What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-03-31 compared with 2024-09-24 · 577 added, 498 removed, 936 unchanged (53% of the section changed)

46 unchanged sentences

Chief Financial Officer

Steven Horowitz

Michael Burke

Troy Kirchenbauer

Vincent Matozzo

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cap and start-up businesses.

Irby was appointed

to the Board of Directors on March 10, 2021.

Alton Irby is a co-founder of London Bay Capital and has been Chairman of the firm

London Bay Capital makes investments in private companies, and also provides business advisory services.

a seasoned executive with a highly successful track record in the financial services and investment banking industries in both the UK

and the US from 1982 to the present.

Irby has served on the boards of several public and private companies including 17 years

as a director of The McKesson Corporation chairing both the Compensation and Finance Committees.

Steven Horowitz

Horowitz was appointed

to the Board of Directors in August 2021.

Horowitz is currently the Chief Executive Officer of CareCentrix, a multi-billion dollar

health care services company, after previously serving as its Chief Financial Officer since 2012.

Prior to joining CareCentrix,

Steve was the Vice President of business planning for Medco Health Solutions, a Fortune 50 pharmacy benefit manager.

In this role, Steve

was the CFO for three key U.S.-based divisions as well as all international markets, which together generated over $2 billion in annual

Previously, Steve held the position of controller at National Medical Health Card Systems, a pharmacy benefit manager, and at

The Fantastic Corporation, a global broadband multimedia corporation.

Earlier, Steve was CFO at the Mount Vernon Neighborhood Health Center.

Steve received his MBA from

Adelphi University and earned his BS in business management from Cornell University.

He is a licensed CPA and Chartered Global Management

Accountant (CGMA).

Steve is a member of the American Institute of Certified Public Accountants (AICPA).

Michael Burke

Burke was formerly the

Executive Vice President and CFO of Prisma Health from 2018-2022.

Prior to Prisma Health Mr.

Burke served as CFO of NYU Langone Medical

Center from December 2008 to July 2018 and formerly served as CFO to Tufts New England Medical Center from 2004 to 2008 and was a practicing

CPA in New York through 2012.

His experience with disaster recovery, large financial system integration projects, and mergers and acquisitions

at each institution provides valuable insights to clients as they manage in this ever-changing healthcare environment.

Prior to Tufts,

Burke worked as the Chief Financial Officer of Duke University Hospital and was also a Senior Manager at KPMG.

Burke graduated

John Fisher University with a BS, Accounting.

Troy Kirchenbauer

Kirchenbauer is a seasoned

executive with over two decades of experience driving digital transformation, product innovation, and data-driven decision-making in the

healthcare industry.

Throughout his career, he has been at the forefront of creating technology solutions that address complex challenges

in supply chain management, business intelligence, and advanced analytics.

Kirchenbauer is the founder of TWK Ventures LLC, where

he leads a healthcare data and analytics consulting practice.

From 2018 to July 2023, he served as Senior Vice President of Digital Supply

at Vizient Inc., where he played a key role in developing a digital ecosystem to advance supply chain automation and analytics solutions.

As Senior Vice President of

Digital Supply Chain at Vizient, Mr.

Kirchenbauer was instrumental in the development of a digital ecosystem designed to enhance supply

chain automation and provide advanced analytics solutions.

His leadership played a pivotal role in managing over $230 billion in healthcare

supply spend, consolidating disparate data systems, and building e-commerce platforms that significantly improved operational efficiency

for healthcare organizations.

Kirchenbauer’s work at Aptitude, where he built a cutting-edge B2B marketplace, further showcases

his capability in using data and analytics to drive substantial business growth, delivering over $50 million in new revenue within a few

Kirchenbauer has a deep

understanding of the nuances in healthcare supply chains and expertise in building data management systems and analytics platforms.

commitment to leveraging data for business transformation makes him an ideal leader for organizations focused on delivering innovative

analytics solutions that empower healthcare providers to make smarter, data-driven decisions.

Kirchenbauer graduated

from Texas A&M University of Commerce and has an MBA from the University of Dallas.

Vincent Matozzo

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Health, Vizient, and NYU Langone Health.

Matozzo has served as the

CEO and Managing Partner of Paradigm Venture Group since 2020.

Prior to that, he served as Director of Strategic Sourcing and Procurement

Operations for Yale New Haven Health from 2019 - 2021

Code of Business Conduct and Ethics

We have adopted a Code of

Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer

or controller or persons performing similar functions and also to other employees.

Our Code of Business Conduct can be found on our website

at www.SCWorx.com.

We have adopted a Code of Business

Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller

or persons performing similar functions and also to other employees.

Our Code of Business Conduct can be found on our website at www.SCWorx.com.

Family Relationships

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in Item 401(f) of Regulation S-K.

Litigation involving our former CEO, Marc S.

Schessel, is described in Item 3, “Legal Proceedings.”

Board Composition

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of Directors and investigate all aspects of our business.

The members of the audit committee are Mr.

Horowitz (chair), Mr.

The audit committee consists exclusively of directors who are financially literate.

In addition, Mr.

Horowitz is considered an

“audit committee financial expert” as defined by the SEC’s rules and regulations.

All members of the Audit Committee

currently satisfy the independence requirements and other established criteria of Nasdaq.

The current members of our Audit Committee are Mr.

Kirchenbauer and

Burke is the Chairman of the Audit Committee, and our board of directors has determined that Mr.

Burke is an “Audit

Committee financial expert” and that all members of the Audit Committee are “independent” as defined by the rules of

the SEC and the Nasdaq rules and regulations.

The Audit Committee operates under a written charter that is posted on our website at www.scworx.com.

Compensation Committee

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performance, productivity and innovation.

The members of the compensation committee are Mr.

Irby (chair), Mr.

Horowitz and Mr.

The current members of our Compensation Committee are Mr.

Kirchenbauer, Mr.

Burke and Mr.

Kirchenbauer is the current Chairman of the Compensation Committee and our board of directors has determined that all of the members

of the Compensation Committee are “independent” as defined by the rules of the SEC and Nasdaq rules and regulations.

The Compensation

Committee operates under a written charter that is posted on our website at www.scworx.com.

Nominating and Governance Committee

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committees, advises the Board of Directors on corporate governance matters and any related matters required by the federal securities

The members of the Nominating Committee are Mr.

Matozzo (chair), Mr.

Horowitz, and all currently satisfy the independence

requirements and other established criteria of Nasdaq.

The current members of our Nominating and Corporate Governance Committee are Mr.

Burke, and Mr.

Kirchenbauer.

is the Chairman of the Nominating and Corporate Governance Committee.

Our board of directors has determined that all of the members of

the Nominating and Corporate Governance Committee are “independent” as defined by Nasdaq rules and regulations.

The Nominating and Governance

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or paid to our executive officers.

The value attributable to any option awards and stock awards reflects the grant date fair values of

stock awards calculated in accordance with FASB Accounting Standards Codification Topic 718.

As described further in Note 9, Stockholders’

Equity, to our consolidated year-end financial statements, the assumptions made in the valuation of these option awards and stock awards

is set forth therein.

Name and Principal Position

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The following summary compensation

table sets forth information concerning compensation for services rendered in all capacities during 2023 and 2022 awarded to, earned

by or paid to our directors.

table sets forth information concerning compensation for services rendered in all capacities during 2024 and 2023 awarded to, earned by

or paid to our directors.

The value attributable to any stock option awards reflects the grant date fair values of stock awards calculated

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Name and Principal Position

Alton Irby (1)

Michael Burke (1)

Chairman and Director

Vincent Matozzo (2)

Troy Kirchenbauer (3)

Alton Irby (4)

Former Chairman and Director

Steven Horowitz (5)

John Ferrara (4)

Former Director

Steven Wallitt (5)

John Ferrara (6)

Former Director

(1) Alton Irby was appointed as a Director on March 16, 2021.

May 15, 2024, Mr Irby returned all previously received stock grants to the Company.

(2) Vincent Matozzo was appointed as a Director on August 17, 2023.

May 15, 2024, Mr Matozzo returned all previously received stock grants to the Company.

(3) Steven Horowitz was appointed as a Director on August 11, 2021.

May 15, 2024, Mr Horowitz returned all previously received stock grants to the Company.

Burke was appointed as a Director on October 31, 2024.

Matozzo was appointed as a Director on August 17, 2023.

Effective May 15, 2024, Mr Matozzo returned all previously received stock grants

to the Company.

Kirchenbauer was appointed as a Director on October 31, 2024.

Irby was appointed as a Director on March 16, 2021.

Effective May 15, 2024, Mr Irby returned all previously received stock grants to

Mr Irby resigned as a Director effective October 31, 2024.

Horowitz was appointed as a Director on August 11, 2021.

Effective May 15, 2024, Mr Horowitz returned all previously received

stock grants to the Company.

Mr Horowitz resigned as a Director effective October 31, 2024.

Ferrara was appointed as a Director on August 11, 2021.

Mr Ferrera resigned as a Director effective August 18, 2023.

Wallitt was appointed as a Director on October 4, 2019.

Mr Wallitt’s service was not continued effective approval of the Company’s

proxy statement nominations at our shareholder meeting held December 22, 2022.

Security Ownership of Certain Beneficial

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The following table sets forth

certain information regarding beneficial ownership of our common stock as of September 23, 2024:

(i) by each of our directors, (ii) by

each of the named executive officers, (iii) by all of our executive officers and directors as a group, and (iv) by each person or entity

known by us to beneficially own more than five percent (5%) of any class of our outstanding shares.

As of September 23, 2024, there were

certain information regarding beneficial ownership of our common stock as of March 31, 2025:

(i) by each of our directors, (ii) by each

of the named executive officers, (iii) by all of our executive officers and directors as a group, and (iv) by each person or entity known

by us to beneficially own more than five percent (5%) of any class of our outstanding shares.

As of March 31, 2025, there were 2,105,755

shares of our common stock outstanding.

Amount and Nature of Beneficial Ownership as

of September 23, 2024 (1)

of March 31, 2025 (1)

Named Executive Officers and Directors

Timothy Hannibal

Michael Burke

Vincent Matozzo

Steven Horowitz

Troy Kirchenbauer

Directors and Executive Officers as a Group (5 persons)

Steven Wallitt

Steven Horowitz

beneficial ownership of less than 1% of our outstanding stock.

In determining beneficial ownership of our common stock as of a given date, the number of shares

shown includes shares of common stock that may be acquired upon the exercise of stock options within 60 days of September 23, 2024.

In determining the percent of common stock owned by a person or entity on September 23, 2024, (a) the numerator is the number

of shares of the class beneficially owned by such person or entity, including shares which may be acquired within 60 days of September

23, 2024 upon the exercise of stock options, and (b) the denominator is the sum of (i) the total shares of common stock outstanding

on September 23, 2024 and (ii) the total number of shares that the beneficial owner may acquire upon exercise of stock options within

60 days of September 23, 2024.

Unless otherwise indicated, the address of each of the individuals and entities named below is c/o SCWorx

Corp., 100 S Ashley Dr, Suite 100 Tampa, FL 33602.

determining beneficial ownership of our common stock as of a given date, the number of shares shown includes shares of common stock that

may be acquired upon the exercise of stock options within 60 days of March 31, 2025.

In determining the percent of common stock

owned by a person or entity on March 31, 2025, (a) the numerator is the number of shares of the class beneficially owned by such

person or entity, including shares which may be acquired within 60 days of March 31, 2025 upon the exercise of stock options, and

(b) the denominator is the sum of (i) the total shares of common stock outstanding on March 31, 2025 and (ii) the total number

of shares that the beneficial owner may acquire upon exercise of stock options within 60 days March 31, 2025.

Unless otherwise indicated,

the address of each of the individuals and entities named below is c/o SCWorx Corp., 100 S Ashley Dr, Suite 100 Tampa, FL 33602.

Certain Relationships and Related

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At December 31, 2024 and 2023

2022 Company had amounts due to officers in the amount of $149,838 and $153,838, respectively.

During September 2021, the Company’s former CEO (also a significant

shareholder) advanced $100,000 in cash to the Company for short term capital requirements.

This amount is non-interest bearing and payable

The Company had balances of $67,622 and $100,000 included in shareholder advance on the Company’s consolidated balance

sheets as of December 31, 2023 and 2022, respectively.

Between May 24, 2023 and

November 29, 2023, the Company’s CFO advanced an aggregate $193,558 in cash to the Company for short term capital requirements.

As of December 31, 2023, all advanced amounts have been repaid.

Company had aged payables that were due to officers in the amount of $149,838.

During September 2021, the

Company’s former CEO (also a significant shareholder) advanced $100,000 in cash to the Company for short term capital requirements.

This amount is non-interest bearing and payable upon demand.

The Company had balances of $67,622 included in shareholder advance on the

Company’s consolidated balance sheets as of December 31, 2024 and 2023.

Between January 18, 2024 and

July 11, 2024, the Company’s CFO advanced an aggregate $128,479 in cash to the Company for short term capital requirements.

December 31, 2024, all advanced amounts have been repaid.

Director Independence

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In considering the independence of compensation committee members, the Nasdaq Rules require that our Board of Directors must consider

additional factors relevant to the duties of a compensation committee member, including the source of any compensation we pay to the

director and any affiliations with our company.

additional factors relevant to the duties of a compensation committee member, including the source of any compensation we pay to the director

and any affiliations with our company.

Our Board of Directors undertook

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Based upon information

requested from and provided by each director concerning his background, employment and affiliations, including family relationships,

our Board of Directors has determined that each of our directors other than Tim Hannibal, is independent based on the definition of independence

requested from and provided by each director concerning his background, employment and affiliations, including family relationships, our

Board of Directors has determined that each of our directors other than Tim Hannibal, is independent based on the definition of independence

in the Nasdaq listing standards.

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Board of Directors has selected Astra Audit and Advisory, LLC (“Astra”), an independent registered public accounting firm,

to audit our financial statements for the years ended December 31, 2023 and 2022.

to audit our consolidated financial statements for the years ended December 31, 2024 and 2023.

BF Borgers CPA PC served as

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particular services on a case-by-case basis.

Exhibits and Financial Statement

following documents are filed as a part of this report:

(1) Financial

Exhibits and Financial Statement Schedules

The following documents are filed as a part of this report:

Financial Statements .

See Index to Consolidated Financial Statements, which appears on page F-1 hereof.

The consolidated financial statements

listed in the accompanying Index to Consolidated Financial Statements are filed herewith in response to this Item.

Financial Statement

Schedules are omitted because the required information is not present or is not present in amounts sufficient to require

submission of the schedule or because the information required is given in the consolidated financial statements or the notes thereto.

(3) Exhibits .

The information required by this Item 15 is incorporated by reference to the Index to Exhibits accompanying this Annual Report on Form

The consolidated financial statements listed in the accompanying Index to Consolidated Financial Statements are filed herewith in response to this Item.

Financial Statement Schedules .

Schedules are omitted because the required information is not present or is not present in amounts sufficient to require submission of the schedule or because the information required is given in the consolidated financial statements or the notes thereto.

The information required by this Item 15 is incorporated by reference to the Index to Exhibits accompanying this Annual Report on Form 10-K.

Pursuant to the requirements

of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf

by the undersigned, thereunto duly authorized.

of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by

the undersigned, thereunto duly authorized.

/s/ Timothy Hannibal

Timothy Hannibal

President, Chief Executive Officer

September 23, 2024

March 31, 2025

/s/ Chris Kohler

Chief Financial Officer

September 23, 2024

March 31, 2025

Pursuant to the requirements

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capacities and on the dates indicated.

Timothy Hannibal

/s/ Timothy Hannibal

Timothy Hannibal

President, Chief Executive Officer, Director

September 23, 2024

March 31, 2025

/s/ Chris Kohler

Chief Financial Officer

September 23, 2024

March 31, 2025

/s/ Michael Burke

Michael Burke,

March 31, 2025

/s/ Vincent Matazzo

Vincent Matazzo

September 23, 2024

Steven Horowitz

September 23, 2024

March 31, 2025

/s/ Troy Kirchenbauer

Trou Kirchenbauer

March 31, 2025

Index to Consolidated Financial Statements

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standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial

statements are free of material misstatement, whether due to error or fraud.

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We believe that our audits provide a reasonable basis for our opinion.

Astra Audit & Advisory, LLC

Critical Audit Matters

The critical audit matters communicated below

are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to

the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our

especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion

on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions

on the critical audit matters or on the accounts or disclosures to which they relate.

Impairment of Goodwill

As described in Note 3 to the Company’s

financial statements, the Company evaluates Goodwill for impairment at least once annually or more frequently if events or circumstances

indicate that the goodwill might be impaired.

The Company first assesses qualitative factors to determine whether it is necessary to perform

the quantitative analysis.

If, after assessing the totality of events or circumstances, the Company determines that it is not more likely

than not that the fair value of a reporting unit is less than its carrying value then quantitative goodwill impairment test is unnecessary.

The goodwill balance was $5,842,433 related to the SaaS reporting unit.

The Company uses the discounted cash flow model to estimate

the fair value of the SaaS reporting unit, which requires management to make subjective estimates and assumptions related to forecasts

of future revenues.

Changes in these assumptions could have a significant impact on either the fair value, the amount of any impairment

charge, or both.

The fair value of the SaaS reporting unit exceeded its carrying value as of the measurement date and, therefore, no impairment

was recognized.

We identified the Company’s calculation

of the fair value of the reporting unit to assess the need for impairment as a critical audit matter.

The principal considerations

for our determination of this critical audit matter related to the high degree of subjectivity in the Company’s judgments in determining

the qualitative and quantitative factors.

Auditing these judgments and assumptions by the Company involves auditor judgment

due to the nature and extent of audit evidence and effort required to address these matters.

The primary procedures we performed to address

these critical audit matters included the following:

- We obtained Management’s calculations, forecasts, and conclusion and performed the following procedures:

o Reviewed calculations and forecasts, and evaluated the reasonableness of Management’s calculation,

forecast, and significant assumptions used by the Company, specifically related to revenue growth.

o Performed a sensitivity analysis on key inputs.

o Recalculated management’s fair value of the reporting unit.

o Developed a range of independent estimates of the fair value of the reporting unit and compared to the

fair value determined by Management.

We have served as the Company’s auditor since 2024.

Tampa, Florida

September 23, 2024

West Spruce Street #1430 i Tampa,

Florida 33607 i +1.813.441.9707

March 31, 2025

Consolidated Balance Sheets

Current assets:

Accounts receivable

Accounts receivable, net

Prepaid expenses and other assets

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Accounts payable and accrued liabilities - related party

Stockholder advance

Shareholder advance

Deferred revenue

Equity financing

Loans payable

Total current liabilities

Long-term liabilities:

Loans payable

Loans payable, net of current maturities

Convertible loans payable, net of discounts

Total long-term liabilities

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900,000 shares authorized;

39,810 shares issued and outstanding

39,810 shares issued and outstanding at December 31, 2024 and 2023

Common stock, $ 0.001 par value;

45,000,000 shares authorized;

1,232,333 and 867,574 shares issued and outstanding, respectively

1,859,525 and 1,232,333 shares issued and outstanding at December 31, 2024 and 2023, respectively

Additional paid-in capital

Subscriptions payable

Accumulated deficit

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For the years ended

Cost of revenues

Cost of revenue

Operating expenses:

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Interest expense

Gain on forgiveness of accounts payable

Impairment of goodwill

( 2,524,034 )

Gain on forgiveness of PPP loan

Total other (expense) income

Total other income (expense)

( 2,530,482 )

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Preferred Stock

Additional paid-in

Subscriptions

December 31, 2023

Year ended December 31, 2024

Balances, December 31, 2023

1 unchanged sentence

Shares issued as settlement of accounts payable

Shares issued under equity line of credit, net of financing costs

Shares issued for legal settlement

Shares issued for vested restricted stock units

Shares issued for settlement of class action

Shares issued for cashless exercise of warrants

Proceeds received from potential acquisition

Stock based compensation

Shares issued for common stock placement – net of offering costs of $ 32,000

Issuance of warrants in conjunction with convertible loans

( 1,136,225 )

4 unchanged sentences

Subscriptions

December 31, 2022

Year ended December 31, 2023

Balances, December 31, 2022

1 unchanged sentence

Shares issued as settlement of accounts payable

Shares issued for common stock placement

Shares issued under equity line of credit

Shares issued for vested restricted stock units

Commitment shares issued in conjunction with capital raise

Shares issued for settlement of class action

Shares issued for cashless exercise of warrants

Proceeds received from potential acquisition

Stock based compensation

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Consolidated Statements of Cash Flows

the years ended

For the years ended

Cash flows from operating activities:

1 unchanged sentence

$ ( 3,981,144 )

Adjustments to reconcile net

loss to net cash used in operating activities:

on forgiveness of PPP loan

Changes in operating assets

and liabilities:

expenses and other assets

payable and accrued liabilities

cash provided by (used in) operating activities

Cash flows from investing

from potential acquisition

cash provided by investing activities

Cash flows from financing

from the sale of common stock

of loans payable

of stockholder advance

from advances - related party

of advances - related party

cash provided by financing activities

Net (decrease) increase in cash

Adjustments to reconcile net loss to net cash used in operating activities:

Impairment of goodwill

Amortization of debt discount

Stock-based compensation

Gain on forgiveness of accounts payable

Common stock issued for settlement of payables

Common stock issued for legal settlements

Credit loss expense

Changes in operating assets and liabilities:

Accounts receivable

Prepaid expenses and other assets

Accounts payable and accrued liabilities

Deferred revenue

Net cash used in operating activities

( 1,084,292 )

Net cash from investing activities:

Proceeds from potential acquisition

Net cash provided by investing activities

Cash flows from financing activities:

Proceeds from the sale of common stock

Proceeds from loans payable

Payments on loans payable

Payments of shareholder advance

Proceeds from accounts payable and accrued liabilities - related party

Payments on accounts payable and accrued liabilities - related party

Net cash provided by financing activities

Net increase (decrease) in cash

Cash, beginning of period

Cash, end of period

Supplemental disclosures of

cash flow information:

paid for interest

paid for income taxes

Non-cash investing and financing

shares issued in conjunction with capital raise

issued for vested restricted stock units

issued for settlement of class action

issued for cashless exercise of warrants

Supplemental disclosures of cash flow information:

Cash paid for interest

Cash paid for income taxes

Non-cash investing and financing activities:

Shares issued for vested restricted stock units

Shares issued for settlement of class action

Shares issued for cashless exercise of warrants

Shares issued for accrued legal settlement

Warrants issued in conjunction with convertible loans

The accompanying notes are an integral part

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Corp.) (“SCW LLC”) was a privately held limited liability company which was organized in Florida on November 17, 2016.

December 31, 2017, SCW LLC acquired Primrose Solutions, LLC (“Primrose”), a Delaware limited liability company, which became

its wholly-owned subsidiary and focused on developing functionality for the software now used and sold by SCWorx Corp.

(the “Company”

or “SCWorx”).

The majority interest holders of Primrose were interest holders of SCW LLC and based upon Staff Accounting Bulletin

Topic 5G, the technology acquired has been accounted for at predecessor cost of $ 0 .

To facilitate the planned acquisition by Alliance

MMA, Inc., a Delaware corporation (“Alliance”), on June 27, 2018, SCW LLC merged with and into a newly-formed entity, SCWorx

Acquisition Corp., a Delaware corporation (“SCW Acquisition”), with SCW Acquisition being the surviving entity.

Subsequently,

on August 17, 2018, SCW Acquisition changed its name to SCWorx Corp.

On November 30, 2018, the Company and certain of its stockholders

agreed to cancel 6,510 shares of common stock.

In June 2018, the Company began to collect subscriptions for common stock.

November 2018, the Company collected $ 1,250,000 in subscriptions and issued 3,125 shares of common stock to new third-party investors.

On December 31, 2017, SCW LLC acquired Primrose Solutions, LLC (“Primrose”), a Delaware limited liability company, which

became its wholly-owned subsidiary and focused on developing functionality for the software now used and sold by SCWorx Corp.

“Company” or “SCWorx”).

The majority interest holders of Primrose were interest holders of SCW LLC and based

upon Staff Accounting Bulletin Topic 5G, the technology acquired has been accounted for at predecessor cost of $ 0 .

To facilitate the

planned acquisition by Alliance MMA, Inc., a Delaware corporation (“Alliance”), on June 27, 2018, SCW LLC merged with

and into a newly-formed entity, SCWorx Acquisition Corp., a Delaware corporation (“SCW Acquisition”), with SCW

Acquisition being the surviving entity.

Subsequently, on August 17, 2018, SCW Acquisition changed its name to SCWorx Corp.

2018, the Company began to collect subscriptions for common stock.

From June to November 2018, the Company collected $ 1,250,000 in

subscriptions and issued 3,125 shares of common stock to new third-party investors.

On November 30, 2018, the Company and certain of

its stockholders agreed to cancel 6,510 shares of common stock.

In addition, on February 1, 2019, (i) SCWorx Corp.

(f/k/a SCWorx Acquisition Corp.) changed its name to SCW FL Corp.

(to allow Alliance

to change its name to SCWorx Corp.) and (ii) Alliance acquired SCWorx Corp.

(n/k/a SCW FL Corp.) in a stock-for-stock exchange transaction

and changed Alliance’s name to SCWorx Corp., which is the Company’s current name, with SCW FL Corp.

becoming the Company’s

On March 16, 2020, in response to the COVID-19 pandemic, SCWorx established a wholly-owned subsidiary, Direct-Worx, LLC to

endeavor to source and provide critical, difficult-to-find items for the healthcare industry which it has since ceased.

(f/k/a SCWorx

Acquisition Corp.) changed its name to SCW FL Corp.

(to allow Alliance to change its name to SCWorx Corp.) and (ii) Alliance

acquired SCWorx Corp.

(n/k/a SCW FL Corp.) in a stock-for-stock exchange transaction and changed Alliance’s name to SCWorx

Corp., which is the Company’s current name, with SCW FL Corp.

becoming the Company’s subsidiary.

On October 6, 2023, following

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stock split have been reflected in this Annual Report on Form 10-K for all periods presented.

On October 16, 2023, the Company entered into a letter of intent to

merge with American Energy Partners, Inc.

(“American Environmental”) and subsequently entered into a definitive agreement

and plan of merger (the “Merger Agreement”) on December 22, 2023.

The Merger Agreement was mutually terminate on March 26,

During the year ended December 31, 2023, American Environmental contributed an aggregate $ 165,000 to the Company to assist in covering

its operating expenses.

Operations of the Business

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perform separate functions as follows:

● virtualized

Item Master File repair, expansion and automation;

for proposal automation;

data analytics modeling;

integration and warehousing.

virtualized Item Master File repair, expansion and automation;

CDM management;

contract management;

request for proposal automation;

rebate management;

big data analytics modeling;

data integration and warehousing.

SCWorx continues to provide

11 unchanged sentences

partnerships.

Impact of the COVID-19 Pandemic

The Company’s operations

and business have experienced disruption due to the unprecedented conditions surrounding the COVID-19 pandemic which spread throughout

the United States and the world.

The outbreak adversely impacted new customer acquisition.

The Company has followed the recommendations

of local health authorities to minimize exposure risk for its team members since the outbreak.

In addition, the Company’s

customers (hospitals) also experienced extraordinary disruptions to their businesses and supply chains, while experiencing unprecedented

demand for health care services related to COVID-19.

As a result of these extraordinary disruptions to the Company’s customers’

business, the Company’s customers were focused on meeting the nation’s health care needs in response to the COVID-19 pandemic.

As a result, the Company believes that its customers were not able to focus resources on expanding the utilization of the Company’s

services, which has adversely impacted the Company’s growth prospects, at least until the adverse effects of the pandemic subside.

In addition, the financial impact of COVID-19 on the Company’s hospital customers could cause the hospitals to delay payments due

to the Company for services, which could negatively impact the Company’s cash flows.

Note 2 – Liquidity and Going Concern

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These conditions indicate that there

is substantial doubt about the Company’s ability to continue as a going concern within one year after the financial statement issuance

As of the filing date of this

Report, the Company has only limited cash on hand, and management believes that there may not be sufficient capital resources from operations

and existing financing arrangements in order to meet operating expenses and working capital requirements for the next twelve months.

Accordingly, we are evaluating

various alternatives, including reducing operating expenses, securing additional financing through debt or equity securities to fund future

business activities and other strategic alternatives.

There can be no assurance that the Company will be able to generate the level of

operating revenues in its business plan, or if additional sources of financing will be available on acceptable terms, if at all.

additional sources of financing are available, our future operating prospects may be adversely affected.

The financial statements do not

include any adjustments that might result from the outcome of this uncertainty.

is substantial doubt about the Company’s ability to continue as a going concern within one year after the consolidated financial

statement issuance date.

Summary of Significant Accounting Policies

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Consolidation

The accompanying consolidated financial statements have been prepared

in accordance with U.S.

GAAP and the rules and regulations of the U.S.

The accompanying consolidated

financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S.

and the rules and regulations of the U.S.

Securities and Exchange Commission (“SEC”).

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the fair value measurements for assets and liabilities, which are required to be recorded at fair value, management considers the principal

or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants

or most advantageous market in which it would transact and the market-based risk measurements or assumptions that market participants

would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk.

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those which represent more than 10% of the Company’s revenue for each period presented, or the Company’s accounts receivable

balance as of each respective balance sheet date.

For each significant customer, revenue as a percentage of total revenue and accounts

receivable as a percentage of total net accounts receivable are as follows:

balance as of each respective consolidated balance sheet date.

For each significant customer, revenue as a percentage of total revenue

and accounts receivable as a percentage of total net accounts receivable are as follows:

For the years ended

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expected credit loss model utilizing historical loss rates and historical trends in credit quality indicators (e.g., delinquency, risk

ratings), adjusted to reflect current economic conditions and knowledge or customer relationships.

Management considers the following factors when determining the collectability

of specific customer accounts:

customer creditworthiness, past transaction history with the customer, current industry trends, changes

in customer payment terms, and specific customer situations.

The Company’s normal collection cycle ranges between thirty and 60

ratings), adjusted to reflect current economic conditions and knowledge of customer relationships.

Management considers the following

factors when determining the collectability of specific customer accounts:

customer creditworthiness, past transaction history with the

customer, current industry trends, changes in customer payment terms, and specific customer situations.

The Company’s normal collection

cycle ranges between thirty and 60 days.

Estimated uncollectible amounts are charged to earnings and a credit to a valuation allowance.

Balances which remain outstanding

after reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable The

Company has assessed all receivables are collectable and did not record an allowance for credit losses as of December 31, 2023 and 2022.

The inventory balance at December

31, 2022 is related to the Company’s Direct-Worx, LLC subsidiary and consisted of approximately 87,000 gowns.

These items are tracked

based on average cost and carried on the consolidated balance sheet at the lower of cost or market.

During the year ended December 31, 2022, the Company wrote off all

remaining $ 156,000 in the value of this inventory as unsellable.

During the year ended December 31, 2023, the Company disposed of all

remaining inventory previously written off.

The Company determines if

an arrangement is a lease at inception.

Balances which remain outstanding after reasonable collection efforts are written off through a charge to the valuation allowance and

a credit to accounts receivable.

The Company recorded an allowance for credit losses of $ 20,000 as of December 31, 2024.

The Company has

assessed all receivables are collectable and did not record an allowance for credit losses as of December 31, 2023.

The Company determines if an

arrangement is a lease at inception.

The current portion of lease obligations are included in accounts payable and accrued liabilities

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additional detail).

Goodwill and Purchased Identified Intangible

Goodwill and Impairment of Long Lived Assets

Goodwill is recorded as the

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goodwill impairment test is unnecessary.

For further discussion of goodwill, refer to Note 5, Goodwill.

For further discussion of goodwill,

refer to Note 5, Goodwill.

Revenue Recognition

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the following performance obligations in its SaaS contracts with customers:

Normalization:

which includes data preparation, product and vendor mapping, product categorization, data enrichment and other data related

2) Software-as-a-service

which is generated from clients’ access of and usage of the Company’s hosted software solutions

on a subscription basis for a specified contract term, which is usually annually.

In SaaS arrangements, the client cannot take possession

of the software during the term of the contract and generally has the right to access and use the software and receive any software upgrades

published during the subscription period,

3) Maintenance:

Data Normalization:

which includes data preparation, product and vendor mapping, product categorization, data enrichment and other data related services,

Software-as-a-service (“SaaS”):

which is generated from clients’ access of and usage of the Company’s hosted software solutions on a subscription basis for a specified contract term, which is usually annually.

In SaaS arrangements, the client cannot take possession of the software during the term of the contract and generally has the right to access and use the software and receive any software upgrades published during the subscription period,

which includes ongoing data cleansing and normalization, content enrichment, and optimization, and

4) Professional

Professional Services:

mainly related to specific customer projects to manage and/or analyze data and review for cost reduction opportunities.

A contract will typically

include Data Normalization, SaaS and Maintenance, which are distinct performance obligations and are accounted for separately.

A contract will typically include

Data Normalization, SaaS and Maintenance, which are distinct performance obligations and are accounted for separately.

The transaction

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Data Normalization and Professional Services

The Company’s Data Normalization and Professional Services are

typically fixed fee.

When these services are not combined with SaaS or Maintenance revenues as a single unit of accounting, these revenues

are recognized as the services are rendered and when contractual milestones are achieved and accepted by the customer.

When these services

are combined with SaaS or Maintenance revenues, revenues recognized ratably over the period of the contract.

The Company’s Data Normalization

and Professional Services are typically a fixed fee.

When these services are not combined with SaaS or Maintenance revenues as a single

unit of accounting, these revenues are recognized as the services are rendered and when contractual milestones are achieved and accepted

by the customer.

When these services are combined with SaaS or Maintenance revenues, revenues are recognized ratably over the period of

the contract.

SaaS and Maintenance

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chargeable to customer contracts.

These expenses are recognized and expensed when incurred in accordance with ASC 340-40.

These expenses are recognized and expensed when incurred in accordance with ASC 340-40, “Other

Assets and Deferred Costs—Contracts with Customers” .

Cost of Revenue

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delivering professional services and maintenance of the Company’s large data array during the periods presented.

Convertible Debt and Amortization of Debt

The Company has issued various

debt instruments with warrants and conversion features for which total proceeds were allocated to individual instruments based on the

relative fair value of each instrument at the time of issuance.

The relative fair value of the warrants and conversion was recorded as

discount on debt and amortized over the term of the respective debt.

For the years ended December 31, 2024 and 2023, amortization of debt

discount was $ 19,660 $ 0 , respectively.

Contract Balances

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Contract liabilities arise

when customers remit contractual cash payments in advance of our company satisfying our performance obligations under the contract and

when customers remit contractual cash payments in advance of the Company satisfying its performance obligations under the contract and

are derecognized when the revenue associated with the contract is recognized when the performance obligation is satisfied.

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The stock-based compensation expense for such modification is accounted for as a repurchase of the original award and the issuance of

Calculating stock-based compensation expense requires the input of

highly subjective assumptions, including the expected term of the stock-based awards, stock price volatility, and the pre-vesting option

forfeiture rate.

The Company estimates the expected life of options granted based on historical exercise patterns, which are believed

to be representative of future behavior.

The Company estimates the volatility of the Company’s common stock on the date of grant

based on historical volatility.

The assumptions used in calculating the fair value of stock-based awards represent the Company’s

best estimates, but these estimates involve inherent uncertainties and the application of management’s judgment.

As a result, if

factors change and the Company uses different assumptions, its stock-based compensation expense could be materially different in the future.

In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares expected to

The Company estimates the forfeiture rate based on historical experience of its stock-based awards that are granted, exercised and

If the actual forfeiture rate is materially different from the estimate, stock-based compensation expense could be significantly

different from what was recorded in the current period.

The Company also grants performance based restricted stock awards to employees

and consultants.

These awards will vest if certain employee\consultant-specific or company-designated performance targets are achieved.

If minimum performance thresholds are achieved, each award will convert into a designated number of the Company’s common stock.

Calculating stock-based compensation

expense requires the input of highly subjective assumptions, including the expected term of the stock-based awards, stock price volatility,

and the pre-vesting option forfeiture rate.

The Company estimates the expected life of options granted based on historical exercise patterns,

which are believed to be representative of future behavior.

The Company estimates the volatility of the Company’s common stock on

the date of grant based on historical volatility.

The assumptions used in calculating the fair value of stock-based awards represent the

Company’s best estimates, but these estimates involve inherent uncertainties and the application of management’s judgment.

As a result, if factors change and the Company uses different assumptions, its stock-based compensation expense could be materially different

in the future.

In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares

expected to vest.

The Company estimates the forfeiture rate based on historical experience of its stock-based awards that are granted,

exercised and cancelled.

If the actual forfeiture rate is materially different from the estimate, stock-based compensation expense could

be significantly different from what was recorded in the current period.

The Company also grants performance based restricted stock awards

to employees and consultants.

These awards will vest if certain employee\consultant-specific or company-designated performance targets

are achieved.

If minimum performance thresholds are achieved, each award will convert into a designated number of the Company’s

common stock.

If minimum performance thresholds are not achieved, then no shares will be issued.

Based upon the expected levels of achievement, stock-based

compensation is recognized on a straight-line basis over the requisite service period.

The expected levels of achievement are reassessed

over the requisite service periods and, to the extent that the expected levels of achievement change, stock-based compensation is adjusted

in the period of change and recorded on the consolidated statements of operations and the remaining unrecognized stock-based compensation

is recorded over the remaining requisite service period.

Based upon the expected levels of achievement,

stock-based compensation is recognized on a straight-line basis over the requisite service period.

The expected levels of achievement

are reassessed over the requisite service periods and, to the extent that the expected levels of achievement change, stock-based compensation

is adjusted in the period of change and recorded on the consolidated statements of operations and the remaining unrecognized stock-based

compensation is recorded over the remaining requisite service period.

Refer to Note 9, Stockholders’ Equity, for additional detail.

Loss Per Share

The Company computes earnings (loss) per share in accordance with ASC

260, “ Earnings per Share ” which requires presentation of both basic and diluted earnings (loss) per share (“EPS”)

on the face of the income statement.

Basic EPS is computed by dividing the loss available to common shareholders (numerator) by the weighted

average number of shares outstanding (denominator) during the period.

Diluted EPS gives effect to all dilutive potential common shares

outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method.

diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise

of stock options or warrants and the exercise of fully vested restricted stock units.

Diluted EPS excludes all dilutive potential shares

if their effect is anti-dilutive.

As of December 31, 2023 and 2022, the Company had 180,390 and 273,059 , respectively, common stock equivalents

The Company computes earnings

(loss) per share in accordance with ASC 260, “ Earnings per Share ” which requires presentation of both basic and diluted

earnings (loss) per share (“EPS”) on the face of the consolidated income statement.

Basic EPS is computed by dividing the

loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period.

Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible

preferred stock using the if-converted method.

In computing diluted EPS, the average stock price for the period is used in determining

the number of shares assumed to be purchased from the exercise of stock options or warrants and the exercise of fully vested restricted

Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

As of December 31, 2024 and 2023, the

Company had 9,048,072 and 180,390 , respectively, common stock equivalents outstanding.

Indemnification

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above the applicable policy retention.

In connection with the Class

Action and derivative claims and investigations described in Note 8, Commitments and Contingencies, the Company is obligated to indemnify

its officers and directors for costs incurred in defending against these claims and investigations.

Contingencies

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Use of Estimates

The preparation of consolidated financial statements in conformity

GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the consolidated

financial statements and accompanying notes.

The Company regularly evaluates estimates and assumptions related to the allowance for credit

losses, the estimated useful lives and recoverability of long-lived assets, equity component of convertible debt, stock-based compensation,

and deferred income tax asset valuation allowances.

The Company bases its estimates and assumptions on current facts, historical experience

and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments

about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.

The actual results experienced by the Company may differ materially and adversely from the Company’s estimates.

To the extent there

are material differences between the estimates and the actual results, future results of operations will be affected.

Actual results

could differ materially from those estimates.

The preparation of consolidated

financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the amounts reported

and disclosed in the consolidated financial statements and accompanying notes.

The Company regularly evaluates estimates and assumptions

related to the allowance for credit losses, the estimated useful lives and recoverability of long-lived assets, equity component of convertible

debt, stock-based compensation, and deferred income tax asset valuation allowances.

The Company bases its estimates and assumptions on

current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results

of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses

that are not readily apparent from other sources.

The actual results experienced by the Company may differ materially and adversely from

the Company’s estimates.

To the extent there are material differences between the estimates and the actual results, future results

of operations will be affected.

Actual results could differ materially from those estimates.

Recently Issued Accounting Pronouncements

From time to time, new accounting

pronouncements are issued by FASB that are adopted by the Company as of the specified effective date.

If not discussed, management believes

that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial

statements upon adoption.

From time to time, new accounting pronouncements are issued by the

Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date.

If not discussed,

management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the

Company’s consolidated financial statements upon adoption.

In November 2023, the FASB

issued ASU 2023-07 Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures to enhance the reportable segment disclosures.

The guidance requires additional disclosures about significant segment expenses.

The guidance is effective for the public companies with

fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 with early adoption

Related Party Transactions

At December 31, 2024 and 2023,

the Company had amounts due to officers in the amount of $ 149,838 and $ 153,838 , respectively.

the Company had amounts due to officers in the amount of $ 149,838 .

During September 2021, the

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This amount is non-interest bearing and payable upon demand.

The Company had balances of $ 67,622 and $ 100,000 included in stockholder

advance on the Company’s consolidated balance sheets as of December 31, 2023 and 2022, respectively.

Between May 24, 2023 and November

29, 2023, the Company’s CFO advanced an aggregate $ 193,558 in cash to the Company for short term capital requirements.

of December 31, 2023, all advanced amounts have been repaid.

The Company had balances of $ 67,622 included in stockholder advance on the

Company’s consolidated balance sheets as of December 31, 2024 and 2023.

Between January 18, 2024 and

July 11, 2024, the Company’s CFO advanced an aggregate $ 128,479 in cash to the Company for short term capital requirements.

December 31, 2024, all advanced amounts have been repaid.

The above amounts and terms

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carrying value of goodwill for the year ended December 31, 2024.

Loans Payable

Receipt of CARES funding

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remaining due.

On March 17, 2021, the Company

received $ 139,595 in financing from the U.S.

government’s Payroll Protection Program (“PPP”).

We entered into a loan

agreement with Bank of America.

This loan agreement was pursuant to the CARES Act.

The CARES Act was established in order to enable small

businesses to pay employees during the economic slowdown caused by COVID-19 by providing forgivable loans to qualifying businesses for

up to 2.5 times their average monthly payroll costs.

The amount borrowed under the CARES Act is eligible to be forgiven provided that

(a) the Company uses the PPP Funds during the eight week period after receipt thereof, and (b) the PPP Funds are only used to cover payroll

costs (including benefits), rent, mortgage interest, and utility costs.

The amount of loan forgiveness will be reduced if, among other

reasons, the Company does not maintain staffing or payroll levels.

Principal and interest payments on any unforgiven portion of the PPP

Funds (the “PPP Loan”) will be deferred for six months and will accrue interest at a fixed annual rate of 1.0 % and carry a

two year maturity date.

There is no prepayment penalty on the CARES Act Loan.

This note was fully forgiven on March 12, 2022.

At December 31, 2024 and 2023, the principal balances on the loan were $ 27,369 and 90,359 , respectively and are included

in the Company’s consolidated balance sheets.

Short Term Loans

On April 12, 2024, the Company

issued a secured promissory note in the face amount of $ 330,000 , in exchange for which it received cash in the amount of $ 300,000 .

addition to the original issue discount of $ 30,000 , the note bears interest at the rate of 5 % per annum, was originally due May 10,

2024 and subsequently extended until July 12, 2024 and is secured by all the Company assets.

On July 15, 2024, the balance of the promissory

note was rolled into a new convertible loan offering.

Convertible Loans

On July 15, 2024, the Company

issued an aggregate $ 1,155,000 in convertible notes bearing interest at 10 % per annum.

The notes mature on December 31,

2025 and is convertible, into the Company’s common stock at a price of $ 1.43 per share, subject to certain adjustments,

at the holder’s request.

The noteholders and certain third parties were also granted detachable 5 year warrants

to purchase an aggregate of 4,887,118 shares of the Company’s common stock at exercise prices ranging from $ 1.43 to

$ 1.692 per share.

The Company valued the warrants at $ 6,163,572 using the Black-Scholes pricing model.

The Company has

allocated the note proceeds based on relative fair value and has recorded the value of the warrants as a discount to the debt in the amount

of $ 973,200 .

At December 31, 2024, the principal balances were still outstanding and is included on the Company’s consolidated

balance sheets net of discounts at $ 19,660 .

The Company has accrued interest for the notes in the amount of $ 53,950 , which is included

in accounts payable and accrued liabilities on the Company’s consolidated balance sheets.

The Company recognized amortization expense

of $ 19,660 during the year ended December 31, 2024.

Operating Leases

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executive office in Tampa Florida is under a month-to-month arrangement with a base rent of $ 250 per month.

The Company has operating

leases for corporate, business and technician offices.

The Company has operating leases

for corporate, business and technician offices.

Leases with a probable term of 12 months or less, including month-to-month agreements,

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Commitments and Contingencies

In conducting our business,

In conducting its business,

the Company may become involved in legal proceedings.

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IR has since obtained a judgement in the amount of approximately $ 502,000 (including interest) (“Judgement”) which is included

in accounts payable and accrued liabilities on the Company’s consolidated balance sheet at December 31, 2023.

in accounts payable and accrued liabilities on the Company’s consolidated balance sheets at December 31, 2023.

The Company and Core

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with a value of $ 502,000 (determined based on sales proceeds realized by Core IR), in full and complete satisfaction of the Judgement.

The settlement agreement is filed as exhibit 10.5 to this annual report on Form 10-K

The settlement agreement is filed as exhibit 10.5 to the annual report on Form 10-K as filed with the SEC on September 24, 2024.

18, 2024, the Company issued 159,776 shares of its common stock in the first tranche of payments under this agreement.

In connection with the Settlement

Agreement, the Company and Core IR entered into a Registration Rights Agreement, pursuant to which the Company was required to file a

resale registration statement with the Commission to register for resale the shares issuable upon under the Settlement Agreement as described

Hadrian Equities Partners, LLC et ano.

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Plaintiffs filed an Amended Complaint on November 28, 2022.

On February 6, 2023, SCWorx filed its answer to the Amended

Complaint interposing numerous defenses.

Plaintiff have since entered into a settlement agreement dated December 1, 2023 (effective as

of October 23, 2023) (as amended April 29, 2024), under which the Company agreed to pay Plaintiffs $ 20,000 and issue them 37,500 shares

On February 6, 2023, SCWorx filed its answer to

the Amended Complaint interposing numerous defenses.

Plaintiff has since entered into a settlement agreement dated December 1, 2023 (effective

as of October 23, 2023) (as amended April 29, 2024), under which the Company agreed to pay Plaintiffs $ 20,000 and issue them 37,500 shares

of common stock, all in full settlement of the claims made in the lawsuit.

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made in July 2024, and the shares were issued in May 2024.

Bernstein, Esq.

As previously disclosed in

the Company’s Form 10-Q for the quarter ended June 30, 2023, on June 7, 2023, Carole R.

Bernstein, Esq.

filed a complaint in the

United States District Court for the Southern District of New York against the Company.

The complaint alleged that the Company breached

its engagement agreement with Ms.

Bernstein by failing to pay legal fees when due.

Bernstein sought to recover $ 69,164 fees owing

for services, plus interest, costs, including her attorney’s fees.

The Company has accrued for this liability which is included

in accounts payable and accrued liabilities on the Company’s consolidated balance sheet at December 31, 2023.

The Company and the

Plaintiff have since entered into a settlement agreement dated July 12, 2024, under which the Company agreed to pay Plaintiffs $ 80,000

in two equal installments of $ 40,000 , the first of which was paid August 9, 2024, and the second of which is payable on or about October

Contract Commitments

On February 5, 2024, the

Company entered into a 120 day agreement with a registered broker in which it agreed to pay a 6 % commission to the broker for any capital

raised from parties introduced by the broker.

Following the expiration of the first 120 days, the Company remains obligated to pay the

commission of all capital or debt proceeds received from parties introduced by the broker during the original term of the agreement for

a period of time.

These obligations currently expire on or around July 17, 2025.

Loan Commitments

On July 15, 2024, the Company issued an aggregate $ 1,155,000 in

senior secured convertible notes.

Under these notes, the Company has pledged all assets of the Company as collateral.

for further details.

Stockholders’ Equity

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The Company has 45,000,000

Common shares and 900,000 Series A convertible preferred shares authorized with a par value of $ 0.001 per share.

On October 6, 2023, following stockholder approval at the Company’s annual meeting, the Company amended its certificate of incorporation to implement a 1 for 15 reverse split of its common stock.

The effect of the reverse stock split was to combine every 15 shares of outstanding common stock into one share of common stock.

Common shares authorized and 5,000,000 preferred shares, of which 900,000 have been designated Series A convertible preferred shares and

have been authorized with a par value of $ 0.001 per share.

On October 6, 2023, following

stockholder approval at the Company’s annual meeting, the Company amended its certificate of incorporation to implement a 1 for

15 reverse split of its common stock.

The effect of the reverse stock split was to combine every 15 shares of outstanding common stock

into one share of common stock.

The reverse stock split was effective at the opening of the trading day on October 11, 2023.

The effects of the reverse stock split have been reflected in this Annual report on form 10/K for all periods presented.

effects of the reverse stock split have been reflected in this Annual report on form 10/K for all periods presented.

Issuance of Shares for Vested Restricted Stock

Between January 10, 2023 and

January 26, 2023, the Company issued a total of 756 shares of common stock to holders of fully vested restricted stock units.

Between June 5, 2023 and June

16, 2023, the Company issued a total of 14,445 shares of common stock to holders of fully vested restricted stock units.

Between July 5, 2023 and July

19, 2023, the Company issued a total of 956 shares of common stock to holders of fully vested restricted stock units.

On November 23, 2023, the

Company issued a total of 778 shares of common stock to holders of fully vested restricted stock units.

March 27, 2024, the Company

issued 1,667 shares of common stock to a holder of fully vested restricted stock units.

Issuance of Shares as Settlement of Accounts

May 24, 2023, the Company issued 6,807 shares of common stock in full settlement of $ 26,545 of accounts payable.

had a fair value of $ 3.90 per share.

June 22, 2023, the Company issued 3,264 shares of common stock in full settlement of $ 17,621 of accounts payable.

had a fair value of $ 5.40 per share.

July 26, 2023, the Company issued 4,837 shares of common stock in full settlement of $ 16,686 of accounts payable.

had a fair value of $ 3.45 per share.

August 18, 2023, the Company issued 8,734 shares of common stock in full settlement of $ 32,750 of accounts payable.

shares had a fair value of $ 3.75 per share.

September 27, 2023, the Company issued 7,910 shares of common stock in full settlement of $ 22,542 of accounts payable.

The shares had a fair value of $ 2.85 per share.

February 6, 2024 and July 11, 2024, the Company issued an aggregate 130,039 shares of common stock in full settlement of $ 239,815 of

accounts payable.

The shares had fair values ranging from $ 1.20 to $ 2.65 per share.

October 24, 2024, the Company issued 27,600 shares of common stock in full settlement of $ 32,016 of accounts payable.

shares had a fair value of $ 1.16 per share.

December 22, 2023, the Company issued 20,520 shares of common stock in full settlement of $ 35,088 of accounts payable.

The shares had a fair value of $ 1.71 per share

Issuance of Shares under Common Stock Purchase

On June 1, 2023, the Company

issued 200,000 shares of common stock for net proceeds of $ 127,053 under its common stock purchase agreement dated June 28, 2022.

On June 22, 2023, the Company

issued 200,000 shares of common stock for net proceeds of $ 134,634 under its common stock purchase agreement dated June 28, 2022.

On Between July 7, 2023 and

September 28, 2023, the Company issued a total of 94,056 shares of common stock for aggregate net proceeds of $ 311,220 under its common

stock purchase agreement dated June 28, 2022.

Issuance of Shares for the Exercise of Warrants

On June 15, 2023, the Company

issued 15,238 shares of common stock in a cashless exchange for 54,872 warrants to purchase shares of common stock at $ 9.75 per share.

Issuance of Shares for Class Action Settlement

On June 5, 2023, the Company

issued an aggregate 129,458 shares of common stock in full settlement of the previously accrued subscription payable valued at $ 600,000 .

Issuance of Shares for Legal Settlements

On May 30, 2024, the Company

issued 37,500 shares of common stock valued at $ 87,600 or $ 2.34 per share to fulfill its obligation under a previous legal settlement.

Commitments and Contingencies for further information.

On July 15, 2024, the Company

issued 38,052 shares of common stock valued at $ 53,653 or $ 1.41 per share to settle a potential legal claim.

On July 18, 2024, the Company

issued 159,776 shares of common stock valued at $ 218,094 or $ 1.36 per share as partial fulfillment of its obligation under a previous

legal settlement.

Commitments and Contingencies for further information.

Issuance of Shares and Warrants for Stock Purchase

Between November 18, 2024

and November 19, 2024, SCWorx Corp.

entered into a Securities Purchase Agreement (“ SPA ”) with certain accredited investors

(the “ Investors ”), and, pursuant to the SPA, sold to the Investors an aggregate 232,558 shares of its common stock

and warrants to acquire up to an aggregate 232,558 additional shares of the Company’s common stock for gross proceeds of $ 200,000 .

The exercise price of the warrants is $ 0.86 per share, subject to certain adjustments.

Warrants issued in conjunction with loans payable

On July 15, 2024, the Company

issued warrants to purchase an aggregate 4,887,118 shares of the Company’s common stock at exercise prices ranging from $ 1.43 to

$ 1.573 per share in conjunction with a convertible note issuance, see Note 4.

Loans Payable.

The warrants were valued at $ 6,163,572 using

the Black-Scholes pricing model.

The Company has recognized $ 973,200 of this value as a discount to the associated notes.

The Company has classified

the warrants as having Level 2 inputs, and has used the Black-Scholes option-pricing model to value the warrants.

The fair values at the commitment

date for the warrants were based upon the following management assumptions as of the date of issuance:

Risk-free interest rate

Expected dividend yield

Expected volatility

Fair value of common stock

Stock Incentive Plan

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Stock Option Grants

Restricted Stock Units

Number of shares subject to warrants

average exercise price per share

Number of shares subject to options

average exercise price per share

Number of shares subject to restricted stock units

exercise price per

Balance at December 31, 2023

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Stock Option Grants

Restricted Stock Units

Number of shares subject to warrants

average exercise price per share

Number of shares subject to options

average exercise price per share

Number of shares subject to restricted stock units

exercise price per

Balance at December 31, 2022

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The Company’s outstanding

warrants and options at December 31, 2023 are as follows:

warrants at December 31, 2024 are as follows:

Warrants Outstanding Warrants Exercisable

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$0.86– $60.00 8,925,798 4.55 $ 0.92 8,925,798 $ 0.95 $ 7,400,859

Options Outstanding Options Exercisable

Exercise Price Range Number Outstanding Weighted Average Remaining Contractual Life

(in years) Weighted

Average Exercise Price Number Exercisable Weighted Average Exercise Price Intrinsic Value

$39.60 3,333 0.91 $ 39.60 3,333 $ 39.60 -

As of December 31, 2023 and

2022, the total unrecognized expense for unvested stock options and restricted stock awards was none and approximately $ 220,000 , respectively,

to be recognized over a one to three-year period for restricted stock awards and one year for option grants from the date of grant.

of December 31, 2024 and 2023, there was no unrecognized expense for unvested stock options and restricted stock awards.

Stock-based compensation expense

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For the years ended

Stock compensation is included

in general and administrative expenses on the consolidated statements of operations.

compensation is included on the consolidated statements of operations.

Net Loss Per Share

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As of December 31, 2024 and 2023, the Company had state loss carry-forwards of approximately $ 19.3 million

and $ 17.1 , respectively.

and $ 18.2 million, respectively.

Future utilization of net operating losses may be limited due to potential ownership changes under Section

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By statute, all tax years are open to examination by the major taxing jurisdictions to which the Company

Segment Reporting

As noted above, the Company

is a provider of data content and services related to the repair, normalization and interoperability of information for healthcare providers

and big data analytics for the healthcare industry.

The Company has determined

that it currently operates in a single segment - health information technology solutions and services, located in a single geographic

location – the United States.

The accounting policies of the segment are the same as those described in the summary of significant

accounting policies.

Since the Company operates in a single segment, the measure of segment total assets and loss from operations is the

same as that reported on the accompanying consolidated balance sheets as total assets, and the accompanying consolidated statements of

operations as loss from operations, respectively.

The Company’s Chief

Executive Officer is the Chief Operating Decision Maker (“CODM”).

The CODM manages the Company’s business activities

as a single operating and reportable segment.

The CODM uses consolidated profit and loss to evaluate and measure performance against

progress in its commercialization efforts and clinical trials.

The following table sets forth significant segment expenses.

Year Ended December 31,

Accounts receivable, net

Prepaid expenses and other assets

Service revenue:

Operating expenses:

Legal and professional

Salaries and wages

Stock compensation

Other general and administrative

Total operating expense

Other income (expense)

Interest expense

Forgiveness of accounts payable

Impairment of goodwill

( 2,524,034 )

Total other income (expense)

$ ( 2,530,482 )

$ ( 1,136,225 )

$ ( 3,981,144 )

Subsequent Events

The Company has evaluated

all events that occurred after the balance sheet date through the date when our financial statements were issued to determine if they

must be reported.

Management has determined that except as disclosed below, there were no additional reportable subsequent events to be

all events that occurred after the consolidated balance sheet date through the date when the consolidated financial statements were issued

to determine if they must be reported.

Management has determined that except as disclosed below, there were no additional reportable subsequent

events to be disclosed.

Financing Transaction

On April 12, 2024, the Company

issued a secured promissory note in the face amount of $ 330,000 , in exchange for which it received cash in the amount of $ 300,000 .

addition to the original issue discount of $ 30,000 , the note bears interest at the rate of 5 % per annum, was originally due May 10, 2024

and was secured by all the Company assets.

On July 16, 2024, the Company

On January 18, 2025, the Company

closed a Securities Purchase Agreement (the “SPA”) with certain accredited investors.

Under the SPA, the Company sold a series

of senior secured convertible notes with an aggregate principal amount of $ 1,155,000 , including the exchange of the April 12, 2024 secured

promissory note, that had an initial conversion price of $ 1.43 per share, subject to certain adjustments and maturity date of December

The Company also issued five year warrants to acquire up to an aggregate 4,846,158 additional shares of the Company’s

common stock with exercise prices ranging from $ 1.43 to $ 1.573 per share.

Issuance of Shares for Vested Restricted Stock

On March 27, 2024, the Company

issued 1,667 shares of common stock to a holder of fully vested restricted stock units.

Issuance of Shares as Settlement of Accounts

February 6, 2024 and July 11, 2024, the Company issued an aggregate 130,039 shares of common stock in full settlement of $ 239,809 of

accounts payable.

The shares had a fair value ranging from $ 1.50 to $ 2.65 per share.

of senior secured convertible notes with an aggregate principal amount of $ 1,500,000 , that had an initial conversion price of $ 1.25 per

share, subject to certain adjustments and maturity date of December 31, 2025.

The Company also issued five year warrants to acquire up

to an aggregate 7,256,364 additional shares of the Company’s common stock with exercise prices ranging from $ 1.25 to $ 1.375 per

Issuance of Shares

for note conversions

February 3, 2025 and February 27, 2025, the company issued an aggregate 54,980 shares of common stock for the conversion of $ 47,283 in

principal and accrued interest on its convertible loans.

Issuance of Shares as settlement of other obligations

On May 30, 2024, the Company

issued 37,500 shares owed as part a prior legal settlement.

On July 15, 2024, the Company

issued 38,052 shares of common stock in full settlement of threatened litigation.

The shares were valued at $ 1.41 per share.

On July 18, 2024, the Company

issued 159,776 shares of common stock as part of a stock settlement agreement for payment of its obligation under its judgement from Core

On March 14, 2025, the Company

issued 191,250 shares of common stock valued at $ 148,410 as part of a stock settlement agreement for payment of its obligation under its

judgement from Core IR.

EXHIBIT INDEX

Pursuant to the rules and

regulations of the SEC, the Company has filed certain agreements as exhibits to this Annual Report on Form 10-K.

These agreements may

contain representations and warranties by the parties.

These representations and warranties have been made solely for the benefit of the

other party or parties to such agreements and (i) may have been qualified by disclosures made to such other party or parties, (ii) were

made only as of the date of such agreements or such other date(s) as may be specified in such agreements and are subject to more recent

developments, which may not be fully reflected in the Company’s public disclosure, (iii) may reflect the allocation of risk among

the parties to such agreements and (iv) may apply materiality standards different from what may be viewed as material to investors.

these representations and warranties may not describe the Company’s actual state of affairs at the date hereof and should not be

Pursuant to the rules and regulations

of the SEC, the Company has filed certain agreements as exhibits to this Annual Report on Form 10-K.

These agreements may contain representations

and warranties by the parties.

These representations and warranties have been made solely for the benefit of the other party or parties

to such agreements and (i) may have been qualified by disclosures made to such other party or parties, (ii) were made only as of the date

of such agreements or such other date(s) as may be specified in such agreements and are subject to more recent developments, which may

not be fully reflected in the Company’s public disclosure, (iii) may reflect the allocation of risk among the parties to such agreements

and (iv) may apply materiality standards different from what may be viewed as material to investors.

Accordingly, these representations

and warranties may not describe the Company’s actual state of affairs at the date hereof and should not be relied upon.

Exhibit Description

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333-213166) filed with the SEC on August 16, 2016)

Form of Series A, Series B and Series C Warrant (incorporated by reference to Exhibit 4.1 to the Company’s 8-K filed with the SEC on July 15, 2024)

Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Company’s 8-K filed with the SEC on July 15, 2024)

Form of Senior Secured Convertible Note (incorporated by reference to Exhibit 10.2 to the Company’s 8-K filed with the SEC on July 15, 2024)

Form of Registration Rights Agreement (incorporated by reference to Exhibit 10.3 to the Company’s 8-K filed with the SEC on July 15, 2024)

Form of Guaranty and Security Agreement (incorporated by reference to Exhibit 10.4 to the Company’s 8-K filed with the SEC on July 15, 2024)

Form of Series A, Series B and Series C Warrant (incorporated by reference to Exhibit 4.1 to the Company’s 8-K filed with the SEC on January 23, 2025)

Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Company’s 8-K filed with the SEC on January 23, 2025)

Form of Senior Secured Convertible Note (incorporated by reference to Exhibit 10.2 to the Company’s 8-K filed with the SEC on January 23, 2025)

Amendment and Consent, Dated November 18, 2024 (incorporated by reference to Exhibit 10.5 to the Company’s 8-K filed with the SEC January 23, 2025)

Form of Guaranty and Security Agreement (incorporated by reference to Exhibit 10.4 to the Company’s 8-K filed with the SEC on January 23, 2025)

Settlement Agreement with CorProminence LLC, d/b/a Core IR (incorporated by reference to Exhibit 10.8 to the Company’s 8-K filed with the SEC on July 15, 2024)

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Section 1350 Certification of the Chief Financial Officer*

Clawback Policy of SCWorx Corp.*

Inline XBRL Instance Document.

5 unchanged sentences

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

Filed herewith

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures