8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 or 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (date of earliest event reported): April 12, 2019

HealthLynked Corp.
(Exact Name of Registrant as Specified in its Charter)

Nevada	47-1634127
(State of Incorporation)	(I.R.S. Employer Identification No.)
1726 Medical Blvd., Suite 101, Naples, Florida	34110
(Address of Principal Executive Offices)	(ZIP Code)

(239) 513-1992

(Registrant’s Telephone Number, Including Area Code)

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).  ☒

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

Item 1.01 Entry Into A Material Definitive Agreement    

Item 2.01 Completion of Acquisition or Disposition of Assets

As previously reported on a Current Report on Form 8-K, dated January 15, 2019, HealthLynked Corp. (the “Corporation”) entered into that certain Agreement and Plan of Merger (the “Merger Agreement”) by and among the Corporation, HLYK Florida, LLC, a Florida limited liability company and wholly-owned subsidiary of the Corporation (“HLYK FL”), Hughes Center for Functional Medicine, P.A. (the “Target” or “HCFM”), and Pamela A. Hughes, D.O. (the “Seller,” together with the Corporation, HLYK FL, and the Target, the “Parties”).

On April 12, 2019, the Parties entered into a First Amendment to Agreement and Plan of Merger, which amended certain sections of the Merger Agreement (the “Amendment,” together with the Merger Agreement, the “Transaction Documents”). The Amendment revises the Merger Consideration (as that term is defined in the Merger Agreement) payable to the Seller at Closing to the following: (i) $500,000 in cash; and (ii) 3,968,254 shares of the Corporation’s common stock.

Also on April 12, 2019, the closing of the transactions contemplated by the Transaction Documents (the “Closing”) took place, upon which the Target merged with and into HLYK FL, with HLYK FL as the surviving entity.

At the Effective Time set forth in the Transaction Documents: (i) the Seller received the Merger Consideration due at the Closing; (ii) articles of merger were filed with the Florida Department of State, Division of Corporations; (iii) all of the equity of the Target issued and outstanding immediately prior to the Effective Time was cancelled; (iv) HLYK FL is continuing as the surviving entity; and (v) HLYK FL remains a wholly-owned subsidiary of the Corporation.

Additionally, as a part of the Merger Consideration, the Seller is entitled to: (i) “earn-out” payments in the aggregate amount of $500,000 to be paid over three (3) years, subject to certain revenue and profit targets; (ii) Target cash balances in excess of $35,000 at the Closing, and (iii) any excess over the Minimum Value of $65,000 of the required medical supply inventory of the Target immediately prior to the Closing. If the Minimum Value was below $65,000 at Closing, the difference would have been paid by the Seller. No adjustments were made pursuant to this clause.

The foregoing description of the Transaction Documents does not purport to be complete and is qualified in its entirety by reference to the full text of the Transaction Documents, which are attached as exhibits to this Current Report on Form 8-K and are incorporated herein by reference. Capitalized terms used but not defined herein shall have the respective meanings ascribed to them in the Transaction Documents.

Item 8.01 Other Events

On April 16, 2019, the Corporation issued a press release announcing the Closing of the Merger Agreement.

Pursuant to Regulation G, the information below is a reconciliation of certain non-GAAP financial measures used in the press released filed herewith to the most directly comparable GAAP financial measure. Net income is the most direct comparable GAAP financial measure for EBITDA (earnings before interest, tax, depreciation, and amortization), a non-GAAP financial measure.

	Years Ended December 31,
	2018		2017
HCFM net income	$	290,955	$	257,258
Depreciation and amortization		72,688		53,764
Interest expense		9,278		421
HCFM EBITDA as reported in April 16, 2019 press release	$	372,921	$	311,443

A copy of the press release is filed as Exhibit 99.1 to, and incorporated by reference in this Current Report on Form 8-K. The information in this Current Report on Form 8-K is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report on Form 8-K shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act, except as shall be expressly set forth by specific reference in any such filing.

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Item 9.01. Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired. As a result of its acquisition of the Target as described in Item 2.01, the registrant is filing herewith the Target’s audited financial statements as of December 31, 2018, and 2017 as Exhibit 99.2 to this Current Report on Form 8-K.

(b) Pro Forma Financial Information. The pro forma financial information required by this item is filed as Exhibit 99.3 to this Form 8-K/A.

(d) Exhibits.

Exhibit No.	Description
10.1	First Amendment to Agreement and Plan of Merger, dated April 12, 2019, by and among HealthLynked Corp., HLYK Florida, LLC, Hughes Center for Functional Medicine, P.A., and Pamela A. Hughes, D.O.
99.1	Press Release, dated April 16, 2019
99.2	Audited Consolidated Financial Statements of Hughes Center for Functional Medicine, P.A. for the years ended December 31, 2018 and 2017
99.3	Unaudited pro forma combined financial information of HealthLynked Corp. and Hughes Center for Functional Medicine, P.A.

2

SIGNATURE

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

	HEALTHLYNKED CORP.
Dated: April 18, 2019	/s/ George O’Leary
	George O’Leary
	Chief Financial Officer

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EX-10.1

Exhibit 10.1

FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER

THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER (the “Amendment”) is made and entered into as of April 12, 2019 (the “Effective Date”), by and between HealthLynked Corp., a Nevada corporation (the “Parent”), HLYK Florida, LLC, a Florida limited liability company (the “Company”), Hughes Center for Functional Medicine, P.A. (the “Target”), and Pamela A. Hughes, D.O. (the “Seller”).

WHEREAS, Parent, Company, Target, and Seller are parties to an Agreement and Plan of Merger, dated January 15, 2019 (the “Agreement”) pursuant to which the parties intend to effect a merger of Target with and into Company, upon which time Target will cease to exist and Company will continue as the survive entity and wholly owned subsidiary of Parent; and

WHEREAS, the parties have agreed to amend the terms of the Agreement as set forth herein.

NOW, THEREFORE, in consideration of the promises and mutual agreements contained herein, the parties do hereby agree as follows:

1. Sections 5.1 and 5.2 of the Agreement shall be and are hereby deleted in its entirety and replaced with the following:

5.1. $500,000 payable at the Closing, as defined below;

5.2. 3,968,254 common shares of Parent with an aggregate value of $1,000,000 (valued at $0.252 per common share) shall be issued to the Seller at the Closing;

2. Except as otherwise expressly provided herein, all other terms and conditions of the Agreement shall remain unchanged and shall continue to be in full force and effect, and the terms of this Amendment shall be deemed a part of the Agreement as if fully set forth therein. To the extent any provision of this Amendment is inconsistent or shall conflict with any provision in the Agreement, the terms of this Amendment shall prevail.

3. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one and the same instrument. Transmission of images of signed signature pages by facsimile, e-mail, or other electronic means shall have the same effect as the delivery of manually signed documents in person.

SIGNATURE PAGE FOLLOWS

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the Effective Date.

COMPANY:		SELLER:
HLYK FLORIDA, LLC		PAMELA A. HUGHES, D.O.
By:	/s/ George O’Leary	/s/ Pamela A. Hughes D.O.
Name:	George O’Leary	Pamela A. Hughes, D.O., individually
Title:	CFO

PARENT:		TARGET:
HEALTHLYNKED CORP.		HUGHES CENTER FOR FUNCTIONAL MEDICINE, P.A.
By:	/s/ George O’Leary	By:	/s/ Pamela A. Hughes D.O.
Name:	George O’Leary	Name:	Pamela A. Hughes D.O.
Title:	CFO	Title:	Physician/Owner

 2

EX-99.1

Exhibit 99.1

NAPLES, Fla., April 16, 2019 (GLOBE NEWSWIRE) -- HealthLynked Corp (OTCQB: HLYK) (the Company), a leader in digital healthcare technology, announced today that it closed its acquisition of Hughes Center for Functional Medicine, P.A. (HCFM) on April 12, 2019.

HCFM, a private entity, is a leader in functional medicine focusing on Neurodegenerative diseases such as Alzheimer’s, Parkinson’s and Multiple Sclerosis. HCFM provides cutting-edge treatments to improve health and slow aging, including hormones, thyroid, weight loss, wellness and prevention. HCFM’s income streams are derived from patient office visits, a dedicated IV room, hyperbaric oxygen chambers, ozone, UVlrx, and the sale of supplements. DNA sequence testing has recently been added to its suite of services.

“Closing the acquisition of HCFM demonstrates HealthLynked’s forward-looking strategy of adding business assets that not only strengthen the company’s position in the marketplace but also offer greater services for our patient constituents,” said Michael Dent, M.D., HealthLynked’s Chairman and CEO. The Hughes Center is now the Naples Center for Functional Medicine, a HealthLynked Company (NCFM) and is a welcome addition to the Company’s health service division.

Audited Financials. HCFM’s revenue for 2018 and 2017 were $3,023,344 and $2,696,245 respectively.  HCFM’s EBITDA for the same periods were $372,921 and $311,443 respectively. Anticipated NCFM EBITDA for the next twelve months, factoring out 2018 owners expenses, is projected to be approximately $450,000.  Assets of HCFM on December 31, 2018 were $436,349.

Amendment to the Agreement. HLYK and HCFM mutually agreed to amend the definitive agreement at closing to include $500,000 cash and $1,000,000 in HLYK Stock at $0.252/share. The $500,000 earn-out remained intact.

George O’Leary, Chief Financial Officer of HealthLynked, stated, “Dr. Hughes and I agreed that with her continued participation at the holding company level, it made more sense to align our interests with more stock in the transaction.” He continued, “We are very excited to bring Dr. Carol Roberts, Dr. Eduardo Maristany, and Dr. Pamela Hughes into the HLYK Family. JoAnn Rucker, our Regional Director of Practice Management, will be overseeing the transition.”

About HealthLynked Corp.

HealthLynked Corp. provides a solution for both patient members and providers to improve healthcare through the efficient exchange of medical information. The HealthLynked Network is a cloud-based platform that allows members to connect with their healthcare providers and take more control of their healthcare. Members enter their medical information, including medications, allergies, past surgeries and personal health records, in one convenient online and secure location, free of charge.

Participating healthcare providers can connect with their current and future patients through the system. Other benefits to providers include the ability to utilize the HealthLynked patent pending patient access hub “PAH” for patient analytics and its marketing tools to connect with their active and inactive patients to improve patient retention, access more accurate and current patient information, provide more efficient online scheduling and to fill last minute cancellations using our “real time appointment scheduling” all within our mobile application. Healthcare providers pay a monthly fee to access these HealthLynked services.

For additional information about HealthLynked Corp. visit www.healthlynked.com and connect with HealthLynked on Twitter, Facebook, and LinkedIn.

Forward Looking Statements

Forward-Looking Statements in this press release, which are not historical facts, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Our actual results, including as a result of any acquisitions, performance or achievements may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” “likely,” “will,” “would” and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by our management, and us are inherently uncertain. We caution you not to place undue reliance on any forward-looking statements, which are made as of the date of this press release. We undertake no obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements. Certain risks and uncertainties applicable to our operations and us are described in the “Risk Factors” section of our most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q and in other reports we have filed with the U.S. Securities and Exchange Commission. These reports are available at www.sec.gov.

EX-99.2

Exhibit 99.2

Hughes center for functional medicine Pa

Audited Financial Statements

For the Years Ended December 31, 2018 and 2017

HUGHES CENTER FOR FUNCTIONAL MEDICINE PA

(an S Corporation)

TABLE OF CONTENTS

Independent Auditor’s Report	1
Financial Statements
Balance Sheets as of December 31, 2018 and 2017	2
Statements of Income and Retained Earnings as of December 31, 2018 and 2017	3
Statements of Cash Flows as of December 31, 2018 and 2017	4
Notes to Financial Statements	5-7

i

	805 Third Avenue
	Suite 1430
	New York, NY 10022
	212.868.3669
	212.838.2676 / Fax
	www.rbsmllp.com

INDEPENDENT AUDITOR’S REPORT

To the Board of Directors and Stockholders
of Hughes Center for Functional Medicine PA

We have audited the accompanying financial statements of Hughes Center for Functional Medicine PA (the “Company”), a Florida S-corporation, which comprise the balance sheets as of December 31, 2018 and 2017, and the related statements of income and retained earnings, and cash flows for the years then ended, and the related notes to the financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Hughes Center for Functional Medicine PA as of December 31, 2018 and 2017, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

New York, NY

April 10, 2019

New York | Washington, DC | California | Nevada | China | India | Greece

Member of ANTEA International with offices worldwide

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HUGHES CENTER FOR FUNCTIONAL MEDICINE PA

(an S Corporation)

BALANCE SHEETS

December 31, 2018 and 2017

	2018			2017
ASSETS
Current Assets:
Cash	$	83,223		$	112,705
Inventory		83,371			103,852
Total Current Assets		166,594			216,557
Furniture and Equipment		413,671			399,314
Less: Accumulated Depreciation		(149,229	)		(80,642	)
Net Furniture and Equipment		264,442			318,672
Other Assets:
Security deposit		5,194			5,194
Loan costs net		119			2,291
Total Other Assets		5,313			7,485
Total Assets	$	436,349		$	542,714
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	38,060		$	52,796
Accrued payroll liabilities		16,213			12,774
Line of credit		-			214,000
Total Current Liabilities		54,273			279,570
Total Liabilities		54,273			279,570
Stockholders’ Equity:
Common stock-100 shares authorized no par value; Issued and outstanding 100 and 100 shares in 2018 and 2017, respectively		-			-
Additional paid in capital		1,000			1,000
Retained Earnings		381,076			262,144
Total Stockholders’ Equity		382,076			263,144
Total Liabilities and Stockholders’ Equity	$	436,349		$	542,714

See accompanying independent auditor’s report and notes to financial statements

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HUGHES CENTER FOR FUNCTIONAL MEDICINE PA

(an S Corporation)

STATEMENTS OF INCOME AND RETAINED EARNINGS

Years Ended December 31, 2018 and 2017

	2018			2017
Revenue	$	3,023,344		$	2,686,245
Cost of Services		1,092,187			970,446
Gross Profit		1,931,157			1,715,799
Operating Expenses:
Salaries and wages		671,743			621,587
Contract/purchased services		412,372			360,328
Fringe benefits and payroll taxes		132,696			132,790
Rent		106,202			98,682
Depreciation and amortization		72,688			53,764
Advertising and promotion		87,207			53,905
Insurance		11,145			17,715
Telephone		11,946			9,868
Dues and subscriptions		9,557			4,038
Records storage		7,030			7,824
Professional fees		22,389			8,165
Repairs and maintenance		20,153			16,223
Postage and shipping		20,573			17,713
Office expense		34,030			41,902
Other operating expense		11,193			13,616
Total operating expenses		1,630,924			1,458,120
Income From Operations		300,233			257,679
Other Income (Expense):
Interest expense		(9,278	)		(421	)
Total other (expense)		(9,278	)		(421	)
Net Income		290,955			257,258
Retained Earnings At Beginning Of Year		262,144			215,298
Distributions		(172,023	)		(210,412	)
Retained Earnings At End Of Year	$	381,076		$	262,144

See accompanying independent auditor’s report and notes to financial statements

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HUGHES CENTER FOR FUNCTIONAL MEDICINE PA

(an S Corporation)

STATEMENTS OF CASH FLOWS

Years Ended December 31, 2018 and 2017

	2018			2017
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income	$	290,955		$	257,258
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense		72,688			53,764
Changes in operating assets and liabilities:
Inventory		20,481			(15,122	)
Other assets		(1,929	)		-
Accounts payable		(14,736	)		3,256
Accrued payroll liabilities		3,439			(250	)
NET CASH PROVIDED BY OPERATING ACTIVITIES		370,898			298,906
CASH FLOWS FROM INVESTING ACTIVITIES
Equipment acquisitions		(14,357	)		(227,633	)
NET CASH USED IN INVESTING ACTIVITIES		(14,357	)		(227,633	)
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowing on line of credit		-			224,000
Repayments on line of credit		(214,000	)		(60,332	)
Distributions to shareholder		(172,023	)		(210,412	)
NET CASH USED IN FINANCING ACTIVITIES		(386,023	)		(46,744	)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(29,482	)		24,529
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		112,705			88,176
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	83,223		$	112,705
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest	$	9,278		$	421

See accompanying independent auditor’s report and notes to financial statements

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HUGHES CENTER FOR FUNCTIONAL MEDICINE PA

(an S Corporation)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2018 AND 2017

Note 1. DESCRIPTION OF COMPANY

The Company is a Functional Medical Practice and Professional Association organized under the laws of the State of Florida and is engaged in improving the health of its patients through individualized and integrative health care. Led by Pamela Hughes, DO, ABFM, ABAARM, the Company specializes in treating chronic diseases and helping patients to proactively maintain their long-term health. This is accomplished by exploring the root cause of their condition and partnering with them to shape a customized treatment path to achieve wellness and improved quality of life.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company prepares its financial statements on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America, except where otherwise noted.

Revenue Recognition

Revenues are recognized when earned and expenditures are recognized when incurred. Amounts billed to patients are collected when services are rendered. The Company does not carry accounts receivable and does not accept insurance.

Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company presents its statement of cash flows using the indirect method. For purposes of the statement of cash flows, cash includes cash in checking, merchant and savings accounts.

Inventory

Inventory consisting of supplements, is stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out method. Outdated inventory is directly charged to cost of goods sold.

Furniture and Equipment

Equipment is stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the assets, which range from 5 to 7 years. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any related gain or loss is reflected in income for the period.

Impairment of Long-Lived Assets

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of these assets is determined by comparing the forecasted undiscounted net cash flows of the operation to which the assets relate to the carrying amount. If the operation is determined to be unable to recover the carrying amount of its assets, then assets are written down first, followed by other long-lived assets of the operation to fair value. Fair value is determined based on discounted cash

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HUGHES CENTER FOR FUNCTIONAL MEDICINE PA

(an S Corporation)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2018 AND 2017

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

flows or appraised values, depending on the nature of the assets. As of December 31, 2018 and 2017, there were no impairment losses recognized for long lived assets.

Advertising and Promotion

The Company expenses all advertising costs as they are incurred. Total advertising expenses were $87,207 and $53,905 for the years ended December 31, 2018 and 2017, respectively.

Shipping Costs

The Company records shipping costs billed to its patients in revenue. Shipping costs recorded in revenue for the years ended December 31, 2018 and 2017 totaled $9,476 and $8,979, respectively.

Income Taxes

Federal income taxes have not been provided because the Company has elected, by consent of its stockholder, to be treated as an S Corporation for federal income tax purposes as provided in Section 1362(a) of the Internal Revenue Code.

The Company’s income or loss and credits are passed through to the stockholder and combined with other personal income and deductions to determine taxable income on the individual tax returns.

In accordance with generally accepted accounting principles, the Company accounts for uncertainty in income taxes by recognizing tax positions in the financial statements when it is more-likely-than-not the position will be sustained upon examination by the tax authorities.

As of December 31, 2018 and 2017, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. During the years ended December 31, 2018 and 2017, no interest or penalties were incurred.

Note 3. INVENTORIES

Inventories consist of supplements private labeled under Dr. Hughes brand. The carrying value of Inventory stock at December 31, 2018 and 2017 was $83,371 and $103,852, respectively.

Note 4. FURNITURE AND EQUIPMENT

	December 31, 2018		December 31, 2017
Assets:
Computer equipment & software	$	49,809	$	39,582
Medical equipment		305,174		301,044
Office furniture & equipment		58,688		58,688
		413,671		399,314
Accumulated Depreciation:
Computer equipment & software		30,069		21,770
Medical equipment		87,720		35,816
Office furniture & equipment		31,440		23,056
		149,229		80,642
Furniture & Equipment Net	$	264,442	$	318,672

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HUGHES CENTER FOR FUNCTIONAL MEDICINE PA

(an S Corporation)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2018 AND 2017

Note 5. LINE OF CREDIT

The Company has a line of credit agreement with a bank of $325,000. Borrowings against the line at December 31, 2018 and 2017 were $-0- and $214,000, respectively. The line of credit bears interest of 5.75%. The line is reviewed annually and is due on demand. Under terms of the line of credit, the Company is required to maintain its operating accounts at the issuing bank. Interest expense for the twelve months ended December 31, 2018 and 2017 was $9,278 and $421, respectively.

Note 6. COMMITMENTS AND CONTINGENCIES

The Company leases its office space. The lease was executed on February 23, 2015 for the three-year period commencing March 1, 2015 and terminating February 28, 2018. The Company executed an extension agreement on March 1, 2018 for a period of one-year terminating on February 28, 2019. In addition to minimum monthly rent, the Company is also responsible for common area maintenance costs, which are estimated to be approximately $44,000 and $36,000 annually for the years ended December 31, 2018 and 2017, respectively. Pursuant to the original lease agreement, the Company made a security deposit with the landlord in the amount of $5,194.

U.S. GAAP requires that rent expense be recognized evenly on a straight-line basis over the lease term. The Company recognizes actual amounts paid as an expense in the year payment is made. The overall effect of this departure is immaterial to the Company’s financial statements for the years ending December 31, 2018 and 2017, respectively. Total rent expense for the years ending December 31, 2018 and 2017 was $106,202 and $98,682, respectively.

Future minimum rent payments under the terms of the lease extension agreement are:

Year Ended December 31,	Amount
2019	$	11,014

Note 7. CONCENTRATION OF CREDIT RISK

Cash Balances

The Company maintains cash balances in one checking account and one money market account at a single financial institution. These accounts are insured by the Federal Deposit Insurance Corporation (FDIC) up to a combined total of $250,000; at times, the cash in this institution may exceed FDIC insured limits. The Company has not experienced any loss in such accounts. The Company believes it is not exposed to any significant credit risk on these cash balances.

Purchases and Accounts Payable

For the years ending December 31, 2018 and 2017, one vendor individually provided supplement inventory in excess of 10% of the Company’s total purchases. Purchases from this vendor amounted to $301,094 and $311,812 for 2018 and 2017, respectively. The Company had no accounts payable to this vendor at December 31, 2018 and 2017 and the supplies are readily available from other vendors.

Note 8. SUBSEQUENT EVENTS:

The Company has evaluated subsequent events through April 5, 2019, which is the date the financial statements were available to be issued.

On April 5, 2019, the Company entered in to a three-year agreement on its building lease. Minimum monthly lease payments under the new agreement are as follows:

Year ending December 31, 2019	$	47,335
Year ending December 31, 2120		68,237
Year ending December 31, 2021		70,283
Year ending December 31, 2022		20,675

On January 15, 2019, the Company entered into a definitive agreement to be acquired by HealthLynked Corp. (OTCQB:HLYK)(“HealthLynked”) for $750,000 in cash, $750,000 in shares of HealthLynked common stock and $500,000 in a three-year performance-based payout.

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EX-99.3

Exhibit 99.3

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

Basis of presentation

The following unaudited pro forma combined balance sheet and statements of income are presented to give effect to the acquisition of Hughes Center for Functional Medicine, P.A. (“HCFM”) by HealthLynked Corp (“HealthLynked”). The pro forma information was prepared based on the historical financial statements and related notes of HealthLynked and HCFM, as adjusted for the pro forma impact of applying the acquisition method of accounting in accordance with Generally Accepted Accounting Principles in the United States (“U.S. GAAP”). The pro forma adjustments are based upon available information and assumptions that HealthLynked believes are reasonable. The allocation of the purchase price of the HCFM acquisition reflected in these unaudited pro forma combined financial statements has been based upon preliminary estimates of the fair value of assets acquired and liabilities assumed. The pro forma adjustments are therefore preliminary and have been prepared to illustrate the estimated effect of the acquisition.

The unaudited pro forma combined balance sheet has been prepared to reflect the transaction as if the transaction had occurred on December 31, 2018. The unaudited pro forma combined statement of income combines the results of operations of HealthLynked and HCFM for the fiscal year ended December 31, 2018, as if the transaction had occurred on January 1, 2018.

The unaudited pro forma combined financial statements were prepared using the acquisition method of accounting with HealthLynked treated as the acquiring entity. Accordingly, the aggregate value of the consideration paid by HealthLynked to complete the acquisition was allocated to the assets acquired and liabilities assumed from HCFM based upon their estimated fair values on the closing date of the acquisition. HealthLynked has not completed the detailed valuations necessary to estimate the fair value of the assets acquired and the liabilities assumed from HCFM and the related allocations of purchase price, nor has HealthLynked identified all adjustments necessary to conform HCFM’s accounting policies to HealthLynked’s accounting policies. Additionally, a final determination of the fair value of assets acquired and liabilities assumed from HCFM will be based on the actual net tangible and intangible assets and liabilities of HCFM that existed as of the closing date. Accordingly, the pro forma purchase price adjustments presented herein are preliminary, and may not reflect any final purchase price adjustments made. HealthLynked estimated the fair value of HCFM’s assets and liabilities based on discussions with HCFM’s management, due diligence and preliminary work performed by third-party valuation specialists. As the final valuations are being performed, increases or decreases in the fair value of relevant balance sheet amounts will result in adjustments, which may result in material differences from the information presented herein.

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HealthLynked Corp.

Unaudited Pro Forma Balance Sheets

As of December 31, 2018

						Pro Forma			Pro Forma
	HealthLynked			HCFM		Adjustments			Consolidated
ASSETS
Current Assets
Cash	$	135,778		$	83,223	$	(88,954	)(1)	$	130,047
Accounts receivable, net		114,884								114,884
Prepaid expenses		28,542								28,542
Inventory					83,371					83,371
Deferred offering costs		96,022								96,022
Total Current Assets		375,226			166,594		(88,954	)		452,866
Property, plant and equipment, net		42,597			264,442					307,039
Deposits and other long term assets		9,540			5,313					14,853
Goodwill and other intangible assets							1,590,146	(2)		1,590,146
Total Assets	$	427,363		$	436,349	$	1,501,192		$	2,364,904
LIABILITIES AND SHAREHOLDERS’ DEFICIT
Current Liabilities
Accounts payable and accrued expenses	$	394,333		$	54,273	$	500,000	(3)	$	948,606
Capital lease, current portion		19,877								19,877
Due to related party, current portion		429,717								429,717
Notes payable to related party, current portion		672,471								672,471
Convertible notes payable, net of original issue discount		1,042,314						(4)		1,042,314
Derivative financial instruments		800,440					331,830	(4)		1,132,270
Total Current Liabilities		3,359,152			54,273		831,830			4,245,255
Long-Term Liabilities
Capital leases, long-term portion		3,058								3,058
Total Liabilities		3,362,210			54,273		831,830			4,248,313
Shareholders’ Deficit
Common stock		8,518					459	(5)		8,977
Common stock issuable		26,137								26,137
Additional paid-in capital		7,531,553			1,000		1,094,309	(6)		8,626,862
Retained earnings (accumulated deficit)		(10,501,055	)		381,076		(425,406	)(7)		(10,545,385	)
Total Shareholders’ Deficit		(2,934,847	)		382,076		669,362			(1,883,409	)
Total Liabilities and Shareholders’ Deficit	$	427,363		$	436,349	$	1,501,192		$	2,364,904

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HealthLynked Corp.

Unaudited Pro Forma Statement of Operations

For the Year Ended December 31, 2018

							Pro Forma			Pro Forma
	HealthLynked			HCFM			Adjustments			Consolidated
Revenue
Revenue	$	2,259,002		$	3,023,344		$			$	5,282,346
Cost of services					1,092,187						1,092,187
Gross profit		2,259,002			1,931,157						4,190,159
Operating Expenses
Salaries and benefits		2,366,582			671,743						3,038,325
General and administrative		2,840,784			886,493						3,727,277
Depreciation and amortization		23,782			72,688						96,470
Total Operating Expenses		5,231,148			1,630,924						6,862,072
Loss from operations		(2,972,146	)		300,233						(2,671,913	)
Other Income (Expenses)
Loss on extinguishment of debt		(393,123	)								(393,123	)
Change in fair value of debt		(140,789	)								(140,789	)
Financing cost		(1,221,911	)					(44,330	)(1)		(1,266,241	)
Amortization of original issue and debt discounts on notes payable and convertible notes		(763,616	)								(763,616	)
Change in fair value of derivative financial instrument		(106,141	)								(106,141	)
Interest expense		(193,109	)		(9,278	)					(202,387	)
Total other expenses		(2,818,689	)		(9,278	)		(44,330	)		(2,872,297	)
Net loss before provision for income taxes		(5,790,835	)		290,955			(44,330	)		(5,544,210	)
Provision for income taxes		---									---
Net loss	$	(5,790,835	)	$	290,955		$	(44,330	)	$	(5,544,210	)
Net loss per share, basic and diluted:
Basic	$	(0.07	)							$	(0.07	)
Fully diluted	$	(0.07	)							$	(0.07	)
Weighted average number of common shares:
Basic		78,816,272						617,953	(2)		79,434,225
Fully diluted		78,816,272						617,953	(2)		79,434,225

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HealthLynked Corp.

Notes to Unaudited Pro Forma Combined Financial Information

Note 1 – Purchase Price Consideration

The table below represents the total purchase price consideration:

Cash consideration			$	500,000
Stock consideration
Number of shares		3,968,254
Closing share price on closing date (April 12, 2019)	$	0.245	$	972,222
Contingent Consideration
Cash payment based on HCFM meeting 2019 revenue and profit targets	$	100,000
Cash payment based on HCFM meeting 2020 revenue and profit targets	$	200,000
Cash payment based on HCFM meeting 2021 revenue and profit targets	$	200,000	$	500,000
Total consideration		s	$	1,972,222

Note 2 – Pro Forma Adjustments

Following is a description of the unaudited pro forma adjustments reflected in the unaudited pro forma combined financial statements.

Adjustments to the pro forma combined balance sheet

(1) The pro forma adjustments to cash reflects the cash paid for the acquisition as follows:

Cash portion of purchase consideration	$	(500,000	)
Proceeds from convertible notes payable		300,000
Proceeds from April 2019 Stock Sale		111,046
Total	$	(88,954	)

During April 2019, HealthLynked entered into two separate convertible note instruments with combined face value of $209,000 that generated $200,000 cash proceeds and a third instrument with face value of $103,000 that generated $100,000 cash proceeds (collectively, the “April 2019 Notes”). During April 2019, HealthLynked also received $111,046 proceeds from the sale of common stock pursuant to the July 2016 Investment Agreement (the “April 2019 Stock Sale”). HealthLynked used the proceeds from the April 2019 Notes and the April 2019 Stock Sale in part to offset the cash consideration for the purchase of HCFM.

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(2) The pro forma adjustments to goodwill and other intangible assets reflect the following:

Cash portion of purchase consideration	$	500,000
Contingent purchase consideration	$	500,000
Stock consideration - common stock portion	$	397
Stock consideration - additional paid-in capital stock portion	$	971,825
Eliminate equity of HCFM	$	(1,000	)
Eliminate retained earnings of HCFM	$	(381,076	)
Total	$	1,590,146

The aggregate value of the consideration paid by HealthLynked to complete the acquisition was allocated to the assets acquired and liabilities assumed from HCFM based upon their estimated fair values on the closing date of the acquisition. HealthLynked has not completed the detailed valuations necessary to estimate the fair value of the assets acquired and the liabilities assumed from HCFM and the related allocations of purchase price. Accordingly, such excess is presented as “Goodwill and other intangible assets” on the accompanying unaudited pro forma balance sheets.

(3) The pro forma adjustments to accounts payable and accrued expenses reflects the accrual of contingent purchase price consideration. Such payments may be earned by the selling shareholder as follows: (i) $100,000 on the first anniversary of the closing, of which 50% is subject to HCFM achieving revenue for the fiscal year ended December 31, 2019 of $3,100,000 and 50% is subject to HCFM achieving profit for the fiscal year ended December 31, 2019 of $550,000, (ii) $200,000 on the second anniversary of the closing, of which 50% is subject to HCFM achieving revenue for the fiscal year ended December 31, 2020 of $3,100,000 and 50% is subject to HCFM achieving profit for the fiscal year ended December 31, 2020 of $550,000, and (iii) $200,000 on the third anniversary of the closing, of which 50% is subject to HCFM achieving revenue for the fiscal year ended December 31, 2021 of $3,100,000 and 50% is subject to HCFM achieving profit for the fiscal year ended December 31, 2021 of $550,000.

(4) The pro forma adjustment to derivative financial instrument is to record the beneficial conversion feature of the April 2019 Notes. The April 2019 Notes each contained an embedded conversion feature (“ECF”) that qualified for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The inception date fair value of the ECFs for the April 2019 Notes totaled $331,830. Because the fair value of the ECF exceeded the net proceeds from the April 2019 Notes, a charge was recorded to “Financing cost” in the amount of $44,330 for the excess of the combined fair value of the ECF and 50,000 common shares issued with the April 2019 Notes over the net proceeds from the April 2019 Notes. Because the fair value of the ECFs exceeded the face values of the April 2019 Notes, the inception date discounts of the April 2019 Notes are equal to the face values of the notes and there is no pro forma impact in the “Convertible Notes Payable” line item on the pro forma balance sheet.

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(5) The pro forma adjustment to common stock

Number of consideration shares issued at closing		3,968,254
Par value per share	$	0.0001
Par value of consideration shares	$	397
Shares issued with April 2019 Notes	$	5
Shares issued in April 2019 Stock Sale	$	57
Total	$	459

(6) The pro forma adjustment to additional paid-in capital reflects the following:

Number of shares		3,968,254
Closing share price on closing date (April 12, 2019)	$	0.245
Fair value of shares	$	972,222
Less: portion of stock consideration allocated to common stock	$	(397	)
Portion of stock consideration allocated to additional paid-in capital	$	971,825
Eliminate equity of HCFM	$	(1,000	)
Shares issued with April 2019 Notes	$	12,495
April 2019 Stock Sale	$	110,989
Total	$	1,094,309

(7) The pro forma adjustments to retained earnings is to eliminate the retained earnings of HCFM.

Adjustments to the pro forma combined statement of operations

(1) The pro forma adjustments to financing cost represent the excess of the fair value of the fair value of the ECF and 50,0000 common shares issued with the April 2019 Notes over the net proceeds from the April 2019 Notes.

(2) The pro forma adjustments to weighted average common shares reflects 50,000 shares issued with the April 2019 Notes and 567,953 issued in the April 2019 Stock Sale.

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