SCWorx, Corp. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Acquisitions (Tables)

Acquisitions (Tables)

9 Months Ended

Sep. 30, 2017

The change in the carrying amount of goodwill for the nine months ended September 30, 2017 is:

Balance as of December 31, 2016	$	3,271,815
Goodwill Sucker Punch		160,763
Goodwill Fight Time Promotions		322,601
Goodwill National Fighting Championships		366,227
Goodwill Fight Club OC		518,710
Goodwill Victory		268,167
Final purchase price adjustment Initial Business Units		1,561,942
Balance as of September 30, 2017	$	6,470,225

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block]

Identified intangible assets consist of the following:

		September 30, 2017						December 31, 2016
	Useful	Gross		Accumulated				Gross		Accumulated
Intangible assets	Life	Assets		Amortization		Net		Assets		Amortization		Net
Video library, intellectual property	4 years	$	1,158,500	$	286,136	$	872,364	$	3,512,741	$	181,824	$	3,330,917
Venue relationships	7 years		1,720,000		245,174		1,474,286		1,966,400		163,867		1,802,533
Ticketing software	3 years		90,000		30,000		60,000		360,559		30,047		330,512
Trademark and brand	3 years		1,723,867		283,946		1,439,921		325,000		8,749		316,251
Fighter contracts	3 years		1,525,584		381,396		1,144,188
TV contract	2 years		200,000				200,000
Promoter relationships	6 years		310,000		51,668		258,332
Total intangible assets, gross		$	6,727,951	$	1,278,860	$	5,449,091	$	6,164,700	$	384,487	$	5,780,213

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

As of September 30, 2017, estimated amortization expense for the unamortized acquired intangible assets over the next five years and thereafter is as follows:

2017 (Remaining three months)	$	437,672
2018		1,750,688
2019		1,714,716
2020		736,695
2021		288,344
Thereafter		520,976
	$	5,449,091

Business Acquisition, Pro Forma Information [Table Text Block]

The combined pro forma net revenue and net loss of the Company as if Initial Business Units were acquired in January 1, 2016 are (in 000’s):

	Three Months Ended		Nine Months Ended
	September 30, 2016		September 30, 2016
Revenue	$	335	$	1,559
Net (loss)	$	(848)	$	(4,052)

Sucker Punch [Member]

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

As consideration for the acquisition of SuckerPunch, the Company delivered the following amounts of cash and shares of common stock.

					Warrant		Consideration
	Cash		Shares		Grant		Paid
SuckerPunch	$	357,500		307,487		93,583	$	1,686,347

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The following table reflects the preliminary allocation of the purchase price for SuckerPunch to identifiable assets and preliminary pro forma intangible assets and goodwill:

	SuckerPunch
Cash	$
Accounts receivable, net
Intangible assets		1,525,584
Goodwill		160,763
Total identifiable assets	$	1,686,347
Total identifiable liabilities
Total purchase price	$	1,686,347

Fight Time Promotions, LLC [Member]

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

As consideration for the acquisition of the MMA promotion business of Fight Time, the Company delivered the following amounts of cash and shares of common stock.

					Consideration
	Cash		Shares		Paid
Fight Time	$	84,000		74,667	$	371,468

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The following table reflects the preliminary allocation of the purchase price for the business of Fight Time to identifiable assets and preliminary pro forma intangible assets and goodwill:

	Fight Time
Cash	$
Accounts receivable
Intangible assets		48,867
Goodwill		322,601
Total identifiable assets	$	371,468
Total identifiable liabilities
Total purchase price	$	371,468

National Fighting Championships [Member]

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

As consideration for the acquisition of the MMA promotion business of NFC, the Company delivered the following amounts of cash and shares of common stock.

					Consideration
	Cash		Shares		Paid
NFC	$	140,000		273,304	$	506,227

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The following table reflects the preliminary allocation of the purchase price for the business of NFC to identifiable assets and preliminary pro forma intangible assets and goodwill:

	NFC
Cash	$
Accounts receivable
Fixed assets		20,000
Intangible assets		120,000
Goodwill		366,227
Total identifiable assets	$	506,227
Total identifiable liabilities
Total purchase price	$	506,227

Fight Club OC [Member]

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

As consideration for the acquisition of the MMA promotion business of Fight Club OC, the Company delivered the following amounts of cash and shares of common stock.

					Consideration
	Cash		Shares		Paid
Fight Club OC	$	207,900		693,000	$	1,018,710

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The following table reflects the preliminary allocation of the purchase price for the business of the Fight Club OC to identifiable assets, liabilities, and preliminary pro forma intangible assets and goodwill:

	Fight Club OC
Cash	$	159,000
Accounts receivable
Intangible assets		500,000
Goodwill		518,710
Total identifiable assets	$	1,177,710
Total identifiable liabilities		(159,000)
Total purchase price	$	1,018,710

Victory Fighting Championship [Member]

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

As consideration for the acquisition of the MMA promotion business of Victory, the Company delivered the following amounts of cash and shares of common stock.

					Consideration
	Cash		Shares		Paid
Victory Fighting Championship	$	180,000		267,891	$	822,938

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The following table reflects the preliminary allocation of the purchase price for the business of Victory to identifiable assets, liabilities, and preliminary pro forma intangible assets and goodwill:

	Victory
Cash	$
Accounts receivable		32,180
Fixed assets		30,000
Intangible assets		600,000
Goodwill		268,167
Total identifiable assets	$	930,347
Total identifiable liabilities		(107,409)
Total purchase price	$	822,938

Initial Business Units [Member]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The following table is a reconciliation of the preliminary purchase price allocation at September 30, 2016 to the final purchase price allocation based on the final fair value of the acquired assets and assumed liabilities at the acquisition date:

Under acquisition accounting, assets and liabilities acquired are recorded at their fair value on the acquisition date, with any excess in purchase price over these values being allocated to identifiable intangible assets and goodwill at September 30, 2017.

	Preliminary		Adjustments		Final
Cash and equivalents	$	118,764	$		$	118,764
Accounts receivable and other current assets, net		34,599				34,599
Property and equipment, net		23,661				23,661
Intangible assets		5,839,700		(2,264,700)		3,575,000
Goodwill		2,878,071		1,561,942		4,440,013
Total identifiable assets	$	8,894,795	$	702,758	$	8,192,037
Accounts payable and accrued expenses		1,055,906		(702,758)		353,148
Total identifiable liabilities	$	1,055,906	$	(702,758)	$	353,148
Total purchase price	$	7,838,889	$		$	7,838,889

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block]

The Company allocated $3,575,000 to intangible assets as follows:

Intangible assets	Useful Life	Allocated Amount
Video library, intellectual property	4 years	$	1,125,000
Venue relationships	7 years		1,720,000
Ticketing software	3 years		90,000
Trademark and brand	3 years		330,000
Promoter relationships	6 years		310,000
Total intangible assets, gross		$	3,575,000