Exhibit
10.3


 


LIFEMD,
INC.


NON-QUALIFIED
STOCK OPTION AGREEMENT


 


DIRECTOR


 


THIS
NON-QUALIFIED STOCK OPTION is granted as of December 15, 2022 (the “Grant Date”), and reflected in this NON-QUALIFIED
STOCK OPTION AGREEMENT (this “Agreement”) by and between LifeMD, Inc. (the “Company”) and Kate
Walsh (the “Optionee”).


 


WHEREAS,
pursuant to the authority of the Board of Directors (the “Board”), the Company has granted the Optionee the right
to purchase common stock, $0.01 par value per share (“Common Stock”) of the Company pursuant to stock options, at
not less than 100% of fair market value, granted under the LifeMD, Inc. 2020 Equity and Incentive Plan, approved by the Board (the “Plan”).


 


NOW
THEREFORE, in consideration of the mutual covenants and promises hereafter set forth and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:


 


1.
Grant of Non-Qualified Options. The Company hereby irrevocably grants to the Optionee, as a matter of separate agreement and not
in lieu of salary or other compensation for services, the right and option to purchase all or any part of an aggregate of Thirty Seven
Thousand Five Hundred (37,500) shares of authorized but unissued or treasury common stock of the Company (the “Options”)
on the terms and conditions herein set forth. The Options are not intended to be Incentive Stock Options as defined by Section 422 of
the Internal Revenue Code of 1986, as amended (the “Code”).


 


2.
Price. The exercise price of the shares of Common Stock subject to the Options granted hereunder shall be $2.30.


 


3.
Vesting.


 


(a)
The Options shall vest on the two-year anniversary of the Grant Date, subject to the terms herein and the Optionee continuing to perform
services for the Company on each applicable vesting date. Notwithstanding the foregoing, the Options shall vest upon the termination
of the services provided to the Company by Optionee in his/her capacity as a director of the Company on account of being removed from
such role or otherwise not being asked to stand for re-election for reasons other than Cause (as that term is defined in a service and/or
director agreement of such Optionee, or if such term or terms is not defined in a service and/or director agreement or there is not a
service agreement, as defined by the Plan). In lieu of fractional vesting, the number of Options shall be rounded up each time until
fractional Options are eliminated.


 


(b)
Subject to Sections 3(c) and 4 of this Agreement, Options may be exercised by providing to the Company the Notice of Option Exercise
in the form attached hereto as Exhibit A after vesting and remain exercisable until 5:30 p.m. New York time on the date that is
the fifth (5th) year anniversary of the date of this Agreement.


 


(c)
However, notwithstanding any other provision of this Agreement, at the option of the Board in its sole and absolute discretion, all Options
shall be immediately forfeited in the event any of the following events occur:


 


(i)
The Optionee purchases or sells securities of the Company without written authorization in accordance with the Company’s insider
trading policy then in effect, if any;


 


(ii)
The Optionee (A) discloses, publishes or authorizes anyone else to use, disclose or publish, without the prior written consent of the
Company, any proprietary or confidential information of the Company, including, without limitation, any information relating to existing
or potential customers, business methods, financial information, trade or industry practices, sales and marketing strategies, employee
information, vendor lists, business strategies, intellectual property, trade secrets or any other proprietary or confidential information
or (B) directly or indirectly uses any such proprietary or confidential information for the individual benefit of the Optionee or the
benefit of a third party;


 




    	 



     


    

 


(iii)
During the term of service and for a period of two (2) years thereafter, the Optionee disrupts or damages, impairs, or interferes with
the business of the Company or its Affiliates by recruiting, soliciting or otherwise inducing any of their respective employees to enter
into employment or other relationship with any other business entity, or terminate or materially diminish their relationship with the
Company or its Affiliates, as applicable;


 


(iv)
During the term of employment and for a period of one (1) year thereafter, the Optionee solicits or directs business of any person or
entity who is (A) a customer of the Company or its Affiliates at any time or (B) solicited to be a “prospective customer”
of the Company or its Affiliates, in any case either for such Optionee or for any other person or entity. For purposes of this clause
(v), “prospective customer” means a person or entity who contacted, or is contacted by, the Company or its Affiliates
regarding the provision of services to or on behalf of such person or entity; provided that the Optionee has actual knowledge
of such prospective customer;


 


(iii)
The Optionee fails to reasonably cooperate to effect a smooth transition of the Optionee’s duties and to ensure that the Company
is apprised of the status of all matters the Optionee is handling or is unavailable for consultation after termination of employment
of the Optionee if such availability is a condition of any agreement to which the Company and the Optionee are parties;


 


(iv)
The Optionee fails to assign all of such Optionee’s rights, title and interest in and to any and all ideas, inventions, formulas,
source codes, techniques, processes, concepts, systems, programs, software, computer data bases, trademarks, service marks, brand names,
trade names, compilations, documents, data, notes, designs, drawings, technical data and/or training materials, including improvements
thereto or derivatives therefrom, whether or not patentable or subject to copyright or trademark or trade secret protection, developed
and produced by the Optionee used or intended for use by or on behalf of the Company or the Company’s clients; or


 


(v)
The Optionee acts in a disloyal manner to the Company, such as making comments, whether oral or in writing, which tend to disparage or
injure (i) the reputation or business of the Company or its Affiliates, or is likely to result in discredit to, or loss of business,
reputation, or goodwill of, the Company or its Affiliates or (ii) its directors, officers, or stockholders.


 


In
addition, all of the Options shall, to the extent then unvested, vest immediately prior to the closing for any Change of Control. As
used herein, “Change of Control” means (i) a bona fide transfer or series of related transfers of shares of Common
Stock to any person or Group in which, or as a result of which, such person or Group obtains the direct or indirect right to elect a
majority of the board of directors of the Company; or (ii) a sale of all or substantially all of the assets of the Company. As used herein,
“Group” means any group or syndicate that would be considered a “person” for purposes of Section 13(d)
of the Securities Exchange Act of 1934, as amended.


 


(d)
For purposes of this Agreement, “Affiliate” means with respect to a person or entity, any other person or entity controlled
by, in control of or under common control with such person or entity, and “controlled,” “controlled by,” and
“under common control with” shall mean direct or indirect possession of the power to direct or cause the direction of management
or policies (whether through ownership of voting securities, by contract or otherwise) of a person or entity.


 


4.
Termination of Relationship. Upon the Optionee’s termination of service, all unvested Options shall be automatically and
irrefutably forfeited. For purposes of this Agreement, terms like “service” and “termination of service” refer
to service with the Company and all Affiliates of the Company.


 


(a)
If for any reason, except death or disability as provided below, the Optionee ceases to perform the services for which the Options were
granted, the Optionee shall have the right within three (3) months from the date of cessation to exercise the Optionee’s vested
Options, subject to Section 3(c) hereof.


 


(b)
If the Optionee shall die while performing services for the Company, such Optionee’s estate or any Transferee (as defined hereinafter)
shall have the right within twelve (12) months from the date of death to exercise the Optionee’s vested Options, subject to Section
3(c) hereof. For the purpose of this Agreement, “Transferee” shall mean an individual to whom such Optionee’s
vested Options are transferred by will or by the laws of descent and distribution.


 




    	 



     


    

 


(c)
If the Optionee shall become disabled while performing services for the Company within the meaning of Section 22(e)(3) of the Code, the
three-month period referred to in Section 4(a) of this Agreement shall be extended to one year.


 


(d)
For purposes of this Agreement, a change from performing service on the Board to an employment or consulting relationship or vice versa
shall not be treated as a termination of service.


 


5.
Profits on the Sale of Certain Shares; Redemption. If any of the events specified in Section 3(c) of this Agreement occur within
one (1) year from the last date the Optionee performed services for which the Options were granted (the “Termination Date”),
all profits earned from the sale of the Company’s securities, including the sale of shares of Common Stock underlying the Options,
during the two (2) year period commencing one (1) year prior to the Termination Date shall be forfeited and forthwith paid by the Optionee
to the Company within ten (10) days after the Optionee receives written demand from the Company for such payment and a copy of the documentation
of the sale, including, without limitation, the purchase price therefor. Further, in such event, the Company may at its option redeem
shares of Common Stock acquired upon exercise of the Options by payment of the exercise price to the Optionee. The Company’s rights
under this Section 5 do not lapse one year from the Termination Date, but are a contract right subject to any appropriate statutory limitation
period.


 


6.
Transfer. No transfer of the Options by the Optionee by will or by the laws of descent and distribution shall be effective to
bind the Company unless the Company shall have been furnished with written notice thereof and a copy of the letters testamentary or such
other evidence as the Board may deem necessary to establish the authority of the estate and the acceptance by the Transferee or Transferees
of the terms and conditions of the Options.


 


7.
Method of Exercise. The Options shall be exercisable by a written notice in the manner and form identified on Exhibit A hereto
which information shall include:


 


(a)
state the election to exercise the Options, the number of shares to be exercised, the natural person in whose name the stock certificate
or certificates for such shares of Common Stock is to be registered and such person’s address and social security number (or if
more than one, the names, addresses and social security numbers of such persons);


 


(b)
contain such representations and agreements as to the holder’s investment intent with respect to such shares of Common Stock as
set forth in Section 11 hereof;


 


(c)
be signed by the person or persons entitled to exercise the Options and, if the Options are being exercised by any person or persons
other than the Optionee, be accompanied by proof, satisfactory to counsel for the Company, of the right of such person or persons to
exercise the Options; and


 


(d)
be accompanied by full payment of the purchase or exercise price and all applicable required tax withholding in United States dollars
in cash or by bank or cashier’s check, certified check or money order or (i) by executing a “sell-to-cover cashless exercise”
through the Company’s designated broker to promptly deliver to the Company the amount of proceeds from the sale of shares having
a fair market value equal to the purchase price and all applicable required tax withholding on the date of exercise; (ii) by executing
a “net cashless exercise” by having the Company withhold Option shares equivalent in value to the exercise price and all
applicable required tax withholding; or (iii) by tendering shares of Common Stock equivalent in value to the exercise price and all applicable
required tax withholding, subject to applicable securities laws and share holding period requirements necessary to avoid a charge to
the Company’s earnings for financial accounting purposes.


 


Any
certificate or certificates for shares of Common Stock as to which the Options shall be exercised shall be registered in the name of
the person or persons exercising the Options.


 




    	 



     


    

 


8.
Sale of Shares Acquired Upon Exercise of Options. If the Optionee is an officer (as defined by Section 16(b) of the Securities
Exchange Act of 1934, as amended (“Section 16(b)”), any shares of the Company’s Common Stock acquired pursuant
to Options granted hereunder cannot be sold by the Optionee, subject to registration or an exemption from registration such as to Rule
144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), until at least six (6) months
elapse from the date of grant of the Options, except in the case of death or disability or if the grant was exempt from the short-swing
profit provisions of Section 16(b).


 


9.
Adjustments. The Options under this Agreement shall be subject to the terms of the Plan, including but not limited to, Sections
3(b) (Changes in Stock) and 3(c) (Sale Events) of the Plan.


 


10.
Necessity to Become Holder of Record. Neither the Optionee, the Optionee’s estate, nor the Transferee have any rights as
a shareholder with respect to any shares of Common Stock covered by the Options until such Optionee, estate or Transferee, as applicable,
shall have become the holder of record of such shares of Common Stock. No adjustment shall be made for cash dividends or cash distributions,
ordinary or extraordinary, in respect of such shares of Common Stock for which the record date is prior to the date on which such Optionee,
estate or Transferee, as applicable, shall become the holder of record thereof.


 


11.
Conditions to Exercise of Options.


 


(a)
In order to enable the Company to comply with the Securities Act and relevant state law, the Company may require the Optionee, the Optionee’s
estate or any Transferee, as a condition of the exercise of the Options granted hereunder, to give written assurance satisfactory to
the Company that the shares of Common Stock subject to the Options are being acquired for such Optionee’s, estate’s or Transferee’s,
as applicable, own account, for investment only, with no view to the distribution of same, and that any subsequent resale of any such
shares of Common Stock either shall be made pursuant to a registration statement under the Securities Act and applicable state law which
has become effective and is current with regard to the shares of Common Stock being sold, or shall be pursuant to an exemption from registration
under the Securities Act and applicable state law.


 


(b)
The Options are subject to the requirement that, if at any time the Board shall determine, in its sole and absolute discretion, that
the listing, registration or qualification of the shares of Common Stock subject to the Options upon any securities exchange or under
any state or federal law, or the consent or approval of any governmental regulatory body, is necessary as a condition of, or in connection
with the issue or purchase of such shares of Common Stock under the Options, the Options may not be exercised in whole or in part unless
such listing, registration, qualification, consent or approval shall have been effected.


.


12.
Severability. In the event any parts of this Agreement are found to be void, the remaining provisions of this Agreement shall
nevertheless be binding with the same effect as though the void parts were deleted.


 


13.
Arbitration. Any controversy, dispute or claim arising out of or relating to this Agreement, or its interpretation, application,
implementation, breach or enforcement which the parties hereto are unable to resolve by mutual agreement, shall be settled by submission
by either party of the controversy, claim or dispute to binding arbitration in New York County, New York (unless the parties agree in
writing to a different location), before a single arbitrator in accordance with the rules of the American Arbitration Association then
in effect. The decision and award made by the arbitrator shall be final, binding, and conclusive on all parties hereto for all purposes,
and judgment may be entered thereon in any court having jurisdiction thereof.


 


14.
Benefit. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their legal representatives,
successors, and assigns.


 




    	 



     


    

 


15.
Notices and Addresses. All notices, offers, acceptance and any other acts under this Agreement (except payment) shall be in writing,
and shall be sufficiently given if delivered to the addressees in person, by FedEx or similar receipted delivery, or by facsimile delivery
as follows:


 


	 	The
    Optionee: 	 	Kate
    Walsh
	 	 	 	5
    Union Park Street
	 	 	 	Boston,
    MA 02118
	 	 	 	Kate.Walsh@bmc.org
	 	 	 	 
	 	The
    Company: 	 	LifeMD,
    Inc.
	 	 	 	236
    5th Avenue, 4th Floor
	 	 	 	New
    York, NY 10001
	 	 	 	Attn:
    Justin Schreiber, CEO; Eric H. Yecies, GC & CCO
	 	 	 	justin@lifemd.com 
    eric@lifemd.com or legal@lifemd.com


 


or
to such other address as either of them, by notice to the other, may designate from time to time. The transmission confirmation receipt
from the sender’s facsimile machine shall be evidence of successful facsimile delivery. Time shall be counted to, or from, as the
case may be, the delivery in person or by mail.


 


17.
Attorney’s Fees. In the event that there is any controversy or claim arising out of or relating to this Agreement, or to
the interpretation, breach, or enforcement thereof, and any action or proceeding is commenced to enforce the provisions of this Agreement,
the prevailing party shall be entitled from the non-prevailing party to its reasonable attorneys’ fee, costs, and expenses.


 


18.
Governing Law. This Agreement and any dispute, disagreement, or issue of construction or interpretation arising hereunder whether
relating to its execution, its validity, the obligations provided herein or performance, shall be governed or interpreted according to
the laws of the State of Delaware without regard to choice of law considerations.


 


19.
Oral Evidence. This Agreement, along with the Plan, a director and/or employment agreement, and any amendment thereto, constitute
the entire agreement between the parties hereto and supersedes all prior oral and written agreements between the parties hereto with
respect to the subject matter hereof. Neither this Agreement nor any provision hereof may be changed, waived, discharged, or terminated
except by a statement in writing signed by the party or parties against which enforcement or the change, waiver discharge or termination
is sought.


 


20.
Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument. The execution of this Agreement may be made by facsimile signature, which
shall be deemed to be an original.


 


21.
Section Headings. Section headings herein have been inserted for reference only and shall not be deemed to limit or otherwise
affect, in any matter, or be deemed to interpret in whole or in part, any of the terms or provisions of this Agreement.


 




    	 



     


    

 


IN
WITNESS WHEREOF the parties hereto have set their hand the day and year first above written.


 


	 	LIFEMD,
    INC.
	 	 
	 	By:	/s/Justin
    Schreiber
	 	 	Justin
    Schreiber
	 	 	Chief
    Executive Officer
	 	 	 
	 	OPTIONEE:
	 	 
	 	By:
    	/s/
    Kate Walsh
	 	 	Kate
    Walsh
	 	 	5
    Union Park Street, Boston, MA 02118


 


[Signature
page to Non-qualified Stock Option Agreement]


 




    	 



     


    

 


EXHIBIT
A


 


FORM
OF NOTICE OF OPTION EXERCISE


 


To:
LifeMD, Inc. (the “Company”)


 


(1)
The undersigned hereby elects to purchase __________ shares of Common Stock of the Company (the “Shares”) pursuant to the
terms of the Option Agreement by and between the Company and the undersigned dated as of __________ ___, 20__, and tenders herewith payment
of the exercise price in full as set forth below.


 


(2)
Payment shall take the form of (check applicable box):


 





	 	[  ] 	in
    lawful money of the United States in the form of cash or by a bank check or cashier’s check made payable by the undersigned
    to the Company;
	 	 	 
	 	[  ] 	in
    lawful money of the United States in the form of a wire transfer to the account specified by the Company;
	 	 	 
	 	[  ] 	in
    the form of shares of a “broker-assisted cashless exercise” as described in Section 7(d) of the Option Agreement;
	 	 	 
	 	[  ] 	in
    the form of shares of a “net cashless exercise” as described in Section 7(d) of the Option Agreement; or
	 	 	 
	 	[  ] 	in
    the form of shares of Common Stock (a “stock-for-stock exercise”) as described in Section 7(d) of the Option Agreement.


 


(3)
Please issue a certificate or certificates representing the Shares in the name of the undersigned or in such other name as is specified
below:


 


____________________________________


 


The
Shares shall be delivered via overnight courier (with tracking information to be provided to the undersigned) to the following address:


 


	 	____________________________

    ____________________________

    ____________________________

    Attn:
    ________________________

    Tel:
    _________________________
	 


 


	 	OPTIONEE

	 	 
	 	__________________________________


 


[Exhibit
A to Non-qualified Stock Option Agreement]