UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )
LIFEMD, INC.
(Name of Issuer)
Common Stock, par value $0.01 per share
(Title of Class of Securities)
53216B 104
(CUSIP Number)
800 Third Avenue, Suite 2800
New York, NY 10022
(866) 351-5907
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
February 24, 2021
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box [ ]
The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
| 1 | NAME OF REPORTING PERSON |
| Walters Happy David | |
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions) |
| (a) [ ] | |
| (b) [ ] | |
| 3 | SEC USE ONLY |
| 4 | SOURCE OF FUNDS* |
| PF, OO | |
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |
| [ ] | |
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| United States |
| 7 | SOLE VOTING POWER | |
| NUMBER OF | 2,107,260(1) | |
| SHARES | 8 | SHARED VOTING POWER |
| BENEFICIALLY | ||
| OWNED BY | 0 | |
| EACH | 9 | SOLE DISPOSITIVE POWER |
| REPORTING | ||
| PERSON | 2,107,260(1) | |
| WITH | 10 | SHARED DISPOSITIVE POWER |
| 0 |
| 11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON |
2,107,260(1) | |
| 12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |
| [ ] | |
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) |
| 8.23(2) | |
| 14 | TYPE OF REPORTING PERSON (See Instructions) |
| IN |
| 1. | Consists of 2,107,260 shares of common stock of LifeMD, Inc. (the “Issuer”) held directly by Mr. Walters. Mr. Walters has sole voting and dispositive power over all shares held by him. |
| 2. | Percentage of class based on 25,579,103 total outstanding shares of common stock of the Issuer as of March 15, 2021. |
Item 1 Security and Issuer.
The statement (“Statement”) relates to shares of common stock, par value $0.01 per share (the “Common Stock”), of LifeMD, Inc., a Delaware corporation (the “Issuer” or the “Company”). The principal executive office of the Issuer is located at 800 Third Avenue, Suite 2800, New York, NY 10022.
Item 2 Identity and Background.
The Statement is being filed by Mr. Happy Walters (“Mr. Walters”). Mr. Walters’ present principal occupation or employment is serving as Chief Executive Officer of Blue Horizon Consulting, LLC (“Blue Horizon”). Mr. Walters is a United States citizen. The business address of Mr. Walters is Blue Horizon Consulting, LLC, 53 Calle Palmeras, 8th Floor, San Juan, Puerto Rico 00901.
During the last five years Mr. Walters has not (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors); or (ii) been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which proceeding he was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
Item 3 Source and Amount of Funds or Other Consideration.
Mr. Walters acquired the reported 2,107,260 shares of Common Stock as follows (except as otherwise indicated, all Common Stock and per share information reflect, on a retroactive basis, a 1-for-5 reverse stock split of Common Stock, which became effective on October 14, 2020): (i) 107,260 shares of Common Stock acquired by Mr. Walters in open market purchases; and (ii) 2,000,000 shares of Common Stock were originally acquired from the Issuer by Blue Horizon, Mr. Walters’ wholly owned company, as a result of the attainment of certain revenue targets, pursuant to a consulting agreement (the “Consulting Agreement”) by and between Blue Horizon and the Issuer, and subsequently distributed by Blue Horizon to Mr. Walters
On August 18, 2020, Mr. Walters beneficially owned 107,260 shares of Common Stock.
On October 15, 2020, the Company issued 800,000 shares of Common Stock to Blue Horizon by virtue of the Company’s attainment of specified revenue targets, pursuant to the Consulting Agreement. These shares were distributed to Mr. Walters on October 17, 2020.
In December 2020, Mr. Walters earned the right to receive the balance of 1,200,000 shares of Common Stock pursuant to the Consulting Agreement, which rights were distributed to him on December 31, 2020. The shares were formally issued to Mr. Walters on February 24, 2021.
Item 4 Purpose of Transaction.
Mr. Walters does not have any current plans or proposals which relate to or would result in: (a) the acquisition of additional securities of the Issuer, or the disposition of securities of the Issuer; (b) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Issuer or any of its subsidiaries; (c) a sale or transfer of a material amount of assets of the Issuer or any of its subsidiaries; (d) any change in the present board of directors or management of the Issuer, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board; (e) any material change in the present capitalization or dividend policy of the Issuer; (f) any other material change in the Issuer’s business or corporate structure; (g) any change in the Issuer’s charter, bylaws or instruments corresponding thereto or other actions which may impede the acquisition of control of the Issuer by any person; (h) causing a class of securities of the Issuer to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association; (i) a class of equity securities of the Issuer becoming eligible for termination of registration pursuant to section 12(g)(4) of the Exchange Act; or (j) any action similar to any of those enumerated above.
Item 5 Interest in Securities of the Issuer.
(a) As of the date hereof, Mr. Walters beneficially owns 2,107,260 shares (the “Shares”) of the issued and outstanding Common Stock of the Company. Such amount represents 8.23% of the total of the issued and outstanding shares of the Company’s Common Stock as of the date hereof.
(b) Mr. Walters holds sole voting and dispositive power over the Shares.
(c) Other than disclosed above, there were no transactions by Mr. Walters in the Issuer’s Common Stock during the last 60 days.
(d) No other person is known to have the right to receive, or the power to direct the receipt of, dividends from, or the proceeds from the sale of, the securities of the Issuer owned by Mr. Walters.
(e) Not applicable.
Item 6 Contracts, Agreements, Understandings or Relationships With Respect to Securities of the Issuer.
The shares are subject to the terms and conditions of a lock-up agreement, effective November 3, 2020, by and between the Issuer and Mr. Walters (the “Lock-Up Agreement”). Pursuant to the Lock-Up Agreement, Mr. Walters is precluded, until May 2, 2021, from selling, granting, lending, pledging, offering or in any way, directly or indirectly disposing of the Common Stock he owns.
Item 7 Material to be Filed as Exhibits.
| Exhibit
Number |
Description | |
| 1 | ||
| 2 | Form Lock-Up Agreement |
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
| Date: March 19, 2021 | |
| /s/ Happy Walters | |
| Happy Walters |
Exhibit 1
FIRST Amendment to CONSULTING Agreement
This FIRST Amendment to CONSULTING Agreement (this “Amendment”) is entered into as of September 29, 2020 by and between Blue Horizon Consulting, LLC, a Puerto Rico limited liability company (“Blue Horizon”), as Assignee under concurrent Assignment dated as of May 28, 2019, of all rights, title and interests of Happy Walters, as “Consultant” as applicable both therein and herein, under that certain Consulting Services Agreement (the “Agreement”), effective as of the same date, between Happy Walters and Conversion Labs, Inc., a Delaware corporation (the “Company”). The Consultant and the Company are also referred to together as the “Parties”.
RECITALS
WHEREAS, the Parties previously entered into the Agreement, whereby the Company engaged Consultant to assist with development of Conversion Labs’ telemedicine business (the “Original Agreement”); and
WHEREAS, the Parties desire to amend the Original Agreement to increase the Compensation for Services provided by Consultant, retroactive to the Effective Date of the Original Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt of which is hereby acknowledged, the Parties hereby agree as follows:
1. Amendments. The Original Agreement shall be amended as follows:
| a. | References to the “Agreement” shall mean the Original Agreement, as amended by this Amendment. | |
| b. | Section D of the Original Agreement is hereby deleted in its entirety and replaced with the following, effective as of May 28, 2019.: |
Compensation for Services. Provided that Consultant is still providing the Services, Consultant shall receive or shall be deemed entitled to have received from the Company up to 10,000,000 shares of common stock of the Company, in aggregate, in increments of 2,000,000 shares in accordance with the following milestones:
At such time as Company’s telemedicine brands collectively achieve topline revenue of at least: | Number of Shares of the Company | |||||
| $ | 10,000,000 | 2,000,000 shares | ||||
| $ | 15,000,000 | 2,000,000 shares | ||||
| $ | 20,000,000 | 2,000,000 shares | ||||
| $ | 25,000,000 | 2,000,000 shares | ||||
| $ | 30,000,000 | 2,000,000 shares | ||||
Notwithstanding the foregoing, the shares owed pursuant to this Agreement will only be issued when the Company has sufficient authorized shares to make such an issuance. In the event of a stock-split, the number of shares shall be adjusted accordingly. A telemedicine brand shall be defined as any brand owned by the company that provides virtual medical treatment or sells any prescription medication.
2. Counterparts. This Amendment may be executed in several counterparts, each of which shall be deemed to be an original copy and all of which together shall constitute one agreement binding on all parties hereto, notwithstanding that all the parties shall not have signed the same counterpart.
IN WITNESS WHEREOF, each of the undersigned hereby (a) executes this Agreement; (b) confirms its agreement with the provisions and covenants herein provided; and (c) agrees to be bound by this Agreement.
| BLUE HORIZON CONSULTING, LLC: | ||
| By: | ||
| Name: | Happy Walters | |
| Title: | ||
| CONVERSION LABS, INC. | ||
| By: | ||
| Name: | Justin Schreiber | |
| Title: | Chief Executive Officer | |
Exhibit 2
LIFEMD, INC.
| ____________, 2020 |
LifeMD, Inc.
800 Third Avenue, Suite 2800
New York, NY 10022
Telephone: (212) 351-5907
Email:
| Attention: | Happy Walters |
| Chief Executive Officer |
Re: LifeMD, Inc. - Lock-Up Agreement
Dear Sirs:
This Lock-Up Agreement is being delivered to you in connection with the Securities Purchase Agreement, dated as of ___________, 2020 (the “Purchase Agreement”), by and among LifeMD, Inc., a Delaware corporation (the “Company”), and the investors party thereto (the “Buyers”), with respect to the issuance of shares of the Company’s common stock, par value $0.01 per share, of the Company (the “Common Stock”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Purchase Agreement.
In order to induce the Buyers to enter into the Purchase Agreement, the undersigned agrees that, commencing on the date hereof and ending on May 2, 20211 (the “Lock-Up Period”), the undersigned will not, and will cause all affiliates (as defined in Rule 144 promulgated under the 1933 Act) of the undersigned or any person in privity with the undersigned or any affiliate of the undersigned not to, (i) sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase, make any short sale or otherwise dispose of or agree to dispose of, directly or indirectly, any shares of Common Stock or Common Stock Equivalents, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Securities and Exchange Act of 1934, as amended and the rules and regulations of the Securities and Exchange Commission promulgated thereunder with respect to any shares of Common Stock or Common Stock Equivalents owned directly by the undersigned (including holding as a custodian) or with respect to which the undersigned has beneficial ownership within the rules and regulations of the Securities and Exchange Commission (collectively, the “Undersigned’s Shares”), or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of the Undersigned’s Shares, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Shares or other securities, in cash or otherwise, (iii) make any demand for or exercise any right or cause to be filed a registration statement, including any amendments thereto, with respect to the registration of any shares of Common Stock or Common Stock Equivalents or (iv) publicly disclose the intention to do any of the foregoing.
1 180 days following the Closing Date.
The foregoing restriction is expressly agreed to preclude the undersigned, and any affiliate of the undersigned and any person in privity with the undersigned or any affiliate of the undersigned, from engaging in any hedging or other transaction which is designed to or which reasonably could be expected to lead to or result in a sale or disposition of the Undersigned’s Shares even if the Undersigned’s Shares would be disposed of by someone other than the undersigned. Such prohibited hedging or other transactions would include, without limitation, any short sale or any purchase, sale or grant of any right (including, without limitation, any put or call option) with respect to any of the Undersigned’s Shares or with respect to any security that includes, relates to, or derives any significant part of its value from the Undersigned’s Shares.
Notwithstanding the foregoing, the undersigned may transfer the Undersigned’s Shares (i) as a bona fide gift or gifts, provided that the donee or donees thereof agree to be bound in writing by the restrictions set forth herein or (ii) to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value. For purposes of this Lock-Up Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin. The undersigned now has, and, except as contemplated by the immediately preceding sentence, for the duration of this Lock-Up Agreement will have, good and marketable title to the Undersigned’s Shares, free and clear of all liens, encumbrances, and claims whatsoever. The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent (the “Transfer Agent”) and registrar against the transfer of the Undersigned’s Shares except in compliance with the foregoing restrictions.
In order to enforce this covenant, the Company shall impose irrevocable stop-transfer instructions preventing the Transfer Agent from effecting any actions in violation of this Lock-Up Agreement.
The undersigned acknowledges that the execution, delivery and performance of this Lock- Up Agreement is a material inducement to each Buyer to complete the transactions contemplated by the Purchase Agreement and that the Company shall be entitled to specific performance of the undersigned’s obligations hereunder. The undersigned hereby represents that the undersigned has the power and authority to execute, deliver and perform this Lock-Up Agreement, that the undersigned has received adequate consideration therefor and that the undersigned will indirectly benefit from the closing of the transactions contemplated by the Purchase Agreement.
The undersigned understands and agrees that this Lock-Up Agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors, and assigns.
This Lock-Up Agreement may be executed in two counterparts, each of which shall be deemed an original but both of which shall be considered one and the same instrument.
This Lock-Up Agreement will be governed by and construed in accordance with the laws of the State of New York, without giving effect to any choice of law or conflicting provision or rule (whether of the State of New York, or any other jurisdiction) that would cause the laws of any jurisdiction other than the State of New York to be applied. In furtherance of the foregoing, the internal laws of the State of New York will control the interpretation and construction of this Lock- Up Agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply.
[Remainder of page intentionally left blank]
| 2 |
| Very truly yours, | |
| Exact Name of Shareholder | |
| Authorized Signature | |
| Title |
| Agreed to and Acknowledged: | ||
| LIFEMD, INC. | ||
| By: | ||
| Name: | ||
| Title: | ||
| 3 |