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EX-32.1 - EXHIBIT 32.1 - CardioGenics Holdings Inc.ex32-1.htm
EX-31.2 - EXHIBIT 31.2 - CardioGenics Holdings Inc.ex31-2.htm

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the quarterly period ended July 31, 2014.

 

[  ] Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the transition period from _______ to _______.

 

Commission file number 000-28761

 

CARDIOGENICS HOLDINGS INC.

(Exact name of registrant as specified in its Charter)

 

Nevada   88-0380546
(State or other jurisdiction of
incorporation or organization)
 

(I.R.S. Employer

Identification No.)

 

6295 Northa Drive, Unit 8

Mississauga, Ontario L4V 1WB

(Address of Principal Executive Offices)

 

(905) 673-8501

(Registrant’s Telephone Number, Including Area Code)

 

Indicate by check mark whether the Issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

 

Yes [X] No [  ]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer and “smaller reporting company” in Rule 12b-2 or the Exchange Act. (Check one):

 

Large Accelerated filer [  ] Accelerated Filer [  ]
       
Non-Accelerated Filer [  ] Smaller Reporting Company [X]
(Do not check if a smaller reporting company)    

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

Yes [  ] No [X]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

 

Yes [X] No [  ]

 

As of September 19, 2014 the Registrant had the following number of shares of its capital stock outstanding: 42,119,729 shares of Common Stock and 1 share of Series 1 Preferred Voting Stock, par value $0.0001, representing 13 exchangeable shares of the Registrant’s subsidiary, CardioGenics ExchangeCo Inc., which are exchangeable into 24,176,927 shares of the Registrant’s Common Stock.

 

 

 

 
 

 

CARDIOGENICS HOLDINGS INC.

 

FORM 10-Q

 

For the Quarter Ended July 31, 2014

 

INDEX

 

  Page
   

Part I. Financial Information

   

Item 1: Financial Statements (Unaudited)

F-1
   
Condensed Consolidated Balance Sheets as of July 31, 2014 (Unaudited) and October 31, 2013 F-1
 
Condensed Consolidated Statements of Operations (Unaudited) for the Three and Nine Months Ended July 31, 2014 and 2013 F-2
   
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) for the Three and Nine Months Ended July 31, 2014 and 2013 F-3
   
Condensed Consolidated Statement of Changes in Deficiency (Unaudited) for the Nine Months Ended July 31, 2014 F-4
   

Condensed Consolidated Statements of Cash Flows (Unaudited) for the Nine Months Ended July 31, 2014 and 2013

F-5
   
Notes to Condensed Consolidated Financial Statements (Unaudited) F-6
   
Item 2: Management’s Discussion and Analysis of Financial Conditions and Results of Operations 3
   
Item 3: Quantitative and Qualitative Disclosures About Market Risk 7
   
Item 4: Controls and Procedures 7
   

Part II. Other Information

 

 

 

Item 1: Legal Proceedings

8

 

 

Item 1A: Risk Factors

8

 

 

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds

8

 

 

Item 3: Defaults Upon Senior Securities

8

 

 

Item 4: Mine Safety Disclosures

8

 

 

Item 5: Other Information

8

 

 

Item 6: Exhibits

9
   

Signatures

10

 

2
 

 

 

PART I. FINANCIAL INFORMATION

 

Item 1. Financial Statements (Unaudited)

 

CardioGenics Holdings Inc.

Condensed Consolidated Balance Sheets

 

   July 31, 2014   October 31, 2013 
   (Unaudited)   (Note 2) 
Assets          
           
Current Assets          
Cash and Cash Equivalents  $14,357   $263,103 
Accounts Receivable   236    246 
Deposits and Prepaid Expenses   47,173    49,267 
Refundable Taxes Receivable   3,882    3,302 
Government Grants and Investment Tax Credits Receivable   71,322    60,104 
    136,970    376,022 
Long-Term Assets          
Property and Equipment, net   45,538    53,496 
Patents, net   113,291    118,432 
    158,829    171,928 
Total Assets  $295,799   $547,950 
           
Liabilities and Deficiency          
           
Current Liabilities          
Accounts Payable and Accrued Expenses  $1,053,695   $1,050,115 
Funds Held in Trust for Redemption of Class B Common Shares   4    4 
Due to Shareholder   22,957     
Notes Payable, net of debt discount   41,206    11,983 
Derivative Liability on Notes Payable   428,675    99,702 
Total current liabilities   1,546,537    1,161,804 
Long-Term Liabilities          
Debentures Payable   477,883    303,190 
Total Liabilities   2,024,420    1,464,994 
           
Commitments and Contingencies          
           
Deficiency          
Preferred stock; par value $.0001 per share, 50,000,000 shares authorized, none issued        
Common stock; par value $.00001 per share; 150,000,000 shares authorized, 36,862,476 and 34,726,668 common shares and 24,176,927 and 24,176,927 exchangeable shares issued and outstanding as at July 31, 2014 and October 31, 2013 respectively   587    565 
           
Additional paid-in capital   44,593,531    44,514,000 
           
Accumulated deficit   (46,271,639)   (44,957,870)
           
Accumulated other comprehensive loss   (51,100)   (117,515)
           
Total deficiency attributable to CardioGenics Holdings Inc.   (1,728,621)   (560,820)
Non-controlling interest       (356,224)
Total deficiency   (1,728,621)   (917,044)
Total liabilities and deficiency  $295,799   $547,950 

 

See notes to condensed consolidated financial statements.

 

F-1
 

 

CardioGenics Holdings Inc.

Condensed Consolidated Statements of Operations (unaudited)

For the Three and Nine Months Ended July 31, 2014 and 2013

 

   For the three months Ended   For the nine months Ended 
   July 31,   July 31, 
   2014   2013   2014   2013 
                 
Revenue  $   $   $   $ 
                     
Operating Expenses                    
Depreciation and Amortization of Property and Equipment   2,740    3,374    8,168    10,341 
Amortization of Patent Application Costs   1,724    1,660    5,140    5,089 
General and Administrative   107,751    138,530    375,796    344,177 
Research and Product Development, Net of Investment Tax Credits   85,241    90,060    275,916    288,546 
Total operating expenses   197,456    233,624    665,020    648,153 
Operating Loss   (197,456)   (233,624)   (665,020)   (648,153)
Other Expenses (Income)                    
Interest Expense and Bank Charges (Net)   142,256    95,897    379,836    132,613 
Loss (Gain) on Change in Fair Value of Derivative Liability   246,430    3,531    247,249    (7,250)
Loss (Gain) on Foreign Exchange Transactions   (20,515)   (15,820)   21,664    (11,897)
Total other expenses income   368,171    83,608    648,749    113,466 
Net Loss   (565,627)   (317,232)   (1,313,769)   (761,619)
Net Loss attributable to non-controlling interest       (1,804)       (4,525)
Net Loss attributable to CardioGenics Holdings Inc.  $(565,627)  $(315,428)  $(1,313,769)  $(757,094)
                     
Basic and Fully Diluted Net Loss per Common Share attributable to CardioGenics Holdings Inc. Shareholders  $(0.01)  $(0.00)  $(0.02)  $(0.01)
                     
Weighted-average shares of Common Stock outstanding   60,938,316    56,676,166    60,260,456    56,676,166 

 

See notes to condensed consolidated financial statements.

 

F-2
 

 

CardioGenics Holdings Inc.

Condensed Consolidated Statements of Comprehensive Loss (unaudited)

For the Three and Nine Months Ended July 31, 2014 and 2013

 

 

   Three Months Ended   Nine Months Ended 
   July 31   July 31 
   2014   2013   2014   2013 
                 
Net loss  $(565,627)  $(317,232)  $(1,313,769)  $(761,619)
Net loss attributable to non-controlling interest       (1,804)       (4,525)
Net loss attributable to Cardiogenics Holdings Inc.   (565,627)   (315,428)   (1,313,769)   (757,094)
                    
Other comprehensive income (loss), currency translation adjustments   (10,262)   20,798    66,415    30,308 
                     
Comprehensive loss  $(575,889)  $(294,630)  $(1,247,354)  $(726,786)

 

See notes to condensed consolidated financial statements.

 

F-3
 

 

CardioGenics Holdings Inc.

Condensed Consolidated Statements of Changes in Deficiency (unaudited)

For The Nine Months Ended July 31, 2014

 

                   Accumulated         
               Other         
           Additional       Comprehensive         
   Common Stock   Paid-in   Accumulated   Income   Noncontrolling   Total 
   Shares    Amount   Capital   Deficit   (Loss)   Interest   Deficiency 
Balance November 1, 2013   58,903,595   $565   $44,514,000   $(44,957,870)  $(117,515)  $(356,224)  $(917,044)
Issuance of common shares on conversion of notes payable January 2014   100,000    1    12,066                   12,067 
Issuance of warrants on settlement of suit January 2014   700,000    7    188,993                   189,000 
Issuance of common shares for cash January 2014 at $0.25   200,000    2    49,998                   50,000 
Issuance of common shares on conversion of shares of subsidiary   296,538    3    (356,227)             356,224    - 
Issuance of common shares on conversion of notes payable February 2014   154,658    2    18,557                   18,559 
Issuance of common shares on conversion of notes payable March 2014   150,000    1    14,894                   14,895 
Issuance of common shares on conversion of notes payable April 2014   160,000    2    12,478                   12,480 
Issuance of common shares for services rendered March 2014   83,333    1    17,916                   17,917 
Issuance of common shares for services rendered April 2014   32,946    0    7,083                   7,083 
Issuance of common shares on conversion of notes payable May 2014   258,333    3    15,497                   15,500 
Settlement of derivative value of notes payable on conversion to common shares             98,276                   98,276 

Net Loss

                  (1,313,769             

(1,313,769

Other Comprehensive Income                                 -
Currency Translation Adjustment                       

66,415

         

66,415

 
Total Comprehensive Income (Loss)                  (1,313,769   66,415         (1,247,354)
Balance July 31 2014   61,039,403   $587   $44,593,531   $(46,271,639  $(51,100  $-   $(1,728,621)

 

See notes to condensed consolidated financial statements.

 

F-4
 

 

CardioGenics Holdings Inc.

Condensed Consolidated Statements of Cash Flows (unaudited)

For the Nine Months Ended July 31, 2014 and 2013

  

   Nine Months Ended 
   July 31 
   2014   2013 
Cash flows from operating activities          
Consolidated Net Loss  $(1,313,769)  $(761,619)
Adjustments to reconcile consolidated net loss to net cash used in operating activities          
Depreciation and Amortization of Property and Equipment   8,168    10,341 
Amortization of Patent Application Costs   5,140    5,089 
Loss (Gain) on Change in Value of Derivative Liability   247,249    (7,250)
Amortization of Discount on Notes Payable   123,521    45,685 
Amortization of Discount on Debentures Payable   186,489    49,532 
Common Stock Issued for Services Rendered   25,000     
Changes in Operating Assets and Liabilities, Net of Acquisition          
Accounts Receivable   10    187 
Deposits and Prepaid Expenses   2,094    1,411 
Refundable Taxes Receivable   (580)   40,419 
Government Grants and Investment Tax Credits Receivable   (11,218)   21,669 
Accounts Payable and Accrued Expenses   186,909    (28,897)
Net cash used in operating activities   (540,987)   (623,433)
           
Cash flows from investing activities          
Purchase of Property and Equipment       (154)
Patent Application Costs       (8,923)
Net cash used in investing activities       (9,077)
           
Cash flows from financing activities
   22,957    (100,000)
Due to Shareholders          
    Proceeds from Notes Payable   180,000    100,000 
    (Repayment) of Capital Lease Obligations       (2,627)
    Issue of Common Shares for Cash   50,000     
    Issue (Redemption) of 10% Senior Convertible Debentures       945,600 
Net cash provided by financing activities   252,957    942,973 
Effect of foreign exchange on cash and cash equivalents  39,284   20,130 
Cash and Cash Equivalents          
Increase (decrease) in cash and cash equivalents  during the period   (248,746)   330,593 
Beginning of Period   263,103    27,009 
End of Period  $14,357   $357,602 

 

See notes to condensed consolidated financial statements.

 

F-5
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

 

1. Nature of Business

 

CardioGenics Inc. (“CardioGenics”) was incorporated on November 20, 1997 in the Province of Ontario, Canada, and carries on the business of development and commercialization of diagnostic test products to the In Vitro Diagnostics testing market. CardioGenics has several test products that are in various stages of development.

 

CardioGenics’ business has a limited history of operations and whose revenues, to date, have been primarily comprised of grant revenue and Scientific Research Tax Credits from government agencies. There can be no assurance that the Company will be successful in obtaining regulatory approval for the marketing of any of the existing or future products that the Company will succeed in developing.

 

On October 27, 2009, the name of the Company was changed from JAG Media Holdings, Inc. to CardioGenics Holdings, Inc.

 

2. Basis of Presentation

 

In the opinion of management, the unaudited condensed interim consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary to present fairly the condensed interim consolidated financial position of CardioGenics Holdings, Inc. and its subsidiaries under generally accepted accounting principles in the United States (“US GAAP”) as of July 31, 2014, their results of operations for the three and nine months ended July 31, 2014 and 2013, changes in deficiency for the nine months ended July 31, 2014 and cash flows for the nine months ended July 31, 2014 and 2013. CardioGenics Holdings, Inc. and its subsidiaries are referred to together herein as the “Company”. Pursuant to rules and regulations of the SEC, certain information and disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted from these consolidated financial statements unless significant changes have taken place since the end of the most recent fiscal year. Accordingly, these condensed interim consolidated financial statements should be read in conjunction with the consolidated financial statements, notes to consolidated financial statements and the other information in the audited consolidated financial statements of the Company as of October 31, 2013 and 2012 (the “Audited Financial Statements”) included in the Company’s Form 10-K that was previously filed with the SEC on February 13, 2014 and from which the October 31, 2013 consolidated balance sheet was derived.

 

The results of the Company’s operations for the nine months ended July 31, 2014 are not necessarily indicative of the results of operations to be expected for the full year ending October 31, 2014.

 

The accompanying condensed interim consolidated financial statements have been prepared using the accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.

 

The Company has incurred operating losses and has experienced negative cash flows from operations since inception. The Company has an accumulated deficit at July 31, 2014 of approximately $46.3 million. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern. The Company has funded its activities to date almost exclusively from debt and equity financings. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

 

F-6
 

  

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

 

The Company will continue to require substantial funds to continue research and development, including preclinical studies and clinical trials of its products, and to commence sales and marketing efforts, if the FDA and other regulatory approvals are obtained. In order to meet its operating cash flow requirements management’s plans include financing activities such as private placements of its common stock and issuances of convertible debt instruments. Management is also actively pursuing industry collaboration activities including product licensing and specific project financing.

 

While the Company believes it will be successful in obtaining the necessary financing to fund its operations, meet revenue projections and manage costs, there are no assurances that such additional funding will be achieved and that it will succeed in its future operations. The accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts of liabilities that might be necessary should the Company be unable to continue in existence.

 

3. Summary of Significant Accounting Policies.

  

Derivative Instruments

 

The Company’s derivative liabilities are related to embedded conversion features of the Notes Payable. For derivative instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in fair value recognized in earnings each reporting period. The Company uses the Black-Scholes model to value the derivative instruments at inception and subsequent valuation dates and the value is re-assessed at the end of each reporting period, in accordance with Accounting Standards Codification (“ASC”) 815. Derivative instrument liabilities are classified in the consolidated balance sheets as current or non-current based on whether or not the net-cash settlement of the derivative instrument could be required within twelve months of the consolidated balance sheet date.

 

Beneficial Conversion Charge

 

The intrinsic value of beneficial conversion features arising from the issuance of convertible debentures with conversion rights that are in-the-money at the commitment date is recorded as debt discount and amortized to interest expense over the term of the debentures. The intrinsic value of a beneficial conversion feature is determined after initially allocating an appropriate portion of the proceeds received from the sale of the debentures to any detachable instruments, such as warrants, included in the sale or exchange based on relative fair values.

 

Recently Issued Accounting Standards

 

Revenue From Contracts With Customers

 

In May 2014, the FASB issued an update to ASC 606, Revenue from Contracts with Customers. This update to ASC 606 provides a five-step process to determine when and how revenue is recognized. The core principle of the guidance is that a Company should recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration to be received in exchange for those goods and services. This update to ASC 606 will also result in enhanced disclosures about revenue, providing guidance for transactions that were not previously addressed comprehensively, and improving guidance for multiple-element arrangements. This update to ASC 606 is effective for the Company beginning in fiscal 2017. The Company is currently evaluating the impact of this update on its consolidated financial statements.

 

F-7
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)
July 31, 2014 and 2013

 

Development Stage Entities: Elimination of Certain Financial Reporting Requirements

 

On June 10, 2014, FASB issued Accounting Standards Update No. 2014-10, Development Stage Entities: Elimination of Certain Financial Reporting Requirements. The update removes the definition of a development stage entity from FASB ASC 915 and eliminates the requirement for development stage entities to present inception-to-date information on the statements of operations, cash flows and stockholders’ equity. The Company already adopted this standard for the period covered by the report herein.

 

Other pronouncements issued by the FASB or other authoritative accounting standards group with future effective dates are either not applicable or not significant to the consolidated financial statements of the Company.

  

4. Income Taxes

 

Based on the Company’s evaluation, management has concluded that there are no significant tax positions requiring recognition in the condensed interim consolidated financial statements.

 

The Company has incurred losses in Canada since inception, which have generated net operating loss carryforwards for income tax purposes. The net operating loss carryforwards arising from Canadian sources as of July 31, 2014, approximated $9,789,000 (2013 - $6,816,000) which will expire from 2015 through 2033. All fiscal years as originally filed have been assessed. Claims relating to research and development credits are open for review for the fiscal years ended October 2013, 2012, 2011, 2010, 2009, 2008 and 2007 and July 2009.

 

As of July 31, 2014, the Company had net operating loss carryforwards from US sources of approximately $41,686,000 (2012 - $40,809,000) available to reduce future Federal taxable income which will expire from 2020 through 2033. Returns for the years 2008 through 2013 are yet to be filed.

 

For the nine months ended July 31, 2014 and 2013, the Company’s effective tax rate differs from the statutory rate principally due to the net operating losses for which no benefit was recorded.

  

5. Due to Shareholder

 

During the year a shareholder/officer advanced $22,957 to the Company. The advance carries no interest and is due on demand.

  

6. Notes Payable

 

On November 19, 2012 the Company entered into an agreement (“Line”) with JMJ Financial (“Lender”) whereby the Company may borrow up to $350,000. The Line is subject to an original issue discount of $50,000. Advances under the Line (“JMJ Notes”) have a maturity date of one year from the date of the advance. If the advance is repaid within three months the advance is interest free. If not repaid within three months, the advance may not be repaid before maturity and carries interest at 5%. The Lender has the right at any time to convert all or part of the outstanding principal and accrued interest (and any other fees) into shares of fully paid and non-assessable shares of common stock of the Company at a price equal to the lesser of $0.23 and 60% of the lowest trade price in the 25 trading days previous to the conversion. Unless agreed in writing by the parties, at no time will the Lender convert any amount owing under the Line into common stock that would result in the Lender owing more than 4.99% of the common stock outstanding. During the nine months the Company drew $75,000 under the Line.

 

F-8
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

  

On May 23, 2014 the Company issued promissory notes (the “LG Notes”) to LG Capital Funding, LLC and Adar Bays, LLC (collectively the “Holders”) in the amount of $52,500 each bearing interest at 8% annually due May 23, 2015. The LG Notes and accrued interest may be converted into shares of the Common Stock of the Company at a 42% discount to the lowest closing bid with a 12 day look back. The LG Notes may be prepaid with the following penalties: (i) if the Notes are prepaid within 60 days of the issue date, then at 130% of the face amount plus any accrued interest; and, (ii) if the LG Notes are prepaid after 60 days after the issue date but less than 181 days after the issue date, then at 140% of the face amount plus any accrued interest. The LG Notes may not be prepaid after the 180th day after issue.

 

A summary of the Notes is as follows:

 

   July 31, 2014   October 31, 2013 
         
Convertible Note Payable, due June 27, 2014  $-   $25,000 
Convertible Note Payable, due September 26, 2014   -    35,000 
Convertible Note Payable, due February 20, 2015   35,000    - 
Convertible Notes Payable, due May 23, 2015   105,000    - 
Convertible Note Payable, due June 23, 2015   40,000    - 
Debt Discount - value attributable to conversion feature attached to notes, net of accumulated amortization of $41,206 and $11,983   (138,794)   (48,017)
Total   41,206    11,983 
Less: Current portion   41,206    11,983 
Total Long-term portion  $-   $- 

 

As described in further detail in Note 7, “Derivative Liabilities”, the Company determines the fair value of the embedded derivatives and records them as a discount to the Notes and as a derivative liability. The discount to the Notes is amortized to Loss (Gain) in Change in Value of Derivative Liability over the life of the Note or until conversion. The amount charged to Loss (Gain) in Change in Value of Derivative Liability for the three and nine months was $246,430 and $247,249 respectively. Upon conversion of the Notes and related interest and original issue discount to Common Stock, any remaining unamortized discount is charged to financing expense. During the three and nine months, Notes in the principal amount of $12,653 and $60,000 respectively plus interest and original issue discount totaling $2,847 and $13,501 respectively were exchanged for 258,333 and 822,991 common shares respectively.

 

7. Derivative Liabilities

 

Convertible notes - embedded conversion features:

 

The JMJ Notes and the LG Notes meet the definition of a hybrid instrument, as defined in Accounting Standard Codification (ASC) 815. The hybrid instrument is comprised of a i) a debt instrument, as the host contract and ii) an option to convert the debentures into common stock of the Company, as an embedded derivative. The embedded derivatives derive their value based on the underlying fair value of the Company’s common stock. The embedded derivatives are not clearly and closely related to the underlying host debt instrument since the economic characteristics and risk associated with these derivatives are based on the common stock fair value.

 

The Company determines the fair value of the embedded derivatives and records them as a discount to the Notes and a derivative liability. The Company has recognized a derivative liability of $428,675 and $99,702 at July 31, 2014 and October 31, 2013, respectively. Accordingly, changes in the fair value of the embedded derivative are immediately recognized in earnings and classified as a gain or loss on the embedded derivative financial instrument in the accompanying statements of operations.

 

F-9
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

 

The Company estimated the fair value of the embedded derivatives in the JMJ Notes using a Black Scholes model with the following assumptions: conversion price $0.06 per share according to the agreements; risk free interest rate of .11%; expected life of .53-.85 year; expected dividend of zero; a volatility factor of 187%-214%, as of July 31, 2014. The Company estimated the fair value of the embedded derivatives in the LG Notes using a Black Scholes model with the following assumptions: conversion price $0.058 per share according to the agreements; risk free interest rate of .11%; expected life of .81 year; expected dividend of zero; a volatility factor of 205%, as of July 31, 2014. The expected lives of the instruments are equal to the contractual term of the conversion option. The expected volatility is based on the historical price volatility of the Company’s common stock. The risk-free interest rate represents the U.S. Treasury constant maturities rate for the expected life of the related conversion option. The dividend yield represents anticipated cash dividends to be paid over the expected life of the conversion option.

 

8. Fair Value Measurements

 

As defined by the ASC, fair value measurements and disclosures establish a hierarchy that prioritizes fair value measurements based on the type of inputs used for the various valuation techniques (market approach, income approach and cost approach). The levels of hierarchy are described below:

 

  Level 1:  Observable inputs such as quoted market prices in active markets for identical assets or liabilities.
     
  Level 2:  Inputs other than quoted market prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly-quoted intervals.
     
  Level 3:  Unobservable inputs that reflect the reporting entity’s own assumptions, as there is little, if any, related market activity.

 

The following table summarizes the financial liabilities measured at fair value on a recurring basis as of July 31, 2014, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

   

   Quoted Prices in          Total Increase (Reduction)
   Active Markets for  Significant Other  Significant    in Fair Value
Balance Sheet  Identical Assets or  Observable Inputs  Unobservable   July 31, 2014 Recorded at
Location  Liabilities (Level 1)  (Level 2)  Inputs (Level 3)   Total  July 31, 2014
Liabilities:                               
Derivative liability – on Notes Payable  $ -    $ -    $428,675   $428,675   $ 247,249  

 

F-10
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

 

The table below sets forth a summary of changes in the fair value of the Company’s Level 3 financial liability, or derivative liabilities related to the senior secured convertible notes and warrants, for the nine months ended July 31, 2014:

 

Balance at beginning of period  $99,702 
Additions to derivative instruments   180,000 
Change in fair value of derivative liabilities   247,249 
Settlements   (98,276)
Balance at end of period  $428,675 

9. Debentures Payable

 

In February 2013, shareholder loans were converted on a dollar-for-dollar basis for Series A Convertible Debenture Units (the “A Units”). Each A Unit includes a debenture having a term of three years, bearing interest at 10%, and a warrant having a term of three years. The debentures are convertible at any time into common shares of the Company’s stock at a price of $0.25 per share. The warrants entitle the holder to purchase 2 times the number of common shares of the Company’s stock allowed in conjunction with the debentures at any time up to three years.

 

A summary of the Debentures is as follows:

 

   July 31, 2014   October 31, 2013 
         
Series A Convertible Debentures Payable, interest at 10% per annum to maturity at February 27, 2016  $283,355   $288,584 
Series B Convertible Debentures Payable, interest at 10% per annum to maturity at May 31, 2016   500,000    500,000 
Series B Convertible Debentures Payable, interest at 10% per annum to maturity at June 3, 2016   142,086    148,653 
Debt Discount - value attributable to conversion feature attached to notes   (447,558)   (634,047)
Total   477,883    303,190 
Less: Current portion   -    - 
Total Long-term portion  $477,883   $303,190 

 

Debt discount is amortized to interest expense over the life of the debentures. The amount amortized to interest expense for the period was $186,489.

 

On May 15, 2014, the Company received a notice of default (the “Default Notice”) from the debenture holder under Convertible Debenture No. SBCD-01, dated May 31, 2013 in the original principal amount of $500,000 (the “Debenture”), for failure to make the required interest payments under the Debenture.

 

On June 1, 2014, the Debenture holder and the Company entered into a Standstill and Debt Conversion Agreement (the “Standstill Agreement”) pursuant to which the Debenture holder agreed to (i) refrain from exercising or enforcing any right or remedy against the Company in connection with the Debenture and the Default Notice during a “Standstill Period,” which expired on July 31, 2014 and (ii) convert $350,000 in principal of the Debenture into common stock of the Company at a conversion price equal to the “per share price” of an offering of the Company’s common stock involving Polish investors that was pending at the time, if and when such offering closed (the “Polish Offering”). In consideration for the Debenture holder’s forbearance and conversion obligations, the Company agreed to (i) pay the Debenture holder $150,000 in principal under the Debenture, and accrued interest as of the payment date, from the proceeds of the Polish Offering, if and when the Polish Offering closed. As the Polish Offering was terminated by the Company’s investment bankers prior to July 31, 2014, the Standstill Agreement expired by its terms on July 31, 2014.

 

On September 16, 2014, the Debenture holder and the Company agreed upon a final settlement, pursuant to which the Debenture holder would convert all accrued and unpaid interest, as well as all unpaid principal under the Debenture, into 5,507,979 shares of the Company’s common stock.

 

10. Stock Based Compensation

 

Stock-based employee compensation related to stock options for the nine months ended July 31, 2014 and 2013 amounted to $-0-.

 

The following is a summary of the common stock options outstanding, granted, forfeited or expired and exercised under the Plan:

 

        Weighted 
        Average 
        Exercise 
    Options   Price 
          
Outstanding – October 31, 2012    30,000   $0.90 
Granted         
Forfeited/Expired         
Exercised         
Outstanding – October 31, 2013    30,000   $0.90 
Granted         
Forfeited/Expired         
Exercised         
Outstanding – July 31, 2014    30,000   $0.90 

 

Options typically vest immediately at the date of grant. As such, the Company does not have any unvested options or unrecognized compensation expense at July 31, 2014.

 

F-11
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

 

11. Warrants

 

Outstanding warrants are as follows:

 

   July 31, 2014   October 31, 2013 
         
Issued to Flow Capital Advisors Inc. on settlement of lawsuit in August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.30 per common share up to and including August 23, 2016   250,000    250,000 
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.50 per common share up to and including August 23, 2016   250,000    250,000 
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.75 per common share up to and including August 23, 2016   500,000    500,000 
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $1.00 per common share up to and including August 23, 2016   500,000    500,000 
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.75 per common share up to and including August 23, 2016   500,000    500,000 
Issued to debenture holders February 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.25 per common share up to and including February 27, 2016   600,000    600,000 
Issued to debenture holders May 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including June 3, 2016   750,000    750,000 
Issued to debenture holders June 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including June 3, 2016   232,500    232,500 
Issued to consultants on August 5, 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including August 4, 2023   2,500,000    2,500,000 
Issued to consultants on August 5, 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.10 per common share up to and including August 4, 2023   1,500,000    1,500,000 
Issued to consultant on September 3, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.50 per common share up to and including July 31, 2018   500,000    500,000 
Issued to shareholder on October 29, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including October 29, 2016   250,000    250,000 
Issued to shareholder on November 7, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including November 7, 2016   125,000    - 
Total Warrants outstanding   8,457,500    8,332,500 

 

F-12
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

   

12. Issuance of Common Stock

 

During the nine months ended July 31, 2014, the Company issued the following common shares:

 

Issued for services rendered   116,279 
Issued to shareholder for cash at $0.25 per share   200,000 
Issued on conversion of notes payable   822,991 
Issued on settlement of suit   700,000 
Issued to minority shareholders on conversion of subsidiary’s shares   296,538 
    2,135,808 

 

13. Net Loss per Share

 

The following table sets forth the computation of weighted-average shares outstanding for calculating basic and diluted earnings per share (EPS):

 

   Three Months Ended
July 31,
   Nine Months Ended
July 31,
 
   2014   2013   2014   2013 
                     
Weighted-average shares - basic   60,938,316    56,676,166    60,260,456    56,676,166 
Effect of dilutive securities                
Weighted-average shares - diluted   60,938,316    56,676,166    60,260,456    56,676,166 

 

Basic earnings per share “EPS” and diluted EPS for the three and nine months ended July 31, 2014 and 2013 have been computed by dividing the net loss available to common stockholders for each respective period by the weighted average shares outstanding during that period. All outstanding options, warrants and shares to be issued upon the exercise of the outstanding options and warrants and conversion of debt representing 15,367,845 and 8,532,918 incremental shares, respectively, have been excluded from the three and nine months ended July 31, 2014 and 2013 computation of diluted EPS as they are antidilutive given the net losses generated.

 

F-13
 

 

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

July 31, 2014 and 2013

 

14. Supplemental Disclosure of Cash Flow Information
   
   For the Nine Months Ended 
   July 31 
   2014   2013 
         
Cash paid during the year for:          
Interest  $12,352   $26,085 
Income taxes  $   $ 
Non-cash financing activities          
Conversion of notes payable  $73,501   $ 
Settlement of derivative liability  $98,276   $ 
Issuance of shares on settlement of suit  $189,000   $ 
   
15. Commitments and Contingent Liabilities
   
  Lawsuit
   

On April 22, 2009, the Company was served with a statement of claim from a former employee claiming compensation for wrongful dismissal and ancillary causes of action including payment of monies in realization of his investment in the Company, with an aggregate claim of $514,000. On January 3, 2014 the suit was settled for cash consideration of $10,000 plus 700,000 common shares.

 

16. Subsequent Events

 

  a. In August 2014, $15,000 in principal amount of JMJ notes payable were converted to 250,000 common shares of the Company.
     
  b. In September 2014, an officer of the Company advanced $9,183 to the Company.
     
  c. On September 17, 2014, Convertible Debenture No. SBCD-01 dated May 31, 2013 in the Original Principal Amount of $500,000 and all accrued interest ($50,797.87), representing all amounts owing to the Debenture holder, were converted into 5,507,253 Common Shares of the Company stock.

 

F-14
 

  

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

You should read this Management’s Discussion and Analysis (“MD&A”) in combination with the accompanying unaudited condensed interim consolidated financial statements and related notes as well as the audited consolidated financial statements and the accompanying notes to the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) included within the Company’s Annual Report on Form 10-K filed on February 13, 2014.

 

Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed interim consolidated financial statements, which have been prepared in accordance with U.S. GAAP for interim financial statements filed with the Securities and Exchange Commission.

 

Critical Accounting Policies and Estimates

 

The preparation of these unaudited condensed interim consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to accounts receivable, derivative liability, stock-based compensation, income taxes and contingencies. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

 

The accounting policies and estimates used as of October 31, 2013, as outlined in our previously filed Form 10-K, have been applied consistently for the nine months ended July 31, 2014.

 

Related Party Transactions

 

An officer/shareholder loaned the company $22,957 in the third quarter of 2014.

 

Off-Balance Sheet arrangements

 

We are not party to any off-balance sheet arrangements.

 

Results of operations

 

Nine months ended July 31, 2014 as compared to nine months ended July 31, 2013

 

   Nine Months     
   Ended July 31,     
   2014   2013   $ Change 
             
Revenue  $   $   $ 
                
Operating expenses:               
Depreciation and amortization of property and equipment   8,168    10,341    (2,173)
Amortization of patent application costs   5,140    5,089    51 
General and administrative expenses   375,796    344,177    31,619 
Research and product development, net of investment tax credits   275,916    288,546    (12,630)
Total operating expenses   665,020    648,153    16,867 
Operating Loss   (665,020)   (648,153)   16,867 
                
Other expenses (income)               
Interest expense and bank charges, net   379,836    132,613    247,223 
Loss (gain) on change in value of derivative liability   247,249    (7,250)   254,499 
Loss (gain) on foreign exchange transactions   21,664    (11,897)   33,561 
                
Net loss  $(1,313,769)  $(761,619)  $(552,150)

 

3
 

 

Revenues

 

During the nine months ended July 31, 2014 and 2013 we generated no revenues.

 

Operating expenses

 

Operating expenses include the costs to a) develop and patent a method for controlling the delivery of compounds to a chemical reaction; b) develop the QL Care Analyzer, a small, automated, robust and proprietary point of care testing device; and, c) custom paramagnetic beads through our proprietary method which improves their light collection. In addition, the Company is in the process of adapting test products for the Point Of Care (“POC”) disposable, single-use cartridge-format. Detailed manufacturing specifications and costing have been created and custom manufacturers have been sourced.

 

General and administrative expenses

 

General and administrative expenses consist primarily of compensation to officers, occupancy costs, professional fees, listing costs and other office expenses. The increase in general and administrative expenses is attributable primarily to an increase in consulting fees.

 

Research and product development, net of investment tax credits

 

Research and development expenses consist primarily of salaries and wages paid to officers and employees engaged in those activities and supplies consumed therefor. Research and development expenses in 2014 are less than for the same period last year due to reductions in staff in the current period.

 

Loss on change in value of derivative liability

 

The value of the derivative liability has increased due to the assumption of liabilities with derivatives attached, which increase has resulted in an increase in the loss on change in derivative liability.

 

Interest expense and bank charges

 

Interest expense consists primarily of interest on debentures and debt discount amortization on those debentures. The majority of the debentures were issued in the third quarter of 2013 so that the interest and discount in the 2014 period was substantially higher than that in 2013.

 

Three months ended July 31, 2014 as compared to three months ended July 31, 2013

 

   Three Months     
   Ended July 31,     
   2014   2013   $ Change 
             
Revenue  $   $   $ 
                
Operating expenses:               
Depreciation of property and equipment   2,740    3,374    (634)
Amortization of patent application costs   1,724    1,660    64 
General and administrative expenses   107,751    138,530    (30,779)
Research and product development, net of investment tax credits   85,241    90,060    (4,819)
Total operating expenses   197,456    233,624    (36,168)
Operating Loss   (197,456)   (233,624)   (36,168)
Other expenses (income)               
Interest expense and bank charges, net   142,256    95,897    46,359
Loss (gain) on change in value of derivative liability   246,430    3,531    242,899 
Loss (gain) on foreign exchange transactions   (20,515)   (15,820)   (4,695)
                
Net loss  $(565,627)  $(317,232)  $(248,395)

 

4
 

 

Revenues

 

During the three months ended July 31, 2014 and 2013 we generated no revenues.

 

Operating expenses

 

Operating expenses include the costs to a) develop and patent a method for controlling the delivery of compounds to a chemical reaction; b) develop the QL Care Analyzer, a small, automated, robust and proprietary point of care testing device; and, c) custom paramagnetic beads through our proprietary method which improves their light collection. In addition, the Company is in the process of adapting test products for the POC disposable, single-use cartridge-format. Detailed manufacturing specifications and costing have been created and custom manufacturers have been sourced.

 

General and administrative expenses

 

General and administrative expenses consist primarily of compensation to officers, occupancy costs, professional fees, listing costs and other office expenses. The decrease in general and administrative expenses is attributable primarily to a decrease in consulting fees.

 

Research and product development, net of investment tax credits

 

Research and development expenses consist primarily of salaries and wages paid to officers and employees engaged in those activities and supplies consumed therefor. Research and development expenses in 2014 are less than for the same period in 2013 due to a reduction in staff in the current period.

 

Interest expense and bank charges

 

Interest expense consists primarily of interest on debentures and debt discount amortization on those debentures. The majority of the debentures were issued in the third quarter of 2013 so that the interest and discount in the 2014 period was substantially higher than that in 2013.

 

Loss on change in value of derivative liability

 

The value of the derivative liability has increased due to the assumption of liabilities with derivatives attached, which increase has resulted in an increase in the loss on change in derivative liability.

 

Liquidity and Capital Resources

 

We have not generated significant revenues since inception. We incurred a net loss of approximately $1,314,000 and a cash flow deficiency from operating activities of $540,987 for the nine months ended July 31, 2014. We have not yet established an ongoing source of revenues sufficient to cover our operating costs and allow us to continue as a going concern. We have funded our activities to date almost exclusively from debt and equity financings. These matters raise substantial doubt about our ability to continue as a going concern.

 

We will continue to require substantial funds to continue research and development, including preclinical studies and clinical trials of our products, to fund the ongoing operations and to commence sales and marketing efforts. Our plans include financing activities such as private placements of our common stock and issuances of convertible debt instruments. We are also actively pursuing industry collaboration including product licensing and specific project financing.

 

We believe we will be successful in obtaining the necessary financing to fund our operations, meet revenue projections and manage costs; however, there are no assurances that such additional funding will be achieved and that we will succeed in obtaining the funding to support our future operations.

 

Seasonality

 

We do not believe that our business is subject to seasonal trends or inflation.

 

5
 

 

Recent Accounting Pronouncements

 

Revenue From Contracts With Customers

 

In May 2014, the FASB issued an update to ASC 606, Revenue from Contracts with Customers. This update to ASC 606 provides a five-step process to determine when and how revenue is recognized. The core principle of the guidance is that a Company should recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration to be received in exchange for those goods and services. This update to ASC 606 will also result in enhanced disclosures about revenue, providing guidance for transactions that were not previously addressed comprehensively, and improving guidance for multiple-element arrangements. This update to ASC 606 is effective for the Company beginning in fiscal 2017. The Company is currently evaluating the impact of this update on its consolidated financial statements.

 

Development Stage Entities: Elimination of Certain Financial Reporting Requirements

 

On June 10, 2014, FASB issued Accounting Standards Update No. 2014-10, Development Stage Entities: Elimination of Certain Financial Reporting Requirements. The update removes the definition of a development stage entity from FASB ASC 915 and eliminates the requirement for development stage entities to present inception-to-date information on the statements of operations, cash flows and stockholders’ equity. The Company already adopted this standard for the period covered by the report herein.

 

Other pronouncements issued by the FASB or other authoritative accounting standards group with future effective dates are either not applicable or not significant to the consolidated financial statements of the Company.

 

6
 

 

Item 3. Quantitative and Qualitative Disclosure About Market Risk

 

N/A.

 

Item 4. Controls and Procedures

 

(a) Evaluation of Disclosure Controls and Procedures:

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) of the Exchange Act) to provide reasonable assurance regarding the reliability of our financial reporting and preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. A control system, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Because of the inherent limitations in all control systems, internal controls over financial reporting may not prevent or detect misstatements. The design and operation of a control system must also reflect that there are resource constraints and management is necessarily required to apply its judgment in evaluating the cost-benefit relationship of possible controls.

 

Our management assessed the effectiveness of our internal controls over financial reporting for the quarter ended July 31, 2014 based on the criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 1992. Based on such assessment, our management concluded that during the period covered by this report, our internal controls over financial reporting were not effective. Management has identified the following material weaknesses in our internal controls over financial reporting:

 

  lack of documented policies and procedures;
     
  there is no effective separation of duties, which includes monitoring controls, between the members of management;
     
  lack of resources to account for complex and unusual transactions; and
     
  lack of effective review of the consolidated financial statements
     
  Inadequate coordination between executive and financial management that led to transactions not being properly recorded.

 

Management is currently evaluating what steps can be taken in order to address these material weaknesses.

 

(b) Changes in Internal Control over Financial Reporting:

 

During the fiscal quarter ended July 31, 2014, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

7
 

 

PART II. OTHER INFORMATION

 

Item 1. Legal Proceedings

 

On April 22, 2009, the Company was served with a statement of claim from a former employee claiming compensation for wrongful dismissal and ancillary causes of action including payment of monies in realization of his investment in the Company, with an aggregate claim of $514,000. On January 3, 2014 the suit was settled for cash consideration of $10,000 plus 700,000 common shares.

 

Item 1A. Risk Factors

 

Not Applicable.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

Item 3. Defaults Upon Senior Securities

 

On May 15, 2014, the Company received a notice of default (the “Default Notice”) from the debenture holder under Convertible Debenture No. SBCD-01, dated May 31, 2013 in the original principal amount of $500,000 (the “Debenture”), for failure to make the required interest payments under the Debenture.

 

On June 1, 2014, the Debenture holder and the Company entered into a Standstill and Debt Conversion Agreement (the “Standstill Agreement”) pursuant to which the Debenture holder agreed to (i) refrain from exercising or enforcing any right or remedy against the Company in connection with the Debenture and the Default Notice during a “Standstill Period,” which expired on July 31, 2014 and (ii) convert $350,000 in principal of the Debenture into common stock of the Company at a conversion price equal to the “per share price” of an offering of the Company’s common stock involving Polish investors that was pending at the time, if and when such offering closed (the “Polish Offering”). In consideration for the Debenture holder’s forbearance and conversion obligations, the Company agreed to pay the Debenture holder $150,000 in principal under the Debenture, and accrued interest as of the payment date, from the proceeds of the Polish Offering, if and when the Polish Offering closed. As the Polish Offering was terminated by the Company’s investment bankers prior to July 31, 2014, the Standstill Agreement expired by its terms on July 31, 2014.

 

On September 16, 2014, the Debenture holder and the Company agreed upon a final settlement, pursuant to which the Debenture holder would convert all accrued and unpaid interest, as well as all unpaid principal under the Debenture, into 5,507,979 shares of the Company’s common stock.

 

Item 4. Mine Safety Disclosures

 

None.

 

Item 5. Other Information

 

None.

 

8
 

 

Item 6. Exhibits

 

31.1 Section 302 Certification of Chief Executive Officer*
   
31.2 Section 302 Certification of Chief Financial Officer*
   
32.1 Section 906 Certification of Chief Executive Officer and Chief Financial Officer*
   
101 INS XBRL Instance Document**
   
101 SCH XBRL Schema Document**
   
101 CAL XBRL Calculation Linkbase Document**
   
101 LAB XBRL Label Linkbase Document**
   
101 PRE XBRL Presentation Linkbase Document**
   
101 DEF XBRL Definition Linkbase Document**

 

* Filed herewith

 

** In accordance with Regulation S-T, the XBRL-formatted interactive data files that comprise Exhibit 101 in this Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed.”

 

9
 

 

SIGNATURES

 

In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  CARDIOGENICS HOLDINGS INC.
   
Date: September 22, 2014 By: /s/ Yahia Gawad
  Name: Yahia Gawad
  Title: Chief Executive Officer
     
Date: September 22, 2014 By: /s/ James Essex
  Name: James Essex
  Title: Chief Financial Officer

 

10
 

 

EXHIBIT INDEX

 

31.1 Section 302 Certification of Chief Executive Officer*
   
31.2 Section 302 Certification of Chief Financial Officer*
   
32.1 Section 906 Certification of Chief Executive Officer and Chief Financial Officer*
   
101 INS XBRL Instance Document**
   
101 SCH XBRL Schema Document**
   
101 CAL XBRL Calculation Linkbase Document**
   
101 LAB XBRL Label Linkbase Document**
   
101 PRE XBRL Presentation Linkbase Document**
   
101 DEF XBRL Definition Linkbase Document**

 

* Filed herewith

 

** In accordance with Regulation S-T, the XBRL-formatted interactive data files that comprise Exhibit 101 in this Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed.”

 

11