1,792,186		(557,038	)		1,235,148
Customer relationships		8.26		11,922,290		(2,914,320	)		9,007,970
Purchased software		1.85		667,206		(609,677	)		57,529
Video production assets		0.00		50,000		(50,000	)		-
Non-competition agreements		1.14		3,504,810		(2,704,136	)		800,674
			$	19,743,679	$	(8,068,153	)	$	11,675,526

The following table sets forth the major categories of the Company’s intangible assets and the weighted-average remaining amortization period as of December 31, ~~2021:~~2022:

Weighted Average Remaining Amortization period (Years)
Gross
Carrying
Amount
Accumulated Amortization
Net
Carrying Amount

Trade name and trademarks 3.5 $ 1,777,475 $ (609,822 ) $ 1,167,653
Internally developed software 4.7 595,351 (28,443 ) 566,908
Customer relationships 7.7 4,237,290 (1,048,726 ) 3,188,564
Purchased software 0.6 562,327 (452,985 ) 109,342
Video Production Assets 1.0 20,000 - 20,000
Non-competition agreements 2.9 3,504,809 (1,478,376 ) 2,026,433
$ 10,697,252 $ (3,618,352 ) $ 7,078,900

	Weighted Average Remaining Amortization period (Years)		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Trade name and trademarks		4.4	$	1,806,188	$	(969,241	)	$	836,947
Internally developed software		4.1		1,635,178		(287,990	)		1,347,188
Customer relationships		9.0		11,922,290		(2,076,086	)		9,846,204
Purchased software		0.4		665,137		(581,497	)		83,640
Video production assets		-		50,000		(50,000	)		-
Non-competition agreements		1.9		3,504,810		(2,179,420	)		1,325,390
Total			$	19,583,603	$	(6,144,234	)	$	13,439,369

The following table reflects expected amortization expense as of ~~June~~September 30, ~~2022,~~2023, for each of the following five years and thereafter:

SCHEDULE OF AMORTIZATION EXPENSE OF ACQUIRED INTANGIBLES ASSETS

Years ending December 31,	Amortization Expense			Amortization Expense
2022 (remainder of year)	$	1,374,512
2023		2,461,552
2023 (remainder of year)			$	639,264
2024		2,083,450		2,193,428
2025		1,703,824		1,799,472
2026		1,463,747		1,530,604
2027				1,196,429
Thereafter		5,664,666		4,316,329
Total	$	14,751,751	$	11,675,526

NOTE 4.3. LONG-TERM DEBT AND SHORT-TERM FINANCINGS

Long-Term Debt

The composition of the long-term debt follows:

SCHEDULE OF LONG TERM DEBT

June 30,
2022

December 31,
2021

Oak Street Funding LLC Term Loan for the acquisition of EBS and USBA, net of deferred financing costs of $13,497 and $14,606 as of June 30, 2022 and December 31, 2021, respectively $ 455,391 $ 485,317
Oak Street Funding LLC Senior Secured Amortizing Credit Facility for the acquisition of CCS, net of deferred financing costs of $16,351 and $17,626 as of June 30, 2022 and December 31, 2021, respectively 738,547 785,826
Oak Street Funding LLC Term Loan for the acquisition of SWMT, net of deferred financing costs of $10,085 and $11,027 as of June 30, 2022 and December 31, 2021, respectively 835,376 884,720
Oak Street Funding LLC Term Loan for the acquisition of FIS, net of deferred financing costs of $39,752 and $42,660 as of June 30, 2022 and December 31, 2021, respectively 2,103,885 2,226,628
Oak Street Funding LLC Term Loan for the acquisition of ABC, net of deferred financing costs of $45,369 and $48,609 as of June 30, 2022 and December 31, 2021, respectively 3,427,614 3,616,754
Oak Street Funding LLC Term Loan for the acquisition of Barra, net of deferred financing costs of $208,901 and $0 as of June 30, 2022 and December 31, 2021, respectively 6,311,099 -
13,871,912 7,999,245
Less: current portion (936,263 ) (913,920 )
Long-term debt $ 12,935,649 $ 7,085,325

	September 30, 2023			December 31, 2022


Oak Street Funding LLC Term Loan	$	384,402		$	426,883
Oak Street Funding LLC Term Loan for the acquisition of EBS and USBA, variable interest of Prime Rate plus 2.5%, maturing August 2028, net of deferred financing costs of $10,724 and $12,388 as of September 30, 2023 and December 31, 2022, respectively	$	384,402		$	426,883
Oak Street Funding LLC Senior Secured Amortizing Credit Facility for the acquisition of CCS, variable interest of Prime Rate plus 1.5%, maturing December 2028, net of deferred financing costs of $13,163 and $15,076 as of September 30, 2023 and December 31, 2022, respectively		627,676			693,682
Oak Street Funding LLC Term Loan for the acquisition of SWMT, variable interest of Prime Rate plus 2.0%, maturing April 2029, net of deferred financing costs of $8,101 and $9,206 as of September 30, 2023 and December 31, 2022, respectively		719,654			788,596
Oak Street Funding LLC Term Loan for the acquisition of FIS, variable interest of Prime Rate plus 2.0%, maturing May 2029, net of deferred financing costs of $32,481 and $36,843 as of September 30, 2023 and December 31, 2022, respectively		1,817,583			1,987,846
Oak Street Funding LLC Term Loan for the acquisition of ABC, variable interest of Prime Rate plus 2.0%, maturing September 2029, net of deferred financing costs of $37,269 and $42,129 as of September 30, 2023 and December 31, 2022, respectively		2,989,482			3,249,575
Oak Street Funding LLC Term Loan for the acquisition of Barra, variable interest of Prime Rate plus 2.5%, maturing May 2032, net of deferred financing costs of $182,118 and $198,188 as of September 30, 2023 and December 31, 2022, respectively		6,195,731			6,321,812
Long term debt gross		12,734,528			13,468,394
Less: current portion		(1,353,961	)		(1,118,721	)
Long-term debt	$	11,380,567		$	12,349,673

Oak Street Funding LLC – Term Loans and Credit Facilities

SCHEDULE OF CUMULATIVE MATURITIES OF ~~LONG-TERM~~LONG -TERM LOANS AND CREDIT FACILITIES

Fiscal year ending December 31,	Maturities of Long-Term Debt			Maturities of Long-Term Debt
2022 (remainder of year)	$	438,616
2023		1,228,897
2023 (remainder of year)				$	326,783
2024		1,542,156			1,390,766
2025		1,656,383			1,552,772
2026		1,776,385			1,729,160
2027					1,925,603
Thereafter		7,563,428			6,093,302
Total		14,205,865			13,018,386
Less: debt issuance costs		(333,953	)		(283,858	)
Total	$	13,871,912		$	12,734,528

Short-Term Financings

The Company ~~financed certain annual insurance premiums through the use of two~~has various short-term notes payable for financed items such as insurance premiums and CRM software purchases. These are normally paid in ~~nine~~equal installments over a period of twelve months or less and ~~ten equal monthly installments~~carry interest rates up to 8% per annum. As of September 30, 2023, and December 31, 2022, balances outstanding on short-term financings were $~~42,894~~114,394 and $~~4,456~~ ~~at interest rates of~~ ~~7.51% and~~ ~~7.95%, per annum respectively. Policies financed include directors and officers and errors and omissions insurance coverage with premium financing recognized in 2022 and 2021 of $417,199~~ ~~and $~~0154,017, respectively. ~~Outstanding balances as of June 30, 2022 and December 31, 2021, respectively were $376,647~~ ~~and $~~0.

NOTE 5.4. WARRANT LIABILITIES

Series B Warrants

~~On December 22, 2021,~~Pursuant to the ~~Company entered into a securities purchase agreement with several institutional buyers for the purchase and sale of (i) warrants to purchase an aggregate of up to~~ ~~651,997~~ ~~shares~~terms of the ~~Company’s common stock, par value $0.086~~ ~~per share at an~~Sales and Purchase Agreement (SPA), during the quarter ended September 30, 2023, the Series B Warrants’ effective exercise price reset to $2.43. As of $September 30, 2023, there remain ~~61.35~~1,166,667 ~~per share, (ii) an aggregate of~~ ~~178,059~~ ~~shares of Common Stock, and (iii)~~ ~~9,076~~ ~~shares of the Company’s newly-designated~~ Series B ~~convertible preferred stock, par value $0.086~~ ~~per share, with a stated value of $1,000~~ ~~per share, initially convertible into an aggregate of~~ ~~147,939~~ ~~shares of Common Stock at a conversion price of $61.35~~ ~~per share, each a freestanding financial instrument, (the “Private Placement”). The aggregate purchase price for the Common Shares, the Preferred Shares and the~~ Warrants ~~was approximately $20,000,000~~.outstanding.

~~By entering into~~For the ~~Private Placement on December 22, 2021,~~three and nine months ended September 30, 2023, net fair value gains and losses recognized for the ~~Company entered into a commitment to issue the Common Shares, Preferred Shares and~~ Series B Warrants onwere gains of $1,703,333 and $4,345,599, respectively. For the ~~Initial Closing Date~~three and nine months ended September 30, 2022, net fair value gains and losses recognized for ~~a fixed price and exercise price, as applicable. The commitment to issue~~the Series B Warrants ~~(the “Warrant Commitment”) represents a derivative financial instrument, other than an outstanding share, that, at inception, has both~~were gains of the following characteristics: (i) embodies a conditional obligation indexed to the Company’s equity. The Company classified the commitment to issue the warrants as a derivative liability because it represents a written option that does not qualify for equity accounting The Company initially measured the derivative liability at its fair value$7,726,161 and ~~will subsequently remeasure the derivative liability, at fair value with changes~~$34,621,024, respectively, presented in ~~fair value recognized in earnings. An option pricing model was utilized to calculate the fair value of the Warrant Commitment. The Company initially recorded $17,652,808~~ ~~of non-operating unrealized losses within~~ the recognition and change in fair value of warrant liabilities account ~~for~~in the ~~year ended~~condensed consolidated statements of operations. The Series B Warrant liability outstanding as of September 30, 2023 and December 31, ~~2021. The Private Placement closed on January 4,~~ 2022 ~~at which time the Company remeasured the derivative liability for the warrants issued in the transaction. The Company recognized~~was $~~12,322,737~~1,575,000 and $~~24,748,163~~6,384,250 ~~of non-operating unrealized gains within~~respectively, presented in the ~~recognition and change in fair value of~~ warrant ~~liabilities~~liability account on the condensed consolidated statement of operations for the three and six months ended June 30, 2022, respectively, related to the subsequent changes in its fair value through June 30, 2022. A corresponding derivative liability of $~~10,757,945~~ ~~is included on Company’s condensed consolidated~~ balance ~~sheet as of June 30, 2022. The closing of the Private Placement settled the subscription receivable reported on the Company’s balance sheet as of December 31, 2021.~~sheets.

Placement Agent Warrants

~~In connection with~~For the ~~Private Placement, the Company issued~~ ~~16,303~~ ~~warrants to the placement agent~~three and nine months ended September 30, 2023, net fair value gains and losses recognized for the Private Placement. The warrants were issued as compensation for the Placement Agent’s services. The Placement Agent Warrants are: (i) exercisable on any day after the six (6) month anniversary of the issue date, (ii) expire ~~five years~~ ~~after the closing of the Private Placement, and (iii) exercisable at $61.35~~ ~~per share. The Placement Agent Warrants contain terms that may require the Company to transfer assets to settle the warrants. Therefore,~~ the Placement Agent Warrants ~~are classified as a derivative liability measured at fair value of $1,525,923~~ on the date of issuance and will be remeasured each accounting period with the changes in fair value reported in earnings. The Placement Agent Warrants are considered financing expense fees paid to the Placement Agent. Since the financing expenses relate to a derivative liability measured at fair value, this financing expense of $~~1,525,923, along with non-operating unrealized~~(“PAW”) were gains of $~~310,514~~12,064 and ~~losses of~~ $~~268,948~~43,520, respectively. For the three and nine months ended September 30, 2022, net fair value gains recognized for the PAW were ~~included~~$193,154 and $1,450,129, respectively, presented in the recognition and change in fair value of warrant liabilities account in the condensed consolidated statements of operations. The PAW liability outstanding as of September 30, 2023 and December 31, 2022 was $5,380 and $48,900, respectively, presented in the warrant liability account on the condensed consolidated ~~statement~~balance sheets. As of ~~operations for the three and six months ended June~~September 30, ~~2022, respectively, A corresponding derivative liability of $268,948~~ ~~is included on Company’s condensed consolidated balance sheet as of June 30, 2022.~~

~~NOTE 6.~~ ~~EQUITY~~2023, there remain 16,303 PAW’s outstanding.

~~Preferred Stock~~NOTE 5. EQUITY

~~The Company has been authorized to issue~~ ~~750,000,000~~ ~~shares of $0.086~~ par value Preferred Stock. The Board of Directors is expressly vested with the authority to divide any or all of the Preferred Stock into series and to fix and determine the relative rights and preferences of the shares of each series so established, within certain guidelines established in the Articles of Incorporation.

~~In January 2022, the Company issued~~ ~~9,076~~ ~~shares of its newly designated Series B convertible preferred stock through the Private Placement for the purpose of raising capital. These shares remain issued and outstanding as of June 30, 2022.~~

~~The Series B convertible preferred stock has no voting rights and initially each share of Series B convertible preferred stock may be converted into~~ 16 shares of the Company’s common stock. The holders of the Series B convertible preferred stock are not entitled to receive any dividends other than any dividends paid on account of the common stock. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders shall be entitled to receive out of the assets, whether capital or surplus, of the Company the same amount that a holder of common stock would receive if the Preferred Stock were fully converted (disregarding for such purposes any conversion limitations hereunder) to common stock which amounts shall be paid pari passu with all holders of common stock.

Common Stock

The Company ~~has been~~is authorized to issue 133,333,333 shares of common stock, $0.086par value. Each share of issued and outstanding common stock ~~shall entitle~~entitles the holder thereof to fully participate in all shareholder meetings, to cast one vote on each matter with respect to which shareholders have the right to vote, and to share ratably in all dividends and other distributions declared and paid with respect to common stock, as well as in the net assets of the corporation upon liquidation or dissolution.

In January ~~2022,~~2023, the Company issued ~~178,059~~ ~~shares of common stock through the Private Placement for the purpose of raising capital. See Note 5 -~~ ~~Warrant Liabilities~~ ~~for proceeds received by the Company.~~

~~In January 2022, the Company issued~~ ~~40,402~~ ~~shares of common stock pursuant to the Medigap Acquisition.~~

~~In January 2022, upon agreement with Series A warrant holders,~~ ~~25,000~~ ~~warrants were exercised at a price of $99.00~~ ~~into~~ ~~25,000~~ ~~of the Company’s common stock.~~

~~In March 2022, the Company issued~~ ~~400~~109,358 shares of the Company’s common stock ~~due~~ to ~~the vesting of~~ settle two earn-out liabilities.

~~400~~ ~~stock awards~~

On February 23, 2023, pursuant to ~~an employee agreement.~~authority granted by the Board of Directors of the Company, the Company implemented a 1-for-15 reverse split of the Company’s authorized and issued and outstanding common stock (the “Reverse Split-2023”). The par value remains unchanged. All share and per share information as well as common stock and additional paid-in capital have been retroactively adjusted to reflect the Reverse Split-2023 for all periods presented, unless otherwise indicated. The split resulted in a rounding addition of approximately 15,300 shares valued at par, totaling $1,300.

In ~~May and June 2022,~~ March 2023, Yes Americana, a related party, converted $~~218,462~~645,000 ~~Series C prepaid warrants were exchanged for~~of its outstanding convertible debt into ~~218,462~~66,743 shares of the Company’s common stock. The conversion considered the fair market value of the stock on the day of conversion of $9.67 for the total of 66,743 shares.

In March 2023, the Company issued 155,038 shares of the Company’s common stock in conjunction with the Private Placement-2023 as defined and discussed further below.

During the second quarter of 2023, the Company issued from its common stock, 112,557 shares in lieu of services provided, 352,260 shares to settle an earn-out liability and 22,219 shares pursuant to vested restricted stock awards earned by agents through an equity-based compensation program at one of the Company’s subsidiaries.

During the third quarter of 2023, the Company issued from its common stock, 174,610 shares to settle an earn-out liability, 400 shares in lieu of services provided, and 3,017 shares to employees for vested stock awards.

As of ~~June~~September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, there were ~~974,268~~2,304,375 and ~~730,407~~1,219,573 shares of ~~Common Stock~~common stock outstanding, respectively.

Warrants

Series A ~~warrant holders exercised~~ Warrants

~~25,000~~

In conjunction with the Company’s initial public offering, the Company issued 2,070,000 Series A Warrants, classified as equity warrants ~~in January 2022, resulting in~~ per its provisions, which permit holders to obtain a fixed number of shares for a fixed monetary value. The warrants are standalone equity securities transferable without the Company’s consent or knowledge. The warrants were recorded at a value per the offering of $~~113,000~~0.01, and may be exercised at any point from the effective date at an exercise price $6.60 of until the 5^th-year anniversary from issuance (effectively, February 8, 2026) and are not subject to antidilution provisions. Considering 375,000 warrant exercises through September 30, 2023, there remain 1,695,000Series A ~~warrants remaining~~Warrants issued and outstanding as of ~~June~~September 30, 2023 and December 31, 2022. Pursuant to the Reverse Split-2023, the outstanding Series A Warrants are exercisable into 113,000 common shares for an effective exercise price of $99.00.

Series E and F Warrants

On March 13, 2023, the Company entered into a securities purchase agreement (the “SPA-2023”) with one institutional buyer for the purchase and sale of, (i) an aggregate of 155,038 shares (the “Common Shares”) of the Company’s common stock, par value $0.086 per share (the “Common Stock”) along with accompanying common warrants (the “Common Units”), (ii) prefunded warrants (the “Prefunded Warrants” or “Series E Warrants”) that are exercisable into 897,594 shares of Common Stock (the “Prefunded Warrant Shares”) along with accompanying common warrants (the “Pre-Funded Units”), and (iii) common warrants (the “Common Warrants” or “Series F Warrants”) to initially acquire up to 2,105,264 shares of Common Stock (the “Common Warrant Shares”) (representing 200% of the Common Shares and Prefunded Warrant Shares) in a private placement offering (the “Private Placement-2023”). Additionally, the Company agreed to issue a warrant to the Placement Agent (defined below), to initially acquire 52,632 shares of common stock (the “PA Warrant”) and entered into a registration rights agreement with the buyer to register for resale the common shares underlying the Series E and F Warrants.

The aggregate purchase price for the Common Shares, Prefunded Warrants (Series E Warrants) and the Common Warrants (Series F Warrants) to be purchased by the Buyer shall be equal to (i) $3.80 for each Common Unit purchased by such Buyer, or (ii) $3.799 for each Prefunded Unit purchased by the Buyer, which Prefunded Warrants are exercisable into Prefunded Warrant Shares at the initial Exercise Price (as defined in the Prefunded Warrant) of $0.001 per Prefunded Warrant Share in accordance with the Prefunded Warrant.

The Common Warrant (Series F) has an exercise price of $3.55 per share, subject to adjustment for any stock dividend, stock split, stock combination, reclassification or similar transaction occurring after the date of the Private Placement-2023. The Common Warrant will be exercisable six months following the date of issuance and will expire five and a half years from the date of issuance.

The PA Warrant has an exercise price of $3.91 per share, subject to adjustment for any stock dividend, stock split, stock combination, reclassification or similar transaction occurring after the date of the SPA-2023. The PA Warrant will be exercisable six months following the date of issuance and will expire five years from the date of issuance.

~~In January 2022, as a result~~The closing of the ~~issuance~~Private Placement-2023 occurred on March 16, 2023. EF Hutton, a division of ~~common stock in~~Benchmark Investments, LLC (the “Placement Agent”) acted as the ~~January 2022 stock offering~~sole placement agent and was entitled to an 8% of gross proceeds cash fee and the ~~Medigap Acquisition, the Company received a deficiency notification from Nasdaq indicating violation~~reimbursement of Listing Rule 5365(a). As part of its remediation plan, in March 2022, the Company entered into Exchange Agreements with the holders of common stock issued in January 2022. Pursuant to the Exchange Agreements, the Company issued ~~218,462~~ ~~Series C prepaid warrants in exchange for~~ ~~218,462~~ ~~shares of the Company’s common stock. Additionally, as compensation for entering into the Exchange Agreements, the Company issued~~ ~~81,500~~ ~~Series D prepaid warrants to the January 2022 stock offering investors for no additional consideration. The fair value of the Series D prepaid warrants was treated as a deemed dividend~~certain Placement Agent fees and ~~accordingly was treated as a reduction from income available to common stockholders in the calculation of earnings per share. Refer to Note 7,~~ ~~Earnings (Loss) Per Share~~ ~~for additional information.~~customary expenses.

~~In May~~Gross and ~~June 2022,~~net proceeds to the Company from the Private Placement-2023 ~~218,462~~were approximately $4 million and $3.4 million respectively, to be utilized primarily for general working capital and administrative purposes. Direct financing fees approximated $553,000.

The Company determined the Series ~~C prepaid warrants were converted~~E Warrants, Series F Warrants, and PA Warrants are equity in nature because of provisions, pursuant to the warrant agreements, that permit the holder to obtain a fixed number of shares for a fixed monetary amount. The values offset to $~~218,462~~0 ~~shares of~~in additional paid-in capital in the Company’s ~~common stock for an exercise price~~condensed consolidated statements of $~~0.001~~stockholders’ equity (deficit).~~. Through June~~

As of September 30, ~~2022, the Company has received payments of $~~2023, no exercises have occurred and there remain ~~1,336~~897,594, 2,105,264 ~~from one investor for these issuances.~~and 52,632 Series E Warrants, Series F Warrants and PA Warrants outstanding respectively.

Equity-based Compensation

~~Between February and May 2022, three existing employees were~~During the nine-month period ended September 30, 2023, an executive was awarded ~~bonuses~~an annual stock award in conjunction with a promotion agreement, consisting of2,667 shares of the Company’s common stock per annum, to ~~be vested immediately. The shares granted in 2022 were valued at $766,250~~.vest monthly throughout the term of employment. For the three and ~~six~~nine months ended ~~June~~September 30, ~~2022,~~2023, total stock compensation ~~expense on these grants totaled~~for this award was valued at approximately $~~100,000~~5,601, and $~~766,250~~17,044, ~~respectively. As of June 30, 2022, these shares have not been issued.~~respectively, recorded as stock-based compensation.

~~In April 2022 , pursuant to an agreement between~~Total stock-based compensation expense recorded in general and administrative expenses in the ~~Company and an Executive,~~condensed consolidated statements of operations for the ~~Executive will be compensated with~~ ~~4,000~~ ~~shares of the Company’s Common stock. These shares vest quarterly over a three-year period. The shares granted were valued at $178,200~~ ~~at the date of the grant. For the~~ three and ~~six~~nine months ended ~~June~~ September 30, ~~2022, compensation expense on this grant was~~2023 is $27,779 and $~~70,721~~106,943~~. As of June 30, 2022, no shares were issued under this contract.~~, respectively.

NOTE 7.6. EARNINGS (LOSS) PER SHARE

Basic ~~EPS~~earnings per common share (“EPS”) applicable to common stockholders is computed by dividing earnings applicable to common stockholders by the weighted-average number of common shares outstanding.

If there is a loss from operations, diluted EPS is computed in the same manner as basic EPS is computed. Similarly, if the Company has net income but its preferred dividend adjustment made in computing income available to common stockholders results in a net loss available to common stockholders, diluted EPS would be computed in the same manner as basic EPS.

TheThe following calculates basic and diluted EPS:

SCHEDULE OF CALCULATIONS OF BASIC AND DILUTED EPS

Three Months Three Months
Ended Ended
June 30, 2022 June 30, 2021
Net income (loss), numerator, basic and diluted computation $ 10,495,691 $ (1,276,886 )

Weighted average shares - denominator basic computation 1,069,157 728,966
Effect of stock awards 2,128 -
Effect of Series B warrant liability
Effect of preferred stock 147,939 -
Weighted average shares, as adjusted - denominator diluted computation 1,219,224 728,966
Earnings (loss) per common share – basic $ 9.82 $ (1.75 )
Earnings (loss) per common share – diluted 8.61 (1.75 )

	Three Months Ended September 30, 2023			Three Months Ended September 30, 2022

(Loss) income from continuing operations, numerator, basic and diluted computation	$	(139,004	)	$	6,296,483
Deemed dividend		-			-
Net income continuing operations, numerator, basic computation
Recognition and change in fair value of warrant liabilities
Net loss continuing operations, numerator, diluted computation

Weighted average common shares, basic		3,021,455			1,156,939
Effect of series B warrants		-			147,939
Non-vested stock awards
Weighted average common shares, dilutive		3,021,455			1,304,878
(Loss) earnings per common share – basic	$	(0.05	)	$	5.44
(Loss) earnings per common share – diluted	$	(0.05	)		4.83

Six Months Six Months
Ended Ended
June 30, 2022 June 30, 2021
Net income (loss) $ 19,835,692 $ (1,890,812 )
Deemed dividend (6,930,335 ) -
Net income (loss), numerator, basic computation 12,905,357 (1,890,812 )
Recognition and change in fair value of warrant liability (26,625,915 ) -
Net income (loss), numerator, diluted computation $ (13,720,558 ) $ (1,890,812 )

Weighted average shares - denominator basic computation 1,025,108 617,316
Effect of Series B warrant liability 43,128 -
Weighted average shares, as adjusted - denominator diluted computation 1,068,236 617,316
Earnings (loss) per common share - basic $ 12.59 $ (3.06 )
Earnings (loss) per common share - diluted $ (12.84 ) $ (3.06 )

	Nine Months Ended September 30, 2023			Nine Months Ended September 30, 2022
(Loss) income from continuing operations	$	(1,136,922	)	$	26,357,370
Deemed dividend		-			(6,930,335	)
Net (loss) income from continuing operations, numerator, diluted computation	$	(1,136,922	)	$	19,427,035

Weighted average common shares, basic		2,436,015			1,069,534
Effect of series B warrants		-			147,939
Non-vested stock awards		-			2,349
Weighted average common shares, dilutive		2,436,015			1,219,822
Loss per common share – basic		(0.47	)		18.16
Loss per common share – diluted	$	(0.47	)	$	15.93

Additionally, the following are considered anti-dilutive securities excluded from weighted-average shares used to calculate diluted net loss per common share:

SCHEDULE OF ~~ANTI-DILUTIVE SECURITIES IN WEIGHTED AVERAGE~~DILUTIVE NET LOSS PER COMMON SHARES

For the Three Months Ended
June 30,
2022 June 30,
2021
Shares subject to outstanding common stock options 10,928 10,928
Shares subject to outstanding Series A warrants 113,000 138,000
Shares subject to unvested stock awards - 3,072
Shares subject to warrant liability 668,299 -

For the six months ended
June 30,
2022 June 30,
2021
Shares subject to outstanding common stock options 10,928 10,928
Shares subject to outstanding Series A warrants 113,000 138,000
Shares subject to conversion of Series B preferred stock 147,939 -
Shares subject to unvested stock awards 4,621 3,072
Weighted-average anti-dilutive securities 4,621 3,072


	For the Three and Nine Months Ended
	September 30, 2023		September 30, 2022
Shares subject to outstanding common stock options		10,298		10,928
Shares subject to Series A warrants		113,000		113,000
Shares subject to Series B warrants		1,182,969		668,297
Shares subject to Series E warrants		887,594		-
Shares subject to series F warrants		2,105,264		-
Shares subject to placement agent warrants		52,632		-
Shares subject to vested and unvested stock awards		5,756		4,085

NOTE 8.7. LEASES

Operating lease expense for the three months ended ~~June~~September 30, ~~2022~~2023 and ~~2021~~2022 was $~~156,750~~123,508 and $~~43,931~~118,653, respectively. Operating lease expense for the ~~six~~nine months ended ~~June~~September 30, ~~2022~~2023 and ~~2021~~2022 was $~~275,174~~ 362,804and $~~112,199~~337,876 respectively. As of ~~June~~September 30, ~~2022,~~2023, the weighted average remaining lease term and weighted average discount rate for the operating leases were ~~4.01~~3.82 years and ~~5.76~~6.14% respectively.

Future minimum lease payment under these operating leases consisted of the following:

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENT

Year ending December 31,	Operating Lease Obligations
2022	$	303,256
Period ending September 30, 2023				Operating Lease Obligations
2023		546,275		$	391,173
2024		253,908			210,106
2025		144,124			112,904
2026		113,738			116,291
2027					119,780
Thereafter		268,202			60,774
Total undiscounted operating lease payments		1,629,503			1,011,028
Less: Imputed interest		(169,978	)		101,495
Present value of operating lease liabilities	$	1,459,525		$	909,533

NOTE 9.8. COMMITMENTS AND CONTINGENCIES

Legal Contingencies

The Company is subject to various legal proceedings and claims, either asserted or unasserted, arising in the ordinary course of business. While the outcome of these claims cannot be predicted with certainty, management does not believe the outcome of any of these matters will have a material adverse effect on our business, financial position, results of operations, or cash flows, and accordingly, no legal contingencies are accrued as of ~~June~~September 30, ~~2022~~2023 and December 31, ~~2021.~~2022. Litigation relating to the insurance brokerage industry is not uncommon. As such the Company, from time to time have been subject to such litigation. No assurances can be given with respect to the extent or outcome of any such litigation in the future.

Earn-out liabilities

The following outlines changes to the Company’s earn-out liability balances ~~inclusive of accumulated accretion~~ for the respective ~~period~~periods ended ~~June~~September 30, ~~2022~~2023 and December 31, ~~2021:~~2022:

SCHEDULE OF EARN-OUT LIABILITY

CCS Fortman Montana Altruis Kush Barra Total
Ending balance December 31, 2021 $ - $ 515,308 $ 615,969 $ 992,868 $ 1,689,733 $ - $ 3,813,878
Changes due to acquisitions - - - - - 600,000 600,000
Changes due to payments (326,935 ) (84,473 ) (411,408 )
Changes due to fair value adjustments - 32,620 37,741 - 334,602 (50,000 ) 354,963
Ending balance June 30, 2022 $ - $ 547,928 $ 326,775 $ 908,395 $ 2,024,335 $ 550,000 $ 4,357,433

	Fortman			Montana			Altruis			Kush			Barra			Total
Ending balance December 31, 2022	$	667,000		$	500,000		$	834,943		$	147,535		$	560,000		$	2,709,478
Changes due to business combinations
Changes due to payments		(1,433,700	)		(750,000	)		(929,168	)		(147,535	)		-			(3,260,403	)
Changes due to fair value adjustments		1,152,525			356,744			94,225			-			(312,000	)		1,291,494
Changes due to amount payable in common shares		-			(53,372	)		-			-			-			(53,372	)
Ending balance September 30, 2023	$	385,825		$	53,372		$	-		$	-		$	248,000		$	687,197

CCS Fortman Montana Altruis Kush Total
Ending balance December 31, 2020 $ 81,368 $ 432,655 $ 522,553 $ 1,894,842 $ - $ 2,931,418
Changes due to business combinations - - - - 1,694,166 1,694,166
Changes due to payments - - - (452,236 ) - (452,236 )
Changes due to fair value adjustments - 82,653 93,416 (449,738 ) (4,433 ) (278,102 )
Changes due to write-offs (81,368 ) - - - - (81,368 )
Ending balance December 31, 2021 $ - $ 515,308 $ 615,969 $ 992,868 $ 1,689,733 $ 3,813,878

	Fortman			Montana			Altruis			Kush			Barra			Total
Ending balance December 31, 2021	$	515,308		$	615,969		$	992,868		$	1,689,733		$	-		$	3,813,878
Beginning balance	$	515,308		$	615,969		$	992,868		$	1,689,733		$	-		$	3,813,878

Changes due to business combinations		-			-			-			-			600,000			600,000
Changes due to payments		(34,430	)		(326,935	)		(84,473	)		(1,259,087	)		-			(1,704,925	)
Changes due to fair value adjustments		186,122			210,966			(73,452	)		(283,111	)		(40,000	)		525
Ending balance December 31, 2022	$	667,000		$	500,000		$	834,943		$	147,535		$	560,000		$	2,709,478
Ending balance	$	667,000		$	500,000		$	834,943		$	147,535		$	560,000		$	2,709,478

NOTE 9. RELATED PARTY TRANSACTIONS

On September 13, 2022, the Company issued a promissory note to YES Americana Group, LLC (“Americana”) a related party entity beneficially owned by the Company’s Chief Executive Officer, for the principal sum of $1,500,000 (the “Note”), accruing monthly interest of 5% per annum beginning nine months after Note issuance. On February 7, 2023 , the Company and Americana entered into an amendment to the Note pursuant to which (i) the principal amount of the Note was increased to $1,845,000, (ii) the maturity date of the Note was amended to January 15, 2026, (iii) the interest rate under the Note shall not increase after the maturity date, and (iv) the Note can be converted at any time, at the option of Americana, into shares of the Company’s common stock, par value $0.086 per share at an agreed upon conversion price.

On February 13, 2023, Americana effectuated a conversion of $645,000 of the Note into 66,743 shares of the Company’s common stock, $0.086 par value per share, in accordance with the terms of the Amendment. In addition, throughout the year of 2023 the Company repaid principal to Americana of $693,145. As of September 30, 2023, and December 31, 2022 respectively, the balance owed to Americana was $161,855 and $1,500,000, reclassified and recorded in the convertible debt, related parties, less current portion account in the condensed consolidated balance sheets. Interest expense for both the three and nine months ended September 30, 2023, was $4,355, recorded to interest expense, related parties in the condensed consolidated statements of operations.

The Company has amounts payable to Reliance Global Holdings, LLC, a related party beneficially owned by the Company’s Chief Executive Officer stemming from funds loaned to the Company for various subsidiary acquisitions. These loans do not bear interest and there is no term. Repayment will be made at the Company’s discretion. The open balance is considered non-current and classified to the related parties, less current portion account in the condensed consolidated balance sheets with open balances of $25,479 and $100,724 as of September 30, 2023 and December 31, 2022, respectively.

The Company incurred a payable of $200,000 to an employee for a software purchased in July of 2019. The payable was issued with a $27,673 discount, utilizing a 7.5% discount rate. There are monthly payment terms of $4,167 through June 2024, the date of final settlement. The balance is carried at present value on the condensed consolidated balance sheets. The Company classifies amounts planned to be settled within twelve months from the balance sheet date to current liabilities. Accordingly, the Company presents current balances of $36,479 and $47,249 in the current portion of loans payables, related parties account in the condensed consolidated balance sheets as of September 30, 2023 and December 31, 2022. Non-current amounts are classified to the loans payable, related parties, less current portion account in the condensed consolidated balance sheets and amounted to $0 and $21,541 as of September 30, 2023, and December 31, 2022, respectively. Amortization expense to bring the payable to present value for the three and nine months ended September 30, 2023 respectively, was $1,730 and $5,189, and is classified to the interest expense, related parties account in the condensed consolidated statements of operations.

Pursuant to the first amendment to the April 26, 2022 asset purchase agreement between the Company and Barra & Associates, LLC, a related party entity beneficially owned by a senior vice president of the Company, the Company agreed to pay a deferred purchase price (the “DPP”) of $1,375,000 by January 31, 2023, and all amounts unpaid thereafter will accrue interest at a rate of 1.5% per month until paid. The Company intends to fully repay all unpaid amounts inclusive of interest over the next two years. The Company classifies amounts planned to be settled within twelve months from the balance sheet date to current liabilities. Accordingly, the Company reclassifies and presents current balances of $300,000 and $1,375,000 respectively, in the current portion of loans payables, related parties account in the condensed consolidated balance sheets as of September 30, 2023 and December 31, 2022. Non-current amounts are classified to the loans payable, related parties, less current portion account in the condensed consolidated balance sheets and amounted to $233,306 and $0 as of September 30, 2023, and December 31, 2022 respectively. Interest expense for the three and nine months ended September 30, 2023 respectively, was $26,390 and $115,560, recorded to interest expense, related parties in the condensed consolidated statements of operations.

NOTE 10. INVESTMENT IN NSURE

During April 2023, the Company sold its remaining 262,684 of NSURE shares to unaffiliated third parties, receiving the shares’ cost basis and cash proceeds of $900,000. The Company’s remaining NSURE share balance as of September 30, 2023, was $0.

NOTE 11. SUBSEQUENT EVENTS

On October 3, 2023, 168,594 pre-funded Series E Warrants were exercised into 168,594 common shares at an exercise price of $0.001, resulting in $729 of cash proceeds to the Company. Subsequently, the issued and outstanding balance of Series E Warrants is 729,000.

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

Overview

Reliance Global Group, Inc. (the “Company”) operates as a diversified company engaging in business in the insurance market, as well as other related sectors. Our focus is to grow the Company by pursuing an aggressive acquisition strategy, initially and primarily focused upon wholesale and retail insurance agencies.

In the insurance sector, our management has extensive experience acquiring and managing insurance portfolios in several states, as well as developing specialized programs targeting niche markets. Our primary strategy is to identify specific risk to reward arbitrage opportunities and develop these on a national platform, thereby increasing revenues and returns, and then identify and acquire undervalued wholesale and retail insurance agencies with operations in growing or underserved segments, expand and optimize their operations, and achieve asset value appreciation while generating interim cash flows.

As part of our growth and acquisition strategy, we continue to survey the current insurance market for value-add acquisition opportunities. As of September 30, 2023, we have acquired nine insurance agencies.

Over the next 12 months, we plan to focus on the expansion and growth of our business through continued asset acquisitions in insurance markets and organic growth of our current insurance operations through geographic expansion and market share growth.

Further, we launched our 5MinuteInsure.com (“5MI”) Insurtech platform during 2021 which expanded our national footprint. 5MI is a high-tech proprietary tool developed by us as a business to consumer portal which enables consumers to instantly compare quotes from multiple carriers and purchase their car and home insurance in a time efficient and effective manner. 5MI taps into the growing number of online shoppers and utilizes advanced artificial intelligence and data mining techniques, to provide competitive insurance quotes in around 5 minutes with minimal data input needed from the consumer. The platform launched during the summer of 2021 and currently operates in 46 states offering coverage with up to 30 highly rated insurance carriers.

With the acquisition of Barra, we launched RELI Exchange, our business-to-business (B2B) InsurTech platform and agency partner network that builds on the artificial intelligence and data mining backbone of 5MinuteInsure.com. Through RELI Exchange we on-board agency partners and provide them with an InsurTech platform white labeled, designed and branded specifically for their business. This combines the best of digital and human capabilities by providing our agency partners and their customers quotes from multiple carriers within minutes. Since its inception, RELI Exchange has increased its agent roster by more than 30%.

Business Trends and Uncertainties

The insurance intermediary business is highly competitive, and we actively compete with numerous firms for customers and insurance companies, many of which have relationships with insurance companies, or have a significant presence in niche insurance markets that may give them an advantage over us. Other competitive concerns may include the quality of our products and services, our pricing and the ability of some of our customers to self-insure and the entrance of technology companies into the insurance intermediary business. Several insurance companies are engaged in the direct sale of insurance, primarily to individuals, and do not pay commissions to agents and brokers.

Financial Instruments

The Company’s financial instruments as of September 30, 2023, consist of derivative warrants. These are accounted at fair value as of inception/issuance date, and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, (non-cash) gain or loss.

Insurance Operations

Our insurance operations focus on the acquisition and management of insurance agencies throughout the U.S. Our primary focus is to pinpoint undervalued wholesale and retail insurance agencies with operations in growing or underserved segments (including healthcare and Medicare, as well as personal and commercial insurance lines). We then focus on expanding their operations on a national platform and improving operational efficiencies to achieve asset value appreciation while generating interim cash flows. In the insurance sector, our management team has over 100 years of experience acquiring and managing insurance portfolios in several states, as well as developing specialized programs targeting niche markets. We plan to accomplish these objectives by acquiring wholesale and retail insurance agencies it deems to represent a good buying opportunity (as opposed to insurance carriers) as insurance agencies bear no insurance risk. Once acquired, we plan to develop them on a national platform to increase revenues and profits through a synergetic structure. The Company is initially focused on segments that are underserved or growing, including healthcare and Medicare, as well as personal and commercial insurance lines.

Insurance Acquisitions and Strategic Activities

As of the balance sheet date, we have acquired multiple insurance brokerages (see table below), including both acquisitions of affiliated companies (i.e., owned by Reliance Holdings before the acquisition) and unaffiliated companies. As our acquisition strategy continues, our reach within the insurance arena can provide us with the ability to offer lower rates, which could boost our competitive position within the industry.

Acquired	Date	Location	Line of Business	Status

U.S. Benefits Alliance, LLC (USBA)	October 24, 2018	Michigan	Health Insurance	Affiliated

Employee Benefit Solutions, LLC (EBS)	October 24, 2018	Michigan	Health Insurance	Affiliated

Commercial Solutions of Insurance Agency, LLC (CCS or Commercial Solutions)	December 1, 2018	New Jersey	P&C – Trucking Industry	Unaffiliated

Southwestern Montana Insurance Center, Inc. (Southwestern Montana or Montana)	April 1, 2019	Montana	Group Health Insurance	Unaffiliated

Fortman Insurance Agency, LLC (Fortman or Fortman Insurance)	May 1, 2019	Ohio	P&C and Health Insurance	Unaffiliated

Altruis Benefits Consultants, Inc. (Altruis)	September 1, 2019	Michigan	Health Insurance	Unaffiliated

UIS Agency, LLC (UIS)	August 17, 2020	New York	P&C – Trucking Industry	Unaffiliated

J.P. Kush and Associates, Inc. (Kush)	May 1, 2021	Michigan	Health Insurance	Unaffiliated

Barra & Associates, LLC	April 26, 2022	Illinois	Health Insurance	Unaffiliated

Recent Developments

Reverse Stock Split

On February 23, 2023, pursuant to authority granted by the Board of Directors of the Company, the Company implemented a 1-for-15 reverse split of the Company’s authorized and issued and outstanding common stock (the “Reverse Split-2023”). The par value remains unchanged. All share and per share information as well as common stock and additional paid-in capital have been retroactively adjusted to reflect the Reverse Split-2023 for all periods presented, unless otherwise indicated. The split resulted in a rounding addition of approximately 15,300 shares valued at par, totaling $1,300.

Second Amendment to Fortman Purchase Agreement

As previously disclosed, the Company, Fortman Insurance Services, LLC, Fortman Insurance Agency, LLC, Jonathan Fortman, and Zachary Fortman (collectively, the “Parties”) entered into a purchase agreement on or around May 1, 2019 (the “Purchase Agreement”), whereby the Company purchased the business and certain assets noted within the Purchase Agreement. On May 18, 2023, the Parties entered into that certain second amendment to the Purchase Agreement (the “Second Amendment”). Pursuant to the Second Amendment, the Parties agreed to a total remaining balance of $716,850 owed to both Jonathan Fortman and Zachary Fortman under the Purchase Agreement for a combined total amount owed of $1,433,700. In satisfaction of such remaining balances, the Company agreed to issue 176,130 shares of the Company’s restricted common stock, par value $0.086 per share (the “Common Stock”), to both Jonathan Fortman and Zachary Fortman (collectively, the “Shares”), for a total issuance of 352,260 shares of Common Stock. Following the issuance of the Shares, the Company’s issued and outstanding Common Stock count will be 1,983,308. If the Nasdaq official closing price of the Common Stock is less than $4.07 on November 18, 2023, then the Company shall pay both Jonathan Fortman and Zachary Fortman an amount equal to the Make-Up Payment (as defined herein) within 15 business days thereafter. Pursuant to the Second Amendment, the “Make-Up Payment” means an amount in cash equal to $616,850 minus First Holder Shares Value (as defined herein) to Jonathan Fortman, and $616,850 minus Second Holder Shares Value (as defined herein) to Zachary Fortman. Further, under the Second Amendment, the “First Holder Shares Value” and “Second Holder Shares Value” means 176,130 and 176,130 respectively (subject to appropriate adjustments for any stock dividend, stock split, stock combination, rights offerings, reclassification or similar transaction that proportionately decreases or increases the Common Stock) multiplied by the Nasdaq official closing price of the Common Stock on November 18, 2023.

Settlement Agreement

On June 30, 2023, the Company entered into a Confidential Settlement Agreement and Mutual Release (the “Settlement Agreement”) by and between the Company, Medigap Healthcare Insurance Agency, LLC, a wholly owned subsidiary of the Company (the “Agency” and together with the Company, the “Reliance Parties”), Pagidem, LLC f/k/a Medigap Healthcare Insurance Company, LLC (“Pagidem”), Joseph J. Bilotti, III (together with Pagidem, the “Bilotti Parties”), Kyle Perrin, Zachary Lewis, T65 Health Insurance Solutions, Inc. f/k/a T65 Health Solutions, Inc. (“T65”), and Seniors First Life, LLC (collectively with Mr. Lewis and T65, the “Lewis Parties”).

The Company, Pagidem, and Mr. Bilotti previously entered into that certain Asset Purchase Agreement dated December 21, 2021 (the “APA”), pursuant to which the Company acquired, and the Bilotti Parties sold, certain assets and liabilities of Pagidem to the Company. As part of the transactions contemplated by the APA, the Company entered into that certain Employment Agreement, dated as of January 10, 2022, by and between the Company and Mr. Perrin (the “Employment Agreement”). The Company later assigned the assets and liabilities it acquired pursuant to the APA, and the Employment Agreement, to Agency. Mr. Perrin previously served as the Chief Operating Officer and Chief Executive Officer of Agency pursuant to the Employment Agreement. The Company and Mr. Lewis entered into that certain Non-Disclosure Agreement, effective as of January 24, 2022 (the “NDA”).

The Company, pursuant to the APA, previously filed a claim with the American Arbitration Association (“AAA”), Case No. 01-23-0002-3404 (the “Bilotti Arbitration”), wherein the Company purports to assert claims against the Bilotti Parties for fraudulent inducement, intentional and negligent misrepresentation, breach of contract, breach of restrictive covenants, conversion, civil theft, tortious interference, and conspiracy (the “Bilotti Claim”). The Company also filed, pursuant to the Employment Agreement, a claim with the AAA, Case No. 01-23-0002-2048(the “Perrin Arbitration”), wherein the Company purports to assert claims against Mr. Perrin for conversion, civil conspiracy, fraud, breach of fiduciary duty, and breach of duty of loyalty and good faith. (the “Perrin Claim”). In the Perrin Arbitration, Mr. Perrin filed counterclaims against the Company for breaches of employment agreement, unjust enrichment, and breach of the covenant of good faith and fair dealing (the “Perrin Counterclaim”).

The Reliance Parties have filed a complaint in the Circuit Court of the 15th Judicial Circuit in and for Palm Beach County, Florida, Case No. 50-2023-CA-010777-XXXXMB, Div. AA (the “Lewis Litigation,” and collectively with the Bilotti Arbitration and the Perrin Arbitration, the “Medigap Disputes”), wherein the Reliance Parties purport to assert claims against the Lewis Parties for tortious interference with business relationship, civil conspiracy, breach of contract, conversion, and unjust enrichment (the “Lewis Claim”).

The parties to the Settlement Agreement have each disputed and continue to dispute the claims asserted and allegations made against them.

United Insurance Group Agency, Inc. and/or LTC Global, Inc. or those entities’ assignees, affiliates, subsidiaries, partners or parent companies (collectively, the “Factor”), allege the Reliance Parties owe the Factor a debt, which the Reliance Parties dispute.

Pursuant to the terms of the Settlement Agreement, the Medigap Parties agreed to pay to the Company an amount equal to $2,900,000 (the “Settlement Payment”) within five business days of the effective date of the Settlement Agreement. The Company received the Settlement Payment on July 6, 2023.

Upon receipt of the Settlement Payment, the Reliance Parties agreed to release and discharge each and all of the Bilotti Parties, Mr. Perrin, and the Lewis Parties, and each of their present and former agents, servants, or employees, members, owners, shareholders, officers, managers, partners, directors, trustees, representatives, attorneys, contractors, predecessor and successor entities and assigns, parents, subsidiaries and affiliates (collectively, the “Medigap Released Parties”) of and from any and all past, existing, and/or future suits, liabilities, claims, demands, fees, costs, expenses, payments, judgments, damages, actions and rights or causes of action of any kind or nature, from the beginning of the world to the effective date of the Settlement Agreement, including but not limited to (A) any matters that were or could have been alleged in the: (i) the Bilotti Arbitration; (ii) the Perrin Arbitration; (iii) the Lewis Litigation; and (B) (i) any and all claims to additional money, distributions, or compensation of any kind from the Medigap Released Parties; provided, however, that nothing in the Settlement Agreement will serve to release any claims the Reliance Parties may have against the Factor.

In addition, upon receipt of the Settlement Payment, the Medigap Parties agreed to release and discharge each and all of the Reliance Parties, and each of their present and former agents, servants, or employees, members, owners, shareholders, officers, managers, partners, directors, trustees, representatives, attorneys, contractors, predecessor and successor entities and assigns, parents, subsidiaries and affiliates (collectively, the “Reliance Released Parties”) of and from any and all past, existing, and/or future suits, liabilities, claims, demands, fees, costs, expenses, payments, judgments, damages, actions and rights or causes of action of any kind or nature, from the beginning of the world to the effective date of the Settlement Agreement, including but not limited to (A) any matters that were or could have been alleged in the: (i) the Bilotti Arbitration; (ii) the Perrin Arbitration; (iii) the Lewis Litigation; and (B) (i) any and all claims to additional money, distributions, or compensation of any kind from the Medigap Released Parties.

Also, pursuant to the terms of the Settlement Agreement, Mr. Perrin agreed to release the Reliance Parties from all claims arising under any federal, state or local law or statute, including without limitation, the Fair Labor Standards Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the Family Medical Leave Act, Title VII of the Civil Rights Act of 1964, Employee Retirement Income Security Act, the Equal Pay Act, the Worker Adjustment and Retraining Notification Act, the law of contract and tort, any claim for attorneys’ fees, claims for unpaid wages or other employment compensation, and claims of personal injury, including mental and physical pain and suffering or intentional infliction of emotional distress. Additionally, Mr. Perrin expressly waived any right to recover any type of personal relief from the Reliance Parties, including monetary damages or reinstatement, in any administrative action or proceeding, whether state or federal, and whether brought by Mr. Perrin or on his behalf by an administrative agency, related in any way to the matters herein.

Pursuant to the terms of the Settlement Agreement, all of the parties thereto agreed that, upon receipt of the Settlement Payment by the Reliance Parties, they would discharge any obligations under the APA, the Employment Agreement, the NDA and all ancillary documents and agreements referenced or contemplated therein. In addition, within five business days of receipt of the Settlement Payment: (i) the Company will cause the Bilotti Arbitration to be dismissed, with prejudice; (ii) the Reliance Parties and Mr. Perrin will cause the Perrin Arbitration to be dismissed, with prejudice; and (iii) the Reliance Parties will cause the Lewis Litigation to be dismissed, with prejudice.

Results of Operations

Comparison of the three months ended September 30, 2023 to the three months ended September 30, 2022

The following table sets forth our revenue and operating expenses for each of the years presented.

	September 30, 2023			September 30, 2022
Revenue
Commission income	$	3,275,583		$	2,821,768
Total revenue		3,275,583			2,821,768

Operating expenses
Commission expense		796,001			695,020
Salaries and wages		1,775,919			1,629,947
General and administrative expenses		1,368,126			1,117,027
Marketing and advertising		117,752			63,371
Depreciation and amortization		652,839			651,395
Total operating expenses		4,710,637			4,156,760

Loss from operations		(1,435,054	)		(1,334,992	)

Other income (expense)
Interest expense		(386,562	)		(281,201	)
Interest related parties		(32,475	)		(1,730	)
Other income (expense), net		(310	)		(4,909	)
Recognition and change in fair value of warrant liabilities		1,715,397			7,919,315
Total other income (expense)		1,296,050			7,631,475
Loss (income) from continuing operations before tax		(139,004	)		6,296,483
Loss (income) from discontinued operations before tax		-			(174,390	)
Net income (loss)	$	(139,004	)	$	6,122,093

Revenues

The Company’s revenue is primarily comprised of commissions paid by insurance carriers or their representatives related to insurance plans that have been purchased by a member who used our services. We define a member as an individual or entity currently covered by an insurance plan, including individual and family, Medicare-related, small business, and ancillary plans, as well as property and casualty coverage, including auto, home and life, for which the Company is entitled to receive compensation from an insurance carrier.

The Company had revenues of approximately $3.3 million for the three months ended September 30, 2023, as compared to approximately $2.8 million for the three months ended September 30, 2022. The increase of approximately $454,000 or 16% is primarily driven by organic growth.

Commission expense

The Company had total commission expense of approximately $796,000 for the three months ended September 30, 2023, compared to approximately $695,000 for the three months ended September 30, 2022. The increase of approximately $101,000 or 15% is primarily driven by organic growth and in-line with the revenue increase.

Salaries and wages

The Company reported approximately $1.8 million of salaries and wages expense for the three months ended September 30, 2023, compared to approximately $1.6 million for the three months ended September 30, 2022. The increase of approximately $146,000 or 9% is a result of the Company’s growth driven by expanded operations.

General and administrative expenses

The Company had total general and administrative expenses of approximately $1.4 million for the three months ended September 30, 2023, as compared to approximately $1.1 million for the three months ended September 30, 2022. The increase of approximately $251,000, or 22% is primarily driven by the approximate $270,000 loss in fair value change of the estimated earn-out liability compared to the same period in the prior year which had an approximate gain of $223,000.

Marketing and advertising

The Company reported approximately $118,000 of marketing and advertising expense for the three months ended September 30, 2023 compared to approximately $63,000 for the three months ended September 30, 2022. The increase of approximately $54,000, or 86% is a result of increased branding and outreach efforts to drive the higher organic revenue growth.

Depreciation and amortization

The Company reported approximately $653,000 of depreciation and amortization expense for the three months ended September 30, 2023 compared to approximately $651,000 for the three months ended September 30, 2022. The increase of approximately $1,000 or 0.2% is primarily a result of additional assets placed in service.

Other income and expense

The Company reported approximately $1.3 million of other income for the three months ended September 30, 2023 compared to approximately $7.9 million of other income for the three months ended September 30, 2022. The decrease of approximately $6.2 million, or 78%, is attributable primarily to the change in fair value of warrant liabilities, offset by interest expense.

Comparison of the nine months ended September 30, 2023 to the nine months ended September 30, 2022

The following table sets forth our revenue and operating expenses for each of the periods presented.

	September 30, 2023			September 30, 2022
Revenue
Commission income	$	10,410,591		$	8,727,614
Total revenue		10,410,591			8,727,614

Operating expenses
Commission expense		2,701,601			2,143,562
Salaries and wages		5,230,871			4,899,171
General and administrative expenses		4,430,177			5,080,991
Marketing and advertising		364,184			148,057
Depreciation and amortization		1,962,066			1,901,140
Total operating expenses		14,688,899			14,172,921

Loss from operations		(4,278,308	)		(5,445,307	)

Other income (expense)
Interest expense		(1,126,281	)		(586,251	)
Interest related parties		(125,104	)		(5,189	)
Other income (expense), net		3,650			(4,414	)
Recognition and change in fair value of warrant liabilities		4,389,120			32,398,530
Total other income (expense)		3,141,385			31,802,676

Income (loss) from continuing operations before tax		(1,136,922	)		26,357,370
Income (loss) from discontinued operations before tax		(1,845,904	)		(399,585	)
Net (loss) income	$	(2,982,827	)	$	25,957,784

Revenues

The Company had revenues of approximately $10.4 million for the nine months ended September 30, 2023, as compared to approximately $8.7 million for the nine months ended September 30, 2022. The increase of approximately $1.7 million or 19% is primarily driven by organic growth and the addition of RELI Exchange during the second quarter of 2022.

Commission expense

The Company had total commission expense of approximately $2.7 million for the nine months ended September 30, 2023, compared to approximately $2.1 million for the nine months ended September 30, 2022. The increase of approximately $558,000 or 26% is primarily driven by organic growth and the addition of RELI Exchange during the second quarter of 2022.

Salaries and wages

The Company reported approximately $5.2 million of salaries and wages expense for the nine months ended September 30, 2023, compared to approximately $4.9 million for the nine months ended September 30, 2022. The increase of approximately $331,000 or 7% is a result of the Company’s growth driven by expanded operations and the addition of RELI Exchange during the second quarter of 2022.

General and administrative expenses

The Company had total general and administrative expenses of approximately $4.4 million for the nine months ended September 30, 2023, as compared to approximately $5.1 million for the nine months ended September 30, 2022. The decrease in expense of approximately $651,000, or 13%, is a result of the Company’s focus on leaner operations and the implementation of cost-cutting measures.

Marketing and advertising

The Company reported approximately $364,000 of marketing and advertising expense for the nine months ended September 30, 2023, compared to approximately $148 million for the nine months ended September 30, 2022. The increase of approximately $216,000 or 146% is a result of the Company increasing its branding and outreach efforts to drive the higher organic revenue growth.

Depreciation and amortization

The Company reported approximately $2.0 million of depreciation and amortization expense for the nine months ended September 30, 2023, compared to approximately $1.9 million for the nine months ended September 30, 2022. The increase of approximately $60,000, or 3%, is primarily a result of our acquired tangible and intangible assets through business combinations.

Other income and expense

The Company reported approximately $3.1 million of other income for the nine months ended September 30, 2023, compared to approximately $32.4 million of other income for the nine months ended September 30, 2022. The decrease of approximately $28 million, or 86%, is attributable primarily to the change in the fair value of warrant liabilities, offset by interest expense.

Liquidity and capital resources

As of September 30, 2023, we had a cash balance of approximately $3.2 million and working capital of approximately $795,000, compared with a cash balance of approximately $1.9 million and working capital deficit of approximately $4.6 million at December 31, 2022. The improved working capital is primarily attributable to cash proceeds from the issuance of stock with a private placement, other receivables related to discontinued operations recoveries/settlements, and the repayment of liabilities.

Inflation

The Company generally may be impacted by rising costs for certain inflation-sensitive operating expenses such as labor, employee benefits, and facility leases. The Company believes inflation could have a material impact to pricing and operating expenses in future periods due to the state of the economy and current inflation rates.

Off-balance sheet arrangements

We do not have any off-balance sheet arrangements as such term is defined in Regulation S-K.

Cash Flows

	Nine Months Ended September 30,
	2023			2022
Net cash used in operating activities	$	(17,307	)	$	(2,177,998	)
Net cash provided and used in investing activities		718,583			(24,982,609	)
Net cash provided by financing activities		576,212			25,564,501
Net increase in cash, cash equivalents, and restricted cash	$	1,277,488		$	(1,596,106	)

Operating Activities

Net cash used in operating activities for the nine months ended September 30, 2023 was approximately $17,000, compared to net cash flows used in operating activities of approximately $2.2 million for the nine months ended September 30, 2022. The cash used includes net loss of approximately $2.98 million, decreased by approximate non-cash adjustments of $855,000 principally related to income of recognition and change in fair value of warrant liabilities of $4.4 million, offset by earn-out fair value adjustments and depreciation and amortization of $1.3 million and $1.96 million, respectively, as well as a net increase in cash due to changes of net working capital items in the amount of $285,000 and offset by net cash adjustments for discontinued operating activities of $3.8 million.

Investing Activities

During the nine months ended September 30, 2023, cash flows provided in investing activities approximated $719,000 compared to cash flows used in investing activities of approximately $25 million for the nine months ended September 30, 2022. The cash provided is primarily related to the sale of the Company’s shares in NSURE stock. Total proceeds received in 2023 were $900,000.

Financing Activities

During the nine months ended September 30, 2023, approximate cash provided by financing activities was $576,000 as compared to approximately $25.6 million for the nine months ended September 30, 2022. Net cash provided by financing activities primarily relates to proceeds from private placement offerings of approximately $3.4 million, offset by net debt principal repayments of $786,000, related party loan and related party convertible debt repayments of $1.6 million, and earn out payments of $419,000.

Significant Accounting Policies and Estimates

We describe our significant accounting policies in Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, and our critical accounting estimates in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. There have been no significant changes in our significant accounting policies or critical accounting estimates since the end of fiscal year 2022.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), refers to controls and procedures that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to a company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

~~The~~During fiscal year 2022, the Company determined it had a material weakness in its disclosure controls and procedures ~~as it pertains~~relating to earnings per share ~~(EPS) for~~(“EPS”). During the ~~three and six months~~quarters ended March 31, June 30 ~~2022. During the quarter ended March 31,~~and September 30, 2023, the Company mitigated ~~this~~the deficiency by consulting with qualified advisors that have in-depth EPS expertise. These advisors ~~will assist~~assisted the Company in the calculations and disclosures of EPS for ~~future reporting periods. Pursuant to~~ the ~~above, our~~three and nine months ended September 30, 2023.

Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures as of ~~June~~September 30, ~~2022, concluding them to be ineffective~~2023, and concluded that they were not effective as of ~~such date.~~September 30, 2023 due to the material weakness discussed above.

Changes in Internal Control over Financial Reporting

~~There~~During fiscal year 2022, the Company retained subject matter expert advisors to prepare the accounting and disclosures over Earnings per Share. These advisors assisted the Company in the calculations and disclosures of EPS for the three and nine months ended September 30, 2023. Aside for the foregoing, there have ~~not~~ been ~~any~~no other changes in our internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter which is the subject of this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

Item 1. Legal Proceedings.

We are subject to various legal proceedings and claims, either asserted or unasserted, arising in the ordinary course of business. While the outcome of these claims cannot be predicted with certainty, management does not believe the outcome of any of these matters will have a material adverse effect on our business, financial position, results of operations, or cash flows, and accordingly, no legal contingencies are accrued as of September 30, 2023. Litigation relating to the insurance brokerage industry is not uncommon. As such we, from time to time have been, subject to such litigation. No assurances can be given with respect to the extent or outcome of any such litigation in the future.

Item 1A. Risk Factors.

Investing in our common stock involves a high degree of risk. You should consider carefully the information disclosed in Part I, Item 1A, “Risk Factors,” contained in our Annual Report on Form 10-K for the year ended December 31, 2022. There have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K for the year ended December 31, 2022, as amended from time to time.

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

None that have not been previously disclosed in our filings with the SEC.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

Not applicable.

Item 6. Exhibits

The following exhibits are filed with this Form 10-K.

Exhibit No.		Description

10.1		~~Asset~~Amendment #1 to the Purchase Agreement, ~~with Barra~~dated as of September 29, 2023, by and ~~Associates (Incorporated~~between Reliance Global Group, Inc., Southwestern Montana Insurance Center, LLC, Southwestern Montana Financial Center, Inc., and Julie A. Blockey (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on ~~May 2, 2022~~October 4, 2023).

~~10.2~~31.1*		~~Loan Agreement with Oak Street Lending (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on May 2, 2022~~

~~10.3~~		Employment Agreement with Grant Barra (Incorporated by reference to the Registrant’s Current Report on Form 8-K, File No. 001-40020, filed with the Securities and Exchange Commission on May 2, 2022(File Number 001-40020))
~~31.1~~		Certification of Chief Executive Officer pursuant to ~~Section302~~Section 302 of the Sarbanes-Oxley Act 2002*of 2002
~~31.2~~
31.2*		Certification of Chief Financial Officer pursuant to ~~Section302~~Section 302 of the Sarbanes-Oxley Act 2002*of 2002
~~32.1~~
32.1**		Section 1350 Certification of the Chief Executive Officer and Chief Financial Officer*Officer

101.INS*		Inline XBRL Instance Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted in IXBRL, and included in exhibit 101).

*Filed ~~herewith.~~herewith

**Furnished ~~herewith.~~herewith

SIGNATURES

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

	Reliance Global Group, Inc.

Date: ~~May 18,~~November 13, 2023	By:	/s/ Ezra Beyman
		Ezra Beyman
		Chief Executive Officer
		(principal executive officer)


Date: ~~May 18,~~November 13, 2023	By:	/s/ Joel Markovits
		Joel Markovits
		Chief Financial Officer
		(principal financial officer and principal accounting officer)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	RELI	The Nasdaq Capital Market
Series A Warrants	RELIW	The Nasdaq Capital Market

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

~~(i)~~	~~reflect the restatement of earnings per share (“EPS”) information (the “Restatement”) in the condensed consolidated statements of operations for the three and six months ended June 30, 2022;~~
~~(ii)~~	~~insert additional disclosure relating to the Restatement to Note 1;~~
~~(iii)~~	~~replace Note 7 from the Original Form 10-Q in its entirety as a result of the Restatement;~~
~~(iv)~~	~~revise share and per share information throughout the Form 10-Q/A to give effect to the 1-for-15 reverse stock split that became effective on February 23, 2023 (the “Reverse Split”);~~
~~(v)~~	~~revise Part I, Item 4 to indicate that the Company’s disclosure controls and procedures were not effective as of June 30, 2022;~~
~~(vi)~~	~~replace the exhibit index contained in Item 6 in its entirety;~~
~~(vii)~~	~~provide current dated certifications;~~
~~(viii)~~	~~correct certain immaterial errors on the cover sheet to the Form 10-Q/A.~~

	●	~~Part I — Item 1. Financial Statements~~
	●	~~Part I – Item 4. Controls and Procedures~~
	●	~~Part II – Item 6. Exhibits~~

	June 30, 2022			December 31, 2021			September 30, 2023			December 31, 2022
	June 30, 2022			December 31, 2021			(Unaudited)
Assets
Current assets:
Cash	$	2,979,769		$	4,136,180		$	1,777,348		$	505,410
Restricted cash		1,417,635			484,542			1,409,909			1,404,359
Accounts receivable		1,072,294			1,024,831			1,190,780			994,321
Accounts receivable, related parties		54,414			7,131			21,078			18,292
Accounts receivable								21,078			18,292
Other receivables								813			11,464
Prepaid expense and other current assets		576,691			2,328,817			299,522			245,535
Current assets - discontinued operations								-			85,998
Total current assets		6,100,803			7,981,501			4,699,450			3,265,379

Property and equipment, net		164,017			130,359			145,962			162,767
Right-of-use assets		1,421,474			1,067,734			878,672			1,018,952
Investment in NSURE, Inc.		1,350,000			1,350,000			-			900,000
Intangibles, net		14,751,751			7,078,900			11,675,526			13,439,369
Goodwill		33,486,107			10,050,277			14,287,099			14,287,099
Other non-current assets		23,284			16,792			23,283			23,284
Other assets - discontinued operations								-			5,330,879
Total assets	$	57,297,436		$	27,675,563		$	31,709,992		$	38,427,729

Liabilities and stockholders’ equity (deficit)
Current liabilities:
Accounts payable and other accrued liabilities	$	1,051,333		$	2,759,160		$	999,785		$	951,382
Chargeback reserve		1,559,541			-
Short term financing agreements								114,394			154,017
Current portion of loans payables, related parties								336,479			1,422,249
Other payables		1,333,484			81,500			64,101			101,113
Short term Financing Agreements		376,647
Current portion of long-term debt		936,263			913,920			1,353,961			1,118,721
Current portion of leases payable		528,902			276,009			348,492			339,937
Earn-out liability, current portion		3,683,596			3,297,855
Warrant commitment		-			37,652,808
Current portion of earn-out liability								687,197			2,153,478
Current liabilities - discontinued operations								-			1,600,636
Total current liabilities		9,469,766			44,981,252			3,904,409			7,841,533

Loans payable, related parties, less current portion		332,225			353,766			258,785			122,266
Convertible debt, related parties, less current portion								161,855			1,500,000
Long term debt, less current portion		12,935,649			7,085,325			11,380,567			12,349,673
Leases payable, less current portion		930,623			805,326			561,041			714,068
Earn-out liability, less current portion		673,837			516,023			-			556,000
Warrant liabilities		11,026,893			-			1,580,380			6,433,150
Noncurrent liabilities - discontinued operations								-			-
Total liabilities		35,368,993			53,741,692			17,847,037			29,516,690
Stockholders’ equity (deficit):
Preferred stock, $0.086 par value; 750,000,000 shares authorized and 9,076 and 0 issued and outstanding as of June 30, 2022 and December 31, 2021, respectively		781			-
Common stock, $0.086 par value; 133,333,333 shares authorized and 974,268 and 730,407 issued and outstanding as of June 30, 2022 and December 31, 2021, respectively		83,787			62,815
Stockholders’ equity:
Preferred stock, $0.086 par value; 750,000,000 shares authorized and 0 issued and outstanding as of September 30, 2023 and December 31, 2022, respectively								-			-
Common stock, $0.086 par value; 133,333,333 shares authorized and 2,304,375 and 1,219,573 issued and outstanding as of September 30, 2023 and December 31, 2022, respectively								198,155			104,883
Additional paid-in capital		35,466,329			27,329,201			43,639,612			35,798,139
Stock subscription receivable		-			(20,000,000	)
Accumulated deficit		(13,622,454	)		(33,458,145	)		(29,974,812	)		(26,991,983	)
Total stockholders’ equity (deficit)		21,928,443			(26,066,129	)
Total liabilities and stockholders’ equity (deficit)	$	57,297,436		$	27,675,563
Total stockholders’ equity								13,862,955			8,911,039
Total liabilities and stockholders’ equity							$	31,709,992		$	38,427,729

PART I
Item 1. Financial Statements	13
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	24
Item 3. Quantitative and Qualitative Disclosures About Market Risk.	32
Item 4. Controls and ~~Procedures~~Procedures.	2032
PART II
Item 1. Legal Proceedings.	32
Item 1A. Risk Factors.	32
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	33
Item 3. Defaults Upon Senior Securities.	33
Item 4. Mine Safety Disclosures.	33
Item 5. Other Information.	33
Item 6. Exhibits	2033
~~Signatures~~	21

	2022			2021			2022			2021
	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021			Three Months Ended September 30, 2023			Three Months Ended September 30, 2022			Nine Months Ended September 30, 2023			Nine Months Ended September 30, 2022
Revenue
Commission income	$	4,207,126		$	2,190,847		$	8,442,907		$	4,514,577		$	3,275,583		$	2,821,768		$	10,410,591		$	8,727,614
Total revenue		4,207,126			2,190,847			8,442,907			4,514,577			3,275,583			2,821,768			10,410,591			8,727,614

Operating expenses
Commission expense	$	850,128		$	558,271		$	1,754,283		$	1,087,743			796,001			695,020			2,701,601			2,143,562
Salaries and wages		2,176,792			1,110,629			4,258,967			2,029,174			1,775,919			1,629,947			5,230,871			4,899,171
General and administrative expenses		1,759,217			1,202,350			4,212,287			2,206,751			1,368,126			1,117,027			4,430,177			5,080,991
Marketing and advertising		609,383			55,021			1,196,405			78,100			117,752			63,371			364,184			148,057
Depreciation and amortization		756,403			369,366			1,363,928			702,454			652,839			651,395			1,962,066			1,901,140
Total operating expenses		6,151,923			3,295,637			12,785,870			6,104,222			4,710,637			4,156,760			14,688,899			14,172,921

Loss from operations		(1,944,797	)		(1,104,790	)		(4,342,963	)		(1,589,645	)		(1,435,054	)		(1,334,992	)		(4,278,308	)		(5,445,307	)

Other income (expense)
Other expense, net		(192,763	)		(172,096	)		(300,560	)		(301,167	)
Interest expense														(386,562	)		(281,201	)		(1,126,281	)		(586,251	)
Interest related parties														(32,475	)		(1,730	)		(125,104	)		(5,189	)
Interest expense														(32,475	)		(1,730	)		(125,104	)		(5,189	)
Other (expense) income, net														(310	)		(4,909	)		3,650			(4,414	)
Recognition and change in fair value of warrant liabilities		12,633,251			-			24,479,215			-			1,715,397			7,919,315			4,389,120			32,398,530
Total other income (expense)		12,440,488			(172,096	)		24,178,655			(301,167	)
Total other income														1,296,050			7,631,475			3,141,385			31,802,676

Net income (loss)	$	10,495,691		$	(1,276,886	)	$	19,835,692		$	(1,890,812	)
(Loss) income from continuing operations before tax													$	(139,004	)		6,296,483		$	(1,136,922	)		26,357,370
(Loss) income from discontinued operations before tax														-			(174,390	)		(1,845,904	)		(399,585	)
Net (loss) income														(139,004	)		6,122,093			(2,982,827	)		25,957,784

Basic earnings (loss) per share	$	9.82		$	(1.75	)	$	12.59		$	(3.06	)
Diluted earnings (loss) per share	$	8.61		$	(1.75	)	$	(12.84	)	$	(3.06	)
Basic (loss) earnings per share
Continuing operations													$	(0.05	)	$	5.44		$	(0.47	)	$	18.16
Discontinued Operations													$	-		$	(0.15	)	$	(0.75	)	$	(0.37	)
Basic (loss) earnings per share													$	(0.05	)	$	5.29		$	(1.22	)	$	17.79

Diluted (loss) earnings per share
Continuing operations													$	(0.05	)	$	4.83		$	(0.47	)	$	15.93
Discontinued operations													$	-		$	(0.14	)	$	(0.75	)	$	(0.33	)
Diluted (loss) earnings per share													$	(0.05	)	$	4.69		$	(1.22	)	$	15.60

Weighted average number of shares outstanding - Basic		1,069,157			728,966			1,025,108			617,316			3,021,455			1,156,939			2,436,015			1,069,534
Weighted average number of shares outstanding - Diluted		1,219,224			728,966			1,068,236			617,316			3,021,455			1,304,878			2,436,015			1,219,822

	Shares		Amount		Shares			Amount			Shares		Amount		capital			Receivable			Deficit			Total
	Reliance Global Group, Inc.
	Preferred stock				Common stock						Common stock issuable				Additional paid-in			Subscription			Accumulated
	Shares		Amount		Shares			Amount			Shares		Amount		capital			Receivable			Deficit			Total

Balance, December 31, 2021		-	$	-		730,407		$	62,815			-	$	-	$	27,329,201		$	(20,000,000	)	$	(33,458,145	)	$	(26,066,129	)

Share based compensation		-		-		-			-			-		-		739,960			-			-			739,960

Shares issued due to private placement		9,076		781		178,059			15,313			-		-		(16,043	)		20,000,000			-			20,000,051

Shares issued pursuant to acquisition of Medigap		-		-		40,402			3,475			-		-		4,759,976			-			-			4,763,451

Exercise of Series A warrants		-		-		25,000			2,150			-		-		2,472,850			-			-			2,475,000

Issuance of prefunded Series C Warrants in exchange for common shares		-		-		(218,462	)		(18,788	)		-		-		18,788			-			-			-

Shares issued for vested stock awards		-		-		400			34			-		-		(34	)		-			-			-

Net Income		-		-		-			-			-		-		-			-			9,340,000			9,340,000

Balance, March 31, 2022		9,076	$	781	$	755,806		$	64,999			-	$	-	$	35,304,698		$	-		$	(24,118,145	)	$	11,252,333

Share based compensation		-		-		-			-			-		-		179,083			-			-			179,083

Exercise of Series C warrants into common shares		-		-		218,462			18,788			-		-		(17,452	)		-			-			1,336

Net Income		-		-		-			-			-		-		-			-			10,495,691			10,495,691

Balance, June 30, 2022		9,076	$	781		974,268		$	83,787			-	$	-	$	35,466,329		$	-		$	(13,622,454	)	$	21,928,443

	2022			2021
	Six months ended June 30,
	2022			2021
Cash flows from operating activities:
Net income (loss)	$	19,835,692		$	(1,890,812	)
Adjustment to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		1,363,928			702,454
Amortization of debt issuance costs and accretion of debt discount		18,291			20,206
Non-cash lease expense		24,450			1,534
Stock compensation expense		919,043			521,148
Earn-out fair value and write-off adjustments		354,963			-
Recognition and change in fair value of warrant liabilities		(24,479,215	)		-
Change in operating assets and liabilities:
Accounts payables and other accrued liabilities		(1,711,287	)		(805,092	)
Accounts receivable		45,122			75,212
Accounts receivable, related parties		(47,283	)		(7,131	)
Other payables		126,984			-
Charge back reserve		75,068			-
Other non-current assets		(6,492	)		(18,035	)
Prepaid expense and other current assets		2,169,325			(92,736	)
Net cash used in operating activities		(1,311,411	)		(1,493,252	)

Cash flows from investing activities:
Purchase of property and equipment		(20,989	)		-
Business acquisitions, net of cash acquired		(24,138,750	)		(1,608,586	)
Purchase of intangibles		(466,190	)		(152,990	)
Net cash used in investing activities		(24,625,929	)		(1,761,576	)

Cash flows from financing activities:
Principal repayments of debt		(447,908	)		(432,833	)
Proceeds from loan for business acquisition		6,520,000			-
Payment of debt issuance costs		(214,257	)		-
Payments on earn-out liabilities		(411,408	)		-
Proceeds from loans payable, related parties		-			2,931
Payments of loans payable, related parties		(21,541	)		(508,307	)
Proceeds from exercise of warrants into common stock		2,476,336			-
Repayments on short-term financing		(40,552	)
Net proceeds from private placement issuance of shares and warrants		17,853,351			-
Issuance of common stock		-			10,496,221
Net cash provided by financing activities		25,714,021			9,558,012

Net (decrease) increase in cash and restricted cash		(223,319	)		6,303,184
Cash and restricted cash at beginning of period		4,620,722			529,581
Cash and restricted cash at end of period	$	4,397,403		$	6,832,765

Supplemental disclosure of cash and non-cash investing and financing transactions:
Issuance of Series D Warrants	$	6,930,335		$	-
Issuance of placement agent warrants	$	1,525,923		$	-
Prepaid insurance acquired through short-term financing	$	417,199		$	-
Conversion of preferred stock into common stock	$	-		$	339,264
Cash paid for interest	$	218,528		$	350,175
Conversion of debt into equity	$	-		$	3,800,000
Common stock issued pursuant to acquisition	$	4,763,451		$	50,000
Common stock issued in lieu of services	$	-		$	91,050
Issuance of common stock pursuant to the purchase of software	$	-		$	340,000
Acquisition of business deferred purchase price	$	1,125,000		$	0
Lease assets acquired in exchange for lease liabilities	$	223,922		$	861,443


	For the Nine Months Ended September 30,
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income		(2,982,827	)	$	25,957,784
Adjustment to reconcile net (loss) income to net cash used in operating activities:
Depreciation and amortization		1,962,066			1,901,140
Amortization of debt issuance costs and accretion of debt discount		35,163			28,702
Non-cash lease expense		(4,192	)		19,549
Stock compensation expense		106,943			1,233,300
Shares issued for services performed		289,995			-
Recognition and change in fair value of warrant liability		(4,389,120	)		(32,398,531	)
Earn-out fair value adjustments		1,291,494			132,445
Change in operating assets and liabilities:
Accounts receivable		(196,459	)		174,025
Accounts receivable, related parties		(2,786	)		5,972
Other receivables		10,651			(31,981	)
Prepaid expense and other current assets		34,136			2,346,510
Other non-current assets		-			(6,491	)
Accounts payables and other accrued liabilities		48,403			(1,642,938	)
Other payables		(37,012	)		34,841
Net cash used in continuing operating activities		(3,833,545	)		(2,245,673	)

Net cash adjustments for discontinued operating activities		3,816,238			67,675

Total net cash used in continuing and discontinued operating activities		(17,307	)		(2,177,998	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(21,206	)		(58,149	)
Purchase of intangibles		(160,211	)		(5,392,951	)
Proceeds from sale of investment in NSURE		900,000			-
Business acquisitions, net of cash acquired		-			(6,000,000	)
Net cash provided by (used in) investing activities		718,583			(11,451,100	)

Net cash used in discontinued investing activities		-			(13,531,509	)

Total net cash provided by (used in) continuing and discontinued investing activities		718,583			(24,982,609	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings of debt		-			-
Principal repayments of debt		(763,840	)		(663,016	)
Debt issuance costs		-			(214,257	)
Loans acquired through acquisitions		-			6,520,000
Issuance of common shares in exchange for Series C warrants					2,131
Principal repayments of short-term financings		(21,923	)		(107,206	)
Payments of loans payable, related parties		(954,439	)		(174,206	)
Payments of convertible debt, related parties		(693,145	)		1,500,000
Cash payments on earn-out liability		(419,225	)		(1,627,296	)
Proceeds from exercise of warrants into common stock		-			2,475,000
Private placement of shares and warrants		3,446,484			17,853,351
Net cash provided by continuing financing activities		593,912			25,564,501

Net cash used in discontinued financing activities		(17,700	)		-

Total net cash provided by continuing and discontinued financing activities		576,212			25,564,501

Net increase in cash and restricted cash		1,277,488			(1,596,106	)
Cash and restricted cash at beginning of year		1,909,769			4,620,722
Cash and restricted cash at end of year		3,187,257			3,024,616

SUPPLEMENTAL DISCLOSURE OF CASH AND NON-CASH TRANSACTIONS:
Common stock issuance to settle earn-out liabilities		2,894,550			-


	Three Months Ended June 30, 2022
	As Reported			Adjustment			As Corrected

Basic earnings (loss) per share		8.40			1.42			9.82

Diluted earnings (loss) per share		(1.50	)		10.11			8.61

Weighted average number of shares outstanding – Basic		1,249,219			(180,062	)		1,069,157

Weighted average number of shares outstanding - Diluted		1,399,286			(180,062	)		1,219,224


	Six Months Ended June 30, 2022
	As Reported			Adjustment			As Corrected

Basic earnings (loss) per share		11.25			1.34			12.59

Diluted earnings (loss) per share		(8.85	)		(3.99	)		(12.84	)

Weighted average number of shares outstanding – Basic		1,149,219			(124,111	)		1,025,108

Weighted average number of shares outstanding - Diluted		1,342,315			(274,080	)		1,068,236

	June 30, 2022		June 30, 2021		September 30, 2023		September 30, 2022
Cash	$	2,979,769	$	6,348,415	$	1,777,348	$	1,615,054
Restricted cash		1,417,635		484,350		1,409,909		1,409,562
Total cash and restricted cash	$	4,397,404	$	6,832,765	$	3,187,257	$	3,024,616

		Series B Warrant Commitment			Series B warrant liabilities			Placement agent warrants		Total
	Three and Six Months ended June 30, 2022
	Series B Warrant Commitment			Series B warrant liabilities			Placement agent warrants			Total
Beginning balance	$	37,652,808		$	-		$	-		$	37,652,808
Initial recognition		-			55,061,119			1,525,923			56,587,042
Unrealized (gain) loss		17,408,311			(31,980,437	)		(946,461	)		(15,518,587	)
Warrants exercised or transferred		(55,061,119	)								(55,061,119	)
Ending balance, March 31, 2022	$	-		$	23,080,682		$	579,462		$	23,660,144
Unrealized gain		-			(12,322,737	)		(310,514	)		(12,633,251	)
Ending balance, June 30, 2022		-			10,757,945			268,948			11,026,893

	~~June 30, 2022~~		~~December 31, 2021~~
~~Valuation technique~~		~~Discounted cash flow~~		~~Discounted cash flow~~
~~Significant unobservable input~~		~~Projected revenue and probability of achievement~~		~~Projected revenue and probability of achievement~~

	September 30, 2023
WACC Risk Premium:		13.5	%
Volatility		50.0% – 105.0	%
Credit Spread:		8.77% -10.4	%
Payment Delay (days)		90
Risk free rate		USD Yield Curve or 5.46% - 5.47	%
Discounting Convention:		Mid-period
Stock Price	$	2.49
Dividend Yield		0.00	%
Number of Iterations		100,000

	~~June 30, 2022~~
~~WACC Risk Premium:~~		~~14.6~~	%
~~Volatility~~		50	%
~~Credit Spread:~~		11	%
~~Payment Delay (days)~~		90	%
~~Risk free rate~~		~~USD Yield Curve~~
~~Discounting Convention:~~		~~Mid-period~~
~~Number of Iterations~~		~~100,000~~

	June 30, 2022			December 31, 2021
Beginning balance – January 1	$	3,813,878		$	2,931,418

Acquisitions and Settlements
JP Kush Acquisition		-			1,694,166
Barra Acquisition		600,000			-
CCS Write-off		-			(81,368	)
Altruis partial settlement		(84,473	)		(452,236	)
Montana final settlement		(326,935	)		-

Period adjustments:
Fair value changes and accretion included in earnings^*		354,963			(278,102	)

Ending balance	$	4,357,433		$	3,813,878
Less: Current portion		(3,683,596	)		(3,297,855	)
Ending balance, less current portion		673,837			516,023

Three Months ended June 30, 2022	Medical/Life		Property and Casualty		Total
Regular
Three Months Ended September 30, 2023							Medical		Life		Property and Casualty		Total

EBS	$	184,851	$	-	$	184,851	$	206,308	$	8,900	$	-	$	215,208
USBA		12,319		-		12,319		11,266		843		-		12,109
CCS/UIS		-		57,195		57,195		-		-		62,197		62,197
Montana		451,705		-		451,705		453,269		1,770		-		455,039
Fortman		357,334		205,804		563,138		288,969		602		268,704		558,275
Altruis		882,171		-		882,171		1,200,054		-		-		1,200,054
Kush		425,449		-		425,449		331,240		-		-		331,240
Medigap		1,359,976		-		1,359,976
Barra		69,925		200,397		270,322
	$	3,743,730	$	463,396	$	4,207,126
Reli Exchange								66,833		18,139		356,489		441,461
Total							$	2,557,939	$	30,254	$	687,390	$	3,275,583

Nine Months Ended September 30, 2023	Medical		Life		Property and Casualty		Total

EBS	$	646,259	$	17,470	$	-	$	663,729
USBA		33,956		2,266		-		36,222
CCS/UIS		-		-		182,368		182,368
Montana		1,384,060		10,105		-		1,394,165
Fortman		887,605		2,675		700,169		1,590,449
Altruis		4,268,727		-		-		4,268,727
Kush		973,719		-		-		973,719
Reli Exchange		182,638		103,341		1,015,233		1,301,212
Total	$	8,376,964	$	135,857	$	1,897,770	$	10,410,591

Six Months ended June 30, 2022	Medical/Life		Property and Casualty		Total
Regular
Three Months Ended September 30, 2022							Medical		Life		Property and Casualty		Total

EBS	$	406,035	$	-	$	406,035	$	206,906		5,478	$	-	$	212,384
USBA		25,906		-		25,906		13,227		505		-		13,732
CCS/UIS		-		101,077		101,077		-		-		76,035		76,035
Montana		958,426		-		958,426		422,978		3,613		-		426,591
Fortman		689,933		403,064		1,092,997		256,791		2,464		186,860		446,115
Altruis		2,187,043		-		2,187,043		895,905		107		-		896,012
Kush		864,040		-		864,040		366,043		176		-		366,219
Medigap		2,537,061		-		2,537,061
Barra		69,925		200,397		270,322
	$	7,738,369	$	704,538	$	8,442,907
Reli Exchange								56,232		27,383		301,065		384,680
Total							$	2,218,083		39,725	$	563,960	$	2,821,768

Three Months ended June 30, 2021	Medical/Life		Property and Casualty		Total
Regular
EBS		207,201		-		207,201
USBA		15,395		-		15,395
CCS/UIS		-		65,348		65,348
Montana		404,740		-		404,740
Fortman		276,634		226,337		502,971
Altruis		729,874		-		729,874
Kush		265,318		-		265,318
	$	1,899,162	$	291,685	$	2,190,847

Six Months ended June 30, 2021	Medical/Life		Property and Casualty		Total
Regular
Nine Months Ended September 30, 2022							Medical		Life		Property and Casualty		Total

EBS	$	416,195	$	-	$	416,195	$	633,252		11,965	$	-	$	645,217
USBA		27,620		-		27,620		38,610		1,028		-		39,638
CCS/UIS		-		154,166		154,166		-		-		177,111		177,111
Montana		939,856		-		939,856		1,379,307		5,710		-		1,385,017
Fortman		526,435		434,109		960,544		943,852		5,337		589,924		1,539,113
Altruis		1,750,878		-		1,750,878		3,053,474		2,783		-		3,056,257
Kush		265,318		-		265,318		1,229,326		933		-		1,230,259

	$	3,926,302	$	588,275	$	4,514,577
Reli Exchange								103,893		49,646		501,463		655,002
Revenues							$	7,381,714		77,402	$	1,268,498	$	8,727,614

Insurance Carrier	2022			2021

	For the three months ended June 30,						For the Three Months Ended September 30,
Insurance Carrier	2022			2021			2023			2022
LTC Global		30	%		-	%
Priority Health		20	%		31	%		44	%		30	%
BlueCross BlueShield		-	%		28	%		21	%		13	%
Insurance carrier								21	%		13	%

Medigap Related Assets	Carrying Value Prior To Abandonment		Asset and Liability Transfers Retained by the Company			Asset Impairments and Liability Write-Offs			Carrying Value As of September 30, 2023

Accounts receivable	$	56,398	$	-		$	(56,398	)	$	-
Accounts receivable, related party		3,595		-			(3,595	)		-
Accounts receivable		3,595		-			(3,595	)		-
Other receivables		5,388		-			(5,388	)		-
Current assets – Medigap	$	65,381	$	-		$	(65,381	)	$	-

Property and equipment, net	$	22,378	$	-		$	(22,378	)	$	-
Right-of-use assets		119,594		-			(119,594	)		-
Intangibles, net		4,570,536		(4,258,214 )¹			(312,322	)		-
Goodwill		4,825,634		-			(4,825,634	)		-
Other assets - Medigap	$	9,538,142	$	(4,258,214	)	$	(5,279,928	)	$	-

Total assets - Medigap	$	9,603,523	$	(4,258,214	)	$	(5,345,309	)	$	-

Accounts payable and other accrued liabilities	$	4,157	$	-		$	(4,157	)	$	-
Short term financing agreements		29,500		(29,500	)		-			-
Chargeback reserve		831,725		-			(831,725 )²			-
Current portion of leases payable		134,517		-			(134,517 )³			-
Other liabilities		9,842		-			(9,842 )³			-
Current liabilities - Medigap	$	1,009,741	$	(29,500	)	$	(980,241	)	$	-

Total liabilities - Medigap	$	1,009,741	$	(29,500	)	$	(980,241	)	$	-

Net assets and liabilities - Medigap	$	8,593,782	$	(4,228,714	)	$	(4,365,068	)	$	-

	1	Includes customer relationships and internally developed and purchased software intangible assets that have continued value to the Company and have not been impaired as the fair value exceeds carrying cost.
	2	Estimated liability write-off per net zero dollar estimated liability value.
	3	Liability discharge pursuant to the Settlement Agreement.

Account	12/31/2020 As reported			Adjustment			12/31/2020 Adjusted
Earn-out liability		2,631,418			300,000			2,931,418
Goodwill		9,265,070			(503,345	)		8,761,725
Common stock issuable		822,116			(482,116	)		340,000
Additional paid-in-capital		11,377,123			182,116			11,559,239
Accumulated Deficit		(12,482,281	)		122,601			(12,359,680	)

Account	3/31/2021 As reported			Adjustment			3/31/2021 Adjusted
Common stock issuable		482,116			(482,116	)		0
Additional paid-in-capital		25,810,147			182,116			25,992,263
Accumulated Deficit		(13,123,609	)		150,003			(12,973,606	)

	Three Months Ended September 30, 2023		Three Months Ended September 30, 2022			Nine Months Ended September 30, 2023			Nine Months Ended September 30, 2022
Income
Commission income	$	-	$	1,331,593		$	744,030		$	3,868,654

Expenses
Commission expense		-		167,837			110,639			473,578
Salaries and wages		-		484,783			454,663			1,474,526
General and administrative expenses		-		136,070			129,363			384,393
Marketing and advertising		-		662,744			426,818			1,774,463
Depreciation and amortization		-		62,048			7,283			176,233
Other expenses (income)		-		(7,500	)		(3,902	)		(14,954	)
Total discontinued operations expenses before impairments and write-offs		-		1,505,982			1,124,864			4,268,239
Total discontinued operations income / (loss) before impairments and write-offs	$	-	$	(174,390	)	$	(380,834	)	$	(399,585	)
Gains and (losses) from recoveries and impairments / write-offs of discontinued operations assets and liabilities

Settlement Recovery	$	-		-		$	2,900,000			-

Asset impairment losses
Accounts receivable		-		-			56,398			-
Accounts receivable, related parties		-		-			3,595			-
Other receivables		-		-			5,388			-
Property and equipment, net		-		-			22,378			-
Right-of-use assets		-		-			119,593			-
Intangibles, net		-		-			312,322			-
Goodwill		-		-			4,825,634			-
Total asset impairments		-		-			5,345,309			-

Liability write-off gains
Accounts payable and other accrued liabilities		-		-			4,156			-
Other payables		-		-			9,842			-
Chargeback reserve		-		-			831,725			-
Current portion of leases payable		-		-			134,517			-
Total liability write-off gains		-		-			980,240			-

Discontinued operations net asset and liability impairments / write-offs gains and (losses)		-		-			4,365,070			-

Net gains and (losses) from recoveries and impairments / write-offs from discontinued operations assets and liabilities		-		-			(1,465,070	)		-

Gain (loss) from discontinued operations before tax		-		(174,390	)		(1,845,904	)		(399,585	)

Consolidated statement of operations - Income (loss) from discontinued operations before tax	$	-	$	(174,390	)	$	(1,845,904	)	$	(399,585	)

Description	Fair Value			Weighted Average Useful Life (Years)
Property, plant and equipment	$	20,666			5
Right-of-use asset		317,787
Trade names		340,000			15
Customer relationships		4,550,000			12
Technology		67,000			3
Backlog		210,000			1
Chargeback reserve		(1,484,473	)
Lease liability		(317,787	)
Goodwill		19,199,008			Indefinite
	$	22,902,201

	June 30,			June 30,
	2022			2021
Revenue	$	8,809,482		$	7,071,329
Net Income (Loss)	$	19,849,175		$	(1,796,767	)
Earnings (Loss) per common share, basic	$	11.25		$	2.85	)
Earnings (Loss) per common share, diluted	$	8.85	)	$	2.85	)

	Goodwill
December 31, 2020	$	8,761,725
Goodwill recognized in connection with Kush acquisition on May 1, 2021	$	1,288,552
December 31, 2021	$	10,050,277
Goodwill recognized in connection with Medigap acquisition on January 10, 2022	$	19,199,008
Goodwill recognized in connection with Barra acquisition on April 26, 2022		4,236,822
June 30, 2022	$	33,486,107

	Weighted Average Remaining Amortization period (Years)		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Trade name and trademarks		4.9	$	2,142,858	$	(804,020	)	$	1,338,838
Internally developed software		4.5		1,326,158		(131,655	)		1,194,503
Customer relationships		9.53		11,922,290		(1,517,174	)		10,405,116
Purchased software		-		562,327		(562,327	)		-
Video Production Assets		0.6		50,000		(23,242	)		26,758
Non-competition agreements		2.4		3,504,810		(1,827,590	)		1,677,220
Contracts Backlog		0.5		210,000		(100,684	)		109,316
			$	19,718,443	$	(4,966,692	)	$	14,751,751

	Three Months		Three Months
	Ended		Ended
	June 30, 2022		June 30, 2021
Net income (loss), numerator, basic and diluted computation	$	10,495,691	$	(1,276,886	)

Weighted average shares - denominator basic computation		1,069,157		728,966
Effect of stock awards		2,128		-
Effect of Series B warrant liability
Effect of preferred stock		147,939		-
Weighted average shares, as adjusted - denominator diluted computation		1,219,224		728,966
Earnings (loss) per common share – basic	$	9.82	$	(1.75	)
Earnings (loss) per common share – diluted		8.61		(1.75	)

	Six Months			Six Months
	Ended			Ended
	June 30, 2022			June 30, 2021
Net income (loss)	$	19,835,692		$	(1,890,812	)
Deemed dividend		(6,930,335	)		-
Net income (loss), numerator, basic computation		12,905,357			(1,890,812	)
Recognition and change in fair value of warrant liability		(26,625,915	)		-
Net income (loss), numerator, diluted computation	$	(13,720,558	)	$	(1,890,812	)

Weighted average shares - denominator basic computation		1,025,108			617,316
Effect of Series B warrant liability		43,128			-
Weighted average shares, as adjusted - denominator diluted computation		1,068,236			617,316
Earnings (loss) per common share - basic	$	12.59		$	(3.06	)
Earnings (loss) per common share - diluted	$	(12.84	)	$	(3.06	)


	For the Three Months Ended
	June 30, 2022		June 30, 2021
Shares subject to outstanding common stock options		10,928		10,928
Shares subject to outstanding Series A warrants		113,000		138,000
Shares subject to unvested stock awards		-		3,072
Shares subject to warrant liability		668,299		-