Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 12, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2021 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 000-55857 | |
Entity Registrant Name | LIFEMD, INC. | |
Entity Central Index Key | 0000948320 | |
Entity Tax Identification Number | 76-0238453 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 800 Third Avenue, | |
Entity Address, Address Line Two | Suite 2800 | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10022 | |
City Area Code | (855) | |
Local Phone Number | 743-6478 | |
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | LFMD | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 26,562,800 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash | $ 17,414,237 | $ 9,179,075 |
Accounts receivable, net | 1,612,308 | 648,421 |
Product deposit | 1,391,764 | 816,765 |
Inventory, net | 1,614,117 | 1,264,258 |
Other current assets | 447,233 | 154,876 |
Total Current Assets | 22,479,659 | 12,063,395 |
Non-current Assets | ||
Equipment, net | 18,116 | |
Right of use asset, net | 225,259 | 274,437 |
Capitalized software, net | 1,264,466 | 375,983 |
Intangible assets, net | 339,840 | |
Total Non-current Assets | 1,507,841 | 990,260 |
Total Assets | 23,987,500 | 13,053,655 |
Current Liabilities | ||
Accounts payable and accrued expenses | 16,726,698 | 11,794,084 |
Notes payable, net | 438,234 | 779,132 |
Deferred revenue | 1,381,938 | 916,880 |
Total Current Liabilities | 18,546,870 | 13,490,096 |
Long-term Liabilities | ||
Long-term debt | 9,251,849 | |
Lease liability | 240,670 | 285,323 |
Contingent consideration on purchase of LegalSimpli | 100,000 | 100,000 |
Total Liabilities | 28,139,389 | 13,875,419 |
Commitments and contingencies (see Note 8) | ||
Stockholders’ Deficit | ||
Common stock, $0.01 par value; 100,000,000 shares authorized, 26,635,840 and 23,433,663 shares issued, 26,532,800 and 23,330,623 outstanding as of June 30, 2021 and December 31, 2020, respectively | 266,359 | 234,337 |
Additional paid-in capital | 101,450,858 | 77,779,370 |
Accumulated deficit | (108,584,988) | (80,151,905) |
Treasury stock, 103,040 and 103,040 shares, at cost | (163,701) | (163,701) |
Total LifeMD, Inc. Stockholders’ Deficit | (7,031,472) | (2,301,899) |
Non-controlling interest | (1,001,869) | (2,175,687) |
Total Stockholders’ Deficit | (8,033,341) | (4,477,586) |
Total Liabilities, Mezzanine Equity and Stockholders’ Deficit | 23,987,500 | 13,053,655 |
Series B Preferred Stock [Member] | ||
Mezzanine Equity | ||
Preferred Stock Value | $ 3,881,452 | $ 3,655,822 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Preferred stock, at par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 26,635,840 | 23,433,663 |
Common stock, shares outstanding | 26,532,800 | 23,330,623 |
Treasury stock, shares | 103,040 | 103,040 |
Series B Preferred Stock [Member] | ||
Preferred stock, at par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000 | 5,000 |
Preferred stock, shares issued | 3,500 | 3,500 |
Preferred stock, shares outstanding | 3,500 | 3,500 |
Preferred stock, liquidation value | $ 1,109 | $ 1,045 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenues | ||||
Total revenues, net | $ 22,313,611 | $ 9,089,783 | $ 40,511,723 | $ 13,394,595 |
Cost of revenues | ||||
Total cost of revenues | 4,200,008 | 1,694,421 | 7,463,261 | 3,032,062 |
Gross profit | 18,113,603 | 7,395,362 | 33,048,462 | 10,362,533 |
Expenses | ||||
Selling and marketing expenses | 22,388,510 | 8,394,331 | 41,029,241 | 11,140,213 |
General and administrative expenses | 10,415,272 | 1,834,336 | 17,279,151 | 3,425,312 |
Operating expenses | 917,936 | 203,260 | 1,779,017 | 327,751 |
Customer service expenses | 473,235 | 89,482 | 768,512 | 257,667 |
Development costs | 45,413 | 92,325 | 237,641 | 170,467 |
Total expenses | 34,240,366 | 10,613,734 | 61,093,562 | 15,321,410 |
Operating loss | (16,126,763) | (3,218,372) | (28,045,100) | (4,958,877) |
Other income (expenses), net | (901,910) | (228,875) | (856,459) | (1,021,914) |
Loss from operations before income taxes | (17,028,673) | (3,447,247) | (28,901,559) | (5,980,791) |
Income tax provision (benefit) | ||||
Net loss | (17,028,673) | (3,447,247) | (28,901,559) | (5,980,791) |
Net loss attributable to noncontrolling interests | (197,973) | (68,131) | (468,476) | (206,947) |
Net loss attributable to LifeMD, Inc. | $ (16,830,700) | $ (3,379,116) | $ (28,433,083) | $ (5,773,844) |
Basic loss per share attributable to LifeMD, Inc. from operations | $ (0.64) | $ (0.27) | $ (1.12) | $ (0.50) |
Diluted loss per share attributable to LifeMD, Inc. from operations | $ (0.64) | $ (0.27) | $ (1.12) | $ (0.50) |
Weighted average number of common shares outstanding | ||||
Basic | 26,289,678 | 12,348,739 | 25,381,530 | 11,523,253 |
Diluted | 26,289,678 | 12,348,739 | 25,381,530 | 11,523,253 |
Product [Member] | ||||
Revenues | ||||
Total revenues, net | $ 15,799,610 | $ 7,869,813 | $ 29,082,925 | $ 10,825,614 |
Cost of revenues | ||||
Total cost of revenues | 4,044,981 | 1,622,214 | 7,168,006 | 2,544,376 |
Software Revenues Net [Member] | ||||
Revenues | ||||
Total revenues, net | 6,514,001 | 1,219,970 | 11,428,798 | 2,568,981 |
Cost of revenues | ||||
Total cost of revenues | 155,027 | 72,207 | 295,255 | 487,686 |
Service [Member] | ||||
Revenues | ||||
Total revenues, net |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Deficit (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Parent [Member] | Noncontrolling Interest [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 106,807 | $ 15,663,626 | $ (16,594,919) | $ (163,701) | $ (988,187) | $ (141,056) | $ (1,129,243) |
Balance, shares at Dec. 31, 2019 | 10,680,730 | ||||||
Stock compensation | 95,900 | 95,900 | 95,900 | ||||
Stock compensation, shares | |||||||
Cashless exercise of warrants | $ 1,479 | (1,479) | |||||
Cashless exercise of warrants, shares | 147,858 | ||||||
Deemed dividend from down-round provision in common stock shares yet to be issued | (106,519) | (106,519) | (106,519) | ||||
Deemed dividend from warrant price adjustments | 1,142,385 | (1,142,385) | |||||
Distribution to non-controlling interest | (36,000) | (36,000) | |||||
Net loss | (2,394,728) | (2,394,728) | (138,816) | (2,533,544) | |||
Ending balance, value at Mar. 31, 2020 | $ 108,286 | 16,900,432 | (20,238,551) | (163,701) | (3,393,534) | (315,872) | (3,709,406) |
Balance, shares at Mar. 31, 2020 | 10,828,588 | ||||||
Beginning balance, value at Dec. 31, 2019 | $ 106,807 | 15,663,626 | (16,594,919) | (163,701) | (988,187) | (141,056) | (1,129,243) |
Balance, shares at Dec. 31, 2019 | 10,680,730 | ||||||
Balance, shares | 1,203,750 | ||||||
Net loss | (5,980,791) | ||||||
Ending balance, value at Jun. 30, 2020 | $ 142,126 | 19,316,367 | (23,705,170) | (163,701) | (4,410,378) | (469,226) | (4,879,604) |
Balance, shares at Jun. 30, 2020 | 14,212,688 | ||||||
Beginning balance, value at Mar. 31, 2020 | $ 108,286 | 16,900,432 | (20,238,551) | (163,701) | (3,393,534) | (315,872) | (3,709,406) |
Balance, shares at Mar. 31, 2020 | 10,828,588 | ||||||
Stock compensation | 438,575 | 438,575 | 438,575 | ||||
Stock issued for services | $ 500 | 34,700 | 35,200 | 35,200 | |||
Balance, shares | 50,000 | ||||||
Purchase of common stock | $ 2,941 | 247,059 | 250,000 | 250,000 | |||
Purchase of common stock, shares | 294,120 | ||||||
Shares issued for share liability | $ 21,967 | 1,704,033 | 1,726,000 | 1,726,000 | |||
Shares issued for share liability, shares | 2,196,740 | ||||||
Deemed distribution from down-round provision in common stock shares yet to be issued | 87,503 | 87,503 | 87,503 | ||||
Cashless exercise of warrants | $ 8,432 | (8,432) | |||||
Cashless exercise of warrants, shares | 843,240 | ||||||
Distribution to non-controlling interest | (85,223) | (85,223) | |||||
Net loss | (3,379,116) | (3,379,116) | (68,131) | (3,447,247) | |||
Deemed distribution from down-round provision in common stock shares yet to be issued | (87,503) | (87,503) | (87,503) | ||||
Ending balance, value at Jun. 30, 2020 | $ 142,126 | 19,316,367 | (23,705,170) | (163,701) | (4,410,378) | (469,226) | (4,879,604) |
Balance, shares at Jun. 30, 2020 | 14,212,688 | ||||||
Beginning balance, value at Dec. 31, 2020 | $ 234,337 | 77,779,370 | (80,151,905) | (163,701) | (2,301,899) | (2,175,687) | (4,477,586) |
Balance, shares at Dec. 31, 2020 | 23,433,663 | ||||||
Stock issued for services | $ 12,038 | 2,313,737 | 2,325,775 | 2,325,775 | |||
Cashless exercise of stock options | $ 6,089 | (6,089) | |||||
Balance, shares | 608,905 | ||||||
Exercise of stock options | $ 300 | 23,700 | 24,000 | 24,000 | |||
Balance, shares | 30,000 | ||||||
Sale of stock in private placement, net | $ 6,087 | 13,489,183 | 13,495,270 | 13,495,270 | |||
Balance, shares | 608,696 | ||||||
Purchase of additional membership interest of LSS | (377,419) | (377,419) | (66,603) | (444,022) | |||
Adjustment of noncontrolling Interest for additional investment | (1,636,875) | (1,636,875) | 1,780,897 | 144,022 | |||
Distribution to non-controlling interest | (36,000) | (36,000) | |||||
Net loss | (11,602,383) | (11,602,383) | (270,503) | (11,872,886) | |||
Ending balance, value at Mar. 31, 2021 | $ 258,851 | 91,585,607 | (91,754,288) | (163,701) | (73,531) | (767,896) | (841,427) |
Balance, shares at Mar. 31, 2021 | 25,885,014 | ||||||
Beginning balance, value at Dec. 31, 2020 | $ 234,337 | 77,779,370 | (80,151,905) | (163,701) | (2,301,899) | (2,175,687) | $ (4,477,586) |
Balance, shares at Dec. 31, 2020 | 23,433,663 | ||||||
Balance, shares | 1,233,750 | ||||||
Net loss | $ (28,901,559) | ||||||
Ending balance, value at Jun. 30, 2021 | $ 266,359 | 101,450,858 | (108,584,988) | (163,701) | (7,031,472) | (1,001,869) | (8,033,341) |
Balance, shares at Jun. 30, 2021 | 26,635,840 | ||||||
Beginning balance, value at Mar. 31, 2021 | $ 258,851 | 91,585,607 | (91,754,288) | (163,701) | (73,531) | (767,896) | (841,427) |
Balance, shares at Mar. 31, 2021 | 25,885,014 | ||||||
Stock issued for services | $ 300 | 2,547,000 | 2,547,300 | 2,547,300 | |||
Balance, shares | 30,000 | ||||||
Cashless exercise of stock options | $ 2,641 | (2,641) | |||||
Balance, shares | 264,142 | ||||||
Exercise of stock options | $ 3,910 | 738,840 | 742,750 | 742,750 | |||
Balance, shares | 391,000 | ||||||
Exercise of warrants | $ 657 | 311,342 | 311,999 | 311,999 | |||
Warrants issued for debt instruments | 6,270,710 | 6,270,710 | 6,270,710 | ||||
Distribution to non-controlling interest | (36,000) | (36,000) | |||||
Net loss | (16,830,700) | (16,830,700) | (197,973) | (17,028,673) | |||
Ending balance, value at Jun. 30, 2021 | $ 266,359 | $ 101,450,858 | $ (108,584,988) | $ (163,701) | $ (7,031,472) | $ (1,001,869) | $ (8,033,341) |
Balance, shares at Jun. 30, 2021 | 26,635,840 | ||||||
Balance, shares | 65,684 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (28,901,559) | $ (5,980,791) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Amortization of debt discount | 522,559 | 739,324 |
Amortization of capitalized software | 63,864 | 11,585 |
Amortization of intangibles | 339,840 | 167,806 |
Write-down of inventory | 57,481 | |
Acceleration of debt discount | 500,145 | |
Gain on forgiveness of debt | (184,914) | |
Operating lease payments | 49,178 | 3,635 |
Stock compensation expense | 4,873,075 | 534,475 |
Stock issued for services | 35,200 | |
Liability to issue shares for services | 32,500 | |
Changes in assets and liabilities | ||
Accounts receivable | (963,887) | (338,577) |
Product deposit | (574,999) | (131,143) |
Inventory | (407,340) | 141,213 |
Other current assets | (292,357) | 114,047 |
Change in operating lease liability | (44,653) | (1,061) |
Deferred revenue | 465,058 | 194,118 |
Accounts payable and accrued expenses | 5,158,245 | 2,880,243 |
Net cash used in operating activities | (19,840,409) | (1,097,281) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Cash paid for capitalized software costs | (952,347) | |
Purchase of equipment | (18,116) | |
Payment to seller for contingent consideration | (277,161) | |
Contingent consideration on business combination paid | (400,000) | |
Net cash used in investing activities | (970,463) | (677,161) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Cash proceeds from private placement offering, net | 13,495,270 | |
Proceeds from issuance of debt instruments | 15,000,000 | |
Cash proceeds from exercise of options | 766,750 | |
Cash proceeds from exercise of warrants | 311,999 | |
Shares issued for cash | 250,000 | |
Cash receipts from investors for unissued shares | 1,639,000 | |
Purchase of membership interest of LSS | (300,000) | |
Distributions to non-controlling interest | (72,000) | (121,223) |
Proceeds from notes payable | 963,965 | 1,750,000 |
Repayment of notes payable | (1,119,950) | (2,498,808) |
Debt issuance costs | (15,000) | |
Net cash provided by financing activities | 29,046,034 | 1,003,969 |
Net increase (decrease) in cash | 8,235,162 | (770,473) |
Cash at beginning of period | 9,179,075 | 1,106,624 |
Cash at end of period | 17,414,237 | 336,151 |
Cash paid for interest | ||
Cash paid during the period for interest | 143,183 | 349,791 |
Non-cash investing and financing activities | ||
Principal of Paycheck Protection Program loans forgiven | 184,914 | |
Additional purchase of membership interest in LSS issued in performance options | 144,002 | |
Warrants issued for debt instruments | 6,270,710 | |
Deemed distribution from down-round provision | 1,142,385 | |
Stock yet to be issued for capitalized costs | 40,000 | |
Deemed distribution from down-round provision on unissued shares | 194,022 | |
Shares issued for share liability | (1,726,000) | |
Debt issuance costs for liability to issues shares | $ 219,450 |
NATURE OF THE ORGANIZATION AND
NATURE OF THE ORGANIZATION AND BUSINESS | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF THE ORGANIZATION AND BUSINESS | NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS Corporate History LifeMD, Inc. was formed in the State of Delaware on May 24, 1994, under its prior name, Immudyne, Inc. The Company changed its name to Conversion Labs, Inc. on June 22, 2018 and then subsequently, on February 22, 2021, changed its name to LifeMD, Inc. Effective February 22, 2021, the trading symbol for the Company’s common stock, par value $ 0.01 On April 1, 2016, the original operating agreement of Immudyne PR LLC (“Immudyne PR”), a joint venture to market the Company’s skincare products, was amended and restated and the Company increased its ownership and voting interest in Immudyne PR to 78.2 100 In June 2018, the Company closed the strategic acquisition of 51 % of LegalSimpli Software, LLC (“LegalSimpli”), which operates a software as a service (SaaS) application for converting, editing, signing and sharing PDF documents called PDFSimpli. In addition to LegalSimpli Software’s growth business model, this acquisition added deep search engine optimization and search engine marketing expertise to the Company. Effective January 22, 2021, the Company consummated a transaction to restructure the ownership of LegalSimpli (the “LSS Restructuring”) (See Note 7) and concurrently increased its ownership stake in LegalSimpli to 85.6 %. Nature of Business The Company is a direct-to-patient telehealth technology company that provides a smarter, cost-effective and convenient way for a provider’s patients to access healthcare. The Company believes that the traditional model of visiting a doctor’s office, receiving a physical prescription, visiting a local pharmacy, and returning to see a doctor for follow up care or prescription refills is inefficient, costly to patients, and discourages many patients from seeking much needed medical care. The U.S. healthcare system is undergoing a paradigm shift, thanks to new technologies and the emergence of direct-to-patient healthcare. Direct-to-patient telehealth technology companies, like the Company, connect consumers to licensed healthcare professionals for care across numerous indications, including concierge care, men’s sexual health and dermatology, among others. The Company’s telehealth platform helps patients access their licensed providers for diagnoses, virtual care, and prescription medications, often delivered on a recurring basis. In addition to its telehealth technology offerings, it sells nutritional supplements and other over-the-counter products. Many of its products are available on a subscription or membership basis, where a patient can subscribe to receive regular shipments of prescribed medications or products. This creates convenience and often discounted pricing opportunities for patients and recurring revenue streams for the Company. The Company believes that brand innovation, customer acquisition and service excellence form the heart of its business. As is exemplified with its first brand, Shapiro MD, it has built a full line of proprietary over-the-counter (“OTC”) products for male and female hair loss, FDA approved OTC minoxidil, an FDA-cleared medical device, and now a personalized telehealth platform offering that gives consumers access to virtual medical treatment from their providers and, when appropriate, a full line of oral and topical prescription medications for hair loss. The Company’s men’s brand, Rex MD, currently offers access to provider-based treatment for erectile dysfunction, as well as treatment for other common men’s health issues including premature ejaculation and hair loss. In the first quarter of 2021, the Company launched its newest brand, Nava MD, a tele-dermatology and skincare brand for women. The Company has built a platform that allows it to efficiently launch telehealth and wellness product lines wherever it determines there is a market need. Business and Subsidiary History In June 2018, Conversion Labs closed the strategic acquisition of 51% of LegalSimpli Software, LLC (“LegalSimpli”), which operates a software as a service (SaaS) application for converting, editing, signing and sharing PDF documents called PDFSimpli. In addition to LegalSimpli’s growth business model, this acquisition added deep search engine optimization and search engine marketing expertise to the Company. The Company subsequently increased its ownership stake in LegalSimpli to its current 85.6%. In early 2019, the Company had launched a service-based business under the name Conversion Labs Media LLC, which was to be used to run e-commerce marketing campaigns for other online businesses. However, this business initiative was terminated in early 2019 in order to focus on its core business as well as the expansion of our telehealth opportunities. In June 2019, a strategic joint venture with GoGoMeds.com (GoGoMeds) was formed in order to help facilitate the launch of our telehealth business. GoGoMeds is a nationwide pharmacy licensed to dispense prescription medications directly to consumers in all 50 states and the District of Columbia. However, on August 7, 2020, the Company terminated its Strategic Partnership Agreement with GoGoMeds. The joint venture with GoGoMeds had not initiated activities, and its termination did not have an impact on the Company’s operations. Conversion Labs Rx, LLC (“CVLB Rx”), a Puerto Rico limited liability company, had no activity during the year ended December 31, 2020 and was dissolved during the period. Unless otherwise indicated, the terms “LifeMD,” “Company,” “we,” “us,” and “our” refer to LifeMD, Inc. (formerly known as Conversion Labs, Inc.), our wholly subsidiary LifeMD PR, LLC (formerly Immudyne PR LLC, and “Conversion Labs PR”), a Puerto Rico limited liability company (“Conversion Labs PR”, or “CLPR”) and our majority-owned subsidiaries LegalSimpli Software, LLC, a Puerto Rico limited liability company (“LegalSimpli”). Unless otherwise specified, all dollar amounts are expressed in United States dollars. Reverse Stock Split On October 9, 2020, the Company filed a Certificate of Amendment to its Articles of Incorporation with the Secretary of State of Delaware (the “Amendment”) in order to effectuate a 1-for-5 reverse stock split Liquidity The Company has funded operations in the past through the sales of its products, issuance of common and preferred stock and through loans and advances. The Company’s continued operations are dependent upon obtaining an increase in its sale volumes and obtaining funding from third-party sources or the issuance of additional shares of common stock. On February 11, 2021, the Company consummated the closing of a private placement offering (the “February 2021 Offering”), whereby pursuant to the securities purchase agreement (the “February 2021 Purchase Agreement”) entered into by the Company and certain accredited investors on February 11, 2021 the Investors purchased 608,696 0.01 23.00 14.0 13.5 On June 1, 2021, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with an institutional investor (the “Purchaser”), pursuant to which the Company sold and issued: (i) a senior secured redeemable debenture (the “Debenture”) in the aggregate principal amount of $ 15.0 million (the “Aggregate Principal Amount”), and (ii) warrants to purchase up to an aggregate of 1,500,000 shares of the Company’s common stock at an exercise price of $ 12.00 per share (the “Warrant”) of which 500,000 warrants were issued to the Purchaser upon closing with the remaining 1,000,000 warrants only issued to the Purchaser in increments of 500,000 if the Debenture remains outstanding for twelve and twenty four months, respectively, following the closing date of the Purchase Agreement. The Warrant has a term of three years , and the Debenture has a maturity date of three years 15.0 million and intends to use such proceeds for working capital, growth investment and general corporate purposes. On June 8, 2021, the Company filed a shelf registration statement on Form S-3 under the Securities Act of 1933, or “Securities Act”, which was declared effective on June 22, 2021 (the “2021 Shelf”). Under the 2021 Shelf at the time of effectiveness, the Company had the ability to raise up to $150 million by selling common stock, preferred stock, debt securities, warrants and units. 60 million, through or to the Agents, acting as agent or principal. Sales of common stock, if any, will be made by any method permitted that is deemed an “at the market offering” as defined in Rule 415 under the Securities Act. The Company intends to use any net proceeds from the sale of securities for our operations and for other general corporate purposes, including, but not limited to, capital expenditures, general working capital and possible future acquisitions. There were no sales of shares of common stock under the 2021 Shelf or the Sales Agreement as of June 30, 2021. The Company had the full availability of the Sales Agreement and $90 million available under the 2021 Shelf as of June 30, 2021 Going Concern Evaluation The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern, which assumes the realization of assets and the satisfaction of liabilities in the normal course of business. As of June 30, 2021, the Company has an accumulated deficit approximating $ 108.6 million and has experienced significant losses from its operations. Although the Company is showing significant positive revenue trends, the Company expects to incur further losses through the end of 2021. Additionally, the Company expects its burn rate of cash to continue through the second half of 2021; however, the Company expects this burn rate to improve in future quarters. To date, the Company has been funding operations primarily through the sale of equity in private placements and securities purchased with an institutional investor. Management is unable to predict if and when the Company will be able to generate significant positive cash flow or achieve profitability. There can be no assurances that we will be successful in increasing revenues, improving operational efficiencies or that financing will be available or, if available, that such financing will be available under favorable terms. The Company has a current cash balance of approximately $ 12.5 million as of the filing date, which includes the $ 13.5 million of net proceeds from the February 2021 Offering and the $ 14.9 million of net proceeds from the June 2021 Purchase Agreement. Based on the Company’s projected cash requirements, management estimates that it will utilize approximately $ 15.3 million through the next 12 months from the filing date of this report. The Company reviewed its forecasted operating results and sources and uses of cash used in management’s assessment, which included the available financing, consideration of positive and negative evidence impacting management’s forecasts, market and industry factors. Positive indicators that lead to its conclusion that the Company will have sufficient cash over the next 12 months following the date of this report include (1) its continued strengthening of the Company’s revenues and improvement of operational efficiencies across the business, (2) the expected improvement in its cash burn rate in the second half of 2021 and over the next 12 months, (3) overall investor interest in its equity securities which it believes will enable it to successfully complete future capital raises, (4) full availability of the Sales Agreement and $90 million available under the 2021 Shelf, (5) management’s ability to curtail expenses if necessary and (6) the overall market value of the telehealth industry and how it believes that will continue to drive interest in the Company. |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete audited financial statements. The accompanying unaudited financial information should be read in conjunction with the audited consolidated financial statements, including the notes thereto, as of and for the year ended December 31, 2020, included in our 2020 Annual Report on Form 10-K filed with the SEC. The information furnished in this report reflects all adjustments (consisting of normal recurring adjustments), which are, in the opinion of management, necessary for a fair presentation of our financial position, results of operations and cash flows for each period presented. The results of operations for the three and six months ended June 30, 2021 are not necessarily indicative of the results for the year ending December 31, 2021 or for any future period. Principles of Consolidation The Company evaluates the need to consolidate affiliates based on standards set forth in ASC 810 Consolidation (“ASC 810”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, CLPR and its majority owned subsidiary, LegalSimpli. The non-controlling interest in LegalSimpli represents the 49 % equity interest held by other members of the subsidiary as of December 31, 2020. During the six months ended June 30, 2021, the Company purchased an additional 36 % of LegalSimpli for a total equity interest of approximately 85 % (see Note 7). All significant intercompany transactions and balances have been eliminated in consolidation. Cash and Cash Equivalents Highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents. As of June 30, 2021 and December 31, 2020, there were no Variable Interest Entities The Company follows ASC 810-10-15 guidance with respect to accounting for variable interest entities (each, a “VIE”). These entities do not have sufficient equity at risk to finance their activities without additional subordinated financial support from other parties or whose equity investors lack any of the characteristics of a controlling financial interest. A variable interest is an investment or other interest that will absorb portions of a VIE’s expected losses or receive portions of its expected residual returns and are contractual, ownership, or pecuniary in nature and that change with changes in the fair value of the entity’s net assets. A reporting entity is the primary beneficiary of a VIE and must consolidate it when that party has a variable interest, or combination of variable interests, that provides it with a controlling financial interest. A party is deemed to have a controlling financial interest if it meets both of the power and losses/benefits criteria. The power criterion is the ability to direct the activities of the VIE that most significantly impact its economic performance. The losses/benefits criterion is the obligation to absorb losses from, or right to receive benefits from, the VIE that could potentially be significant to the VIE. The VIE model requires an ongoing reconsideration of whether a reporting entity is the primary beneficiary of a VIE due to changes in facts and circumstances. In accordance with ASC 810-10-25-37 and as amended by ASU 2009-17, the Company determines whether any legal entity in which the Company becomes involved is a VIE and subject to consolidation. The Company conducts an assessment on an ongoing basis for each VIE including (1) the power to direct activities of the VIE that most significantly impact the VIE’s economic performance, and (2) the obligation to absorb losses or right to receive benefits from the VIE that could potentially be significant to the VIE. As a result, the Company determined that three (3) entities were VIEs and subject to consolidation. 1. Conversion Labs Media, LLC (“CVLB Media”), a Puerto Rico limited liability company, 2. Conversion Labs Rx, LLC (“CVLB Rx”), a Puerto Rico limited liability company (dissolved in 2020), and 3. Conversion Labs Asia Limited, a Hong Kong company (“Conversion Labs Asia”). CVLB Media, CVLB Rx and Conversion Labs Asia are all considered immaterial as of June 30, 2021 and December 31, 2020. CVLB Rx had no activity and was dissolved during the year ended December 31, 2020. Use of Estimates The Company prepares its unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates required to be made by management include the determination of reserves for accounts receivable, returns and allowances, the valuation of inventory, stockholders’ equity-based transactions, estimates to cash flow projections and going concern assessment. Actual results could differ from those estimates. The continuing impact on business activity brought about by the Coronavirus pandemic (“COVID-19”) continues to evolve, globally in macro terms, and in micro terms, as such affects the Company. As a result, many of our estimates and assumptions for the period ended June 30, 2021 were subject to an increased level of judgment and may carry a higher degree of variability and volatility. In future periods, subsequent to June 30, 2021, when additional information becomes available, which may differ from our current assumptions, may subject our estimates to material change in future periods. Reclassifications Certain reclassifications have been made to conform the prior year’s data to the current presentation. These reclassifications have no effect on previously reported operating loss, stockholders’ deficit or cash flows. Given the increase in the Company’s software business and to conform the Company’s presentation of operating results to industry standards, the Company has changed their categories for reporting operations, as result the Company has made reclassifications to the prior year presentation in order to conform it to the current periods’ presentation. The reclassification includes $ 495,787 917,785 Revenue Recognition The Company records revenue under the adoption of ASC 606 by analyzing exchanges with its customers using a five-step analysis: 1. Identify the contract 2. Identify performance obligations 3. Determine the transaction price 4. Allocate the transaction price 5. Recognize revenue For the Company’s product-based contracts with customers, the Company has determined that there is one performance obligation, which is the delivery of the product; this performance obligation is transferred at a discrete point in time. The Company generally records sales of finished products once the customer places and pays for the order, with the product being simultaneously shipped by a third-party fulfillment service provider; in limited cases, title does not pass until the product reaches the customer’s delivery site, in these limited cases, recognition of revenue should be deferred until that time, however the Company does not have a process to properly record the recognition of revenue if orders are not immediately shipped, and deems the impact to be immaterial. In all cases, delivery is considered to have occurred when title and risk of loss have transferred to the customer, which is usually commensurate upon shipment of the product. In the case of its product-based contracts, the Company provides a subscription sensitive service based on the recurring shipment of products and records the related revenue under the subscription agreements subsequent to receiving the monthly product order, recording the revenue at the time it fulfills the shipment obligation to the customer. For its product-based contracts with customers, the Company records an estimate for provisions of discounts, returns, allowances, customer rebates and other adjustments for its product shipments, and are reflected as contra revenues in arriving at reported net revenues. The Company’s discounts and customer rebates are known at the time of sale, correspondingly, the Company reduces gross product sales for such discounts and customer rebates. The Company estimates customer returns and allowances based on information derived from historical transaction detail, and accounts for such provisions, as contra revenue, during the same period in which the related revenues are earned. The Company has determined that the population of its product-based contracts with customers are homogenous, supporting the ability to record estimates for returns and allowances to be applied to the entire product-based portfolio population. Customer discounts, returns and rebates on product revenues approximated $ 1,362,000 857,000 2,584,000 1,334,000 The Company, through its majority-owned subsidiary LegalSimpli, offers a subscription-based service providing a suite of software applications to its subscribers, principally on a monthly subscription basis. The software suite allows the subscriber/user to convert almost any type of document to another electronic form of editable document, providing ease of editing. For these subscription-based contracts with customers, the Company offers an initial 14-day trial period which is billed at $ 1.95 , followed by a monthly subscription, or a yearly subscription to the Company’s software suite dependent on the subscriber’s enrollment selection. The Company has estimated that there is one product and one performance obligation that is delivered over time, as the Company allows the subscriber to access the suite of services for the time period of the subscription purchased. The Company allows the customer to cancel at any point during the billing cycle, in which case the customers subscription will not be renewed for the following month or year depending on the original subscription. The Company records the revenue over the customers’ subscription period for monthly and yearly subscribers or at the end of the initial 14-day service period for customers who purchased the initial subscription, as the circumstances dictate. The Company offers a discount for the monthly or yearly subscriptions being purchased, which is deducted at the time of payment at the initiation of the contract term, therefore the Contract price is fixed and determinable at the contract initiation. Monthly and annual subscriptions for the service are recorded net of the Company’s known discount rates. As of June 30, 2021 and December 31, 2020, the Company has accrued contract liabilities, as deferred revenue, of approximately $ 1,382,000 and $ 917,000 , respectively, which represent obligations on in-process monthly or yearly contracts with customers and a portion attributable to the yet to be recognized initial 14-day trial period collections. Customer discounts and allowances on software revenues approximated $ 668,000 and $ 107,000 for the three months ended June 30, 2021 and 2020, respectively. Customer discounts and allowances on software revenues approximated $ 1,222,000 and $ 270,000 for the six months ended June 30, 2021 and 2020, respectively. For the three and six months ended June 30, 2021 and 2020, the Company had the following disaggregated revenue: SCHEDULE OF DISAGGREGATED REVENUE Three Months Ended June 30, Six Months Ended June 30, 2021 % 2020 % 2021 % 2020 % Product revenues by Brand for Conversion Labs PR: Rex MD $ 12,128,524 54 % $ 1,835,503 20 % $ 21,969,077 55 % $ 2,328,276 18 % Shapiro MD 3,515,631 16 % 5,881,965 65 % 6,899,414 17 % 8,219,073 61 % Nava MD 108,252 1 % - - % 108,252 - % - - % iNR Wellness 19,737 - % 71,162 1 % 43,642 - % 141,090 1 % Purpurex 27,466 - % 79,426 1 % 62,540 - % 132,948 1 % Scarology - - % 1,757 - % - - % 4,227 - % Total product revenue for Conversion Labs PR $ 15,799,610 71 % $ 7,869,813 87 % $ 29,082,925 72 % $ 10,825,614 81 % Software revenue for LegalSimpli 6,514,001 29 % 1,219,970 13 % 11,428,798 28 % 2,568,981 19 % Total net revenue $ 22,313,611 100 % $ 9,089,783 100 % $ 40,511,723 100 % $ 13,394,595 100 % Deferred Revenues The Company records deferred revenues when cash payments are received or due in advance of its performance. The Company’s deferred revenues relate to payments received for the in-process monthly or yearly contracts with customers and a portion attributable to the yet to be recognized initial 14-day trial period collections. SCHEDULE OF CONTRACT WITH CUSTOMER LIABILITY 2021 2020 2021 2020 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Beginning of period $ 1,339,309 $ 302,960 $ 916,880 $ 109,552 Additions 6,183,965 1,127,862 11,210,719 2,484,256 Revenue recognized 6,141,336 1,127,152 10,745,661 2,290,138 End of period $ 1,381,938 $ 303,670 $ 1,381,938 $ 303,670 Accounts Receivable Accounts receivable principally consist of amounts due from third-party merchant processors, who process our subscription revenues; the merchant accounts balance receivable represents the charges processed by the merchants that have not yet been deposited with the Company. The unsettled merchant receivable amount normally represents processed sale transactions from the final one to three days of the month, with collections being made by the Company within the first week of the following month. Management determines the need, if any, for an allowance for future credits to be granted to customers, by regularly evaluating aggregate customer refund activity, coupled with the consideration and current economic conditions in its evaluation of an allowance for future refunds and chargebacks. As of both June 30, 2021 and December 31, 2020, the Company had an allowance for bad debt, attributable to the single agent relationship amounting to approximately $ 133,000 470,000 349,000 Inventory As of June 30, 2021 and December 31, 2020, inventory primarily consisted of finished goods related to the Company’s brands included in the product revenue section of the table above. Inventory is maintained at the Company’s third-party warehouse location in Wyoming and at the Amazon fulfillment center. The Company also maintains inventory at a related-party warehouse in Pennsylvania. Inventory is valued at the lower of cost or net realizable value with cost determined on a first-in, first-out (“FIFO”) basis. Management compares the cost of inventory with the net realizable value and an allowance is made for writing down inventory to net realizable, if lower. As of June 30, 2021, the Company did not record an inventory reserve. As of December 31, 2020, the Company recorded an inventory reserve in the amount of $ 57,481 As of June 30, 2021 and December 31, 2020, the Company’s inventory consisted of the following: SUMMARY OF INVENTORY June 30, December 31, 2021 2020 Finished Goods - Products $ 1,526,491 1,172,624 Raw materials and packaging components 87,626 149,115 Inventory reserve - (57,481 ) Total Inventory - net $ 1,614,117 $ 1,264,258 Product Deposit Many of our vendors require deposits when a purchase order is placed for goods or fulfillment services. These deposits typically range from 10 % to 33 % of the total purchased amount. Our vendors include a credit memo within their final invoice, recognizing the deposit amount previously paid. As of June 30, 2021 and December 31, 2020, the Company has $ 1,391,764 and $ 816,765 , respectively, of product deposits with multiple vendors for the purchase of raw materials or finished goods. The Company’s history of product deposits with its inventory vendors, creates an implicit purchase commitment equaling the total expected product acceptance cost in excess of the product deposit. As of June 30, 2021 and December 31, 2020, the Company approximates its implicit purchase commitments to be $ 2.6 million and $ 1.6 million, respectively. As of June 30, 2021 and December 31, 2020, the vast majority of these product deposits are with one vendor that manufacturers the Company’s finished goods inventory for its Shapiro hair care product line. Capitalized Software Costs The Company capitalizes certain internal payroll costs and third-party costs related to internally developed software and amortizes these costs using the straight-line method over the estimated useful life of the software, generally three years. The Company does not sell internally developed software other than through the use of subscription service. Certain development costs not meeting the criteria for capitalization, in accordance with Accounting Standards Codification (“ASC”) ASC 350-40 Internal-Use Software 1,390,483 438,136 Intangible Assets Intangible assets are comprised of a customer relationship asset (with original cost of approximately $ 1,007,000 200,000 three ten years Impairment of Long-Lived Assets Long-lived assets are evaluated for impairment whenever events or changes in circumstances have indicated that an asset may not be recoverable and are grouped with other assets to the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities (asset group). If the sum of the projected undiscounted cash flows (excluding interest charges) of an asset group is less than its carrying value and the fair value of an asset group is also less than its carrying value, the assets will be written down by the amount by which the carrying value of the asset group exceeded its fair value. However, the carrying amount of a finite-lived intangible asset can never be written down below its fair value. Any loss would be recognized in income from continuing operations in the period in which the determination is made. Paycheck Protection Program During the year ended December 31, 2020, the Company received aggregate loan proceeds in the amount of approximately $ 249,000 The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The unforgiven portion of the PPP loan is payable over two years at an interest rate of 1 During the six months ended June 30, 2021, the Company had a total of $ 184,914 of its PPP loans forgiven by the SBA (see Note 5). As of June 30, 2021 and December 31, 2020, the PPP loan balance was $ 74,269 and $ 259,183 , respectively, and is reflected on the Company’s consolidated balance sheet as current liabilities, within notes payable, net. Income Taxes The Company files corporate federal, state and local tax returns. Conversion Labs PR and LegalSimpli file tax returns in Puerto Rico, both are limited liability companies and file separate tax returns with any tax liabilities or benefits passing through to its members. The Company records current and deferred taxes in accordance with Accounting Standards Codification (“ASC”) 740, “Accounting for Income Taxes.” This ASC requires recognition of deferred tax assets and liabilities for temporary differences between tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company periodically assesses the value of its deferred tax asset, a majority of which has been generated by a history of net operating losses and management determines the necessity for a valuation allowance. ASC 740 also provides a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken in a tax return. Using this guidance, a company may recognize the tax benefit from an uncertain tax position in its financial statements only if it is more likely-than-not (i.e., a likelihood of more than 50%) that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company’s tax returns for all years since December 31, 2017, remain open to audit by all related taxing authorities. Stock-based Compensation The Company follows the provisions of ASC 718, “Share-Based Payment”. Under this guidance compensation cost generally is recognized at fair value on the date of the grant and amortized over the respective vesting or service period. The fair value of options at the date of grant is estimated using the Black-Scholes option pricing model. The expected option life is derived from assumed exercise rates based upon historical exercise patterns and represents the period of time that options granted are expected to be outstanding. The expected volatility is based upon historical volatility of the Company’s common shares using weekly price observations over an observation period that approximates the expected life of the options. The risk-free interest rate approximates the U.S. Treasury yield curve rate in effect at the time of grant for periods similar to the expected option life. Due to limited history of forfeitures, the Company has elected to account for forfeitures as they occur. Many of the assumptions require significant judgment and any changes could have a material impact in the determination of stock-based compensation expense. Earnings (Loss) Per Share Basic earnings (loss) per common share is based on the weighted average number of shares outstanding during each period presented. Convertible securities, warrants and options to purchase common stock are included as common stock equivalents only when dilutive. Potential common stock equivalents are excluded from dilutive earnings per share when the effects would be antidilutive. The Company follows the provisions of ASC 260, “Diluted Earnings per Share”. In computing diluted EPS, basic EPS is adjusted for the assumed issuance of all potentially dilutive securities. The dilutive effect of call options, warrants and share-based payment awards is calculated using the “treasury stock method,” which assumes that the “proceeds” from the exercise of these instruments are used to purchase common shares at the average market price for the period. The dilutive effect of traditional convertible debt and preferred stock is calculated using the “if-converted method.” Under the if-converted method, securities are assumed to be converted at the beginning of the period, and the resulting common shares are included in the denominator of the diluted EPS calculation for the entire period being presented. The following table summarizes the number of shares of common stock issuable pursuant to our convertible securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive even though the exercise price could be less than the average market price of the common shares: SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES Three Months Ended Three Months Ended Six Months Ended Six Months Ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Series B Preferred Stock 1,076,923 - 1,076,923 - Restricted Stock Units (RSUs) 664,375 - 355,938 - Stock options 4,013,400 4,469,000 4,204,200 4,169,000 Warrants 3,984,787 1,407,636 3,767,629 2,167,136 Potentially dilutive securities 9,739,485 5,876,636 9,404,690 6,336,136 Fair Value of Financial Instruments The carrying value of the Company’s financial instruments, including cash, accounts receivable, accounts payable and accrued expenses and the face amount of notes payable approximate fair value for all periods presented. Concentrations of Risk The Company grants credit in the normal course of business to its customers. The Company periodically performs credit analysis and monitors the financial condition of its customers to reduce credit risk. The Company monitors its positions with, and the credit quality of, the financial institutions with which it invests. The Company, at times, maintains balances in various operating accounts in excess of federally insured limits. We are dependent on certain third-party manufacturers, although we believe that other contract manufacturers could be quickly secured if any of our current manufacturers cease to perform adequately. As of June 30, 2021 and December 31, 2020, we utilized two (2) suppliers for fulfillment services, two (2) suppliers for manufacturing finished goods, one (1) supplier for packaging and bottles and one (1) supplier for labeling. For the three and six months ended June 30, 2021 and 2020, we purchased 100 Recently Adopted Accounting Pronouncements In August 2020, the FASB issued ASU 2020-06, “ Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40); Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Other Recent Accounting Pronouncements All other accounting standards updates that have been issued or proposed by the FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 3 – INTANGIBLE ASSETS As of June 30, 2021 and December 31, 2020, the Company has the following amounts related to intangible assets: SCHEDULE OF INTANGIBLE ASSETS Intangible Assets as at: June 30, December 31, Amortizable 2021 2020 Life Amortizable Intangible Assets Customer relationship asset $ 1,006,840 $ 1,006,840 3 Purchased licenses 200,000 200,000 10 Less: accumulated amortization (1,206,840 ) (867,000 ) Total net amortizable intangible assets $ - $ 339,840 The aggregate amortization expense of the Company’s intangible assets for the six months ended June 30, 2021 and 2020 was approximately $ 339,840 167,806 |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2021 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 4 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES As of June 30, 2021 and December 31, 2020, the Company has the following amounts related to accounts payable and accrued expenses: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES June 30, December 31, 2021 2020 Accounts payable $ 11,664,281 $ 10,408,172 Accrued compensation 3,363,794 237,036 Accrued selling and marketing expenses 180,683 60,870 Accrued legal and professional fees 56,456 209,009 Sales tax payable 275,000 125,000 Other accrued expenses 1,186,484 753,997 Total accounts payable and accrued expenses $ 16,726,698 $ 11,794,084 |
NOTES PAYABLE
NOTES PAYABLE | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTE 5 – NOTES PAYABLE PPP Loan and Forgiveness In June 2020, the Company and its subsidiaries received three loans in the aggregate amount of approximately $ 259,183 1.0 184,914 74,269 259,183 Bank Loan In December 2020, the Company received proceeds of $ 500,000 19,950 3.99 519,950 Merchant Funding Agreement On March 17, 2021, the Company entered into a Merchant Funding Agreement with MO Technologies USA, LLC (“MO Tech”), which provides cash advances to the Company based on the Company’s accounts receivable for a total cash advance of $ 600,000 3.99 On June 23, 2021, the Company entered into a Merchant Funding Agreement with MO Tech, which provides cash advances to the Company based on the Company’s accounts receivable for a total cash advance of $ 350,000 3.99 363,965 Total interest expense on notes payable, inclusive of amortization of debt discounts, amounted to $ 229,351 and $ 228,875 for the three months ended June 30, 2021 and 2020, respectively. Total interest expense on notes payable, inclusive of amortization of debt discounts, amounted to $ 368,814 and $ 1,021,914 for the six months ended June 30, 2021 and 2020, respectively. |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | NOTE 6 – LONG-TERM DEBT Securities Purchase Agreement As noted above, on June 1, 2021, the Company entered into the Purchase Agreement with the Purchaser, pursuant to which the Company sold and issued: (i) the Debenture in the aggregate principal amount of $ 15.0 1,500,000 12.00 which 500,000 6,270,710 522,559 three years The Aggregate Principal Amount of the Debenture, together with interest, is due and payable on June 1, 2024. The Debenture bears interest as follows: (i) for the period beginning on June 1, 2021 and ending on the date that is six (6) months thereafter (the “Initial Interest Rate Period”) shall be six percent (6%), (ii) for the period beginning the date following the Initial Interest Rate Period and ending on the date that is three (3) months thereafter (the “Second Interest Rate Period”), nine percent (9%), and (iii) for the period beginning the date following the Second Interest Rate Period and ending on June 1, 2024, twelve percent (12%). Until such time as the obligations shall have been paid in full, the Company shall apply thirty-five percent (35%) of the gross proceeds received by the Company from At-The-Market offerings of its Common Stock to partial redemptions of each Debenture on a pro rata basis. 15.0 14.9 Total interest expense on long-term debt, inclusive of amortization of debt discounts, amounted to $ 672,559 0 672,559 0 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 7 – STOCKHOLDERS’ EQUITY The Company has authorized the issuance of up to 100,000,000 0.01 5,000,000 0.0001 5,000 4,996,500 On October 9, 2020, the Company effectuated a 1-for-5 reverse stock split 632 Options and Warrants During the six months ended June 30, 2021, the Company issued an aggregate of 873,047 shares of common stock related to cashless exercise of options. During the six months ended June 30, 2021, the Company issued an aggregate of 421,000 shares of common stock related to the exercise of options for gross proceeds of $ 766,750. During the six months ended June 30, 2021, the Company issued an aggregate of 65,684 shares of common stock related to the exercise of warrants for gross proceeds of $ 311,999 Membership Interest Purchase Agreement On July 31, 2019 the Company entered into a certain membership interest purchase agreement (the “MIPA”) by and between the Company, Conversion Labs PR, a majority owned subsidiary, Taggart International Trust, an entity controlled by the Company’s Chief Executive Officer, Mr. Justin Schreiber, and American Nutra Tech LLC, a company controlled by its Chief Technology and Operating Officer, Mr. Stefan Galluppi (Mr. Schreiber, Taggart International Trust, Mr. Galluppi and American Nutra Tech LLC each a “Related Party” and collectively, the “Related Parties”). Pursuant to the MIPA, the Company purchased 21.83333 % of the membership interests (the “Remaining Interests”) of Conversion Labs PR from the Related Parties, bringing the Company’s ownership of Conversion Labs PR to 100 %. As consideration for the Company’s purchase of the Remaining Interests from the Related Parties, Mr. Schreiber and Mr. Galluppi agreed to cancel all potential issuances of restricted stock and or options related to their employment with the Company, in exchange for the immediate issuance of 500,000 500,000 2.50 500,000 3.75 1,000,000 The Company recorded an aggregate expense of $ 18,060,000 reflected in general and administrative expenses during the three months ended September 30, 2020 for the issuance of these 2,000,000 shares, of which 1,200,000 shares were issued during the six months ended June 30, 2020. Common Stock Common Stock Transactions During the Six Months Ended June 30, 2021: On February 11, 2021, the Company consummated the closing of the February 2021 Offering, whereby pursuant to the February 2021 Purchase Agreement entered into by the Company and certain accredited investors on February 11, 2021 the investors purchased 608,696 0.01 23.00 14.0 The Purchase Price was funded on the closing date and resulted in net proceeds to the Company of approximately $ 13.5 During the six months ended June 30, 2021, the Company issued an aggregate of 1,233,750 Noncontrolling Interest For the three months ended June 30, 2021 and 2020, the net loss attributed to the non-controlling interest amounted to $ 197,973 and $ 68,131 , respectively. During the three months ended June 30, 2021 and 2020, the Company paid distributions to non-controlling stockholders of $ 36,000 and $ 85,223 , respectively. For the six months ended June 30, 2021 and 2020, the net loss attributed to the non-controlling interest amounted to $ 468,476 and $ 206,947 , respectively. During the six months ended June 30, 2021 and 2020, the Company paid distributions to non-controlling stockholders of $ 72,000 and $ 121,223 , respectively. LegalSimpli Software Restructuring Transaction Effective January 22, 2021 (the “LSS Effective Date”), the Company consummated a transaction to restructure the ownership of LegalSimpli Software, LLC, a Puerto Rico limited liability company (“LSS”), a majority-owned subsidiary of the Company (the “LSS Restructuring”). To effect the LSS Restructuring the Company’s wholly-owned subsidiary Conversion Labs PR, entered into a series of membership interest exchange agreements, pursuant to which, Conversion Labs PR exchanged that certain promissory note, dated May 8, 2019 with an outstanding balance of $ 375,823 (the “CVLBPR Note”), issued by LSS in favor of Conversion Labs PR, for 37,531 newly issued membership interests of LSS (the “Exchange”). Upon consummation of the Exchange the CVLBPR Note was extinguished. Concurrently, in furtherance of the LSS Restructuring, Conversion Labs PR entered into two Membership Interest Purchase Agreements (the “Founding Members MIPAs”) with two founding members of LSS (the “Founding Members”) whereby Conversion Labs PR purchased from the Founding Members an aggregate of 2,183 membership interests of LSS for an aggregate purchase price of $ 225,000 , paid in December 2020. In furtherance of the LSS Restructuring, Conversion Labs PR entered into a Membership Interest Purchase Agreement with LSS, (the “CVLB PR MIPA”), pursuant to which Conversion Labs PR purchased 12,000 membership interests of LSS for an aggregate purchase price of $ 300,000 . The CVLB PR MIPA provides that the transaction may be completed in three (3) tranches with a purchase price of $100,000 per tranche to be made at the sole discretion of Conversion Labs PR. Payment for the first tranche of $100,000 was made upon execution of the CVLB PR MIPA in January 2021. Payments for the second and third tranches were made on the 60-day anniversary and the 120-day anniversary of the LSS Effective Date. Following the consummation of the LSS Restructuring, Conversion Labs PR increased its ownership of LSS from 51% to approximately 85.58% on a fully diluted basis. LSS entered into an amendment to its operating agreement (the “LSS Operating Agreement Amendment”) to reflect the change in ownership. Concurrently with the LSS Restructuring, Conversion Labs PR entered into option agreements with Sean Fitzpatrick (the “Fitzpatrick Option Agreement”) and Varun Pathak (the “Pathak Option Agreement” together with Fitzpatrick Option Agreement the “Option Agreements”), pursuant to which Conversion Labs PR granted options to purchase membership interest units of LSS. Upon vesting, the Fitzpatrick Options and the Pathak Options provide for the potential re-purchase of up to an additional 13.25% of LSS by Fitzpatrick and Pathak in the aggregate with Conversion Labs PR ownership ratably reduced to approximately 72.98% . The Fitzpatrick Option Agreement grants Sean Fitzpatrick the option to purchase 10,300 1.00 The Pathak Options shall vest in accordance with the following (i) 700 membership interests upon LSS achieving $2,500,000 of gross sales in any fiscal quarter (ii) 700 membership interests upon LSS achieving $4,000,000 of gross sales in any fiscal quarter and (iii) 700 membership interests upon LSS achieving $8,000,000 of gross sales with a ten percent (10%) net profit margin in any fiscal quarter. The first two tranches of performance options granted to Sean Fitzpatrick and Varun Pathak vested immediately after the consummation of the restructuring transaction and therefore have been recorded as part of the acquisition through equity. The third tranche is not deemed probable and therefore has not been recognized to date. Stock Options 2020 Equity Incentive Plan (the “2020 Plan”) On January 8, 2021, the Company approved the Company’s 2020 Equity Incentive Plan (the “2020 Plan”). Approval of the 2020 Plan was included as Proposal 1 in the Company’s definitive proxy statement for its Special Meeting of Shareholders filed with the Securities and Exchange Commission on December 7, 2020. The 2020 Plan is administered by the Compensation Committee and initially provided for the issuance of up to 1,500,000 shares of Common Stock. The number of shares of Common Stock available for issuance under the Plan automatically increases by 150,000 shares of Common Stock on January 1st of each year, for a period of not more than ten years, commencing on January 1, 2021. As of January 1, 2021, the 2020 Plan provided for the issuance of up to 1,650,000 shares of Common Stock. Awards under the 2020 Plan can be granted in the form of stock options, non-qualified and incentive options, stock appreciation rights, restricted stock, and restricted stock units. The 2020 Plan will be administered by the Compensation Committee of the Company’s Board of Directors. On June 24, 2021, at the Annual Meeting of Stockholders, the stockholders of the Company approved an amendment to the 2020 Plan to increase the maximum number of shares of the Company’s common stock available for issuance under the 2020 Plan by 1,500,000 3,150,000 The forms of award agreements to be used in connection with awards made under the 2020 Plan to the Company’s executive officers and non-employee directors are: ● Form of Non-Qualified Option Agreement (Non-Employee Director Awards) ● Form of Non-Qualified Option Agreement (Employee Awards); and ● Form of Restricted Stock Award Agreement. Previously, the Company had granted service-based stock options and performance-based stock options separate from this plan. On January 20, 2020, the Company approved the transition of its Chief Acquisition Officer, to the role of President of LegalSimpli (“President”). In connection with this change in role, the Company amended that certain services agreement entered into on July 23, 2018, by and between the Company and its President, to (i) decrease the number of options to purchase the Company’s common stock previously granted from 1,000,000 500,000 130,000 370,000 500,000 1.50 During the six months ended June 30, 2021, the Company issued an aggregate of 1,368,000 10 The following is a summary of outstanding options activity under our 2020 Plan for the six months ended June 30, 2021: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance, December 31, 2020 829,000 $ 5.20 8.81 9.75 $ 7.49 Granted 958,000 6.00 21.02 9.64 11.09 Exercised - Cancelled/Forfeited/Expired - Balance at June 30, 2021 1,787,000 $ 5.20 21.02 8.40 $ 9.42 Exercisable at December 31, 2020 76,222 $ 5.20 8.81 9.77 $ 7.74 Exercisable at June 30, 2021 331,000 $ 5.20 21.02 9.39 $ 8.49 The total fair value of the options granted was approximately $16,502,680 , which was determined by the Black-Scholes Pricing Model with the following assumptions: dividend yield of 0 %, expected term of 6.5 years, volatility of 169.00 % – 180.12 %, and risk-free rate of 0.66 %– 1.26 %. Total compensation expense under the 2020 Plan options above was approximately $ 1,200,387 and $ 0 for the three months ended June 30, 2021 and 2020, respectively, with unamortized expense remaining of approximately $ 13,848,417 as of June 30, 2021. Total compensation expense under the 2020 Plan options above was approximately $2,434,254 and $ 0 for the six months ended June 30, 2021 and 2020, respectively. Restricted Stock Units (RSU) The following is a summary of outstanding RSU activity under our 2020 Plan during the six months ended June 30, 2021: SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE RSUs Outstanding Number of Shares Balance at December 31, 2020 35,000 Granted 356,250 Vested (26,875 ) Cancelled/Forfeited/Expired - Balance at June 30, 2021 364,375 The total fair value of the 356,250 $4,496,950 which was determined using the fair value of the quoted market price on the date of grant. Total compensation expense under the above 2020 Plan RSUs above was approximately $357,163 and $ 0 for both the three and six months ended June 30, 2021 and 2020, respectively, with unamortized expense remaining of approximately $ 4,139,787 as of June 30, 2021. During the six months ended June 30, 2021, 26,875 RSUs vested, of which 20,000 RSUs were issued. The Company granted 300,000 RSUs outside of the 2020 Plan during the six months ended June 30, 2021. The total fair value of these RSUs was approximately $ 4,212,000 and no compensation expense was recorded as the performance terms were not met. The following is a summary of outstanding service-based options activity (prior to the establishment of our 2020 Plan above) for the six months ended June 30, 2021: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance, December 31, 2020 2,243,400 $ 0.80 7.95 5.14 $ 2.11 Granted 410,000 4.75 19.61 7.34 13.17 Exercised (100,000 ) 0.80 2.00 2.58 1.31 Cancelled/Forfeited/Expired (992,000 ) 1.50 4.75 9.44 2.80 Balance at June 30, 2021 1,561,400 $ 1.00 19.61 6.36 $ 5.49 Exercisable December 31, 2020 1,570,428 $ 1.00 7.50 2.57 $ 1.67 Exercisable at June 30, 2021 837,997 $ 1.00 19.61 5.23 $ 2.69 Total compensation expense under the above service-based option plan was approximately $470,896 $255,153 $5,234,815 $819,269 $260,677 The following is a summary of outstanding performance-based options activity for the six months ended June 30, 2021: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2020 1,165,000 $ 1.25 7.50 4.97 $ 1.80 Granted - Exercised (235,000 ) 2.00 0.47 years 2.00 Cancelled/Expired (265,000 ) 1.25 2.00 3.74 years 1.75 Balance at June 30, 2021 665,000 $ 1.25 7.50 6.19 $ 1.75 Exercisable December 31, 2020 425,000 $ 2.00 1.18 $ 2.00 Exercisable at June 30, 2021 90,000 $ 1.75 – 2.00 2.38 years $ 1.96 No compensation expense was recognized on the performance-based options above for the three and six months ended June 30, 2021 and 2020, as the performance terms have not been met or are not probable. All performance options exercised during the six months ended June 30, 2021 had been previously expensed. Warrants The following is a summary of outstanding and exercisable warrants activity during the six months ended June 30, 2021: SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE Warrants Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2020 3,550,471 $ 1.40 5.75 5.58 $ 4.56 Granted 500,000 12.00 4.92 12.00 Exercised/Expired (65,684 ) 4.75 4.34 4.75 Balance at June 30, 2021 3,984,787 $ 1.40 12.00 5.08 $ 5.49 Exercisable December 31, 2020 2,144,700 $ 1.40 5.75 7.67 $ 4.29 Exercisable June 30, 2021 2,994,760 $ 1.40 12.00 6.12 $ 5.67 Total compensation expense on the above warrants for services was approximately $604,974 and $147,424 for the three months ended June 30, 2021 and 2020, respectively, and $1,209,948 and $159,411 for the six months ended June 30, 2021 and 2020, respectively. Stock-based Compensation The total stock-based compensation expense related to common stock issued for services, service-based stock options, performance-based stock options, warrants and RSUs amounted to approximately $2,547,300 and $439,000 for the three months ended June 30, 2021 and 2020, respectively, and approximately $4,873,075 and $535,000 for the six months ended June 30, 2021 and 2020, respectively. Such amounts are included in general and administrative expenses in the consolidated statement of operations. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 8 - COMMITMENTS AND CONTINGENCIES Royalty Agreements During 2016, Conversion Labs PR entered into a sole and exclusive license, royalty and advisory agreement with Pilaris Laboratories, LLC (“Pilaris”) relating to Pilaris’ PilarisMax shampoo formulation and conditioner. The term of the agreement will be the life of the US Patent held by Pilaris, ten years As consideration for granting Conversion Labs PR this license, Pilaris will receive on quarterly basis, 10 no During 2018, the Company entered into a license agreement (the “Alphabet Agreement”) with M.ALPHABET, LLC (“Alphabet”), pursuant to which Alphabet agreed to license its PURPUREX business which consists of methods and compositions developed by Alphabet for the treatment of purpura, bruising, post-procedural bruising and traumatic bruising (the “Product Line”). Pursuant to the license granted under the Alphabet Agreement, Conversion Labs PR obtains an exclusive license to incorporate (i) any intellectual property rights related to the Product Line and (ii) all designs, drawings, formulas, chemical compositions and specifications used or useable in the Product Line into one or more products manufactured, sold, and/or distributed by Alphabet for the treatment of purpura, bruising, post-procedural bruising and traumatic bruising and for all other fields of use or purposes (the “Licensed Product(s)”), and to make, have made, advertise, promote, market, sell, import, export, use, offer to sell and distribute the Licensed Product(s) throughout the world with the exception of China, Hong Kong, Japan, and Australia (the “License”). The Company shall pay Alphabet a royalty equal to 13 Upon execution of the Alphabet Agreement, Alphabet was granted a 10 -year stock option to purchase 20,000 shares of the Company’s common stock at an exercise price of $ 2.50 . Further, if Licensed Products have gross receipts of $ 7,500,000 in any calendar year, the Company will grant Alphabet an option to purchase 20,000 shares of the Company’s common stock at an exercise price of $ 2.50 ; (ii) if Licensed Products have gross receipts of $ 10,000,000 in any calendar year, the Company will grant Alphabet an additional option to purchase 20,000 shares of the Company’s common stock at an exercise price of $ 2.50 and (iii) if Licensed Products have gross receipts of $ 20,000,000 in any calendar year, the Company will grant Alphabet an option to purchase 40,000 shares of the Company’s common stock at an exercise price of $ 3.75 . The likelihood of meeting these performance goals for the licensed products are remote and, therefore, the Company has not recognized any compensation. Purchase Commitments Many of the Company’s vendors require product deposits when a purchase order is placed for goods or fulfillment services related to inventory requirements. The Company’s history of product deposits with its inventory vendors creates an implicit purchase commitment equaling the total expected product acceptance cost in excess of the product deposit. As of June 30, 2021 and December 31, 2020, the Company approximates its implicit purchase commitments to be $ 2.6 million and $ 1.6 million, respectively. Legal Matters In the normal course of business operations, the Company may become involved in various legal matters. As of June 30, 2021, other than as set forth below, the Company’s management does not believe that there are any potential legal matters that could have an adverse effect on the Company’s consolidated financial position. On April 16, 2021, a purported securities class action lawsuit, captioned David L. Owens, Sr. v. LifeMD, Inc. et al. Similarly, on May 5, 2021, a second purported securities class action lawsuit, captioned Cho v. LifeMD, Inc. et al. On June 7, 2021, a purported Americans with Disabilities class action lawsuit, captioned Sosa v. LifeMD, Inc. et al. www.rexmd.com |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 9 – RELATED PARTY TRANSACTIONS Chief Executive Officer Conversion Labs PR utilizes office space in Puerto Rico, which is subleased from the President and CEO, and incurs expense of approximately $ 7,500 a month for this office space for which the Company and the CEO do not have a written lease agreement. Payments to JLS Ventures, an entity wholly owned by our CEO, for rent on Conversion Labs PR’s Puerto Rico office space amounted to $ 22,500 and $ 15,000 for the three months ended June 30, 2021 and 2020, respectively, and $ 45,000 30,000 Conversion Labs PR utilizes BV Global Fulfillment, owned by a related person of the Company’s CEO to warehouse a portion of the Company’s finished goods inventory and for fulfillment services. The Company pays a monthly fee of $ 13,000 to $ 16,000 for fulfillment services and reimburses BV Global Fulfillment for their direct costs associated with shipping the Company’s products. The Company reimbursed BV Global Fulfillment a total of $ 418,526 and $ 316,804 during the six months ended June 30, 2021 and 2020, respectively. As of June 30, 2021 and December 31, 2020, the Company owed BV Global Fulfillment $ 90,047 and $ 58,943 , respectively, which are included in accounts payable and accrued liabilities on the accompanying unaudited condensed consolidated balance sheets. Consulting Agreement with Chief Operating Officer On November 27, 2020 , the Company entered into a consulting agreement (the “Consulting Agreement”) with JDM Investments, LLC (“JDM”), an entity solely owned by our COO, whereby JDM will provide consulting services in support of the Company’s day-to-day call center operations. The Consulting Agreement is for a term of thirty-six months and is renewable for additional twelve-month periods upon the mutual agreement of the Company and JDM. As compensation for the services, JDM will receive a monthly fee of $ 17,000 102,000 On June 15, 2021, the Company and Brad Roberts, our COO, restructured Mr. Roberts’s compensation arrangements. The Company and JDM mutually terminated Mr. Roberts’s Consulting Agreement and Mr. Roberts waived all consulting fees due for the remainder of the term of the Consulting Agreement. In place of the Consulting Agreement, Mr. Roberts and the Company amended his Amended and Restated Employment Agreement dated December 21, 2020 (the “Amendment”) to increase his base salary to $ 475,000 per calendar year and to update the terms of his annual bonus, providing for a target amount of $ 200,000 , with any actual bonus to be awarded in the sole discretion of the Board of Directors. On June 29, 2021, the Company and Mr. Roberts entered into a Second Amendment (the “Second Amendment”) to the Amended and Restated Employment Agreement dated December 21, 2020 to provide that Mr. Roberts is eligible to receive up to 300,000 0.01 Appointment of Chief Financial Officer On February 4, 2021, the Board appointed Mr. Marc Benathen as the Company’s Chief Financial Officer. In connection with the Appointment, Mr. Benathen entered into an Employment Agreement with the Company. To induce Mr. Benathen to enter into the Employment Agreement, Mr. Benathen was granted a signing bonus of 15,000 restricted stock units of the Company’s common stock (the “RSUs”). The RSU’s vest in accordance with the following: (i) 3,750 of the RSUs vesting on February 4, 2021 3,750 RSUs on February 4, 2022 (iii) 3,750 RSU’s on February 4, 2023 and (iv) 3,750 RSU’s on February 4, 2024 . In addition to the RSU’s, Mr. Benathen received stock options to purchase up to 200,000 shares of the Company’s common stock. The Stock Options shall vest in equal monthly tranches, based on the passage of time, over the 36 months. On March 18, 2021, we issued 3,750 common shares under this Employment Agreement. Appointment of President On June 10, 2021, the Board appointed Mr. Alex Mironov as the Company’s President. In connection with the appointment, Mr. Mironov entered into an Employment Agreement with the Company. To induce Mr. Mironov to enter into the Employment Agreement, Mr. Mironov was granted an equity award with a grant date of June 10, 2021 outside of the Company’s 2020 Equity and Incentive Plan. Mironov received options to purchase an aggregate of 200,000 shares of LifeMD, Inc. common stock. The options have an exercise price of $ 14.04 , which is equal to the closing price of LifeMD. Inc. common stock on June 10, 2021. The options will vest ratably, with 1/36th of the shares fully vested on June 10, 2021, and the remainder of the shares vesting ratably each month over a 35-month period that commences on the date of grant, subject to, the employee’s continued employment with LifeMD, Inc. on such vesting dates. The options have a five-year term. Additionally, Mr. Mironov received a performance-based grant of up to 300,000 restricted shares of LifeMD, Inc. common stock, subject to, the employee’s sourcing, and material contribution to the consummation of pharmaceutical deals, as set forth in more detail in the employment agreement. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 10 – SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date these unaudited condensed consolidated financial statements were issued and has identified the following: Partnerships Quest Diagnostics and Axle Health On July 13, 2021, the Company, on behalf of its customers, entered into an agreement to engage Quest Diagnostics Incorporated (“Quest Diagnostics”) as the Company’s laboratory services provider to perform certain clinical laboratory diagnostic services based on orders submitted to Quest Diagnostics by licensed health care providers who are under contract with the Company and are authorized under U.S. federal or state law to order laboratory tests. Patients of LifeMD Inc.’s affiliated providers gain access to more than 150 of the most ordered laboratory tests at substantially discounted prices, and which can be completed in the comfort, safety, and convenience of their home or office. In addition, on July 14, 2021, the Company entered into an agreement to engage Axle Health Inc. (“Axle Health”) to assist the Company in establishing a platform to enable patients of the Company’s medical practice clients (“MP Clients”) to schedule certain nursing services, including blood draws, injections, and other basic healthcare services, and to furnish operational support services to medical practices using the platform. In connection therewith, Axle Health granted the Company a revocable, nontransferable, non-exclusive right and license, with the right to grant sublicenses, to install and use the software and other technology relating to the platform developed, owned, or with the right to grant sublicenses to install and use the software and/or other technology developed, owned, or licensed by Axle Health, including the platform, to facilitate the scheduling and provision of certain nursing services to patients of MP Clients. Restricted Stock Issuance In July 2021, the Company issued an aggregate of approximately 30,000 |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete audited financial statements. The accompanying unaudited financial information should be read in conjunction with the audited consolidated financial statements, including the notes thereto, as of and for the year ended December 31, 2020, included in our 2020 Annual Report on Form 10-K filed with the SEC. The information furnished in this report reflects all adjustments (consisting of normal recurring adjustments), which are, in the opinion of management, necessary for a fair presentation of our financial position, results of operations and cash flows for each period presented. The results of operations for the three and six months ended June 30, 2021 are not necessarily indicative of the results for the year ending December 31, 2021 or for any future period. |
Principles of Consolidation | Principles of Consolidation The Company evaluates the need to consolidate affiliates based on standards set forth in ASC 810 Consolidation (“ASC 810”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, CLPR and its majority owned subsidiary, LegalSimpli. The non-controlling interest in LegalSimpli represents the 49 % equity interest held by other members of the subsidiary as of December 31, 2020. During the six months ended June 30, 2021, the Company purchased an additional 36 % of LegalSimpli for a total equity interest of approximately 85 % (see Note 7). All significant intercompany transactions and balances have been eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents Highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents. As of June 30, 2021 and December 31, 2020, there were no |
Variable Interest Entities | Variable Interest Entities The Company follows ASC 810-10-15 guidance with respect to accounting for variable interest entities (each, a “VIE”). These entities do not have sufficient equity at risk to finance their activities without additional subordinated financial support from other parties or whose equity investors lack any of the characteristics of a controlling financial interest. A variable interest is an investment or other interest that will absorb portions of a VIE’s expected losses or receive portions of its expected residual returns and are contractual, ownership, or pecuniary in nature and that change with changes in the fair value of the entity’s net assets. A reporting entity is the primary beneficiary of a VIE and must consolidate it when that party has a variable interest, or combination of variable interests, that provides it with a controlling financial interest. A party is deemed to have a controlling financial interest if it meets both of the power and losses/benefits criteria. The power criterion is the ability to direct the activities of the VIE that most significantly impact its economic performance. The losses/benefits criterion is the obligation to absorb losses from, or right to receive benefits from, the VIE that could potentially be significant to the VIE. The VIE model requires an ongoing reconsideration of whether a reporting entity is the primary beneficiary of a VIE due to changes in facts and circumstances. In accordance with ASC 810-10-25-37 and as amended by ASU 2009-17, the Company determines whether any legal entity in which the Company becomes involved is a VIE and subject to consolidation. The Company conducts an assessment on an ongoing basis for each VIE including (1) the power to direct activities of the VIE that most significantly impact the VIE’s economic performance, and (2) the obligation to absorb losses or right to receive benefits from the VIE that could potentially be significant to the VIE. As a result, the Company determined that three (3) entities were VIEs and subject to consolidation. 1. Conversion Labs Media, LLC (“CVLB Media”), a Puerto Rico limited liability company, 2. Conversion Labs Rx, LLC (“CVLB Rx”), a Puerto Rico limited liability company (dissolved in 2020), and 3. Conversion Labs Asia Limited, a Hong Kong company (“Conversion Labs Asia”). CVLB Media, CVLB Rx and Conversion Labs Asia are all considered immaterial as of June 30, 2021 and December 31, 2020. CVLB Rx had no activity and was dissolved during the year ended December 31, 2020. |
Use of Estimates | Use of Estimates The Company prepares its unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates required to be made by management include the determination of reserves for accounts receivable, returns and allowances, the valuation of inventory, stockholders’ equity-based transactions, estimates to cash flow projections and going concern assessment. Actual results could differ from those estimates. The continuing impact on business activity brought about by the Coronavirus pandemic (“COVID-19”) continues to evolve, globally in macro terms, and in micro terms, as such affects the Company. As a result, many of our estimates and assumptions for the period ended June 30, 2021 were subject to an increased level of judgment and may carry a higher degree of variability and volatility. In future periods, subsequent to June 30, 2021, when additional information becomes available, which may differ from our current assumptions, may subject our estimates to material change in future periods. |
Reclassifications | Reclassifications Certain reclassifications have been made to conform the prior year’s data to the current presentation. These reclassifications have no effect on previously reported operating loss, stockholders’ deficit or cash flows. Given the increase in the Company’s software business and to conform the Company’s presentation of operating results to industry standards, the Company has changed their categories for reporting operations, as result the Company has made reclassifications to the prior year presentation in order to conform it to the current periods’ presentation. The reclassification includes $ 495,787 917,785 |
Revenue Recognition | Revenue Recognition The Company records revenue under the adoption of ASC 606 by analyzing exchanges with its customers using a five-step analysis: 1. Identify the contract 2. Identify performance obligations 3. Determine the transaction price 4. Allocate the transaction price 5. Recognize revenue For the Company’s product-based contracts with customers, the Company has determined that there is one performance obligation, which is the delivery of the product; this performance obligation is transferred at a discrete point in time. The Company generally records sales of finished products once the customer places and pays for the order, with the product being simultaneously shipped by a third-party fulfillment service provider; in limited cases, title does not pass until the product reaches the customer’s delivery site, in these limited cases, recognition of revenue should be deferred until that time, however the Company does not have a process to properly record the recognition of revenue if orders are not immediately shipped, and deems the impact to be immaterial. In all cases, delivery is considered to have occurred when title and risk of loss have transferred to the customer, which is usually commensurate upon shipment of the product. In the case of its product-based contracts, the Company provides a subscription sensitive service based on the recurring shipment of products and records the related revenue under the subscription agreements subsequent to receiving the monthly product order, recording the revenue at the time it fulfills the shipment obligation to the customer. For its product-based contracts with customers, the Company records an estimate for provisions of discounts, returns, allowances, customer rebates and other adjustments for its product shipments, and are reflected as contra revenues in arriving at reported net revenues. The Company’s discounts and customer rebates are known at the time of sale, correspondingly, the Company reduces gross product sales for such discounts and customer rebates. The Company estimates customer returns and allowances based on information derived from historical transaction detail, and accounts for such provisions, as contra revenue, during the same period in which the related revenues are earned. The Company has determined that the population of its product-based contracts with customers are homogenous, supporting the ability to record estimates for returns and allowances to be applied to the entire product-based portfolio population. Customer discounts, returns and rebates on product revenues approximated $ 1,362,000 857,000 2,584,000 1,334,000 The Company, through its majority-owned subsidiary LegalSimpli, offers a subscription-based service providing a suite of software applications to its subscribers, principally on a monthly subscription basis. The software suite allows the subscriber/user to convert almost any type of document to another electronic form of editable document, providing ease of editing. For these subscription-based contracts with customers, the Company offers an initial 14-day trial period which is billed at $ 1.95 , followed by a monthly subscription, or a yearly subscription to the Company’s software suite dependent on the subscriber’s enrollment selection. The Company has estimated that there is one product and one performance obligation that is delivered over time, as the Company allows the subscriber to access the suite of services for the time period of the subscription purchased. The Company allows the customer to cancel at any point during the billing cycle, in which case the customers subscription will not be renewed for the following month or year depending on the original subscription. The Company records the revenue over the customers’ subscription period for monthly and yearly subscribers or at the end of the initial 14-day service period for customers who purchased the initial subscription, as the circumstances dictate. The Company offers a discount for the monthly or yearly subscriptions being purchased, which is deducted at the time of payment at the initiation of the contract term, therefore the Contract price is fixed and determinable at the contract initiation. Monthly and annual subscriptions for the service are recorded net of the Company’s known discount rates. As of June 30, 2021 and December 31, 2020, the Company has accrued contract liabilities, as deferred revenue, of approximately $ 1,382,000 and $ 917,000 , respectively, which represent obligations on in-process monthly or yearly contracts with customers and a portion attributable to the yet to be recognized initial 14-day trial period collections. Customer discounts and allowances on software revenues approximated $ 668,000 and $ 107,000 for the three months ended June 30, 2021 and 2020, respectively. Customer discounts and allowances on software revenues approximated $ 1,222,000 and $ 270,000 for the six months ended June 30, 2021 and 2020, respectively. For the three and six months ended June 30, 2021 and 2020, the Company had the following disaggregated revenue: SCHEDULE OF DISAGGREGATED REVENUE Three Months Ended June 30, Six Months Ended June 30, 2021 % 2020 % 2021 % 2020 % Product revenues by Brand for Conversion Labs PR: Rex MD $ 12,128,524 54 % $ 1,835,503 20 % $ 21,969,077 55 % $ 2,328,276 18 % Shapiro MD 3,515,631 16 % 5,881,965 65 % 6,899,414 17 % 8,219,073 61 % Nava MD 108,252 1 % - - % 108,252 - % - - % iNR Wellness 19,737 - % 71,162 1 % 43,642 - % 141,090 1 % Purpurex 27,466 - % 79,426 1 % 62,540 - % 132,948 1 % Scarology - - % 1,757 - % - - % 4,227 - % Total product revenue for Conversion Labs PR $ 15,799,610 71 % $ 7,869,813 87 % $ 29,082,925 72 % $ 10,825,614 81 % Software revenue for LegalSimpli 6,514,001 29 % 1,219,970 13 % 11,428,798 28 % 2,568,981 19 % Total net revenue $ 22,313,611 100 % $ 9,089,783 100 % $ 40,511,723 100 % $ 13,394,595 100 % |
Deferred Revenues | Deferred Revenues The Company records deferred revenues when cash payments are received or due in advance of its performance. The Company’s deferred revenues relate to payments received for the in-process monthly or yearly contracts with customers and a portion attributable to the yet to be recognized initial 14-day trial period collections. SCHEDULE OF CONTRACT WITH CUSTOMER LIABILITY 2021 2020 2021 2020 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Beginning of period $ 1,339,309 $ 302,960 $ 916,880 $ 109,552 Additions 6,183,965 1,127,862 11,210,719 2,484,256 Revenue recognized 6,141,336 1,127,152 10,745,661 2,290,138 End of period $ 1,381,938 $ 303,670 $ 1,381,938 $ 303,670 |
Accounts Receivable | Accounts Receivable Accounts receivable principally consist of amounts due from third-party merchant processors, who process our subscription revenues; the merchant accounts balance receivable represents the charges processed by the merchants that have not yet been deposited with the Company. The unsettled merchant receivable amount normally represents processed sale transactions from the final one to three days of the month, with collections being made by the Company within the first week of the following month. Management determines the need, if any, for an allowance for future credits to be granted to customers, by regularly evaluating aggregate customer refund activity, coupled with the consideration and current economic conditions in its evaluation of an allowance for future refunds and chargebacks. As of both June 30, 2021 and December 31, 2020, the Company had an allowance for bad debt, attributable to the single agent relationship amounting to approximately $ 133,000 470,000 349,000 |
Inventory | Inventory As of June 30, 2021 and December 31, 2020, inventory primarily consisted of finished goods related to the Company’s brands included in the product revenue section of the table above. Inventory is maintained at the Company’s third-party warehouse location in Wyoming and at the Amazon fulfillment center. The Company also maintains inventory at a related-party warehouse in Pennsylvania. Inventory is valued at the lower of cost or net realizable value with cost determined on a first-in, first-out (“FIFO”) basis. Management compares the cost of inventory with the net realizable value and an allowance is made for writing down inventory to net realizable, if lower. As of June 30, 2021, the Company did not record an inventory reserve. As of December 31, 2020, the Company recorded an inventory reserve in the amount of $ 57,481 As of June 30, 2021 and December 31, 2020, the Company’s inventory consisted of the following: SUMMARY OF INVENTORY June 30, December 31, 2021 2020 Finished Goods - Products $ 1,526,491 1,172,624 Raw materials and packaging components 87,626 149,115 Inventory reserve - (57,481 ) Total Inventory - net $ 1,614,117 $ 1,264,258 |
Product Deposit | Product Deposit Many of our vendors require deposits when a purchase order is placed for goods or fulfillment services. These deposits typically range from 10 % to 33 % of the total purchased amount. Our vendors include a credit memo within their final invoice, recognizing the deposit amount previously paid. As of June 30, 2021 and December 31, 2020, the Company has $ 1,391,764 and $ 816,765 , respectively, of product deposits with multiple vendors for the purchase of raw materials or finished goods. The Company’s history of product deposits with its inventory vendors, creates an implicit purchase commitment equaling the total expected product acceptance cost in excess of the product deposit. As of June 30, 2021 and December 31, 2020, the Company approximates its implicit purchase commitments to be $ 2.6 million and $ 1.6 million, respectively. As of June 30, 2021 and December 31, 2020, the vast majority of these product deposits are with one vendor that manufacturers the Company’s finished goods inventory for its Shapiro hair care product line. |
Capitalized Software Costs | Capitalized Software Costs The Company capitalizes certain internal payroll costs and third-party costs related to internally developed software and amortizes these costs using the straight-line method over the estimated useful life of the software, generally three years. The Company does not sell internally developed software other than through the use of subscription service. Certain development costs not meeting the criteria for capitalization, in accordance with Accounting Standards Codification (“ASC”) ASC 350-40 Internal-Use Software 1,390,483 438,136 |
Intangible Assets | Intangible Assets Intangible assets are comprised of a customer relationship asset (with original cost of approximately $ 1,007,000 200,000 three ten years |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets are evaluated for impairment whenever events or changes in circumstances have indicated that an asset may not be recoverable and are grouped with other assets to the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities (asset group). If the sum of the projected undiscounted cash flows (excluding interest charges) of an asset group is less than its carrying value and the fair value of an asset group is also less than its carrying value, the assets will be written down by the amount by which the carrying value of the asset group exceeded its fair value. However, the carrying amount of a finite-lived intangible asset can never be written down below its fair value. Any loss would be recognized in income from continuing operations in the period in which the determination is made. |
Paycheck Protection Program | Paycheck Protection Program During the year ended December 31, 2020, the Company received aggregate loan proceeds in the amount of approximately $ 249,000 The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The unforgiven portion of the PPP loan is payable over two years at an interest rate of 1 During the six months ended June 30, 2021, the Company had a total of $ 184,914 of its PPP loans forgiven by the SBA (see Note 5). As of June 30, 2021 and December 31, 2020, the PPP loan balance was $ 74,269 and $ 259,183 , respectively, and is reflected on the Company’s consolidated balance sheet as current liabilities, within notes payable, net. |
Income Taxes | Income Taxes The Company files corporate federal, state and local tax returns. Conversion Labs PR and LegalSimpli file tax returns in Puerto Rico, both are limited liability companies and file separate tax returns with any tax liabilities or benefits passing through to its members. The Company records current and deferred taxes in accordance with Accounting Standards Codification (“ASC”) 740, “Accounting for Income Taxes.” This ASC requires recognition of deferred tax assets and liabilities for temporary differences between tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company periodically assesses the value of its deferred tax asset, a majority of which has been generated by a history of net operating losses and management determines the necessity for a valuation allowance. ASC 740 also provides a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken in a tax return. Using this guidance, a company may recognize the tax benefit from an uncertain tax position in its financial statements only if it is more likely-than-not (i.e., a likelihood of more than 50%) that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company’s tax returns for all years since December 31, 2017, remain open to audit by all related taxing authorities. |
Stock-based Compensation | Stock-based Compensation The Company follows the provisions of ASC 718, “Share-Based Payment”. Under this guidance compensation cost generally is recognized at fair value on the date of the grant and amortized over the respective vesting or service period. The fair value of options at the date of grant is estimated using the Black-Scholes option pricing model. The expected option life is derived from assumed exercise rates based upon historical exercise patterns and represents the period of time that options granted are expected to be outstanding. The expected volatility is based upon historical volatility of the Company’s common shares using weekly price observations over an observation period that approximates the expected life of the options. The risk-free interest rate approximates the U.S. Treasury yield curve rate in effect at the time of grant for periods similar to the expected option life. Due to limited history of forfeitures, the Company has elected to account for forfeitures as they occur. Many of the assumptions require significant judgment and any changes could have a material impact in the determination of stock-based compensation expense. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per common share is based on the weighted average number of shares outstanding during each period presented. Convertible securities, warrants and options to purchase common stock are included as common stock equivalents only when dilutive. Potential common stock equivalents are excluded from dilutive earnings per share when the effects would be antidilutive. The Company follows the provisions of ASC 260, “Diluted Earnings per Share”. In computing diluted EPS, basic EPS is adjusted for the assumed issuance of all potentially dilutive securities. The dilutive effect of call options, warrants and share-based payment awards is calculated using the “treasury stock method,” which assumes that the “proceeds” from the exercise of these instruments are used to purchase common shares at the average market price for the period. The dilutive effect of traditional convertible debt and preferred stock is calculated using the “if-converted method.” Under the if-converted method, securities are assumed to be converted at the beginning of the period, and the resulting common shares are included in the denominator of the diluted EPS calculation for the entire period being presented. The following table summarizes the number of shares of common stock issuable pursuant to our convertible securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive even though the exercise price could be less than the average market price of the common shares: SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES Three Months Ended Three Months Ended Six Months Ended Six Months Ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Series B Preferred Stock 1,076,923 - 1,076,923 - Restricted Stock Units (RSUs) 664,375 - 355,938 - Stock options 4,013,400 4,469,000 4,204,200 4,169,000 Warrants 3,984,787 1,407,636 3,767,629 2,167,136 Potentially dilutive securities 9,739,485 5,876,636 9,404,690 6,336,136 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying value of the Company’s financial instruments, including cash, accounts receivable, accounts payable and accrued expenses and the face amount of notes payable approximate fair value for all periods presented. |
Concentrations of Risk | Concentrations of Risk The Company grants credit in the normal course of business to its customers. The Company periodically performs credit analysis and monitors the financial condition of its customers to reduce credit risk. The Company monitors its positions with, and the credit quality of, the financial institutions with which it invests. The Company, at times, maintains balances in various operating accounts in excess of federally insured limits. We are dependent on certain third-party manufacturers, although we believe that other contract manufacturers could be quickly secured if any of our current manufacturers cease to perform adequately. As of June 30, 2021 and December 31, 2020, we utilized two (2) suppliers for fulfillment services, two (2) suppliers for manufacturing finished goods, one (1) supplier for packaging and bottles and one (1) supplier for labeling. For the three and six months ended June 30, 2021 and 2020, we purchased 100 |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In August 2020, the FASB issued ASU 2020-06, “ Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40); Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity |
Other Recent Accounting Pronouncements | Other Recent Accounting Pronouncements All other accounting standards updates that have been issued or proposed by the FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SCHEDULE OF DISAGGREGATED REVENUE | For the three and six months ended June 30, 2021 and 2020, the Company had the following disaggregated revenue: SCHEDULE OF DISAGGREGATED REVENUE Three Months Ended June 30, Six Months Ended June 30, 2021 % 2020 % 2021 % 2020 % Product revenues by Brand for Conversion Labs PR: Rex MD $ 12,128,524 54 % $ 1,835,503 20 % $ 21,969,077 55 % $ 2,328,276 18 % Shapiro MD 3,515,631 16 % 5,881,965 65 % 6,899,414 17 % 8,219,073 61 % Nava MD 108,252 1 % - - % 108,252 - % - - % iNR Wellness 19,737 - % 71,162 1 % 43,642 - % 141,090 1 % Purpurex 27,466 - % 79,426 1 % 62,540 - % 132,948 1 % Scarology - - % 1,757 - % - - % 4,227 - % Total product revenue for Conversion Labs PR $ 15,799,610 71 % $ 7,869,813 87 % $ 29,082,925 72 % $ 10,825,614 81 % Software revenue for LegalSimpli 6,514,001 29 % 1,219,970 13 % 11,428,798 28 % 2,568,981 19 % Total net revenue $ 22,313,611 100 % $ 9,089,783 100 % $ 40,511,723 100 % $ 13,394,595 100 % |
SCHEDULE OF CONTRACT WITH CUSTOMER LIABILITY | The Company records deferred revenues when cash payments are received or due in advance of its performance. The Company’s deferred revenues relate to payments received for the in-process monthly or yearly contracts with customers and a portion attributable to the yet to be recognized initial 14-day trial period collections. SCHEDULE OF CONTRACT WITH CUSTOMER LIABILITY 2021 2020 2021 2020 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Beginning of period $ 1,339,309 $ 302,960 $ 916,880 $ 109,552 Additions 6,183,965 1,127,862 11,210,719 2,484,256 Revenue recognized 6,141,336 1,127,152 10,745,661 2,290,138 End of period $ 1,381,938 $ 303,670 $ 1,381,938 $ 303,670 |
SUMMARY OF INVENTORY | As of June 30, 2021 and December 31, 2020, the Company’s inventory consisted of the following: SUMMARY OF INVENTORY June 30, December 31, 2021 2020 Finished Goods - Products $ 1,526,491 1,172,624 Raw materials and packaging components 87,626 149,115 Inventory reserve - (57,481 ) Total Inventory - net $ 1,614,117 $ 1,264,258 |
SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES | The following table summarizes the number of shares of common stock issuable pursuant to our convertible securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive even though the exercise price could be less than the average market price of the common shares: SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES Three Months Ended Three Months Ended Six Months Ended Six Months Ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Series B Preferred Stock 1,076,923 - 1,076,923 - Restricted Stock Units (RSUs) 664,375 - 355,938 - Stock options 4,013,400 4,469,000 4,204,200 4,169,000 Warrants 3,984,787 1,407,636 3,767,629 2,167,136 Potentially dilutive securities 9,739,485 5,876,636 9,404,690 6,336,136 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF INTANGIBLE ASSETS | As of June 30, 2021 and December 31, 2020, the Company has the following amounts related to intangible assets: SCHEDULE OF INTANGIBLE ASSETS Intangible Assets as at: June 30, December 31, Amortizable 2021 2020 Life Amortizable Intangible Assets Customer relationship asset $ 1,006,840 $ 1,006,840 3 Purchased licenses 200,000 200,000 10 Less: accumulated amortization (1,206,840 ) (867,000 ) Total net amortizable intangible assets $ - $ 339,840 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES | As of June 30, 2021 and December 31, 2020, the Company has the following amounts related to accounts payable and accrued expenses: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES June 30, December 31, 2021 2020 Accounts payable $ 11,664,281 $ 10,408,172 Accrued compensation 3,363,794 237,036 Accrued selling and marketing expenses 180,683 60,870 Accrued legal and professional fees 56,456 209,009 Sales tax payable 275,000 125,000 Other accrued expenses 1,186,484 753,997 Total accounts payable and accrued expenses $ 16,726,698 $ 11,794,084 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Restricted Stock Units (RSUs) [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE | The following is a summary of outstanding RSU activity under our 2020 Plan during the six months ended June 30, 2021: SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE RSUs Outstanding Number of Shares Balance at December 31, 2020 35,000 Granted 356,250 Vested (26,875 ) Cancelled/Forfeited/Expired - Balance at June 30, 2021 364,375 |
Service Based Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
SCHEDULE OF OPTION ACTIVITY | The following is a summary of outstanding service-based options activity (prior to the establishment of our 2020 Plan above) for the six months ended June 30, 2021: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance, December 31, 2020 2,243,400 $ 0.80 7.95 5.14 $ 2.11 Granted 410,000 4.75 19.61 7.34 13.17 Exercised (100,000 ) 0.80 2.00 2.58 1.31 Cancelled/Forfeited/Expired (992,000 ) 1.50 4.75 9.44 2.80 Balance at June 30, 2021 1,561,400 $ 1.00 19.61 6.36 $ 5.49 Exercisable December 31, 2020 1,570,428 $ 1.00 7.50 2.57 $ 1.67 Exercisable at June 30, 2021 837,997 $ 1.00 19.61 5.23 $ 2.69 |
Performance Shares [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
SCHEDULE OF OPTION ACTIVITY | The following is a summary of outstanding performance-based options activity for the six months ended June 30, 2021: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2020 1,165,000 $ 1.25 7.50 4.97 $ 1.80 Granted - Exercised (235,000 ) 2.00 0.47 years 2.00 Cancelled/Expired (265,000 ) 1.25 2.00 3.74 years 1.75 Balance at June 30, 2021 665,000 $ 1.25 7.50 6.19 $ 1.75 Exercisable December 31, 2020 425,000 $ 2.00 1.18 $ 2.00 Exercisable at June 30, 2021 90,000 $ 1.75 – 2.00 2.38 years $ 1.96 |
2020 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
SCHEDULE OF OPTION ACTIVITY | The following is a summary of outstanding options activity under our 2020 Plan for the six months ended June 30, 2021: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance, December 31, 2020 829,000 $ 5.20 8.81 9.75 $ 7.49 Granted 958,000 6.00 21.02 9.64 11.09 Exercised - Cancelled/Forfeited/Expired - Balance at June 30, 2021 1,787,000 $ 5.20 21.02 8.40 $ 9.42 Exercisable at December 31, 2020 76,222 $ 5.20 8.81 9.77 $ 7.74 Exercisable at June 30, 2021 331,000 $ 5.20 21.02 9.39 $ 8.49 |
SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE | The following is a summary of outstanding and exercisable warrants activity during the six months ended June 30, 2021: SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE Warrants Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2020 3,550,471 $ 1.40 5.75 5.58 $ 4.56 Granted 500,000 12.00 4.92 12.00 Exercised/Expired (65,684 ) 4.75 4.34 4.75 Balance at June 30, 2021 3,984,787 $ 1.40 12.00 5.08 $ 5.49 Exercisable December 31, 2020 2,144,700 $ 1.40 5.75 7.67 $ 4.29 Exercisable June 30, 2021 2,994,760 $ 1.40 12.00 6.12 $ 5.67 |
NATURE OF THE ORGANIZATION AN_2
NATURE OF THE ORGANIZATION AND BUSINESS (Details Narrative) - USD ($) | Jun. 08, 2021 | Jun. 03, 2021 | Jun. 03, 2021 | Feb. 11, 2021 | Oct. 09, 2020 | Feb. 28, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 02, 2021 | Feb. 22, 2021 | Jan. 22, 2021 | Dec. 31, 2020 | Apr. 25, 2019 | Jun. 30, 2018 | Apr. 01, 2016 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Common stock per share | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||
Reverse stock split | 1-for-5 reverse stock split | ||||||||||||||
Proceed from private placement, net | $ 60,000,000 | $ 15,000,000 | $ 13,500,000 | $ 13,495,270 | |||||||||||
Notes Payable, Current | $ 438,234 | $ 779,132 | |||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | ||||||||||||||
Warrants and Rights Outstanding, Term | 3 years | ||||||||||||||
Going concern ability description | Under the 2021 Shelf at the time of effectiveness, the Company had the ability to raise up to $150 million by selling common stock, preferred stock, debt securities, warrants and units. | ||||||||||||||
Retained Earnings (Accumulated Deficit) | $ 108,584,988 | $ 80,151,905 | |||||||||||||
Cash | 12,500,000 | ||||||||||||||
Through the Next 12 Months [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Cash | $ 15,300,000 | ||||||||||||||
Securities Purchase Agreement [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Warrant or Right, Reason for Issuance, Description | which 500,000 warrants were issued to the Purchaser upon closing with the remaining 1,000,000 warrants only issued to the Purchaser in increments of 500,000 if the Debenture remains outstanding for twelve and twenty four months, respectively, following the closing date of the Purchase Agreement. | ||||||||||||||
Securities Purchase Agreement [Member] | Investors [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Notes Payable, Current | $ 15,000,000 | $ 15,000,000 | |||||||||||||
Class of Warrant or Right, Outstanding | 1,500,000 | 1,500,000 | |||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | $ 12 | |||||||||||||
Warrant or Right, Reason for Issuance, Description | 500,000 warrants were issued to the Purchaser upon closing with the remaining 1,000,000 warrants only issued to the Purchaser in increments of 500,000 if the Debenture remains outstanding for twelve and twenty four months, respectively, following the closing date of the Purchase Agreement. | ||||||||||||||
Warrants and Rights Outstanding, Term | 3 years | 3 years | |||||||||||||
Debt maturity term | 3 years | ||||||||||||||
Sales Agreement [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Going concern ability description | The Company had the full availability of the Sales Agreement and $90 million available under the 2021 Shelf as of June 30, 2021 | ||||||||||||||
Purchase Agreement [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Proceed from private placement, net | $ 14,900,000 | ||||||||||||||
Private Placement [Member] | Securities Purchase Agreement [Member] | Investors [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Common stock per share | $ 0.01 | ||||||||||||||
Number of stock issued | 608,696 | ||||||||||||||
Stock issued price per share | $ 23 | ||||||||||||||
Proceed from private placement, net | $ 13,500,000 | ||||||||||||||
Private Placement [Member] | Securities Purchase Agreement [Member] | Investors [Member] | Purchase Price [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Proceed from private placement, net | $ 14,000,000 | ||||||||||||||
Legal Simpli Software Llc [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 51.00% | ||||||||||||||
Immudyne PrLlc [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Percentage of ownership equity interest | 78.20% | ||||||||||||||
Conversion Labs Pr [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Percentage of ownership equity interest | 100.00% | ||||||||||||||
Legal Simpli Software Llc [Member] | |||||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||||
Percentage of ownership equity interest | 85.60% |
SCHEDULE OF DISAGGREGATED REVEN
SCHEDULE OF DISAGGREGATED REVENUE (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 22,313,611 | $ 9,089,783 | $ 40,511,723 | $ 13,394,595 |
Net revenue, percentage | 100.00% | 100.00% | 100.00% | 100.00% |
Product [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 15,799,610 | $ 7,869,813 | $ 29,082,925 | $ 10,825,614 |
Product [Member] | CVLB PR [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 15,799,610 | $ 7,869,813 | $ 29,082,925 | $ 10,825,614 |
Net revenue, percentage | 71.00% | 87.00% | 72.00% | 81.00% |
Product [Member] | Rex MD [Member] | CVLB PR [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 12,128,524 | $ 1,835,503 | $ 21,969,077 | $ 2,328,276 |
Net revenue, percentage | 54.00% | 20.00% | 55.00% | 18.00% |
Product [Member] | Shapiro MD [Member] | CVLB PR [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 3,515,631 | $ 5,881,965 | $ 6,899,414 | $ 8,219,073 |
Net revenue, percentage | 16.00% | 65.00% | 17.00% | 61.00% |
Product [Member] | Nava MD [Member] | CVLB PR [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 108,252 | $ 108,252 | ||
Net revenue, percentage | 1.00% | |||
Product [Member] | INR Wellness [Member] | CVLB PR [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 19,737 | $ 71,162 | $ 43,642 | $ 141,090 |
Net revenue, percentage | 1.00% | 1.00% | ||
Product [Member] | Purpurex [Member] | CVLB PR [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 27,466 | $ 79,426 | $ 62,540 | $ 132,948 |
Net revenue, percentage | 1.00% | 1.00% | ||
Product [Member] | Scarology [Member] | CVLB PR [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 1,757 | $ 4,227 | ||
Net revenue, percentage | ||||
Software Revenue [Member] | Legal Simpli Software Llc [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total revenues, net | $ 6,514,001 | $ 1,219,970 | $ 11,428,798 | $ 2,568,981 |
Net revenue, percentage | 29.00% | 13.00% | 28.00% | 19.00% |
SCHEDULE OF CONTRACT WITH CUSTO
SCHEDULE OF CONTRACT WITH CUSTOMER LIABILITY (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Beginning of period | $ 1,339,309 | $ 302,960 | $ 916,880 | $ 109,552 |
Additions | 6,183,965 | 1,127,862 | 11,210,719 | 2,484,256 |
Revenue recognized | 6,141,336 | 1,127,152 | 10,745,661 | 2,290,138 |
End of period | $ 1,381,938 | $ 303,670 | $ 1,381,938 | $ 303,670 |
SUMMARY OF INVENTORY (Details)
SUMMARY OF INVENTORY (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Finished Goods - Products | $ 1,526,491 | $ 1,172,624 |
Raw materials and packaging components | 87,626 | 149,115 |
Inventory reserve | (57,481) | |
Total Inventory - net | $ 1,614,117 | $ 1,264,258 |
SCHEDULE OF POTENTIALLY DILUTIV
SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Affiliate, Collateralized Security [Line Items] | ||||
Potentially dilutive securities | 9,739,485 | 5,876,636 | 9,404,690 | 6,336,136 |
Restricted Stock Units (RSUs) [Member] | ||||
Affiliate, Collateralized Security [Line Items] | ||||
Potentially dilutive securities | 664,375 | 355,938 | ||
Share-based Payment Arrangement, Option [Member] | ||||
Affiliate, Collateralized Security [Line Items] | ||||
Potentially dilutive securities | 4,013,400 | 4,469,000 | 4,204,200 | 4,169,000 |
Warrant [Member] | ||||
Affiliate, Collateralized Security [Line Items] | ||||
Potentially dilutive securities | 3,984,787 | 1,407,636 | 3,767,629 | 2,167,136 |
Series B Preferred Stock [Member] | ||||
Affiliate, Collateralized Security [Line Items] | ||||
Potentially dilutive securities | 1,076,923 | 1,076,923 |
BASIS OF PRESENTATION AND SUM_4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | Jun. 02, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Cash equivalent | $ 0 | $ 0 | $ 0 | |||
Merchant processing fees | $ 495,787 | $ 917,785 | ||||
[custom:SubscriptionPricePerShare-0] | $ 1.95 | |||||
Contract with Customer, Liability, Current | 1,382,000 | 1,382,000 | $ 917,000 | |||
Bad debt | 133,000 | 133,000 | ||||
Sales returns and allowances | 470,000 | 470,000 | 349,000 | |||
Inventory reserve | 57,481 | |||||
Deposits Assets, Current | 1,391,764 | 1,391,764 | 816,765 | |||
Purchase Obligation | 2,600,000 | 2,600,000 | 1,600,000 | |||
Capitalized software costs | 1,390,483 | 1,390,483 | 438,136 | |||
Proceeds from aggregate loan received | $ 15,000,000 | |||||
[custom:PrincipalOfPaycheckProtectionProgramLoansForgiven] | 184,914 | |||||
Notes Payable, Current | $ 438,234 | $ 438,234 | 779,132 | |||
Two Manufacturers [Member] | Revenue Benchmark [Member] | Product Concentration Risk [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Concentration risk, percentage | 100.00% | 100.00% | 100.00% | 100.00% | ||
Paycheck Protection Program Loan [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Notes Payable, Current | $ 74,269 | $ 74,269 | $ 259,183 | |||
Paycheck Protection Program Loan [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Proceeds from aggregate loan received | $ 249,000 | |||||
Loan Description | The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. | |||||
Interest rate on laon | 1.00% | 1.00% | ||||
Customer Relationships [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Intangible assets | $ 1,007,000 | $ 1,007,000 | ||||
Estimated useful life of intangible assets | 3 years | |||||
Purchased Licenses [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Intangible assets | $ 200,000 | $ 200,000 | ||||
Estimated useful life of intangible assets | 10 years | |||||
Minimum [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Percentage of Interest-bearing Domestic Deposits to Deposits | 10.00% | 10.00% | ||||
Maximum [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Percentage of Interest-bearing Domestic Deposits to Deposits | 33.00% | 33.00% | ||||
Product [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Customer discounts, returns and rebates | $ 1,362,000 | $ 857,000 | $ 2,584,000 | $ 1,334,000 | ||
Software Revenue [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Customer discounts, returns and rebates | $ 668,000 | $ 107,000 | $ 1,222,000 | $ 270,000 | ||
Legal Simpli Software Llc [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Parent | 36.00% | 36.00% | 49.00% | |||
Equity Method Investment, Ownership Percentage | 85.00% | 85.00% |
SCHEDULE OF INTANGIBLE ASSETS (
SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Less: Accumulated amortization | $ (1,206,840) | $ (867,000) |
Total Net Amortizable Intangible Assets | 339,840 | |
Customer Relationship Asset [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,006,840 | 1,006,840 |
Amortizable Life | 3 years | |
Purchased Licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 200,000 | $ 200,000 |
Amortizable Life | 10 years |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 339,840 | $ 167,806 |
SCHEDULE OF ACCOUNTS PAYABLE AN
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 11,664,281 | $ 10,408,172 |
Accrued compensation | 3,363,794 | 237,036 |
Accrued selling and marketing expenses | 180,683 | 60,870 |
Accrued legal and professional fees | 56,456 | 209,009 |
Sales tax payable | 275,000 | 125,000 |
Other accrued expenses | 1,186,484 | 753,997 |
Total accounts payable and accrued expenses | $ 16,726,698 | $ 11,794,084 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | Jun. 23, 2021 | Mar. 17, 2021 | Dec. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 02, 2021 |
Short-term Debt [Line Items] | ||||||||
Debt instrument, face amount | $ 15,000,000 | |||||||
Gain (Loss) on debt settlement | $ 184,914 | |||||||
Proceeds from advances | 963,965 | 1,750,000 | ||||||
Working Capital Loan [Member] | Chase Bank [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Debt instrument, interest rate | 3.99% | |||||||
Notes payable | $ 519,950 | |||||||
Proceeds from short term loan | 500,000 | |||||||
Service charge | 19,950 | |||||||
6 Accredited Investors [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Proceeds from convertible promissory notes | $ 600,000 | |||||||
Paycheck Protection Program Loan [Member] | US Small Business Administration [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Debt instrument, face amount | $ 259,183 | $ 259,183 | ||||||
Debt instrument, interest rate | 1.00% | 1.00% | ||||||
Notes payable | $ 259,183 | $ 74,269 | 74,269 | |||||
Merchant Funding Agreement [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest Expense, Debt | 229,351 | $ 228,875 | 368,814 | $ 1,021,914 | ||||
Merchant Funding Agreement [Member] | M O Technologies U S A [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Notes payable | $ 363,965 | $ 363,965 | ||||||
Cash advances on service charge percentage | 3.99% | 3.99% | ||||||
Proceeds from advances | $ 350,000 |
LONG-TERM DEBT (Details Narrati
LONG-TERM DEBT (Details Narrative) - USD ($) | Jun. 02, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 15,000,000 | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 500,000 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | ||||
Fair Value Adjustment of Warrants | $ 6,270,710 | ||||
Amortization of debt discount | $ 522,559 | $ 522,559 | $ 739,324 | ||
Warrants and Rights Outstanding, Term | 3 years | ||||
Proceeds from Issuance of Debt | $ 15,000,000 | ||||
Proceeds from Debt, Net of Issuance Costs | $ 14,900,000 | ||||
Securities Purchase Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Warrant or Right, Reason for Issuance, Description | which 500,000 warrants were issued to the Purchaser upon closing with the remaining 1,000,000 warrants only issued to the Purchaser in increments of 500,000 if the Debenture remains outstanding for twelve and twenty four months, respectively, following the closing date of the Purchase Agreement. | ||||
Debt Instrument, Interest Rate Terms | The Aggregate Principal Amount of the Debenture, together with interest, is due and payable on June 1, 2024. The Debenture bears interest as follows: (i) for the period beginning on June 1, 2021 and ending on the date that is six (6) months thereafter (the “Initial Interest Rate Period”) shall be six percent (6%), (ii) for the period beginning the date following the Initial Interest Rate Period and ending on the date that is three (3) months thereafter (the “Second Interest Rate Period”), nine percent (9%), and (iii) for the period beginning the date following the Second Interest Rate Period and ending on June 1, 2024, twelve percent (12%). Until such time as the obligations shall have been paid in full, the Company shall apply thirty-five percent (35%) of the gross proceeds received by the Company from At-The-Market offerings of its Common Stock to partial redemptions of each Debenture on a pro rata basis. | ||||
Interest Expense, Debt | $ 672,559 | $ 0 | $ 672,559 | $ 0 | |
Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,500,000 |
SCHEDULE OF OPTION ACTIVITY (De
SCHEDULE OF OPTION ACTIVITY (Details) - $ / shares | Jun. 10, 2021 | Jun. 30, 2021 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted Average Exercise Price per Share, Ending balance | $ 14.04 | |
2020 Plan [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Beginning balance | $ 5.20 | |
Exercise Price per Share, Ending balance | 5.20 | |
Exercise Price per Share, Exercisable, Beginning | 5.20 | |
2020 Plan [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Beginning balance | 8.81 | |
Exercise Price per Share, Ending balance | 21.02 | |
Exercise Price per Share, Exercisable, Beginning | 8.81 | |
Exercise Price per Share, Exercisable, Beginning. | $ 21.02 | |
Service Based Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Options, Beginning Balance | 2,243,400 | |
Weighted Average Remaining Contractual Life, Beginning | 5 years 1 month 20 days | |
Weighted Average Exercise Price per Share, Beginning balance | $ 2.11 | |
Number of Shares, Granted | 410,000 | |
Weighted Average Remaining Contractual Life, Granted | 7 years 4 months 2 days | |
Weighted Average Exercise Price per Share, Granted | $ 13.17 | |
Number of Shares, Exercised | 100,000 | |
Number of Shares, Cancelled/Forfeited/Expired | 992,000 | |
Number of Options, Ending balance | 1,561,400 | |
Weighted Average Remaining Contractual Life, Ending | 6 years 4 months 9 days | |
Weighted Average Exercise Price per Share, Ending balance | $ 5.49 | |
Number of Options, Exercisable, Beginning | 1,570,428 | |
Weighted Average Remaining Contractual Life, Exercisable, Beginning | 2 years 6 months 25 days | |
Weighted Average Exercise Price per Share, Exercisable, Beginning | $ 1.67 | |
Number of Options, Exercisable, Ending | 837,997 | |
Weighted Average Remaining Contractual Life, Exercisable, ending | 5 years 2 months 23 days | |
Weighted Average Exercise Price per Share, Exercisable, Ending | $ 2.69 | |
Number of Shares, Exercised | (100,000) | |
Weighted Average Remaining Contractual Life, Exercised | 2 years 6 months 29 days | |
Weighted Average Exercise Price per Share, Exercised | $ 1.31 | |
Number of Shares, Cancelled/Forfeited/Expired | (992,000) | |
Weighted Average Remaining Contractual Life, Cancelled/Forfeited/Expired | 9 years 5 months 8 days | |
Weighted Average Exercise Price per Share, Cancelled/Forfeited/Expired | $ 2.80 | |
Service Based Stock Options [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Beginning balance | 0.80 | |
Exercise Price per Share, Granted | 4.75 | |
Exercise Price per Share, Ending balance | 1 | |
Exercise Price per Share, Exercisable, Beginning | 1 | |
Exercise Price per Share, Exercisable, Beginning. | 5.20 | |
Exercise Price per Share, Exercised | 0.80 | |
Exercise Price per Share, Cancelled/Forfeited/Expired | 1.50 | |
Exercise Price per Share, Exercisable, Ending | 1 | |
Service Based Stock Options [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Beginning balance | 7.95 | |
Exercise Price per Share, Granted | 19.61 | |
Exercise Price per Share, Ending balance | 19.61 | |
Exercise Price per Share, Exercisable, Beginning | 7.50 | |
Exercise Price per Share, Exercised | 2 | |
Exercise Price per Share, Cancelled/Forfeited/Expired | 4.75 | |
Exercise Price per Share, Exercisable, Ending | $ 19.61 | |
Performance Shares [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Options, Beginning Balance | 1,165,000 | |
Weighted Average Remaining Contractual Life, Beginning | 4 years 11 months 19 days | |
Weighted Average Exercise Price per Share, Beginning balance | $ 1.80 | |
Number of Shares, Granted | ||
Number of Shares, Exercised | 235,000 | |
Number of Shares, Cancelled/Forfeited/Expired | 265,000 | |
Number of Options, Ending balance | 665,000 | |
Weighted Average Remaining Contractual Life, Ending | 6 years 2 months 8 days | |
Weighted Average Exercise Price per Share, Ending balance | $ 1.75 | |
Number of Options, Exercisable, Beginning | 425,000 | |
Weighted Average Remaining Contractual Life, Exercisable, Beginning | 1 year 2 months 4 days | |
Weighted Average Exercise Price per Share, Exercisable, Beginning | $ 2 | |
Number of Options, Exercisable, Ending | 90,000 | |
Weighted Average Remaining Contractual Life, Exercisable, ending | 2 years 4 months 17 days | |
Weighted Average Exercise Price per Share, Exercisable, Ending | $ 1.96 | |
Number of Shares, Exercised | (235,000) | |
Weighted Average Remaining Contractual Life, Exercised | 5 months 19 days | |
Weighted Average Exercise Price per Share, Exercised | $ 2 | |
Number of Shares, Cancelled/Forfeited/Expired | (265,000) | |
Weighted Average Remaining Contractual Life, Cancelled/Forfeited/Expired | 3 years 8 months 26 days | |
Weighted Average Exercise Price per Share, Cancelled/Forfeited/Expired | $ 1.75 | |
Exercise Price per Share, Exercisable, Beginning | 2 | |
Exercise Price per Share, Exercisable, Ending | 1.75 | |
Performance Shares [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Beginning balance | 1.25 | |
Exercise Price per Share, Ending balance | 1.25 | |
Exercise Price per Share, Cancelled/Forfeited/Expired | 1.25 | |
Performance Shares [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Beginning balance | 7.50 | |
Exercise Price per Share, Ending balance | 7.50 | |
Exercise Price per Share, Exercised | 2 | |
Exercise Price per Share, Cancelled/Forfeited/Expired | $ 2 | |
2020 Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Options, Beginning Balance | 829,000 | |
Weighted Average Remaining Contractual Life, Beginning | 9 years 9 months | |
Weighted Average Exercise Price per Share, Beginning balance | $ 7.49 | |
Number of Shares, Granted | 958,000 | |
Weighted Average Remaining Contractual Life, Granted | 9 years 7 months 20 days | |
Weighted Average Exercise Price per Share, Granted | $ 11.09 | |
Number of Shares, Exercised | ||
Number of Shares, Cancelled/Forfeited/Expired | ||
Number of Options, Ending balance | 1,787,000 | |
Weighted Average Remaining Contractual Life, Ending | 8 years 4 months 24 days | |
Weighted Average Exercise Price per Share, Ending balance | $ 9.42 | |
Number of Options, Exercisable, Beginning | 76,222 | |
Weighted Average Remaining Contractual Life, Exercisable, Beginning | 9 years 9 months 7 days | |
Weighted Average Exercise Price per Share, Exercisable, Beginning | $ 7.74 | |
Number of Options, Exercisable, Ending | 331,000 | |
Weighted Average Remaining Contractual Life, Exercisable, ending | 9 years 4 months 20 days | |
Weighted Average Exercise Price per Share, Exercisable, Ending | $ 8.49 | |
Number of Shares, Exercised | ||
Number of Shares, Cancelled/Forfeited/Expired | ||
2020 Plan [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Granted | $ 6 | |
2020 Plan [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise Price per Share, Granted | $ 21.02 |
SCHEDULE OF WARRANT AND RESTRIC
SCHEDULE OF WARRANT AND RESTRICTED STOCK OUTSTANDING AND EXERCISABLE (Details) | 6 Months Ended |
Jun. 30, 2021$ / sharesshares | |
Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Outstanding Number of Shares, Beginning balance | shares | 3,550,471 |
Outstanding Number of Shares, Granted | shares | 500,000 |
Outstanding Number of Shares, Ending balance | shares | 3,984,787 |
Weighted Average Remaining Contractual Life, Beginning | 5 years 6 months 29 days |
Weighted Average Exercise Price per Share, Beginning balance | $ 4.56 |
Exercise Price per Share, Granted | $ 12 |
Weighted Average Remaining Contractual Life, Granted | 4 years 11 months 1 day |
Weighted Average Exercise Price per Share, Granted | $ 12 |
Outstanding Number of Shares, Exercised/Expired | shares | (65,684) |
Exercise Price per Share, Exercised/Expired | $ 4.75 |
Weighted Average Remaining Contractual Life, Exercised/Expired | 4 years 4 months 2 days |
Weighted Average Exercise Price per Share, Exercised/Expired | $ 4.75 |
Weighted Average Remaining Contractual Life, Ending | 5 years 29 days |
Weighted Average Exercise Price per Share, Ending balance | $ 5.49 |
Outstanding Number of Shares, Exercisable, Beginning | shares | 2,144,700 |
Weighted Average Remaining Contractual Life, Exercisable, Beginning | 7 years 8 months 1 day |
Weighted Average Exercise Price per Share, Exercisable, Beginning | $ 4.29 |
Outstanding Number of Shares, Exercisable, Ending | shares | 2,994,760 |
Weighted Average Remaining Contractual Life, Exercisable, Ending | 6 years 1 month 13 days |
Weighted Average Exercise Price per Share, Exercisable, Ending | $ 5.67 |
Warrant [Member] | Minimum [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Exercise Price per Share, Beginning balance | 1.40 |
Exercise Price per Share, Ending balance | 1.40 |
Exercise Price per Share, Exercisable, Beginning | 1.40 |
Exercise Price per Share, Exercisable, Ending | 1.40 |
Warrant [Member] | Maximum [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Exercise Price per Share, Beginning balance | 5.75 |
Exercise Price per Share, Ending balance | 12 |
Exercise Price per Share, Exercisable, Beginning | 5.75 |
Exercise Price per Share, Exercisable, Ending | $ 12 |
Restricted Stock Units (RSUs) [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Outstanding Number of Shares, Beginning balance | shares | 35,000 |
Outstanding Number of Shares, Granted | shares | 356,250 |
Outstanding Number of Shares, Beginning balance | shares | (26,875) |
Outstanding Number of Shares, Beginning balance | shares | 0 |
Outstanding Number of Shares, Ending balance | shares | 364,375 |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | Feb. 11, 2021 | Jan. 22, 2021 | Dec. 09, 2020 | Oct. 09, 2020 | Jan. 20, 2020 | Jan. 19, 2020 | Jul. 31, 2019 | Jun. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 24, 2021 | Feb. 22, 2021 | Jan. 08, 2021 | Jan. 02, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | |||||||||||||||||
Common stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | ||||||||||||||
Common stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | |||||||||||||||
Preferred stock, at par value | $ 0.0001 | $ 0.0001 | |||||||||||||||
Undesignated preferred stock | 4,996,500 | 4,996,500 | |||||||||||||||
Reverse stock split | 1-for-5 reverse stock split | ||||||||||||||||
Shares issued after stok split | 632 | ||||||||||||||||
Proceeds from Stock Options Exercised | $ 766,750 | ||||||||||||||||
Proceeds from Warrant Exercises | $ 311,999 | ||||||||||||||||
Number of stock issued, value | $ 250,000 | ||||||||||||||||
Shares issued for service | 1,233,750 | ||||||||||||||||
Net Income (Loss) Attributable to Noncontrolling Interest | $ 197,973 | 68,131 | $ 468,476 | 206,947 | |||||||||||||
Payments to Noncontrolling Interests | $ (36,000) | (85,223) | $ (72,000) | $ (121,223) | |||||||||||||
Stock Issued During Period, Value, Other | 1,726,000 | ||||||||||||||||
Conversion Labs P R L L C [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Notes Payable | $ 375,823 | ||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued | 37,531 | ||||||||||||||||
Conversion Labs P R L L C [Member] | Legal Simpli Software Llc [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Membership interests purchases | 12,000 | ||||||||||||||||
Stock Issued During Period, Value, Other | $ 300,000 | ||||||||||||||||
Membership interests, description | The CVLB PR MIPA provides that the transaction may be completed in three (3) tranches with a purchase price of $100,000 per tranche to be made at the sole discretion of Conversion Labs PR. Payment for the first tranche of $100,000 was made upon execution of the CVLB PR MIPA in January 2021. Payments for the second and third tranches were made on the 60-day anniversary and the 120-day anniversary of the LSS Effective Date. | ||||||||||||||||
General and Administrative Expense [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued | 2,000,000 | 1,200,000 | |||||||||||||||
CVLB PR [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Equity Method Investment, Ownership Percentage | 100.00% | ||||||||||||||||
Founding Members M I P As [Member] | Conversion Labs P R L L C [Member] | Legal Simpli Software Llc [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Membership interests purchases | 2,183 | ||||||||||||||||
Stock Issued During Period, Value, Other | $ 225,000 | ||||||||||||||||
Employees Anddvisory Board Members [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock options issued | 1,368,000 | ||||||||||||||||
Contractual term | 10 years | ||||||||||||||||
Membership Interest Purchase Agreement [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
[custom:MembershipInterestPercentage] | 21.83333% | ||||||||||||||||
Aggregate expenses | $ 18,060,000 | ||||||||||||||||
Membership Interest Purchase Agreement [Member] | Mr Schreiber [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued | 1,000,000 | 500,000 | |||||||||||||||
Membership Interest Purchase Agreement [Member] | Mr Galluppi [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued | 1,000,000 | 500,000 | |||||||||||||||
Fitzpatrick Option Agreement [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Membership interests, description | Concurrently with the LSS Restructuring, Conversion Labs PR entered into option agreements with Sean Fitzpatrick (the “Fitzpatrick Option Agreement”) and Varun Pathak (the “Pathak Option Agreement” together with Fitzpatrick Option Agreement the “Option Agreements”), pursuant to which Conversion Labs PR granted options to purchase membership interest units of LSS. Upon vesting, the Fitzpatrick Options and the Pathak Options provide for the potential re-purchase of up to an additional 13.25% of LSS by Fitzpatrick and Pathak in the aggregate with Conversion Labs PR ownership ratably reduced to approximately 72.98% | ||||||||||||||||
Fitzpatrick Option Agreement [Member] | Sean Fitzpatrick [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Share issue price per share | $ 1 | $ 1 | |||||||||||||||
Membership interests purchases | 10,300 | ||||||||||||||||
Membership interests, description | The Fitzpatrick Option Agreement grants Sean Fitzpatrick the option to purchase 10,300 membership interest units of LSS for an exercise price of $1.00 per membership interest unit. The Fitzpatrick Options vest in accordance with the following (i) 3,434 membership interests upon LSS achieving $2,500,000 of gross sales in any fiscal quarter (ii) 3,434 membership interests upon LSS achieving $4,000,000 of gross sales in any fiscal quarter and (iii) 3,434 membership interests upon LSS achieving $8,000,000 of gross sales with a ten percent (10%) net profit margin in any fiscal quarter. | ||||||||||||||||
Pathak Option Agreement [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Membership interests, description | The Pathak Options shall vest in accordance with the following (i) 700 membership interests upon LSS achieving $2,500,000 of gross sales in any fiscal quarter (ii) 700 membership interests upon LSS achieving $4,000,000 of gross sales in any fiscal quarter and (iii) 700 membership interests upon LSS achieving $8,000,000 of gross sales with a ten percent (10%) net profit margin in any fiscal quarter. | ||||||||||||||||
2020 Plan [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,500,000 | 1,650,000 | |||||||||||||||
[custom:IncreaseInSharesAvailableForIssuance-0] | 150,000 | ||||||||||||||||
Shares Granted, Value, Share-based Payment Arrangement, after Forfeiture | $ 16,502,680 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate | 0.00% | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 6 years 6 months | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate, Minimum | 169.00% | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate, Maximum | 180.12% | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Minimum | 0.66% | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Maximum | 1.26% | ||||||||||||||||
Stock compensation expense | $ 1,200,387 | 0 | $ 2,434,254 | $ 0 | |||||||||||||
Unamortized expense | 13,848,417 | 13,848,417 | |||||||||||||||
2020 Plan [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Common stock available for future issuance | 1,500,000 | ||||||||||||||||
Number of share authorized | 3,150,000 | ||||||||||||||||
Warrant [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Proceeds from Warrant Exercises | $ 311,999 | ||||||||||||||||
Outstanding Number of Shares, Granted | 500,000 | ||||||||||||||||
Options Held [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Proceeds from Stock Options Exercised | $ 766,750 | ||||||||||||||||
Employee Stock [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
[custom:CashlessExerciseOfWarrantsShares] | 421,000 | ||||||||||||||||
Private Placement [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued, value | $ 13,500,000 | ||||||||||||||||
Private Placement [Member] | Securities Purchase Agreement [Member] | Investors [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Common stock, par value | $ 0.01 | ||||||||||||||||
Number of stock issued | 608,696 | ||||||||||||||||
Share issue price per share | $ 23 | ||||||||||||||||
Aggregate expenses | $ 14,000,000 | ||||||||||||||||
Number of stock issued, value | $ 13,500,000 | ||||||||||||||||
Warrant And Restricted Stock Units R S U [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 873,047 | ||||||||||||||||
Stock compensation expense | 2,547,300 | 439,000 | $ 4,873,075 | $ 535,000 | |||||||||||||
First Milestone [Member] | Membership Interest Purchase Agreement [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Share issue price per share | $ 2.50 | ||||||||||||||||
First Milestone [Member] | Membership Interest Purchase Agreement [Member] | Mr Schreiber [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued | 500,000 | ||||||||||||||||
First Milestone [Member] | Membership Interest Purchase Agreement [Member] | Mr Galluppi [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued | 500,000 | ||||||||||||||||
Second Mile S Stone [Member] | Membership Interest Purchase Agreement [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Share issue price per share | $ 3.75 | ||||||||||||||||
Second Mile S Stone [Member] | Membership Interest Purchase Agreement [Member] | Mr Schreiber [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued | 500,000 | ||||||||||||||||
Second Mile S Stone [Member] | Membership Interest Purchase Agreement [Member] | Mr Galluppi [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Number of stock issued | 500,000 | ||||||||||||||||
Service Based Stock Options [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 100,000 | ||||||||||||||||
Number of stock options issued | 410,000 | ||||||||||||||||
Stock compensation expense | 470,896 | 255,153 | $ 819,269 | 260,677 | |||||||||||||
Unamortized expense | 5,234,815 | $ 5,234,815 | |||||||||||||||
Service Based Stock Options [Member] | Services Agreement [Member] | Mr Sean Fitzpatrick [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Options to purchase shares of common stock | 500,000 | 1,000,000 | |||||||||||||||
Options granted fully vested | 130,000 | ||||||||||||||||
Remaining performance options | 370,000 | ||||||||||||||||
Number of shares cancelled during period | 500,000 | ||||||||||||||||
Purchase of common stock exercise price | $ 1.50 | ||||||||||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Outstanding Number of Shares, Granted | 356,250 | ||||||||||||||||
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | $ 4,212,000 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 26,875 | ||||||||||||||||
Restricted Stock Units (RSUs) [Member] | 2020 Plan [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Stock compensation expense | $ 357,163 | 0 | |||||||||||||||
Unamortized expense | 4,139,787 | $ 4,139,787 | |||||||||||||||
Restricted Stock Units (RSUs) [Member] | 2020 Plan [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Outstanding Number of Shares, Granted | 20,000 | ||||||||||||||||
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | $ 4,496,950 | ||||||||||||||||
Restricted Stock Units (RSUs) [Member] | Outside Of Two Thousand Twenty Plan [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Outstanding Number of Shares, Granted | 300,000 | ||||||||||||||||
Performance Shares [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 235,000 | ||||||||||||||||
Number of stock options issued | |||||||||||||||||
Warrants For Services [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Stock compensation expense | $ 604,974 | $ 147,424 | $ 1,209,948 | $ 159,411 | |||||||||||||
Series B Preferred Stock [Member] | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Preferred stock, shares authorized | 5,000 | 5,000 | |||||||||||||||
Preferred stock, at par value | $ 0.0001 | $ 0.0001 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2020 | |
Entity Listings [Line Items] | |||||
Proceeds from Issuance of Common Stock | $ 250,000 | ||||
Purchase Obligation | 2,600,000 | $ 1,600,000 | |||
Subscription Agreement [Member] | |||||
Entity Listings [Line Items] | |||||
Accounts payable and accrued expenses | $ 0 | $ 0 | |||
Pilaris Laboratories LLC [Member] | |||||
Entity Listings [Line Items] | |||||
Agreement term | 10 years | ||||
Percentage of net income | 10.00% | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | ||||
Pilaris Laboratories LLC [Member] | CVLB PR [Member] | |||||
Entity Listings [Line Items] | |||||
Agreements of performance fees, description | As consideration for granting Conversion Labs PR this license, Pilaris will receive on quarterly basis, 10% of the net income collected by the licensed products based on the following formula: Net Income = total income – cost of goods sold – advertising and operating expenses directly related to the marketing of the licensed products. | ||||
MALPHABET LLC [Member] | |||||
Entity Listings [Line Items] | |||||
Agreements of performance fees, description | The Company shall pay Alphabet a royalty equal to 13% of Gross Receipts (as defined in the Agreement) realized from the sales of Licensed Products. No amounts were earned or owed as of June 30, 2021. | ||||
Percentage for royalty | 13.00% | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 20,000 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 2.50 | ||||
MALPHABET LLC [Member] | Common Stock One [Member] | |||||
Entity Listings [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 20,000 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 2.50 | ||||
Proceeds from Issuance of Common Stock | $ 7,500,000 | ||||
MALPHABET LLC [Member] | Common Stock Two [Member] | |||||
Entity Listings [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 20,000 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 2.50 | ||||
Proceeds from Issuance of Common Stock | $ 10,000,000 | ||||
MALPHABET LLC [Member] | Common Stock Three [Member] | |||||
Entity Listings [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 40,000 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 3.75 | ||||
Proceeds from Issuance of Common Stock | $ 20,000,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Jun. 15, 2021 | Jun. 10, 2021 | Feb. 04, 2021 | Feb. 04, 2021 | Nov. 27, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Feb. 22, 2021 | Dec. 31, 2020 |
Entity Listings [Line Items] | |||||||||||
Common stock par value | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $ 14.04 | ||||||||||
Common Stock [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Stock Issued During Period, Shares, New Issues | 294,120 | ||||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 356,250 | ||||||||||
Employment Agreement [Member] | Common Stock [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Stock Issued During Period, Shares, New Issues | 3,750 | ||||||||||
BV Global Fulfillment [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Reimbursed amount | $ 418,526 | $ 316,804 | |||||||||
Puerto Rico Office Space [Member] | JLS Ventures LLC [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Payments for Rent | $ 22,500 | $ 15,000 | 45,000 | $ 30,000 | |||||||
President And CEO [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Payments for Rent | 7,500 | ||||||||||
Chief Executive Officer [Member] | BV Global Fulfillment [Member] | Accounts Payable and Accrued Liabilities [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Due to Related Parties | $ 90,047 | 90,047 | $ 58,943 | ||||||||
Chief Executive Officer [Member] | BV Global Fulfillment [Member] | Minimum [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Monthly fees | 13,000 | ||||||||||
Chief Executive Officer [Member] | BV Global Fulfillment [Member] | Maximum [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Monthly fees | 16,000 | ||||||||||
Chief Operating Officer [Member] | Consulting Agreement[Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Monthly fees | $ 17,000 | ||||||||||
Reimbursed amount | $ 102,000 | ||||||||||
Salary and Wage, Excluding Cost of Good and Service Sold | $ 475,000 | ||||||||||
[custom:AnnualBonus] | $ 200,000 | ||||||||||
Common stock par value | $ 0.01 | ||||||||||
Chief Operating Officer [Member] | Maximum [Member] | Consulting Agreement[Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Restricted stock eligible to receive | 300,000 | ||||||||||
Chief Financial Officer [Member] | Restricted Stock Units (RSUs) [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | 15,000 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 200,000 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 36 months | ||||||||||
Chief Financial Officer [Member] | Restricted Stock Units (RSUs) [Member] | Vesting On Effective Date [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 3,750 | ||||||||||
Chief Financial Officer [Member] | Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Tranche One [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 3,750 | ||||||||||
[custom:ShareBasedCompensationArrangementByShareBasedPaymentAwardVestingDate] | Feb. 4, 2021 | ||||||||||
Chief Financial Officer [Member] | Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Tranche Two [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 3,750 | ||||||||||
[custom:ShareBasedCompensationArrangementByShareBasedPaymentAwardVestingDate] | Feb. 4, 2022 | ||||||||||
Chief Financial Officer [Member] | Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Tranche Three [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 3,750 | ||||||||||
[custom:ShareBasedCompensationArrangementByShareBasedPaymentAwardVestingDate] | Feb. 4, 2023 | ||||||||||
Chief Financial Officer [Member] | Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Tranche Four [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
[custom:ShareBasedCompensationArrangementByShareBasedPaymentAwardVestingDate] | Feb. 4, 2024 | ||||||||||
MrMironov [Member] | Employment Agreement [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 200,000 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights | The options will vest ratably, with 1/36th of the shares fully vested on June 10, 2021, and the remainder of the shares vesting ratably each month over a 35-month period that commences on the date of grant, subject to, the employee’s continued employment with LifeMD, Inc. on such vesting dates. | ||||||||||
MrMironov [Member] | Employment Agreement [Member] | Restricted Stock Units (RSUs) [Member] | |||||||||||
Entity Listings [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 300,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) | 1 Months Ended |
Jul. 31, 2021shares | |
Subsequent Event [Member] | |
Subsequent Event [Line Items] | |
Issueance common stock vesting of restricted stock | 30,000 |