Quarterly report pursuant to Section 13 or 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
9 Months Ended
Sep. 30, 2016
Sep. 30, 2015
Net income (loss) attributable to Marathon Patent Group, Inc. Common Shareholders $ (2,261,542) $ (13,034,736)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:    
Depreciation 3,780 5,668
Amortization of patents and website 6,018,196 8,511,730
Allowance for doubtful accounts 12,226  
Deferred tax asset 531,757 (5,579,418)
Deferred tax liability (638,268) (709,280)
Impairment of intangible assets 6,525,273 766,498
Impairment of goodwill 83,000 0
Stock based compensation 1,541,615 1,961,505
Stock issued for services 136,000 1,084,834
Loss on debt extinguishment   654,000
Non-cash interest, discount, and financing costs 952,231 1,926,865
Change in fair value of Clouding earnout (2,122,198) (2,901,348)
Non-controlling interest (27,918)  
Other non-cash adjustments 96,996 (13,244)
Changes in operating assets and liabilities    
Accounts receivable 43,763 (2,109,984)
Prepaid expenses and other assets (6,652) 60,938
Bonds posted with courts 883,695  
Accounts payable and accrued expenses (557,832) 6,454,467
Net cash provided by (used in) operating activities 11,214,122 (2,921,505)
Cash flows from investing activities:    
Acquisition of patents (3,552,656)  
Purchase of property, equipment, and other intangible assets (8,387) (22,520)
Net cash provided by (used in) investing activities (3,561,043) (22,520)
Cash flows from financing activities:    
Payment on MdR Escrow TLI   (50,000)
Cash received upon issuance of notes payable (net of issuance costs)   19,600,000
Repayment of notes payable (5,379,105)  
Cash received upon exercise of warrants   18,751
Repayment of convertible notes payable   (5,050,000)
Payment on note payable (578,804) (42,500)
Net cash provided (used in) by financing activities (8,911,688) 1,266,251
Effect of exchange rate changes on cash (1,592) 4,044
Net decrease in cash (1,260,201) (1,673,730)
Cash at beginning of period 2,555,151 5,082,569
Cash at end of period 1,294,950 3,408,839
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:    
Cash paid for: Interest expense 1,391,567 1,660,372
Cash paid for: Taxes paid 36,218 54,437
Cash paid for: Loan fees   400,000
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:    
Common stock issued in conjunction with note payable   1,000,000
Warrant issued in conjunction with note payable   318,679
Revenue share liability incurred in conjunction with note payable   1,000,000
Note payable issuance in conjunction with the acquisition of GE patent 1,000,000  
Non-cash interest increase in debt assumed in the Orthophoenix acquisition   750,000
Common stock issued in conjunction with debt extinguishment   654,000
Note payable issuance in conjunction with the acquisition of BATO patent   10,000,000
Note payable issuance in conjunction with the acquisition of Siemens patents 1,755,635  
Note payable issuance in conjunction with the acquisition of 3Dnano License 200,000  
Conversion from AP to NP   705,093
Medtech And Orthophoenix    
Cash flows from financing activities:    
Repayment of notes payable $ (2,953,779) (4,200,000)
Orthophoenix, LLC    
Cash flows from financing activities:    
Repayment of notes payable   (5,000,000)
Sarif    
Cash flows from financing activities:    
Repayment of notes payable   (276,250)
IP Liquidity    
Cash flows from financing activities:    
Repayment of notes payable   (1,109,375)
Dynamic Advances    
Cash flows from financing activities:    
Repayment of notes payable   $ (2,624,375)