SCWorx Reaches Agreement in Principle with SEC Staff to Resolve Previously Disclosed SEC Matter
April 14 2022 - 1:21PM
SCWorx Corp (Nasdaq: WORX) today announced that the Company
has reached an agreement in principle, subject to approval by
the Securities and Exchange Commission (“SEC”), to resolve the SEC
matter arising out of the Company’s April 13, 2020 press release
and the events thereafter (first disclosed in the Company’s March
31, 2020 10-Q).
As disclosed in the SCWorx 10-K filed on March
31, 2022, the Company received a Wells Notice from the Staff of the
SEC on December 8, 2021 (and an amended Wells Notice on December
10), in which the Staff made a preliminary determination to
recommend that the SEC file an enforcement action against the
Company and seek, among other things, an injunction, fines and
disgorgement. Subject to approval by the SEC, the Company and
the SEC Staff have agreed to resolve the matter through the
Company’s payment of a civil monetary penalty of $125,000, payable
in 4 equal installments over 12 months.
In addition to final approval by the SEC, the
settlement is subject to the negotiation and court approval of a
consent judgment. The Company is hopeful that the agreement will be
approved by the SEC, however, there is a possibility that the
SEC Staff’s recommendation of this agreement may not be approved by
the Commission or that the court may not approve the consent
judgment. In the event the SEC does not approve the Staff’s
recommendation, the Company will endeavor to resume
settlement discussions with the SEC Staff. Upon final
approval and subsequent entry of a consent judgment against the
Company, the settlement will resolve the previously disclosed
SEC investigation against the Company.
“Since I accepted the CEO role on June 1, 2021
it has been a top priority to resolve legal issues stemming from
the April 13, 2020 press release. It is in the best interest of the
Company and its shareholders and customers that all of our focus
and funds be on our future growth and not prior legal issues or
legal costs. In addition to adding a new CFO and three new
Board members, the additional steps we have taken to improve
governance should further strengthen our organization and internal
controls. The SCWorx Officers and Directors look forward to
putting this issue behind us and dedicating our full efforts
towards growing our data management services for healthcare
providers,” said Tim Hannibal, SCWorx Chief Executive Officer.
Hannibal added, “The Company fully cooperated with the SEC's
investigation and believes the settlement is in the best interest
of the Company. SCWorx takes its regulatory obligations
seriously, and the integrity of the Company, its management and
Board of Directors is of paramount importance. SCWorx
provides critical and high quality data and software solutions to
hospitals and it is very important that these issues from 2020 are
put behind us, as they do not in any way reflect on the quality of
our product, integrity of our company or the hard work of our
employees.”
About SCWorx Corp.
SCWorx has created an advanced attributed
virtualized item data warehouse utilizing machine learning and
artificial intelligence to offer a suite of
software-as-a-service-based solutions for healthcare providers. The
value proposition for customers revolves around the full
integration of all solution modules with the company’s data
platform for cost savings, operational efficiency and accurate
benchmarking and reporting. The solution modules include Virtual
Item Master, data cleanse and normalization, contract management
and request for pricing (RFP) module, automated rebate management
module, data interoperability (EMR, MMIS, finance) module,
Automated Item Add Portal, Virtual General Ledger, and the data
analytics module. SCWorx creates a single source for information
for the healthcare provider’s data governance and analytics
requirements.
Forward-Looking Statements
This press release contains “forward-looking
statements” that involve substantial risks and uncertainties for
purposes of the safe harbor provided by the Private Securities
Litigation Reform Act of 1995. All statements, other than
statements of historical facts, included in this press release
regarding strategy, future operations, future contract renewals and
terminations, future financial position, prospects, plans and
objectives of management are forward-looking statements. You can
identify many (but not all) such forward-looking statements by
looking for words such as “assumes,” “approximates,” “believes,”
“expects,” “anticipates,” “estimates,” “projects,” “seeks,”
“intends,” “plans,” “could,” “would,” “may” or other similar
expressions. You should not place undue reliance on these
forward-looking statements. Such statements are based on
management’s current expectations and involve risks and
uncertainties. Actual results and performance could differ
materially from those projected in the forward-looking statements
as a result of many factors, including, without limitation,
economic disruptions affecting our customers, unexpected contract
terminations, securing future contracts and orders, future product
sourcing, supply disruptions, containing costs, the ability to
project future cash utilization and reserves needed for contingent
future liabilities and business operations, the availability of
sufficient resources of the company to meet its business objectives
and operational requirements and other important factors that are
detailed in filings with the Securities and Exchange Commission
made from time to time by SCWorx, including its Annual Report on
Form 10-K for the year ended December 31, 2020, Quarterly Reports
on Form 10-Q, and Current Reports on Form 8-K. Matters described in
forward-looking statements may also be affected by other known and
unknown risks, trends, uncertainties and factors, many of which are
beyond the company’s ability to control or predict. SCWorx
undertakes no obligation to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated
events.
Contacts: ir@scworx.com
Source: SCWorx Corp.
Released April 14, 2022
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