ITEM 15. Exhibits, Financial
Statement Schedules
Exhibits
The following Exhibits are filed as part of this Annual Report
on Form 10-K or incorporated by reference.
Exhibit No.
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Description
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3.1
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Amended and Restated Articles of Incorporation of Registrant. Incorporated by reference to the Registrant’s Form 10-QSB filed with the SEC on June 19, 2006.
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3.2
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Bylaws of Registrant. Incorporated by reference to the Registrant’s Form SB-2 filed with the SEC on September 30, 1999.
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3.3
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Certificate of Designation of Series 1 Preferred Stock of Registrant. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on July 24, 2009.
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3.4
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Articles of Amendment of CardioGenics ExchangeCo Inc. effective July 14 2009 and Articles of Incorporation of CardioGenics ExchangeCo Inc. Effective May 22, 2009
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3.5
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Certificate of Amendment to Articles of Incorporation of Registrant. Incorporated by reference to the Registrant’s Form DEF 14C filed with the SEC on September 9, 2009.
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4.1
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Form of Common Stock Certificate. Incorporated by reference to the Registrant’s Form 10-KSB filed with the SEC on November 8, 2005.
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4.2
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Form of Series 2 Class B Stock Certificate. Incorporated by reference to the Registrant’s Form 10-KSB filed with the SEC on November 8, 2005.
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4.3
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Securities Purchase Agreement, effective May 25, 2006, with YA Global. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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4.4
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Letter Agreement, dated January 31, 2008, relating to the conversion of the remaining principal balance of the convertible secured debentures. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on February 6, 2008.
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4.5
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Warrant No. CCP-1 for 2,000,000 shares of common stock issued to YA Global, effective May 25, 2006. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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4.6
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Warrant No. CCP-2 for 2,000,000 shares of common stock issued to YA Global, effective May 25, 2006. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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4.7
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Warrant No. CCP-3 for 2,000,000 shares of common stock issued to YA Global, effective May 25, 2006. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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4.8
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Warrant No. CCP-4 for 3,000,000 shares of common stock issued to YA Global, effective May 25, 2006. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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4.9
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Warrant No. CCP-5 for 3,000,000 shares of common stock issued to YA Global, effective May 25, 2006. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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4.10
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Letter Agreement, amending Warrant No. CCP-4. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on October 3, 2008.
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4.11
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Investor Registration Rights Agreement, effective May 25, 2006, with YA Global. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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10.1
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Non-Binding Letter of Intent, dated October 1, 2008, by and among the Registrant, BlueCreek, e2 Business and YA Global. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on October 3, 2008.
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10.2
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1999 Long-Term Incentive Plan, as amended. Incorporated by reference to Exhibit [ ] to the Registrant’s Form S-8 filed with the SEC on May 1, 2002.
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10.3
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Amended and Restated Employment Agreement, dated August 31, 2001, between Thomas J. Mazzarisi and Registrant. Incorporated by reference to Exhibit 10.21 in Amendment No. 1 to the Registrant’s Form SB-2 filed with the SEC on September 26, 2001.
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10.4
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Amended and Restated Employment Agreement, dated August 31, 2001, between Stephen J. Schoepfer and Registrant. Incorporated by reference to Exhibit 10.20 in Amendment No. 1 to the Registrant’s Form SB-2 filed with the SEC on September 26, 2001.
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10.5
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Amendment to Amended and Restated Employment Agreement, dated as of November 3, 2005, between Registrant and Thomas J. Mazzarisi. Incorporated by reference to the Registrant’s Form 10-KSB filed with the SEC on November 8, 2005.
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10.6
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Amendment to Amended and Restated Employment Agreement, dated as of November 3, 2005, between Registrant and Stephen J. Schoepfer. Incorporated by reference to the Registrant’s Form 10-KSB filed with the SEC on November 8, 2005.
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10.7
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Amendment to Amended and Restated Employment Agreement, dated as of November 12, 2007, by and between Registrant and Thomas J. Mazzarisi. Incorporated by reference to Exhibit 10.6 of Registrant’s Form 10-K filed with the SEC on November 13, 2008.
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10.8
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Amendment to Amended and Restated Employment Agreement, dated as of November 12, 2007, by and between Registrant and Stephen J. Schoepfer.
Incorporated by reference to Exhibit 10.7 of the Registrant’s Form 10-K filed with the SEC on November 13, 2008
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10.9
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Extension of Amended and Restated Employment Agreement dated as of November 12, 2008 between registrant and Thomas J. Mazzarisi. Incorporated by reference to Exhibit 10.9 of the Registrant’s Form 10-K filed with the SEC on November 13, 2008.
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10.10
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Extension of Amended and Restated Employment Agreement dated as of November 12, 2008 between registrant and Stephen J. Schoepfer. Incorporated by reference to Exhibit 10.10 of the Registrant’s Form 10-K filed with the SEC on November 13, 2008.
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10.11
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Consulting Agreement, dated November 12, 2007, between the Registrant and Walsh Organization, Inc. Incorporated by reference to Exhibit 10.31 of the Registrant’s Annual Report on Form 10-KSB filed November 13, 2003.
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10.12
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Power of Attorney and Contingent Fee Contract, dated June 14, 2002, among the Registrant, Gary Valinoti and the Law Firm of O’Quinn, Laminack & Pirtle. Incorporated by reference to Exhibit 10.32 of the Registrant’s Annual Report on Form 10-KSB filed November 13, 2003.
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10.13
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Subscription Agreement, dated December 10, 2002, between the Registrant and Bay Point Investment Partners LLC. Incorporated by reference to the Registrant’s Registration Statement on Form SB-2 filed on January 9, 2003.
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10.14
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Placement Agent Agreement, dated December 10, 2002, between the Registrant and RMC 1 Capital Markets, Inc. Incorporated by reference to the Registrant’s Registration Statement on Form SB-2 filed on January 9, 2003.
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10.15
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Placement Agent Agreement, dated as of June 19, 2003, between the Registrant and RMC 1 Capital Markets, Inc., as amended on August 12, 2003. Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 13, 2003.
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10.16
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Subscription Agreement, dated as of June 19, 2003, between the Registrant and Bay Point Investment Partners LLC, as amended on August 12, 2003. Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 13, 2003.
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10.17
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Subscription Agreement, dated as of September 25, 2003, between the Registrant and Kuekenhof Equity Fund L.P. Incorporated by reference to Exhibit 10.39 of the Registrant’s Form 10-KSB filed with the SEC on November 13, 2003.
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10.18
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Non-Circumvention/Non-Disclosure Agreement, dated as of January 1, 2004 between Flow Capital Advisors Inc. and the Registrant. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on July 25, 2007.
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10.19
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Finder’s Fee Agreement, dated as of January 5, 2004, between the Registrant and Flow Capital Advisors, Inc. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on January 20, 2004.
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10.20
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Finder’s Fee Agreement, dated as of March 14, 2005, by and between the Registrant and Flow Capital Advisors, Inc. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on July 25, 2007.
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10.21
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Irrevocable Transfer Agent Instructions, effective May 25, 2006, between the Registrant and YA Global. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 1, 2006.
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10.22
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Letter, dated as of June 17, 2008, from Cryptometrics regarding termination of the agreement and plan of merger between the Registrant and Cryptometrics. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on June 18, 2008.
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10.23
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Stand-By Equity Distribution Agreement dated March 12, 2009 between Registrant and YA Global Master SPV Ltd. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on March 13, 2009.
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10.24
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Registration Rights Agreement dated March 12, 2009 between Registrant and YA Global Master SPV Ltd. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on March 13, 2009.
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10.23
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Share Purchase Agreement dated May 22, 2009 between Registrant, CardioGenics ExchnageCo Inc., CardioGenics Inc. And Yahia Gawad, Principal Shareholder of CardioGenics Inc.
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10.24
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Voting and Exchange Trust Agreement dated July 6, 2009 among Registrant, CardioGenics ExchangeCo Inc. and Weirfoulds LLP. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on July 6, 2009.
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10.25
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Support Agreement dated July 6, 2009 between Registrant and CardioGenics ExchangeCo Inc. Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on July 6, 2009.
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10.26
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Agreement dated September 10, 2009 between Registrant and The Investor’s Relations Group, Inc. by reference to the Registrant’s Form 8-K filed with the SEC on September 11, 2009.
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10.27
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Agreement dated September 28, 2009 between Registrant and Gilford Securities Incorporated by reference to the Registrant’s Form 8-K filed with the SEC on October 2, 2009.
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10.28
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Retainer Agreement dated January 20, 2010 between Registrant and Wolf, Axelrod & Weinberger Associates LLC
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10.29
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Letter of Agreement dated January 18, 2010 between Registrant and The Investor Relations Group, Inc.
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10.30
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Employment agreement dated July 31, 2009 between Registrant and Dr. Yahia Gawad.
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10.31
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LLC Membership Interest Purchase Agreement dated February 10, 2010 between Registrant and Rothcove Partners LLC.
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14.1
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Code of Ethics. Incorporated by reference to the Registrant’s Form 10-KSB filed with the SEC on November 13, 2003.
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21.1
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Subsidiaries of Registrant. Incorporated by reference to the Registrant’s Form 10-K filed with the SEC on January 31, 2011.
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23.1
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Consent of CohnReznick LLP*
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23.2
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Consent of KPMG LLP*
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23.3
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Consent of BDO Canada LLP*
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31.1
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Section 302 Certification of Chief Executive Officer*
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31.2
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Section 302 Certification of Chief Financial Officer*
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32.1
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Section 906 Certification of Chief Executive Officer and Chief Financial Officer*
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*Filed herewith
Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm
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F-1
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Report of Independent Registered Public Accounting Firm
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F-2
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Report of Independent Registered Public Accounting Firm
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F-3
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Consolidated Balance Sheets
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F-4
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Consolidated Statements of Operations
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F-5
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Consolidated Statements of Equity (Deficiency)
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F-6-13
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Consolidated Statements of Cash Flows
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F-14
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Notes to Consolidated Financial Statements
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F-15-31
|
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Report of Independent Registered Public Accounting Firm
|
|
To the Board of Directors and Stockholders
CardioGenics Holdings, Inc.
We have audited the
accompanying consolidated balance sheet of CardioGenics Holdings Inc. (a development stage company) as of October 31, 2012,
and the related consolidated statements of operations, changes in equity (deficiency) and cash flows for the year then ended
and for the period from November 20, 1997 (date of inception) to October 31, 2012. These consolidated financial statements
are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit. The financial statements of CardioGenics, Inc. for the period from November 20, 1997
to October 31, 2008 and the one year ended October 31, 2011 were audited by other auditors whose reports dated July 29, 2009
and April 13, 2012, respectively, expressed an unqualified opinion on those statements with explanatory paragraphs
relating to the Company’s ability to continue as a going concern. Our opinion on the consolidated statements of
operations, changes in equity (deficiency) and cash flows for the period from November 20, 1997 (date of inception) to
October 31, 2012, insofar as it relates to amounts for prior periods through October 31, 2008 and the year ended October 31,
2011, is based solely on the report of the other auditors.
We conducted our audit in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, based on our audits and
the reports of other auditors, the consolidated financial statements referred to above present fairly, in all material respects,
the financial position of CardioGenics Holdings, Inc. as of October 31, 2012, and its results of operations and cash flows for
the year then ended, and for the period from November 20, 1997 (date of inception) to October 31, 2012, in conformity with accounting
principles generally accepted in the United States of America.
The consolidated financial statements referred
to above have been prepared assuming that the Company will continue as a going concern. As further discussed in Note 3 to the consolidated
financial statements, the Company's operations have generated recurring losses and negative cash flows from operating activities.
Such matters raise substantial doubt about the Company's ability to continue as a going concern. Management's plans concerning
these matters are also described in Note 3. The accompanying consolidated financial statements do not include any adjustments that
might result from the outcome of this uncertainty.
/s/ CohnReznick LLP
Roseland, New Jersey
January 29, 2013
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Report of Independent Registered Public Accounting Firm
|
|
To the Directors and Shareholders of
CardioGenics Holdings Inc. (formerly CardioGenics Inc.)
(A Development Stage Company)
We have audited the accompanying consolidated balance sheet
of CardioGenics Holdings Inc. (formerly CardioGenics Inc.) (a development stage company) as at October 31, 2008 and the related
consolidated statements of operations, stockholders’ equity (deficit) and cash flows for the year ended October 31, 2008. These
consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to
express an opinion on these consolidated financial statements based on our audit.
We conducted our audit in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our
audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control
over financial reporting. Accordingly we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the consolidated financial statements and assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the financial position of CardioGenics Holdings Inc. (formerly CardioGenics
Inc.) (a development stage company) as at October 31, 2008 and the results of its operations and its cash flows for the year
ended October 31, 2008 in conformity with accounting principles generally accepted in the United States of America.
The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements,
the Company has suffered recurring net losses and negative cash flows from operations. These matters raise substantial
doubt about the Company’s ability to continue as a going concern. Management’s plans regarding these matters
are also described in Note 3. The accompanying consolidated financial statements do not include any adjustments that
might result from the outcome of this uncertainty.
(Signed)
“BDO Canada LLP”
Chartered Accountants, Licensed Public Accountants
Toronto, Ontario
July 29, 2009
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Report of Independent Registered Public Accounting Firm
|
|
To the Board of Directors and Stockholders
of CardioGenics Holdings Inc.
We have audited the accompanying consolidated
balance sheet of CardioGenics Holdings Inc. (a development stage company) as of October 31, 2011, and the related consolidated
statements of operations, changes in equity (deficiency) and cash flows for the year then ended and for the period from November
20, 1997 (date of inception) to October 31, 2011. These consolidated financial statements are the responsibility of CardioGenics
Holdings Inc.'s management. Our responsibility is to express an opinion on these consolidated financial statements based on our
audit. The cumulative statements of operations, changes in equity (deficiency) and cash flows for the period from November 20,
1997 (date of inception) to October 31, 2011 include amounts for the period from November 20, 1997 (date of inception) to October
31, 2010, which were audited by other auditors whose unqualified reports, which contained an explanatory paragraph related to the
Company’s ability to continue as a going concern, have been furnished to us, and our opinion, insofar as it relates to the
amounts included for the period November 20, 1997 (date of inception) through October 31, 2010 is based solely on the reports of
other auditors.
We conducted our audit in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, based on our audit and the reports of other
auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position
of CardioGenics Holdings Inc. as of October 31, 2011, and the results of its operations and its cash flows for the years ended
October 31, 2011, in conformity with U.S. generally accepted accounting principles.
The accompanying consolidated financial
statements have been prepared assuming that the Company will continue as a going concern. As discussed in note 3 to the consolidated
financial statements, the Company has incurred losses from operations and has experienced negative cash flows from operations since
inception which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to
these matters are also described in note 3. The consolidated financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
As discussed in note 2 to the consolidated
financial statements, the 2011 consolidated financial statements have been restated to correct for misstatements.
/s/ KPMG LLP
Chartered Accountants, Licensed Public
Accountants
Toronto, Canada
April 13, 2012
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Balance Sheets
|
|
|
|
October 31,
|
|
|
October 31,
|
|
|
|
2012
|
|
|
2011
|
|
|
|
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|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
|
|
|
|
|
|
|
|
|
Cash and Cash Equivalents
|
|
$
|
27,009
|
|
|
$
|
669,202
|
|
Accounts Receivable
|
|
|
437
|
|
|
|
9,002
|
|
Deposits and Prepaid Expenses
|
|
|
51,422
|
|
|
|
51,541
|
|
Refundable Taxes Receivable
|
|
|
45,207
|
|
|
|
35,191
|
|
Government Grants and Investment Tax Credits Receivable
|
|
|
80,080
|
|
|
|
187,497
|
|
|
|
|
204,155
|
|
|
|
952,433
|
|
Long-Term
|
|
|
|
|
|
|
|
|
Property and Equipment, net
|
|
|
67,827
|
|
|
|
82,308
|
|
Patents, net
|
|
|
110,031
|
|
|
|
130,732
|
|
|
|
|
177,858
|
|
|
|
213,040
|
|
Total Assets
|
|
$
|
382,013
|
|
|
$
|
1,165,473
|
|
Liabilities and Equity (Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
Accounts Payable and Accrued Expenses
|
|
$
|
786,135
|
|
|
$
|
596,692
|
|
Due to Shareholders
|
|
|
100,000
|
|
|
|
—
|
|
Current Portion of Capital Lease Obligation
|
|
|
2,627
|
|
|
|
25,711
|
|
Funds Held in Trust for Redemption of Class B Common Shares
|
|
|
4
|
|
|
|
4
|
|
|
|
|
888,766
|
|
|
|
622,407
|
|
|
|
|
|
|
|
|
|
|
Long-Term Liabilities
|
|
|
|
|
|
|
|
|
Capital Lease Obligation, net of current portion
|
|
|
—
|
|
|
|
2,630
|
|
|
|
|
—
|
|
|
|
2,630
|
|
Total Liabilities
|
|
|
888,766
|
|
|
|
625,037
|
|
Mandatorily redeemable Class B common stock; par value $.00001 per share:
|
|
|
|
|
|
|
|
|
400,000 shares designated as Series 2; 381,749 shares issued and outstanding
|
|
|
—
|
|
|
|
—
|
|
40,000 shares designated as Series 3; 21,500 shares issued and outstanding
|
|
|
—
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
Equity (Deficiency)
|
|
|
|
|
|
|
|
|
Preferred stock; par value $.0001 per share, 5,000,000 shares authorized, none issued
|
|
|
—
|
|
|
|
—
|
|
Common stock; par value $.00001 per share; 65,000,000 shares authorized, 32,499,239 and 31,237,262 common shares and 24,176,927 and 24,388,904 exchangeable shares issued and outstanding as at October 31, 2012 and 2011, respectively
|
|
|
543
|
|
|
|
540
|
|
|
|
|
|
|
|
|
|
|
Additional paid-in capital
|
|
|
42,036,498
|
|
|
|
41,774,001
|
|
|
|
|
|
|
|
|
|
|
Deficit accumulated during development stage
|
|
|
(42,039,223
|
)
|
|
|
(40,731,174
|
)
|
|
|
|
|
|
|
|
|
|
Accumulated other comprehensive loss
|
|
|
(166,637
|
)
|
|
|
(173,407
|
)
|
|
|
|
|
|
|
|
|
|
Total Equity (Deficiency) Attributable to CardioGenics Holdings Inc.
|
|
|
(168,819
|
)
|
|
|
869,960
|
|
Non-Controlling Interest
|
|
|
(337,934
|
)
|
|
|
(329,524
|
)
|
Total Equity (Deficiency)
|
|
|
(506,753
|
)
|
|
|
540,436
|
|
Total Liabilities and Equity (Deficiency)
|
|
$
|
382,013
|
|
|
$
|
1,165,473
|
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Operations
|
For the Years Ended October 31, 2012 and 2011 and
|
Cumulative from November 20, 1997 (Date of Inception) to October 31, 2012
|
|
|
|
|
|
|
|
|
Cumulative
|
|
|
|
|
|
|
|
|
|
From
|
|
|
|
|
|
|
|
|
|
November 20,
|
|
|
|
|
|
|
|
|
|
1997
|
|
|
|
|
|
|
|
|
|
(Date of
|
|
|
|
For the Years Ended
|
|
|
Inception) to
|
|
|
|
October 31,
|
|
|
October 31,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
1,297
|
|
|
$
|
8,876
|
|
|
$
|
10,173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization of Property and Equipment
|
|
|
18,305
|
|
|
|
20,399
|
|
|
|
219,744
|
|
Amortization of Patent Application Costs
|
|
|
6,882
|
|
|
|
5,207
|
|
|
|
19,293
|
|
Write-off of Patent Application Costs
|
|
|
24,905
|
|
|
|
55,549
|
|
|
|
239,530
|
|
General and Administrative
|
|
|
741,961
|
|
|
|
3,398,960
|
|
|
|
8,417,031
|
|
Write-off of Goodwill
|
|
|
—
|
|
|
|
—
|
|
|
|
12,780,214
|
|
Research and Product Development, Net of Investment Tax Credits
|
|
|
522,953
|
|
|
|
426,007
|
|
|
|
4,150,333
|
|
Cost of Settlement of Lawsuit
|
|
|
—
|
|
|
|
1,753,800
|
|
|
|
1,753,800
|
|
Total operating expenses
|
|
|
1,315,006
|
|
|
|
5,659,922
|
|
|
|
27,579,945
|
|
Operating Loss
|
|
|
(1,313,709
|
)
|
|
|
(5,651,046
|
)
|
|
|
(27,569,772
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expenses (Income)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense and Bank Charges (Net)
|
|
|
21,672
|
|
|
|
20,135
|
|
|
|
2,158,308
|
|
Loss on Change in Value of Derivative Liability
|
|
|
—
|
|
|
|
—
|
|
|
|
12,421,023
|
|
Loss (Gain) on Foreign Exchange Transactions
|
|
|
(18,922
|
)
|
|
|
90,737
|
|
|
|
190,343
|
|
Total other expenses
|
|
|
2,750
|
|
|
|
110,872
|
|
|
|
14,769,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from Continuing Operations
|
|
|
(1,316,459
|
)
|
|
|
(5,761,918
|
)
|
|
|
(42,339,446
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on Sale of Subsidiary
|
|
|
—
|
|
|
|
—
|
|
|
|
90,051
|
|
Loss from Discontinued Operations
|
|
|
—
|
|
|
|
—
|
|
|
|
(127,762
|
)
|
Net Loss
|
|
|
(1,316,459
|
)
|
|
|
(5,761,918
|
)
|
|
|
(42,377,157
|
)
|
Net Loss Attributed to Non-Controlling Interest
|
|
|
8,410
|
|
|
|
37,302
|
|
|
|
337,934
|
|
Net Loss Attributed to CardioGenics Holdings Inc.
|
|
$
|
(1,308,049
|
)
|
|
$
|
(5,724,616
|
)
|
|
$
|
(42,039,223
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Fully Diluted Net Loss per Common Share
|
|
$
|
(0.02
|
)
|
|
$
|
(0.11
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average number of Common Shares
|
|
|
55,629,034
|
|
|
|
54,167,687
|
|
|
|
|
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
The
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Loss
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common shares for cash November 1997
|
|
|
1,592,732
|
|
|
$
|
16
|
|
|
$
|
(15
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Issuance of common shares for cash December 1997, $.00
|
|
|
796,366
|
|
|
|
8
|
|
|
|
35,028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
35,036
|
|
Issuance of common shares for cash March 1998, $.00
|
|
|
551,611
|
|
|
|
6
|
|
|
|
24,442
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,448
|
|
Issuance of common shares for cash April 1998, $.00
|
|
|
12,986,611
|
|
|
|
130
|
|
|
|
5,573
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,703
|
|
Issuance of common shares for cash May 1998, $.01
|
|
|
210,249
|
|
|
|
2
|
|
|
|
17,297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,299
|
|
Issuance of common shares for cash August 1998, $.00
|
|
|
2,787,281
|
|
|
|
28
|
|
|
|
200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
228
|
|
Issuance of common shares for cash September 1998, $.01
|
|
|
84,100
|
|
|
|
1
|
|
|
|
6,570
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,571
|
|
Issuance of common shares for cash October 1998, $.01
|
|
|
31,949
|
|
|
|
—
|
|
|
|
2,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,500
|
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(81,208
|
)
|
|
|
|
|
|
|
|
|
|
|
(81,208
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,096
|
)
|
|
|
|
|
|
|
(2,096
|
)
|
Total Comprehensive Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(81,208
|
)
|
|
|
(2,096
|
)
|
|
|
|
|
|
|
(83,304
|
)
|
Balance at October 31, 1998
|
|
|
19,040,899
|
|
|
$
|
191
|
|
|
$
|
91,595
|
|
|
$
|
(81,208
|
)
|
|
$
|
(2,096
|
)
|
|
$
|
—
|
|
|
$
|
8,482
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Loss
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 1998
|
|
|
19,040,899
|
|
|
$
|
191
|
|
|
$
|
91,595
|
|
|
$
|
(81,208
|
)
|
|
$
|
(2,096
|
)
|
|
$
|
—
|
|
|
$
|
8,482
|
|
Issuance of common shares for cash November 1998, $.01
|
|
|
32,066
|
|
|
|
—
|
|
|
|
2,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,500
|
|
Issuance of common shares for cash February 1999, $.01
|
|
|
159,273
|
|
|
|
2
|
|
|
|
14,287
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,289
|
|
Commission paid on issuance of common stock for cash February 1999
|
|
|
|
|
|
|
|
|
|
|
(935
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(935
|
)
|
Issuance of common shares for cash March 1999, $.01
|
|
|
278,728
|
|
|
|
3
|
|
|
|
24,707
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,710
|
|
Commission paid on issuance of common stock for cash March 1999
|
|
|
|
|
|
|
|
|
|
|
(1,647
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,647
|
)
|
Issuance of common shares for cash to minority shareholders April 1999, $.01
|
|
|
—
|
|
|
|
—
|
|
|
|
10,707
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,707
|
|
Commission paid on issuance of common stock for cash April 1999
|
|
|
|
|
|
|
|
|
|
|
(627
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(627
|
)
|
Issuance of common shares for cash April 1999, $.01
|
|
|
39,818
|
|
|
|
—
|
|
|
|
3,814
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,814
|
|
Commission paid on issuance of common stock for cash April 1999
|
|
|
|
|
|
|
|
|
|
|
(314
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(314
|
)
|
Issuance of common shares for cash July 1999, $.01
|
|
|
119,455
|
|
|
|
1
|
|
|
|
10,073
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,074
|
|
Issuance of common shares for cash August 1999, $.01
|
|
|
119,455
|
|
|
|
1
|
|
|
|
10,045
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,046
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(604
|
)
|
|
|
(604
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(100,141
|
)
|
|
|
|
|
|
|
|
|
|
|
(100,141
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,489
|
)
|
|
|
|
|
|
|
(3,489
|
)
|
Total Comprehensive Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(100,141
|
)
|
|
|
(3,489
|
)
|
|
|
|
|
|
|
(103,630
|
)
|
Balance at October 31, 1999
|
|
|
19,789,694
|
|
|
$
|
198
|
|
|
$
|
164,205
|
|
|
$
|
(181,349
|
)
|
|
$
|
(5,585
|
)
|
|
$
|
(604
|
)
|
|
$
|
(23,135
|
)
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 1999
|
|
|
19,789,694
|
|
|
$
|
198
|
|
|
$
|
164,205
|
|
|
$
|
(181,349
|
)
|
|
$
|
(5,585
|
)
|
|
$
|
(604
|
)
|
|
$
|
(23,135
|
)
|
Issuance of common shares for cash November 1999, $.03
|
|
|
318,546
|
|
|
|
3
|
|
|
|
99,997
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100,000
|
|
Issuance of common shares for minority shareholders as employee compensation December 1999, $.03
|
|
|
—
|
|
|
|
—
|
|
|
|
3,396
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,396
|
|
Issuance of common shares for cash March 2000, $.03
|
|
|
167,237
|
|
|
|
2
|
|
|
|
43,124
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
43,126
|
|
Issuance of common shares for minority shareholders for cash March, 2000, $.03
|
|
|
—
|
|
|
|
—
|
|
|
|
25,330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,330
|
|
Issuance of common shares for cash April 2000, $.03
|
|
|
23,891
|
|
|
|
—
|
|
|
|
6,128
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,128
|
|
Loan Payable plus interest exchanged for shares July 2000, $.03
|
|
|
356,772
|
|
|
|
4
|
|
|
|
111,996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
112,000
|
|
Issuance of common shares for minority shareholders as employee compensation October 2000, $.03
|
|
|
—
|
|
|
|
—
|
|
|
|
6,611
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,611
|
|
Issuance of stock options in exchange for services rendered October 2000
|
|
|
—
|
|
|
|
|
|
|
|
11,570
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11,570
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,840
|
)
|
|
|
(1,840
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(152,525
|
)
|
|
|
|
|
|
|
|
|
|
|
(152,525
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
921
|
|
|
|
|
|
|
|
921
|
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(152,525
|
)
|
|
|
921
|
|
|
|
|
|
|
|
(151,604
|
)
|
Balance at October 31, 2000
|
|
|
20,656,140
|
|
|
$
|
207
|
|
|
$
|
472,357
|
|
|
$
|
(333,874
|
)
|
|
$
|
(4,664
|
)
|
|
$
|
(2,444
|
)
|
|
$
|
131,582
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Loss
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2000
|
|
|
20,656,140
|
|
|
$
|
207
|
|
|
$
|
472,357
|
|
|
$
|
(333,874
|
)
|
|
$
|
(4,664
|
)
|
|
$
|
(2,444
|
)
|
|
$
|
131,582
|
|
Issuance of common shares as employee compensation October 2001, $.03
|
|
|
2,410
|
|
|
|
—
|
|
|
|
925
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
925
|
|
Issuance of common share for minority shareholders as employee compensation October 2001, $.03
|
|
|
—
|
|
|
|
—
|
|
|
|
6,169
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,169
|
|
Issuance of stock options in exchange for services rendered October 2001
|
|
|
—
|
|
|
|
—
|
|
|
|
22,269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,269
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,500
|
)
|
|
|
(1,500
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(114,761
|
)
|
|
|
|
|
|
|
|
|
|
|
(114,761
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(10,528
|
)
|
|
|
|
|
|
|
(10,528
|
)
|
Total Comprehensive Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(114,761
|
)
|
|
|
(10,528
|
)
|
|
|
|
|
|
|
(125,289
|
)
|
Balance at October 31, 2001
|
|
|
20,658,550
|
|
|
$
|
207
|
|
|
$
|
501,720
|
|
|
$
|
(448,635
|
)
|
|
$
|
(15,192
|
)
|
|
$
|
(3,944
|
)
|
|
$
|
34,156
|
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Loss
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November
1, 2001
|
|
|
20,658,550
|
|
|
$
|
207
|
|
|
$
|
501,720
|
|
|
$
|
(448,635
|
)
|
|
$
|
(15,192
|
)
|
|
$
|
(3,944
|
)
|
|
$
|
34,156
|
|
Issuance
of common shares for cash June 2002, $.03
|
|
|
1,051,211
|
|
|
|
11
|
|
|
|
319,011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
319,022
|
|
Issuance
of common shares to minority shareholders for cash July 2002, $.03
|
|
|
—
|
|
|
|
—
|
|
|
|
3,235
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,235
|
|
Issuance
of common shares for cash September 2002, $.03
|
|
|
20,957
|
|
|
|
—
|
|
|
|
6,345
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,345
|
|
Issuance
of common shares for minority shareholders as employee compensation October 2002, $.03
|
|
|
—
|
|
|
|
—
|
|
|
|
9,505
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,505
|
|
Issuance
of stock options in exchange for services rendered October 2002
|
|
|
—
|
|
|
|
—
|
|
|
|
70,518
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
70,518
|
|
Net loss
attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,243
|
)
|
|
|
(2,243
|
)
|
Comprehensive
Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(156,214
|
)
|
|
|
|
|
|
|
|
|
|
|
(156,214
|
)
|
Other Comprehensive
Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency
Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11,506
|
)
|
|
|
|
|
|
|
(11,506
|
)
|
Total
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(156,214
|
)
|
|
|
(11,506
|
)
|
|
|
|
|
|
|
(167,720
|
)
|
Balance
at October 31, 2002
|
|
|
21,730,718
|
|
|
$
|
218
|
|
|
$
|
910,334
|
|
|
$
|
(604,849
|
)
|
|
$
|
(26,698
|
)
|
|
$
|
(6,187
|
)
|
|
$
|
272,818
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2002
|
|
|
21,730,718
|
|
|
$
|
218
|
|
|
$
|
910,334
|
|
|
$
|
(604,849
|
)
|
|
$
|
(26,698
|
)
|
|
$
|
(6,187
|
)
|
|
$
|
272,818
|
|
Issuance of common shares for cash May 2003, $.03
|
|
|
28,292
|
|
|
|
—
|
|
|
|
9,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,871
|
|
Issuance of common shares for minority shareholders for cash May 2003 $.03
|
|
|
—
|
|
|
|
—
|
|
|
|
10,967
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,967
|
|
Issuance of warrants in conjunction with convertible debentures September 2003
|
|
|
|
|
|
|
|
|
|
|
358,406
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
358,406
|
|
Issuance of common shares as employee compensation October 2003, $.04
|
|
|
56,584
|
|
|
|
1
|
|
|
|
20,421
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,422
|
|
Issuance of common shares for minority shareholders as employee compensation October 2003, $.04
|
|
|
—
|
|
|
|
—
|
|
|
|
7,564
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,564
|
|
Issuance of stock options in exchange for services rendered October 2003
|
|
|
—
|
|
|
|
—
|
|
|
|
23,580
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23,580
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,825
|
)
|
|
|
(3,825
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(228,993
|
)
|
|
|
|
|
|
|
|
|
|
|
(228,993
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
42,957
|
|
|
|
|
|
|
|
42,957
|
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(228,993
|
)
|
|
|
42,957
|
|
|
|
|
|
|
|
(186,036
|
)
|
Balance at October 31, 2003
|
|
|
21,815,594
|
|
|
$
|
219
|
|
|
$
|
1,341,143
|
|
|
$
|
(833,842
|
)
|
|
$
|
16,259
|
|
|
$
|
(10,012
|
)
|
|
$
|
513,767
|
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2003
|
|
|
21,815,594
|
|
|
$
|
219
|
|
|
$
|
1,341,143
|
|
|
$
|
(833,842
|
)
|
|
$
|
16,259
|
|
|
$
|
(10,012
|
)
|
|
$
|
513,767
|
|
Issuance of warrants in conjunction with convertible debentures September 2004
|
|
|
|
|
|
|
|
|
|
|
152,628
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
152,628
|
|
Issuance of common shares as employee compensation October 2004, $.04
|
|
|
123,646
|
|
|
|
1
|
|
|
|
47,316
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47,317
|
|
Issuance of common shares as directors' compensation October 2004, $.04
|
|
|
157,177
|
|
|
|
2
|
|
|
|
60,147
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
60,149
|
|
Issuance of stock options in exchange for services rendered October 2004
|
|
|
—
|
|
|
|
—
|
|
|
|
27,669
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27,669
|
|
Issuance of options to directors and committee chairmen for services rendered in October 2004
|
|
|
|
|
|
|
|
|
|
|
54,582
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
54,582
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(9,774
|
)
|
|
|
(9,774
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(592,706
|
)
|
|
|
|
|
|
|
|
|
|
|
(592,706
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6,136
|
)
|
|
|
|
|
|
|
(6,136
|
)
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(592,706
|
)
|
|
|
(6,136
|
)
|
|
|
|
|
|
|
(598,842
|
)
|
Balance at October 31, 2004
|
|
|
22,096,417
|
|
|
$
|
222
|
|
|
$
|
1,683,485
|
|
|
$
|
(1,426,548
|
)
|
|
$
|
10,123
|
|
|
$
|
(19,786
|
)
|
|
$
|
247,496
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2004
|
|
|
22,096,417
|
|
|
$
|
222
|
|
|
$
|
1,683,485
|
|
|
$
|
(1,426,548
|
)
|
|
$
|
10,123
|
|
|
$
|
(19,786
|
)
|
|
$
|
247,496
|
|
Issuance of common shares as employee compensation November 2004, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,760
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,760
|
|
Issuance of common shares as employee compensation December 2004, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,692
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,692
|
|
Issuance of common shares as employee compensation January 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,674
|
|
Issuance of common shares as employee compensation February 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,629
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,629
|
|
Issuance of common shares as employee compensation March 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,701
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,701
|
|
Issuance of common shares as employee compensation April 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,641
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,641
|
|
Issuance of common shares as employee compensation May 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,584
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,584
|
|
Issuance of common shares as employee compensation June 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,628
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,628
|
|
Issuance of common shares as employee compensation July 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,680
|
|
Issuance of common shares as employee compensation August 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,737
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,737
|
|
Issuance of common shares as employee compensation September 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,821
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,821
|
|
Issuance of common shares as employee compensation October 2005, $.04
|
|
|
9,431
|
|
|
|
—
|
|
|
|
3,822
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,822
|
|
Issuance of stock options in exchange for services rendered October 2005
|
|
|
—
|
|
|
|
—
|
|
|
|
33,973
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,973
|
|
Net loss attributtable to noncontolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11,195
|
)
|
|
|
(11,195
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(682,408
|
)
|
|
|
|
|
|
|
|
|
|
|
(682,408
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(13,288
|
)
|
|
|
|
|
|
|
(13,288
|
)
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(682,408
|
)
|
|
|
(13,288
|
)
|
|
|
|
|
|
|
(695,696
|
)
|
Balance at October 31, 2005
|
|
|
22,209,589
|
|
|
$
|
222
|
|
|
$
|
1,761,827
|
|
|
$
|
(2,108,956
|
)
|
|
$
|
(3,165
|
)
|
|
$
|
(30,981
|
)
|
|
$
|
(381,053
|
)
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Loss
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2005
|
|
|
22,209,589
|
|
|
$
|
222
|
|
|
$
|
1,761,827
|
|
|
$
|
(2,108,956
|
)
|
|
$
|
(3,165
|
)
|
|
$
|
(30,981
|
)
|
|
$
|
(381,053
|
)
|
Issuance of common shares as employee compensation November 2005, $.04
|
|
|
10,478
|
|
|
|
—
|
|
|
|
4,232
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,232
|
|
Issuance of common shares in exchange for services rendered December 2005, $.04
|
|
|
10,478
|
|
|
|
—
|
|
|
|
4,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,305
|
|
Issuance of common shares in exchange for services rendered January 2006, $.04
|
|
|
10,478
|
|
|
|
—
|
|
|
|
4,321
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,321
|
|
Issuance of stock options in exchange for services rendered October 2006
|
|
|
—
|
|
|
|
—
|
|
|
|
2,658
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,658
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(8,561
|
)
|
|
|
(8,561
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(522,532
|
)
|
|
|
|
|
|
|
|
|
|
|
(522,532
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(25,688
|
)
|
|
|
|
|
|
|
(25,688
|
)
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(522,532
|
)
|
|
|
(25,688
|
)
|
|
|
|
|
|
|
(548,220
|
)
|
Balance at October 31, 2006
|
|
|
22,241,023
|
|
|
$
|
222
|
|
|
$
|
1,777,343
|
|
|
$
|
(2,631,488
|
)
|
|
$
|
(28,853
|
)
|
|
$
|
(39,542
|
)
|
|
$
|
(922,318
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Loss
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2006
|
|
|
22,241,023
|
|
|
$
|
222
|
|
|
$
|
1,777,343
|
|
|
$
|
(2,631,488
|
)
|
|
$
|
(28,853
|
)
|
|
$
|
(39,542
|
)
|
|
$
|
(922,318
|
)
|
Incremental increase in fair value of warrants in conjunction with re-structuring of debentures, April 2007
|
|
|
|
|
|
|
|
|
|
|
44,096
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
44,096
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,972
|
)
|
|
|
(4,972
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(303,477
|
)
|
|
|
|
|
|
|
|
|
|
|
(303,477
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(184,432
|
)
|
|
|
|
|
|
|
(184,432
|
)
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(303,477
|
)
|
|
|
(184,432
|
)
|
|
|
|
|
|
|
(487,909
|
)
|
Balance at October 31, 2007
|
|
|
22,241,023
|
|
|
$
|
222
|
|
|
$
|
1,821,439
|
|
|
$
|
(2,934,965
|
)
|
|
$
|
(213,285
|
)
|
|
$
|
(44,514
|
)
|
|
$
|
(1,371,103
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2007
|
|
|
22,241,023
|
|
|
$
|
222
|
|
|
$
|
1,821,439
|
|
|
$
|
(2,934,965
|
)
|
|
$
|
(213,285
|
)
|
|
$
|
(44,514
|
)
|
|
$
|
(1,371,103
|
)
|
Issuance of warrants in conjunction with re-structuring of debentures October 2008
|
|
|
|
|
|
|
|
|
|
|
231,580
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
231,580
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(21,813
|
)
|
|
|
(21,813
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,331,408
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,331,408
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
422,766
|
|
|
|
|
|
|
|
422,766
|
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,331,408
|
)
|
|
|
422,766
|
|
|
|
|
|
|
|
(908,642
|
)
|
Balance at October 31, 2008
|
|
|
22,241,023
|
|
|
$
|
222
|
|
|
$
|
2,053,019
|
|
|
$
|
(4,266,373
|
)
|
|
$
|
209,481
|
|
|
$
|
(66,327
|
)
|
|
$
|
(2,069,978
|
)
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2008
|
|
|
22,241,023
|
|
|
$
|
222
|
|
|
$
|
2,053,019
|
|
|
$
|
(4,266,373
|
)
|
|
$
|
209,481
|
|
|
$
|
(66,327
|
)
|
|
$
|
(2,069,978
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common shares as payment of debenture interest, January 2009, $0.05 per share
|
|
|
495,094
|
|
|
|
5
|
|
|
|
236,238
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
236,243
|
|
Issuance of common shares on exercise of options, April 2009
|
|
|
570,980
|
|
|
|
6
|
|
|
|
22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28
|
|
Issuance of common shares as employee compensation for the years 2001 to 2008, May 2009, $0.04 per share
|
|
|
3,153,878
|
|
|
|
32
|
|
|
|
1,298,753
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,298,785
|
|
Issuance of common shares to directors, pursuant to debenture financing of January 2009, May 2009, $0.04 per share
|
|
|
928,394
|
|
|
|
9
|
|
|
|
382,521
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
382,530
|
|
Issuance of common shares in exchange for services rendered, June 2009, $0.04 per share
|
|
|
5,023
|
|
|
|
—
|
|
|
|
2,062
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,062
|
|
Issuance of common shares for cash June 2009, $0.04 per share
|
|
|
24,090
|
|
|
|
—
|
|
|
|
8,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,602
|
|
Issuance of common shares in exchange for services rendered, July 2009, $0.04 per share
|
|
|
47,153
|
|
|
|
—
|
|
|
|
20,250
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,250
|
|
Issuance of common shares as payment of director compensation, for the years 2004 through 2009, July 2009, $0.04 per share
|
|
|
241,005
|
|
|
|
2
|
|
|
|
103,498
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
103,500
|
|
Issuance of common shares as employee compensation pursuant to reverse merger transaction, July 2009, $0.04 per share
|
|
|
1,173,592
|
|
|
|
12
|
|
|
|
503,988
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
504,000
|
|
Issuance of common shares to retire debentures, July 2009, $0.03 per share
|
|
|
3,346,028
|
|
|
|
34
|
|
|
|
997,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
997,572
|
|
Issuance of common shares as payment of debenture interest, January 2009, July 2009, $0.05 per share
|
|
|
855,712
|
|
|
|
9
|
|
|
|
418,659
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
418,668
|
|
Issuance of common shares to retire director's loan, July 2009 $0.04 per share
|
|
|
2,377,813
|
|
|
|
24
|
|
|
|
884,976
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
885,000
|
|
Issuance of common shares as payment of interest on director's loan, July 2009, $0.04 per share
|
|
|
218,556
|
|
|
|
2
|
|
|
|
108,633
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
108,635
|
|
Issuance of common shares for cash, July 2009, $0.04 per share
|
|
|
6,540,017
|
|
|
|
66
|
|
|
|
2,714,934
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,715,000
|
|
Issuance of common shares as compensation for consulting contract, July 2009, $0.38 per share
|
|
|
100,000
|
|
|
|
1
|
|
|
|
379,999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
380,000
|
|
Issuance of common shares on exercise of warrants by YA Global for cash August 2009
|
|
|
25,000
|
|
|
|
—
|
|
|
|
45,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
45,000
|
|
Beneficial conversion charge on 3rd debenture
|
|
|
—
|
|
|
|
|
|
|
|
335,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
335,000
|
|
Beneficial conversion charge on director's loan
|
|
|
—
|
|
|
|
|
|
|
|
117,109
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
117,109
|
|
Reclassification of warrants to derivative liability
|
|
|
|
|
|
|
|
|
|
|
(786,710
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(786,710
|
)
|
Assumption of options in reverse merger
|
|
|
|
|
|
|
|
|
|
|
644,806
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
644,806
|
|
Reclassification of derivative liability on increase of authorized shares
|
|
|
|
|
|
|
|
|
|
|
13,501,360
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,501,360
|
|
Effect of Reverse Merger
|
|
|
7,089,282
|
|
|
|
71
|
|
|
|
11,573,465
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
11,573,536
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(211,670
|
)
|
|
|
(211,670
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(28,715,913
|
)
|
|
|
|
|
|
|
|
|
|
|
(28,715,913
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(529,296
|
)
|
|
|
|
|
|
|
(529,296
|
)
|
Total Comprehensive Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(28,715,913
|
)
|
|
|
(529,296
|
)
|
|
|
|
|
|
|
(29,245,209
|
)
|
Balance October 31, 2009
|
|
|
49,432,640
|
|
|
$
|
495
|
|
|
$
|
35,543,722
|
|
|
$
|
(32,982,286
|
)
|
|
$
|
(319,815
|
)
|
|
$
|
(277,997
|
)
|
|
$
|
1,964,119
|
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance November 1, 2009
|
|
|
49,432,640
|
|
|
$
|
495
|
|
|
$
|
35,543,722
|
|
|
$
|
(32,982,286
|
)
|
|
$
|
(319,815
|
)
|
|
$
|
(277,997
|
)
|
|
$
|
1,964,119
|
|
Issuance of common shares in exchange for services rendered January 2010, $.14
|
|
|
35,000
|
|
|
|
—
|
|
|
|
49,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
49,000
|
|
Common shares issued on exercise of Warrants, February 2010
|
|
|
75,000
|
|
|
|
1
|
|
|
|
35,249
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
35,250
|
|
Common shares issued for cash, February 2010
|
|
|
77,000
|
|
|
|
1
|
|
|
|
76,999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
77,000
|
|
Common shares issued in exchange for services rendered, May 2010
|
|
|
78,371
|
|
|
|
1
|
|
|
|
88,199
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
88,200
|
|
Common shares issued in exchange for services rendered, June 2010
|
|
|
50,000
|
|
|
|
—
|
|
|
|
18,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,000
|
|
Common shares issued for cash, October 2010
|
|
|
3,031,150
|
|
|
|
15
|
|
|
|
1,515,558
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,515,573
|
|
Common shares issued for subscription receivable, October 2010
|
|
|
230,000
|
|
|
|
1
|
|
|
|
114,999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
115,000
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(14,225
|
)
|
|
|
(14,225
|
)
|
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,024,272
|
)
|
|
|
|
|
|
|
|
|
|
|
(2,024,272
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
82,307
|
|
|
|
|
|
|
|
82,307
|
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,024,272
|
)
|
|
|
82,307
|
|
|
|
|
|
|
|
(1,941,965
|
)
|
Balance at October 31, 2010
|
|
|
53,009,161
|
|
|
$
|
514
|
|
|
$
|
37,441,728
|
|
|
$
|
(35,006,558
|
)
|
|
$
|
(237,508
|
)
|
|
$
|
(292,222
|
)
|
|
$
|
1,905,954
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
Balance November 1, 2010
|
|
|
53,009,161
|
|
|
$
|
514
|
|
|
$
|
37,441,728
|
|
|
$
|
(35,006,558
|
)
|
|
$
|
(237,508
|
)
|
|
$
|
(292,222
|
)
|
|
$
|
1,905,954
|
|
Issuance of common shares in exchange for services rendered December 2010, $1.00
|
|
|
100,000
|
|
|
|
1
|
|
|
|
99,999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100,000
|
|
Issuance of common shares for cash December 2010, $.50
|
|
|
600,000
|
|
|
|
6
|
|
|
|
297,741
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
297,747
|
|
Issuance of common shares for cash February 2011, $.50
|
|
|
100,000
|
|
|
|
1
|
|
|
|
49,999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
|
Issuance of common shares on exercise of warrants, February 2011, $.47
|
|
|
22,005
|
|
|
|
|
|
|
|
10,402
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,402
|
|
Refund of common shares subscribed for October 2010 in cash February 2011, $.50
|
|
|
(30,000
|
)
|
|
|
|
|
|
|
(15,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(15,000
|
)
|
Re-pricing of options in exchange for services rendered, February 2011
|
|
|
|
|
|
|
|
|
|
|
163,750
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
163,750
|
|
Issuance of common shares on exercise of options, February 2011, $.01
|
|
|
275,000
|
|
|
|
3
|
|
|
|
2,747
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,750
|
|
Issuance of common shares on settlement of lawsuit, August 2011
|
|
|
1,000,000
|
|
|
|
10
|
|
|
|
599,990
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
600,000
|
|
Issuance of warrants on settlement of lawsuit, August 2011
|
|
|
|
|
|
|
|
|
|
|
1,053,800
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,053,800
|
|
Issuance of common shares in exchange for services rendered September 2011
|
|
|
550,000
|
|
|
|
5
|
|
|
|
291,495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
291,500
|
|
Issuance of warrants in exchange for services rendered, September 2011
|
|
|
|
|
|
|
|
|
|
|
1,777,350
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,777,350
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(37,302
|
)
|
|
|
(37,302
|
)
|
Comprehensive Income (Loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,724,616
|
)
|
|
|
|
|
|
|
|
|
|
|
(5,724,616
|
)
|
Other Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
64,101
|
|
|
|
|
|
|
|
64,101
|
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,724,616
|
)
|
|
|
64,101
|
|
|
|
|
|
|
|
(5,660,515
|
)
|
Balance at October 31, 2011
|
|
|
55,626,166
|
|
|
$
|
540
|
|
|
$
|
41,774,001
|
|
|
$
|
(40,731,174
|
)
|
|
$
|
(173,407
|
)
|
|
$
|
(329,524
|
)
|
|
$
|
540,436
|
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
(A Development Stage Company)
|
Consolidated Statements of Changes in Equity (Deficiency)
|
For the year ended October 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
the
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Development
|
|
|
Comprehensive
|
|
|
Noncontrolling
|
|
|
Equity
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stage
|
|
|
Income (Loss)
|
|
|
Interest
|
|
|
(Deficiency)
|
|
Balance November 1, 2011
|
|
|
55,626,166
|
|
|
$
|
540
|
|
|
$
|
41,774,001
|
|
|
$
|
(40,731,174
|
)
|
|
$
|
(173,407
|
)
|
|
$
|
(329,524
|
)
|
|
$
|
540,436
|
|
Issuance of common shares for cash October 2012
|
|
|
1,050,000
|
|
|
|
3
|
|
|
|
262,497
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
262,500
|
|
Net loss attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(8,410
|
)
|
|
|
(8,410
|
)
|
Comprehensive Income (Loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,308,049
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,308,049
|
)
|
Other Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency Translation Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,770
|
|
|
|
|
|
|
|
6,770
|
|
Total Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,308,049
|
)
|
|
|
6,770
|
|
|
|
|
|
|
|
(1,301,279
|
)
|
Balance at October 31, 2012
|
|
|
56,676,166
|
|
|
$
|
543
|
|
|
$
|
42,036,498
|
|
|
$
|
(42,039,223
|
)
|
|
$
|
(166,637
|
)
|
|
$
|
(337,934
|
)
|
|
$
|
(506,753
|
)
|
See notes to consolidated financial statements.
CardioGenics Holdings Inc.
|
Consolidated Statements of Cash Flows
|
Years Ended October 31, 2012 and 2011 and
|
Cumulative from November 20, 1997 (Date of Inception) to October 31, 2012
|
|
|
|
|
|
|
|
|
Cumulative from
|
|
|
|
|
|
|
|
|
|
November 20, 1997
|
|
|
|
Years Ended
|
|
|
(Date of Inception)
|
|
|
|
October 31
|
|
|
To October 31,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operations activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(1,316,459
|
)
|
|
$
|
(5,761,918
|
)
|
|
$
|
(42,377,157
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization of Property and Equipment
|
|
|
18,305
|
|
|
|
20,399
|
|
|
|
219,744
|
|
Amortization of Patent Application Costs
|
|
|
6,882
|
|
|
|
5,207
|
|
|
|
19,293
|
|
Write-off of Patent Application Costs
|
|
|
24,905
|
|
|
|
55,549
|
|
|
|
239,530
|
|
Re-pricing of Options for Services Rendered
|
|
|
—
|
|
|
|
163,750
|
|
|
|
163,750
|
|
Write-off of Goodwill
|
|
|
—
|
|
|
|
—
|
|
|
|
12,780,214
|
|
Amortization of Deferred Debt Issuance Costs
|
|
|
—
|
|
|
|
—
|
|
|
|
511,035
|
|
Loss on Extinguishment of Debt
|
|
|
—
|
|
|
|
—
|
|
|
|
275,676
|
|
Loss on Change in Value of Derivative Liability
|
|
|
—
|
|
|
|
—
|
|
|
|
12,421,023
|
|
Interest Accrued and Foreign Exchange Loss on Debt
|
|
|
—
|
|
|
|
—
|
|
|
|
922,539
|
|
Unrealized Foreign Currency Exchange Gains
|
|
|
—
|
|
|
|
—
|
|
|
|
25,094
|
|
Beneficial Conversion Charge included in
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense
|
|
|
—
|
|
|
|
—
|
|
|
|
452,109
|
|
Common Stock and Warrants Issued on Settlement of Lawsuit
|
|
|
—
|
|
|
|
1,653,800
|
|
|
|
1,653,800
|
|
Common Stock Issued as Employee or
|
|
|
|
|
|
|
|
|
|
|
|
|
Officer/Director Compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
2,508,282
|
|
Common Stock and Warrants Issued for Services Rendered
|
|
|
—
|
|
|
|
2,168,750
|
|
|
|
2,726,262
|
|
Stock Options Issued for Services Rendered
|
|
|
—
|
|
|
|
—
|
|
|
|
192,238
|
|
Stock Options Issued to Directors and Committee Chairman
|
|
|
—
|
|
|
|
—
|
|
|
|
54,582
|
|
Changes in Operating Assets and Liabilities, Net of Acquisition
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts Receivable
|
|
|
8,565
|
|
|
|
(9,002
|
)
|
|
|
(437
|
)
|
Share Subscriptions Receivable
|
|
|
—
|
|
|
|
115,000
|
|
|
|
—
|
|
Deposits and Prepaid Expenses
|
|
|
119
|
|
|
|
38,233
|
|
|
|
(50,633
|
)
|
Refundable Taxes Receivable
|
|
|
(10,016
|
)
|
|
|
(13,232
|
)
|
|
|
(44,343
|
)
|
Government Grants and Investment Tax Credits Receivable
|
|
|
107,417
|
|
|
|
(31,015
|
)
|
|
|
(60,018
|
)
|
Accounts Payable and Accrued Expenses
|
|
|
189,443
|
|
|
|
73,537
|
|
|
|
18,223
|
|
Advances
|
|
|
—
|
|
|
|
—
|
|
|
|
131
|
|
Net cash used in operating activities
|
|
|
(970,839
|
)
|
|
|
(1,520,942
|
)
|
|
|
(7,349,063
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Acquired from Acquisition
|
|
|
—
|
|
|
|
—
|
|
|
|
195,885
|
|
Purchase of Property and Equipment
|
|
|
(3,824
|
)
|
|
|
(15,242
|
)
|
|
|
(223,490
|
)
|
Patent Application Costs
|
|
|
(4,204
|
)
|
|
|
(17,764
|
)
|
|
|
(318,774
|
)
|
Net cash used in investing activities
|
|
|
(8,028
|
)
|
|
|
(33,006
|
)
|
|
|
(346,379
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Due to Shareholders
|
|
|
100,000
|
|
|
|
—
|
|
|
|
100,000
|
|
Repayment of Capital Lease Obligation
|
|
|
(25,714
|
)
|
|
|
(13,532
|
)
|
|
|
(41,290
|
)
|
Due to Director
|
|
|
—
|
|
|
|
(15,149
|
)
|
|
|
725,330
|
|
Issue of Debentures
|
|
|
—
|
|
|
|
—
|
|
|
|
1,378,305
|
|
Issue of Common Shares on Exercise of Stock Options
|
|
|
—
|
|
|
|
2,750
|
|
|
|
2,781
|
|
Issue of Common Shares on Exercise of Warrants
|
|
|
—
|
|
|
|
10,402
|
|
|
|
45,652
|
|
Issue of Common Shares for Cash
|
|
|
262,500
|
|
|
|
347,747
|
|
|
|
5,886,669
|
|
Refund of Share Subscription
|
|
|
—
|
|
|
|
(15,000
|
)
|
|
|
(15,000
|
)
|
Redemption of 10% Senior Convertible Debentures
|
|
|
—
|
|
|
|
—
|
|
|
|
(394,972
|
)
|
Net cash provided by financing activities
|
|
|
336,786
|
|
|
|
317,218
|
|
|
|
7,687,475
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign exchange on cash and cash equivalents
|
|
|
(112
|
)
|
|
|
61,180
|
|
|
|
34,976
|
|
Cash and Cash Equivalents
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in cash and cash equivalents during the period
|
|
|
(642,193
|
)
|
|
|
(1,175,550
|
)
|
|
|
27,009
|
|
Beginning of Period
|
|
|
669,202
|
|
|
|
1,844,752
|
|
|
|
—
|
|
End of Period
|
|
$
|
27,009
|
|
|
$
|
669,202
|
|
|
$
|
27,009
|
|
See notes to consolidated financial statements.
The accompanying audited consolidated
financial statements have been prepared in accordance with the requirements of Form 10-K and Article 8 of Regulation S-X of the
Securities and Exchange Commission (the “SEC”) and include the results of CardioGenics, Inc. and its subsidiaries and
JAG Media Holdings, Inc and its subsidiaries (”JAG Media”) (from July 31, 2009, date of acquisition) which are collectively
referred to as the “Company.”
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 for the In Vitro Diagnostics testing market. CardioGenics has several test products that are in various
stages of development. In the last quarter of 2011 CardioGenics commenced selling one of these products, but has generated no significant
revenue therefrom.
On July 31, 2009, CardioGenics
acquired the business of JAG Media Holdings, Inc. (“JAG Media”).
The business
acquired is that of gathering and compiling financial and investment information from various financial institutions and other
Wall Street professionals. Revenues of the acquired business of JAG Media are generated by releasing such financial information
to subscribers in a consolidated format on a timely basis through facsimile transmissions and a web site. Further, software focused
on streaming video solutions was acquired through the acquisition of JAG Media by CardioGenics. Historically, further development
of this software had been limited as a result of JAG Media’s lack of financial resources.
On February 11, 2010, the Company
entered into an LLC Membership Interest Purchase Agreement with Rothcove Partners LLS (“Rothcove”) pursuant to which
the Company sold its interest in JAG Media to Rothcove.
References herein to CardioGenics
common shares has been retrospectively adjusted to reflect the exchange ratio of 20.957 established in the Share Purchase Agreement
related to the acquisition of JAG Media Holdings, Inc. (“Holdings”).
On October 27, 2009, the name
of the Company was changed from Jag Media Holdings, Inc. to CardioGenics Holdings, Inc.
On April 23, 2010, the Company’s
Board of Directors approved a reverse stock split of its issued and outstanding common shares. The total authorized shares of common
stock was at the same time reduced to 65,000,000. The Board of Directors selected a ratio of one-for-ten and the reverse stock
split was effective on June 20, 2010. Trading of the Company’s common stock on the Over-The-Counter Capital Market on a split
adjusted basis began at the open of trading on June 21, 2010. The reverse stock split affected all shares of the Company’s
common stock, as well as options to purchase the Company’s common stock and other equity incentive awards and warrants that
were outstanding immediately prior to the effective date of the reverse stock split. All references to common shares and per-share
data for prior periods have been retroactively restated to reflect the reverse stock split as if it had occurred at the beginning
of the earliest period presented.
|
2.
|
Restatement
of Financial Statements
|
During
the preparation of the January 31, 2012 interim consolidated financial statements, the Company determined that the accounting
for the issuance of common stock and warrants in the year ended October 31, 2011 required restatement. The Company also determined
that the recording of certain tax related income and expenses required restatement.
As
a result of these restatements, amounts in our consolidated balance sheet, statement of operations, statement of cash flows and
equity for the year ended October 31, 2011 have been corrected. This restatement also resulted in changes to Notes 8 and 9 to
the consolidated financial statements. Statement of cash flows has been restated to reflect classification errors resulting in
an increase in cash from operating activities of $111,927.
The
restatement relates to the following:
|
a)
|
In
September
2011,
we
entered
into
a
consulting
contracts
covering
a
period
of
eighteen
months,
compensation
for
which
included
the
issuance
of
common
shares
stock
and
fully
vested
warrants.
The
Company
determined
that
the
fair
value
of
the
compensation
was
$2.1
million.
Based
on
our
initial
evaluation
of
the
relevant
accounting
guidance,
the
Company
recorded
the
fair
value
as
an
asset
as
part
of
a
prepaid
expense
in
2011
and
began
amortizing
this
balance
to
general
and
administrative
expense
over
an
eighteen
month
period.
The
offset
to
the
prepaid
expense
credit
was
recorded
as
additional
paid-in
capital.
The
Company
has
subsequently
determined
that
the
entire
fair
value
of
the
compensation
for
these
contracts
should
have
been
expensed
immediately
rather
than
recorded
as
an
asset.
In
order
to
correct
this
error,
the
Company
reduced
deposits
and
prepaid
expenses
by
$1,309,296
and
prepaid
consulting
contract
asset
by
$567,015
as
at
October
31,
2011,
expensed
the
fair
value
of
these
contracts
of
$1,869,660
as
part
of
general
and
administrative
expenses
in
the
year
ended
October
31,
2011
and
recorded
a
reduction
in
currency
translation
adjustment
of
$6,651;
|
|
b)
|
The
Company
determined
that
a
government
grant
and
investment
tax
credit
receivable
relating
to
investment
tax
credits
under
the
scientific
research
and
experimental
development
auspices
of
the
Canadian
Income
Tax
Act
in
the
amount
of
approximately
$187,497
had
formerly
not
been
recorded.
In
order
to
correct
this
error,
the
Company
increased
government
grants
and
investment
tax
credits
receivable
and
reduced
general
and
administrative
expenses
as
at
and
for
the
year
ended
October
31,
2011;
and,
|
|
c)
|
The
Company
determined
that
potential
tax
penalties
in
the
amount
of
$180,000
related
to
the
late
filing
of
certain
tax
returns
with
the
Internal
Revenue
Services
had
formerly
not
been
recorded.
In
order
to
correct
this
error,
the
Company
increased
accounts
payable
and
accrued
expenses
and
general
and
administrative
expenses
as
at
and
for
the
year
ended
October
31,
2011.
|
The
following table summarizes the effects of the restated adjustments on our previously issued consolidated balance sheet for the
year ended October 31, 2011:
|
|
As
Previously
|
|
|
|
|
|
|
|
|
|
Reported
|
|
|
Adjustments
|
|
|
As Restated
|
|
Deposits and Prepaid Expenses
|
|
$
|
1,360,837
|
|
|
$
|
(1,309,296
|
)
|
|
$
|
51,541
|
|
Government Grants and Investment Tax Credits Receivable
|
|
|
—
|
|
|
|
187,497
|
|
|
|
187,497
|
|
Prepaid Consulting Contract
|
|
|
567,015
|
|
|
|
(567,015
|
)
|
|
|
—
|
|
Total Assets
|
|
|
2,854,287
|
|
|
|
(1,688,814
|
)
|
|
|
1,165,473
|
|
Accounts Payable and Accrued Expenses
|
|
|
416,692
|
|
|
|
180,000
|
|
|
|
596,692
|
|
Deficit Accumulated During Development Stage
|
|
|
(38,880,934
|
)
|
|
|
(1,850,240
|
)
|
|
|
(40,731,174
|
)
|
Accumulated Other Comprehensive Loss
|
|
|
(166,756
|
)
|
|
|
(6,651
|
)
|
|
|
(173,407
|
)
|
Total Equity Attributable To CardioGenics Holdings Inc.
|
|
|
2,726,851
|
|
|
|
(1,856,891
|
)
|
|
|
869,960
|
|
Non-Controlling Interest
|
|
|
(317,601
|
)
|
|
|
(11,923
|
)
|
|
|
(329,524
|
)
|
Total Equity
|
|
|
2,409,250
|
|
|
|
(1,868,814
|
)
|
|
|
540,436
|
|
Total Liabilities and Equity
|
|
|
2,854,287
|
|
|
|
(1,688,814
|
)
|
|
|
1.165,473
|
|
The following table summarizes the effects of the restated adjustments
on our previously issued statement of equity for the year ended October 31, 2011:
Changes in deficit accumulated during development stage
|
|
As
Previously
|
|
|
|
|
|
|
|
|
|
Reported
|
|
|
Adjustments
|
|
|
As Restated
|
|
Deficit accumulated during development stage at October 31, 2010
|
|
$
|
(35,006,558
|
)
|
|
$
|
—
|
|
|
$
|
(35,006,558
|
)
|
Net loss attributed to CardioGenics Holdings Inc.
|
|
|
(3,874,376
|
)
|
|
|
(1,850,240
|
)
|
|
|
(5,724,616
|
)
|
Deficit accumulated during development stage at October 31, 2011
|
|
$
|
(38,880,934
|
)
|
|
$
|
(1,850,240
|
)
|
|
$
|
(40,731,174
|
)
|
Changes in accumulated other comprehensive loss
|
|
As
Previously
|
|
|
|
|
|
|
|
|
|
Reported
|
|
|
Adjustments
|
|
|
As Restated
|
|
Accumulated other comprehensive loss October 31, 2010
|
|
$
|
(237,508
|
)
|
|
$
|
—
|
|
|
$
|
(237,508
|
)
|
Currency translation Adjustment
|
|
|
70,752
|
|
|
|
(6,651
|
)
|
|
|
64,101
|
|
Accumulated other comprehensive loss October 31, 2011
|
|
$
|
(166,756
|
)
|
|
$
|
(6,651
|
)
|
|
$
|
(173,407
|
)
|
Changes in non-controlling interest
|
|
As
Previously
|
|
|
|
|
|
|
|
|
|
Reported
|
|
|
Adjustments
|
|
|
As Restated
|
|
Accumulated non-controlling interest October 31, 2010
|
|
$
|
(292,222
|
)
|
|
$
|
—
|
|
|
$
|
(292,222
|
)
|
Net loss attributable to Non-controlling interest
|
|
|
(25,379
|
)
|
|
|
(11,923
|
)
|
|
|
(37,302
|
)
|
Accumulated non-controlling interest October 31, 2011
|
|
$
|
(317,601
|
)
|
|
$
|
(11,923
|
)
|
|
$
|
(329,524
|
)
|
Changes in total equity
|
|
As
Previously
|
|
|
|
|
|
|
|
|
|
Reported
|
|
|
Adjustments
|
|
|
As Restated
|
|
Total equity October 31, 2010
|
|
$
|
1,905,954
|
|
|
$
|
—
|
|
|
$
|
1,905,954
|
|
Additions to common Stock
|
|
|
26
|
|
|
|
—
|
|
|
|
26
|
|
Additions to APIC
|
|
|
4,332,273
|
|
|
|
—
|
|
|
|
4,332,273
|
|
Net loss attributable to non-controlling interest
|
|
|
(25,379
|
)
|
|
|
(11,923
|
)
|
|
|
(37,302
|
)
|
Comprehensive loss
|
|
|
(3,803,624
|
)
|
|
|
(1,856,891
|
)
|
|
|
(5,660,515
|
)
|
Total equity October 31, 2011
|
|
$
|
2,409,250
|
|
|
$
|
(1,868,814
|
)
|
|
$
|
540,436
|
|
The following table summarizes the effects of the restated adjustments
on our previously issued statement of operations for the year ended October 31, 2011:
|
|
As
Previously
|
|
|
|
|
|
As
|
|
|
|
Reported
|
|
|
Adjustments
|
|
|
Restated
|
|
General and administrative expenses
|
|
$
|
1,349,300
|
|
|
$
|
2,049,660
|
|
|
$
|
3,398,960
|
|
Research and product development, net of investment tax credits
|
|
|
613,504
|
|
|
|
(187,497
|
)
|
|
|
426,007
|
|
Total operating expenses
|
|
|
3,797,759
|
|
|
|
1,862,163
|
|
|
|
5,659,922
|
|
Operating loss
|
|
|
(3,788,883
|
)
|
|
|
(1,862,163
|
)
|
|
|
(5,651,046
|
)
|
Loss from continuing operations
|
|
|
(3,899,755
|
)
|
|
|
(1,862,163
|
)
|
|
|
(5,761,918
|
)
|
Net loss attributable to Non-controlling interest
|
|
|
25,379
|
|
|
|
11,923
|
|
|
|
37,302
|
|
Net loss attributed to CardioGenics Holdings Inc.
|
|
|
(3,874,376
|
)
|
|
|
(1,850,240
|
)
|
|
|
(5,724,616
|
)
|
The accompanying 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 a deficit accumulated at October
31, 2012 of approximately $42.0 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.
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 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 as a going concern.
|
4.
|
Summary of Significant Accounting Policies
|
|
(a)
|
Principles of Consolidation
|
The consolidated financial statements
include the accounts of the Company and its 100% owned subsidiaries. All significant intercompany transactions and balances have
been eliminated in consolidation.
|
(b)
|
Development Stage Company
|
The accompanying consolidated
financial statements have been prepared in accordance with the provisions of the guidance for development stage enterprises.
|
(c)
|
Cash and Cash Equivalents
|
The Company considers all highly
liquid investments purchased with an original maturity of three months or less to be cash equivalents.
|
(d)
|
Share Subscription Receivable
|
Subscriptions for common shares
received are recorded as receivable on the subscription date with the offsetting credit to capital on the same date.
|
(e)
|
Government Grants and Investment Tax Credits Receivable
|
The Company’s accounts
include claims for investment tax credits relating to scientific research activities of the Company prior to the acquisition described
in Note 1. The qualification and recording of this activity for investment tax credit purposes is established by Canadian Income
Tax authorities when the income tax returns for the period are assessed. The credit has been recognized in the consolidated statement
of operations in the year in which the expenses were incurred.
Subsequent to the acquisition
described in Note 1, the Company no longer qualifies to receive substantial refunds of Investment Tax Credits (“ITCs”)
resulting from scientific research. Currently, the majority of ITCs resulting from scientific research are carried forward to a
time when the Company becomes tax paying at which time said ITCs are applicable against taxes payable.
|
(f)
|
Property and Equipment
|
Property under capital leases
and the related obligation for future lease payments are initially recorded at an amount equal to the lesser of fair value of the
property or equipment and the present value of those lease payments. Property and equipment is depreciated using methods and rates
as follows:
|
Furniture and Fixtures
|
20% declining balance
|
|
Lab Equipment
|
20% declining balance
|
|
Computer Equipment – Hardware
|
30% declining balance
|
|
Computer Equipment – Software
|
50% declining balance
|
|
Leasehold Improvements
|
Straight-line over the lesser of
|
|
|
the life of the asset or the life of the lease
|
Capitalized
patent costs represent legal and application costs incurred to establish patents. Capitalized patent costs are amortized on a
straight-line method over the related patent term. As patents are abandoned, the net book value of the patent is written off.
|
(h)
|
Impairment or Disposal of Long-Lived Assets
|
The
Company assesses the impairment of long-lived assets under the guidance of standards for the impairment or disposal of long-lived
assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. For long-lived assets
to be held and used, the Company recognizes an impairment loss only if its carrying amount is not recoverable and exceeds its
fair value. The carrying amount of the long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows
expected to result from the use and eventual disposal of the asset.
|
(i)
|
Research and Development Costs
|
Expenditures for research and
development are expensed as incurred and include, among other costs, those related to the production of prototype products, including
payroll costs. Amounts expected to be received from governments under Scientific Research Tax Credit arrangements are offset against
current expenses. The Company recognizes revenue from restricted grants in the period in which the Company has incurred the expenditures
in compliance with the specific restrictions.
The Company utilizes the liability
method of accounting for income taxes as set forth in the authoritative guidance. Under the liability method, deferred taxes are
determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using tax
rates expected to be in effect during the years in which the bases differences reverse. A valuation allowance is recorded when
it is more likely than not that some of the deferred tax assets will not be realized. As there is no certainty that the Company
will generate taxable income in the foreseeable future to utilize tax losses accumulated to date, no provision for ultimate tax
reduction has been made in these consolidated financial statements.
On November 1, 2007, the Company
adopted the guidance issued for accounting for uncertainty in income taxes which provides detailed guidance for the financial statement
recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements. Income
tax positions must meet a more-likely-than-not recognition threshold at the effective date to be recognized upon the adoption of
the guidance and in subsequent periods. The Company recognizes potential accrued interest and penalties related to unrecognized
tax benefits within operations as general and administrative expense.
|
(k)
|
Stock-Based Compensation
|
The Company follows the authoritative
guidance for stock-based compensation which requires that new, modified and unvested share-based payment transactions with employees,
such as grants of stock options and restricted stock, be recognized in the financial statements based on their fair value at the
grant date and recognized as compensation expense over their vesting periods. The Company has also considered the related guidance
of the SEC. The Company estimates the fair value of stock options and shares issued as compensation to employees and directors
as of the date of grant using the Black-Scholes pricing model and restricted stock based on the per share value. The Company also
follows the guidance for equity instruments that are issued to other than employees for acquiring, or in conjunction with selling,
goods or services for equity instruments issued to consultants which provides guidance on transactions in which (1) the fair value
of the equity instruments is more reliably measurable than the fair value of the goods or services received and (2) the counterparty
receives shares of stock, stock options, or other equity instruments in settlement of the entire transaction or, if the transaction
is part cash and part equity instruments, in settlement of the portion of the transaction for which the equity instruments constitute
the consideration. Options issued with a nominal exercise price in exchange for services rendered were measured at the fair value
of the underlying services rendered on the date of grant. The expense was recorded to the consolidated statement of operations
with a corresponding increase in share capital with no additional increase in the number of shares as they were legally not yet
exercised.
|
(l)
|
Net Loss Per Common Share
|
Basic loss per share is computed
by dividing loss available to common stockholders by the weighted average number of common shares outstanding during the period.
Diluted earnings (loss) per share gives effect to all dilutive potential common shares outstanding during the period. The computation
of diluted earnings (loss) per share does not assume conversion, exercise or contingent exercise of securities that would have
an anti-dilutive effect on earnings (loss) per share.
|
(m)
|
Comprehensive Income (Loss)
|
Other comprehensive income (loss),
which includes only foreign currency translation adjustments, is shown in the Consolidated Statements of Changes in Equity (Deficiency).
|
(n)
|
Concentration of Credit Risk
|
The Company
maintains cash balances, at times, with financial institutions in excess of amounts insured by the Canada Deposit Insurance Corporation
and the Federal Deposit Insurance Corporation. Management monitors the soundness of these institutions and has not experienced
any collection losses with these financial institutions.
The preparation of financial
statements in conformity with accounting principles generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual
results could differ from those estimates. By their nature, these estimates are subject to uncertainty and the effect on the consolidated
financial statements of changes in such estimates in future periods could be material.
|
(p)
|
Foreign Currency Translation
|
The Company maintains its accounting
records for its Canadian operations in Canadian dollars. Transactions in United States Dollars (“USD”) are translated
into Canadian Dollars at rates in effect at the date of the transaction and gains or losses on such transactions are recorded at
the time of settlement in the consolidated statement of operations.
The Company’s reporting
currency is the United States Dollar. Foreign denominated assets and liabilities of the Company are translated into USD at the
prevailing exchange rates in effect at the end of the reporting period, the historical rate for equity (deficiency) and a weighted
average of exchange rate in effect during the period for expenses, gains and losses. Adjustments that arise from translation into
the reporting currency are recorded in the accumulated other comprehensive income (loss) component of equity (deficiency).
|
(q)
|
Financial Instruments
|
The carrying values of cash
and cash equivalents, other current assets, accounts payable and accrued expenses approximate their fair values due to their short-term
nature.
Revenue included in these consolidated
financial statements is derived from sales of paramagnetic beads and is recognized on shipment to customers.
|
(s)
|
Effects of Recent Accounting Pronouncements
|
In December 2011, the Financial
Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2011-11, Balance Sheet (Topic 210): Disclosures
about Offsetting Assets and Liabilities. ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements
tp enable users of financial statements to understand the effect of those arrangements on its financial position, and to allow
investors to better compare financial statements prepared under U.S. GAAP with financial statements prepared under International
Financial Reporting Standards. The new standards are effective for annual periods beginning January 1, 2013, and interim periods
within those annual periods. Retrospective application is required. The Company will implement the provisions of ASU 2011-11 beginning
in fiscal 2014.
|
5.
|
Property and Equipment
|
The costs and accumulated depreciation
and amortization of property and equipment are summarized as follows:
|
|
October 31
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Furniture and Fixtures
|
|
$
|
12,120
|
|
|
$
|
12,120
|
|
Lab Equipment
|
|
|
168,328
|
|
|
|
164,504
|
|
Computer Hardware
|
|
|
19,490
|
|
|
|
19,490
|
|
Computer Software
|
|
|
8,433
|
|
|
|
8,433
|
|
Leasehold Improvements
|
|
|
91,269
|
|
|
|
91,269
|
|
Total Property and Equipment
|
|
|
299,640
|
|
|
|
295,816
|
|
Less Accumulated Depreciation and Amortization
|
|
|
231,813
|
|
|
|
213,508
|
|
Property and Equipment, Net
|
|
$
|
67,827
|
|
|
$
|
82,308
|
|
Depreciation and amortization
expense amounted to $18,305 and $20,399 for the years ended October 31, 2012 and 2011, respectively.
The costs and accumulated amortization
of patents are summarized as follows:
|
|
October 31
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Patents
|
|
$
|
128,336
|
|
|
$
|
143,143
|
|
Less: Accumulated Amortization
|
|
|
(18,305
|
)
|
|
|
(12,411
|
)
|
Patents, Net
|
|
$
|
110,031
|
|
|
$
|
130,732
|
|
|
|
|
|
|
|
|
|
|
Weighted-Average Life
|
|
|
17
Years
|
|
|
|
17
Years
|
|
|
|
Amortization expense amounted to $6,882 and $5,207 for the years ended October 31, 2012 and 2011,
respectively. Amortization expense is expected to be approximately $6,800 per year for the years ended October 31, 2013 through
2016. During the years ended October 31, 2012 and 2011, the Company wrote off approximately $24,905 and $55,529 of net book value
of patents, respectively, for abandoned patents.
|
The amount due to shareholders
is due on demand and carries interest at 10% per annum.
The Company adopted the provisions
of the guidance for uncertainty in income taxes on November 1, 2007. The guidance clarifies the accounting for uncertainty in income
taxes recognized in an enterprise’s financial statement, and prescribes a recognition threshold and measurement process for
financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides
guidance on derecognition classification, interest and penalties, accounting in interim periods, disclosure and transition.
Based on the Company’s
evaluation, management has concluded that there are no significant uncertain tax positions requiring recognition in the 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 (“NOLs”) arising from Canadian sources as of October 31, 2012 were $6,319,184 (2011 - $5,819,492) which
will expire from 2014 through 2032.
All fiscal years have been assessed;
however, claims relating to research and development credits are open for review for the fiscal years ended October 31, 2012, 2011,
2010, 2009, 2008, 2007, and July 31, 2009.
As of October 31, 2012 and 2011,
the Company had NOLs from US sources of approximately $40,713,000 and $40,476,000, respectively, available to reduce future Federal
taxable income which will expire from 2019 through 2032.
Internal Revenue Code Section
382 (“Section 382”) imposes a limitation on a corporation’s ability to utilize NOLs if it experiences an ownership
change. In general, an ownership change may occur from certain transactions that increase the ownership of 5% stockholders in the
stock of a corporation by more than 50 percentage points over a three year period. If an ownership change occurs, utilization of
the NOLs would be subject to an annual limitation. The annual limitation under Section 382 is calculated by multiplying the value
of stock at the time of the ownership change by the applicable long- term tax exempt rate. Any unused annual limitation may be
carried over to later years. The Company has historically been in a loss position and, therefore, the Section 382 limitation may
not be relevant for the current period.
For the years ended October
31, 2012 and 2011, the Company’s effective tax rate differs from the statutory rate principally due to the NOLs for which
no benefit was recorded.
As of October 31, 2012 and 2011,
the Company’s deferred tax assets consisted of the effects of temporary differences attributable to the following:
|
|
October 31
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Temporary:
|
|
|
|
|
|
|
|
|
Property and equipment
|
|
$
|
(14,600
|
)
|
|
$
|
(9,459
|
)
|
Net operating loss carryforwards
|
|
|
15,589,530
|
|
|
|
15,221,715
|
|
Unrealized foreign exchange
|
|
|
16,601
|
|
|
|
11,287
|
|
Investment tax credits
|
|
|
381,836
|
|
|
|
359,436
|
|
|
|
|
|
|
|
|
|
|
Transitional tax debits
|
|
|
(25,076
|
)
|
|
|
(25,076
|
)
|
|
|
|
|
|
|
|
|
|
Total Deferred Tax Assets
|
|
|
15,948,291
|
|
|
|
15,557,903
|
|
Valuation Allowance
|
|
|
(15,948,291
|
)
|
|
|
(15,557,903
|
)
|
Net Deferred Income Taxes
|
|
$
|
—
|
|
|
$
|
—
|
|
A reconciliation of the Canadian combined statutory
rate to the Company’s effective tax rate for the years ended October 31, 2012 and 2011 is as follows:
|
|
October 31
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Statutory rate
|
|
|
34
|
%
|
|
|
34
|
%
|
Decrease in income tax rate resulting from:
|
|
|
|
|
|
|
|
|
Rate differences between jurisdictions
|
|
|
(9.9
|
)%
|
|
|
(1.2
|
)%
|
Changes in tax rate
|
|
|
—
|
|
|
|
(27.6
|
)%
|
Other
|
|
|
—
|
|
|
|
(8.5
|
)%
|
Permanent differences
|
|
|
—
|
|
|
|
(24.0
|
)%
|
Change in valuation allowance
|
|
|
24.1
|
%
|
|
|
27.3
|
%
|
Effective tax rate
|
|
|
0.0
|
%
|
|
|
0.0
|
%
|
|
9.
|
Accounts Payable and Accrued Expenses
|
|
|
October 31
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Accounts Payable
|
|
$
|
149,256
|
|
|
$
|
103,544
|
|
Income Tax Reserve
|
|
|
200,000
|
|
|
|
180,000
|
|
Research and Development
|
|
|
70,560
|
|
|
|
24,796
|
|
Investor Relations
|
|
|
21,165
|
|
|
|
7,924
|
|
Patent Application Costs
|
|
|
10,736
|
|
|
|
5,209
|
|
Legal Fees
|
|
|
263,703
|
|
|
|
274,616
|
|
Accounting Fees
|
|
|
70,715
|
|
|
|
603
|
|
Total
|
|
$
|
786,135
|
|
|
$
|
596,892
|
|
|
10.
|
Stock-Based Compensation
|
The Company follows the guidance
for stock-based compensation. Stock-based employee compensation related to stock options for each of the years ended October 31,
2012 and 2011 amounted to $-0-.
The following is a summary of
the common stock options granted, forfeited or expired and exercised under the plan:
|
|
|
|
|
Weighted
|
|
|
|
|
|
|
Average
|
|
|
|
|
|
|
Exercise
|
|
|
|
Options
|
|
|
Price
|
|
|
|
|
|
|
|
|
Outstanding – October 31, 2010
|
|
|
305,000
|
|
|
$
|
2.34
|
*
|
Granted
|
|
|
—
|
|
|
|
—
|
|
Forfeited/expired
|
|
|
|
|
|
|
|
|
Exercised
|
|
|
275,000
|
|
|
|
0.01
|
|
Outstanding – October 31, 2011
|
|
|
30,000
|
|
|
$
|
0.90
|
|
Granted
|
|
|
—
|
|
|
|
—
|
|
Forfeited/expired
|
|
|
—
|
|
|
|
—
|
|
Exercised
|
|
|
—
|
|
|
|
—
|
|
Outstanding – October 31, 2012
|
|
|
30,000
|
|
|
$
|
0.90
|
|
Exercisable
|
|
|
30,000
|
|
|
$
|
0.90
|
|
* of the 305,000 options outstanding
as at October 31, 2010 at a weighted average exercise price of $2.34, 275,000 options were repriced during fiscal 2011 to $0.01.
Options typically vest immediately
at the date of grant. As such, the Company does not have any unvested options or unrecognized compensation expense at October 31,
2012 and 2011.
|
|
Options
|
|
|
|
|
|
*Stock options formerly priced at $0.20 were repriced at $0.01 and extended to August 2011
|
|
|
75,000
|
|
*Stock options formerly priced at $3.60 were repriced at $0.01 and extended to August 2011
|
|
|
200,000
|
|
|
|
|
275,000
|
|
The fair value of each option
granted is estimated on grant date using the Black-Scholes option pricing model which takes into account as of the grant date the
exercise price and expected life of the option, the current price of the underlying stock and its expected volatility, expected
dividends on the stock and the risk-free interest rate for the term of the option. The Company granted no stock options during
the years ended October 31, 2012 and 2011.
The following table summarizes
information on stock options outstanding at October 31, 2012:
|
|
|
Options Outstanding and Exercisable
|
|
|
|
|
|
|
|
|
|
|
Weighted
|
|
|
|
|
|
|
|
Number
|
|
|
Weighted
|
|
|
Average
|
|
|
|
|
|
|
|
Outstanding
|
|
|
Average
|
|
|
Remaining
|
|
|
Aggregate
|
|
Range of
|
|
|
at
|
|
|
Exercise
|
|
|
Life
|
|
|
Intrinsic
|
|
Exercise Price
|
|
|
October 31, 2012
|
|
|
Price
|
|
|
(Years)
|
|
|
Value
|
|
$
|
0.90
|
|
|
|
30,000
|
|
|
$
|
0.90
|
|
|
|
6.75
|
|
|
|
|
|
|
|
|
|
|
30,000
|
|
|
|
|
|
|
|
6.75
|
|
|
$
|
0
|
|
|
|
For the Year Ended October 31,
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Weighted Average Fair Value of Options Granted
|
|
$
|
—
|
|
|
$
|
—
|
|
Cash Received for Exercise of Stock Options
|
|
$
|
—
|
|
|
$
|
2,750
|
|
The intrinsic value is calculated
as the difference between the market value as of October 31, 2012 and the exercise price of the shares. The market value as of
October 31, 2012 was $0.23 as reported by the NASDAQ Stock Market.
|
11.
|
Capital Lease Obligations
|
The Company finances certain
equipment acquisitions through a capital lease agreement that expires in 2013. Future minimum rental payments under capital leases
and related information in years subsequent to October 31, 2012 are presented in the table below:
|
|
October 31
|
|
|
|
2012
|
|
|
2011
|
|
Total amount payable in equal monthly installments of $500
|
|
$
|
3,000
|
|
|
$
|
9,000
|
|
Total amount payable in equal monthly installments of $2,090
|
|
|
—
|
|
|
|
22,440
|
|
|
|
|
3,000
|
|
|
|
31,440
|
|
Less: Amount representing interest
|
|
|
373
|
|
|
|
3,099
|
|
Present value of minimum lease payments
|
|
|
2,627
|
|
|
|
28,341
|
|
Less: Current portion
|
|
|
2,627
|
|
|
|
25,711
|
|
|
|
$
|
—
|
|
|
$
|
2,630
|
|
The net book value of equipment
under capital lease at October 31, 2012 is $7,554 and is included in property and equipment.
Equity Instruments Issued
for Services Rendered
During the years ended October
31, 2000 through 2006 CardioGenics Inc. issued stock options with a nominal exercise price in exchange for services rendered to
CardioGenics Inc. The fair value of each stock option was measured at the fair value of the underlying services on the date of
grant. The fair value of each grant was charged to the related expense in the consolidated statement of operations.
The Company assumed options
outstanding at JAG Media entitling the employees to purchase 75,000 common shares of the Company’s stock at a price of $0.20
per share to August 31, 2011. The Company issued options to employees entitling the employees to purchase 200,000 common shares
of the Company’s stock at a price of $3.60 per share to July 31, 2019, based upon change of control provisions in their employment
agreements. All these options were immediately vested. The fair value of the 275,000 options was included in the purchase price.
During 2011, these options were re-priced at $0.01 per share and subsequently exercised.
On August 1, 2009, the Company
issued options to a consultant entitling the consultant to purchase 30,000 common shares of the Company’s stock at a price
of $0.90 per share to July 31, 2019. These options were immediately vested.
|
|
October 31,
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Warrants
|
|
|
|
|
|
|
|
|
Issued to subscribers to the debenture financing of 2003 and its related extension entitling the holder to purchase 1 common share of the Company at an exercise price of $0.47 per common share up to and including July 31, 2012
|
|
|
—
|
|
|
|
2,046,808
|
|
Issued to subscribers to the debenture financing of 2004 and its related extension entitling the holder to purchase 1 common share of the Company at an exercise price of $0.47 per common share up to and including July 31, 2012
|
|
|
—
|
|
|
|
1,021,654
|
|
Issued to agents for the debenture financings of 2003 and 2004 entitling the holder to purchase 1 common share of the Company at an exercise price of $0.47 per common share up to and including July 31, 2012
|
|
|
—
|
|
|
|
208,417
|
|
Issued to former employee entitling the holder to purchase 1 common share of the Company at an exercise price of $0.47 per common share up to and including July 31, 2012
|
|
|
—
|
|
|
|
136,220
|
|
Issued to consultants July 31, 2009, entitling the holder to purchase 1 common share of the Company at an exercise price of $0.90 per share up to and including July 31, 2012
|
|
|
—
|
|
|
|
104,785
|
|
Issued to consultant August 1, 2009, entitling the holder to purchase 1 common share of the company at an exercise price of $0.90 per common share up to and including July 31, 2017
|
|
|
287,085
|
|
|
|
287,085
|
|
Issued to Flow Capital Advisors Inc. on settlement of lawsuit in August 2011, entitling the holder to purchase 1 common share of 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 of 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 of 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 of 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 of 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 consultants in September 2011 entitling the holders to purchase 1 common share of the Company at an exercise price of $0.10 per common share up to and including March 20, 2013
|
|
|
1,500,000
|
|
|
|
1,500,000
|
|
Issued to consultants in September 2011 entitling the holders to purchase 1 common share of the Company at an exercise price of $0.34 per common share up to and including March 20, 2013
|
|
|
1,500,000
|
|
|
|
1,500,000
|
|
Issued to consultants in September 2011 entitling the holders to purchase 1 common share of the Company at an exercise price of $0.50 per common share up to and including March 20, 2013
|
|
|
1,000,000
|
|
|
|
1,000,000
|
|
Total Warrants outstanding
|
|
|
6,287,085
|
|
|
|
9,804,969
|
|
|
13.
|
Authorized Share Capital
|
On September 30, 2009, the Company’s
Articles of Incorporation were amended to increase the total number of common shares authorized for issuance from 500,000,000 shares
to 650,000,000 shares of common stock, par value $0.00001 per share. On April 23, 2010, the Company’s Board of Directors
approved a reverse stock split of its issued and outstanding common shares. The total authorized shares was at the same time reduced
to 65,000,000. The Board of Directors selected a ratio of one-for-ten and the reverse split was effective June 20, 2010. As a result,
the total number of shares of all classes of capital stock authorized for issuance by the Company decreased from 700,440,000 shares
to 70,044,000 shares with a par value of $.00001 per share, of which 5,000,000 shares are authorized for issuance as preferred
stock, 65,000,000 shares are authorized for issuance as common stock, 40,000 shares are authorized for issuance as Series 2 Class
B common stock and 4,000 shares are authorized for issuance as Series 3 Class B common stock.
|
14.
|
Issuance of Common Stock
|
During the years ended October
31, 2012 and 2011, the Company issued the following common shares:
|
|
Year Ended October 31, 2012
|
|
|
Year Ended October 31, 2011
|
|
|
|
# of shares
|
|
|
Amount
|
|
|
# of shares
|
|
|
Amount
|
|
Issuance to third parties for services rendered
|
|
|
—
|
|
|
$
|
—
|
|
|
|
650,000
|
|
|
$
|
391,500
|
|
Issuance to a director for cash
|
|
|
—
|
|
|
$
|
—
|
|
|
|
600,000
|
|
|
$
|
297,747
|
|
Issuance to third parties for cash
|
|
|
1,050,000
|
|
|
$
|
262,500
|
|
|
|
70,000
|
|
|
$
|
35,000
|
|
Issuance to third parties on exercise of warrants
|
|
|
—
|
|
|
$
|
—
|
|
|
|
22,005
|
|
|
$
|
10.402
|
|
Issuance to third parties on exercise of options
|
|
|
—
|
|
|
$
|
—
|
|
|
|
275,000
|
|
|
$
|
2,750
|
|
Issuance to Flow Capital Advisors Inc. on Settlement of Lawsuit
|
|
|
—
|
|
|
$
|
—
|
|
|
|
1,000,000
|
|
|
$
|
600,000
|
|
The fair value of shares issued services rendered were
measured at the fair value of the services rendered on the date rendered.
|
15.
|
Redemption of Class B Common Stock
|
On or about February 28, 2011,
CardioGenics Holdings Inc. (“Holdings”) mailed notices to the holders of its outstanding Series 2 Class B Common Stock
(the “Series 2 Shares”) and Series 3 Class B Common Stock (the “Series 3 Shares”), which notify such stockholders
that Holdings has elected to redeem all outstanding Series 2 Shares and Series 3 Shares in accordance with their terms. The Redemption
Date is April 4, 2011 and the Redemption Price is par value, $0.00001 per share.
Holdings has established a trust
account with TD Bank Canada, which account will hold proceeds sufficient to redeem the issued and outstanding Series 2 Shares and
Series 3 Shares. Accordingly, notwithstanding that any certificate for Series 2 Shares or Series 3 Shares called for redemption
shall not have been surrendered for cancellation, all Series 2 Shares and Series 3 Shares called for redemption shall no longer
be deemed outstanding, and all rights with respect to such Series 2 Shares and Series 3 Shares shall forthwith on the Redemption
Date cease and terminate, except only the right of the holders thereof to receive the pro-rata amount payable of the Series 2 Shares
and Series 3 Shares, without interest.
The following table sets forth
the computation of weighted-average shares outstanding for calculating basic and diluted earnings per share:
|
|
Years Ended
October 31,
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Weighted-average shares - basic
|
|
|
55,629,034
|
|
|
|
54,167,687
|
|
Effect of dilutive securities
|
|
|
—
|
|
|
|
—
|
|
Weighted-average shares - diluted
|
|
|
55,629,034
|
|
|
|
54,167,687
|
|
Basic earnings per share (“EPS”)
and diluted EPS for the years ended October 31, 2012 and 2011 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 representing 6,317,085 and 9,834,969 incremental
shares, respectively, have been excluded from the years ended October 31, 2012 and 2011, respectively, computation of diluted EPS
as they are antidilutive given the net losses generated.
|
17.
|
Commitments and Contingent Liabilities
|
Leases
The Company has entered into
an operating lease agreement for the use of operating space.
Aggregate minimum annual lease
commitments of the Company under the non-cancelable operating lease as of October 31, 2012 are as follows:
Year
|
|
Amount
|
|
|
|
|
|
2013
|
|
$
|
81,926
|
|
2014
|
|
|
82,259
|
|
2015
|
|
|
83,924
|
|
2016
|
|
|
84,091
|
|
Thereafter
|
|
|
46,244
|
|
Total Minimum Lease Payments
|
|
$
|
378,444
|
|
Lease expense amounted to $75,850
and $76,602 for the years ended October 31, 2012 and 2011, respectively.
The preceding data reflects
existing leases and does not include replacements upon their expiration. In the normal course of business, operating leases are
generally renewed or replaced by other leases.
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. The Company
considers all the claims to be without any merit, has already delivered a statement of defense and intends to vigorously defend
the action. If the matter eventually proceeds to trial, the Company does not expect to be found liable on any ground or for any
cause of action.
While it is not feasible to
predict the outcome of the above proceeding and exposures with certainty, management believes that the ultimate disposition should
not have a material adverse effect on the Company’s consolidated financial position, cash flows or results of operations.
On October 26, 2010, Karver
International Inc. (“Karver”) filed a lawsuit in the 11
th
Judicial Circuit in and for Miami-Dade County,
Florida against Holdings Inc. and several other defendants including affiliates, officers and directors of Holdings. The Plaintiff
generally alleges that the named defendants made certain alleged misrepresentations in connection with the purchase of shares of
Holdings. On December 20, 2010, Holdings and other defendants filed a motion to dismiss on the basis that the court lacks personal
jurisdiction over most defendants, that an enforceable forum selection clause requires that the action be litigated in Ontario,
Canada that the doctrine of
forum non conveniens
requires dismissal in favour of the Ontario forum, and that the complaint
suffers from numerous other technical deficiencies warranting dismissal (e.g., failure to attach documents to the Complaint, failure
to plead fraud with particularity, etc.). The motion is currently pending. Should the motion be denied, Holdings will continue
to pursue vigorous defenses to this action. In addition, Karver’s attorney recently filed a motion to withdraw as counsel
for Karver. The courts have granted Karver’s attorney’s motion to withdraw and Karver had until approximately April
26, 2011 to engage new counsel. On April 20, 2011, having not engaged new counsel as of that date, Karver filed with the court
a Notice of Voluntary Dismissal without Prejudice, which dismisses the lawsuit against the named defendants without prejudice to
Karver’s rights to recommence the action.
On January 14, 2010, Flow Capital
Advisors Inc. (“Flow Capital”) filed a lawsuit against JAG Media Holdings Inc. in the Circuit Court of the 17
th
Judicial Circuit In and For Broward County Florida (Case No. 10001713) (the “Flow Capital State Action”). Pursuant
to this lawsuit, Flow Capital alleges that JAG Media Holdings Inc. breached a Non-Circumvention Agreement it had entered into with
Flow Capital, dated January 1, 2004.
On January 15, 2010, Flow Capital
filed a lawsuit against Holdings, and another defendant in the United States District Court for the Southern Distrcit of Florida,
Fort Lauderdale Division (Case No. 10-CV-6006-Martinez-Brown) (the “Flow Capital Federal Action”). This lawsuit alleges
that Holdings (i) breached a Finder’s Fee Agreement in connection with the CardioGenics Acquisition; and (ii) breached a
non-circumvention agreement. Flow Capital is claiming that it is entitled to the finder’s fee equal to eight percent of the
JAG Media Holdings shares received by Holdings, or the equivalent monetary value of the stock. Plaintiff subsequently amended its
complaint to add related tort claims.
Pursuant to applicable Federal
court rules, the parties to the Flow Capital Federal Action participated in a court mandated mediation session on August 17, 2011
where the parties attempted to settle their disputes. At the mediation, the parties agreed to a settlement of all claims as described
below, subject to the approval of the Board of Directors of Holdings, which approval was subsequently obtained. Pursuant to the
settlement agreement, Flow Capital agreed to dismiss, with prejudice, the Flow Capital Federal Action and the Flow Capital State
Action and the Company agreed to issue Flow Capital 1,000,000 shares of restricted Company common stock and warrants to purchase
restricted Company common stock as follow:
Type of Warrant
|
|
Number of Shares
|
|
|
Exercise Price
|
|
|
Vesting Date
|
|
Term
|
Cash Exercise Only
|
|
|
250,000
|
|
|
$
|
0.30/share
|
|
|
Immediate
|
|
5 years
|
Cash Exercise Only
|
|
|
250,000
|
|
|
$
|
0.50/share
|
|
|
Immediate
|
|
5 years
|
Cash Exercise Only
|
|
|
500,000
|
|
|
$
|
0.75/share
|
|
|
Immediate
|
|
5 years
|
Cash Exercise Only
|
|
|
500,000
|
|
|
$
|
1.00/share
|
|
|
Immediate
|
|
5 years
|
Cash or Cashless Exercise
|
|
|
500,000
|
|
|
$
|
0.75/share
|
|
|
Immediate
|
|
5 years
|
The restricted shares of common
stock and the warrants are subject to the rights and restrictions of Rule 144 and do not have any registration rights. As part
of the settlement, the parties also exchanged mutual general releases and Holdings paid Flow Capital $100,000 for Flow Capital’s
legal fees.
On August 23, 2011, the Company’s
Board of Directors approved the settlement. As a result, the Company recorded a charge to the Consolidated Statement of Operations
for the year ended October 31, 2011 of $1,753,800 for Cost of Settlement of Lawsuit.
|
18.
|
Supplemental Disclosure of Cash Flow Information
|
|
|
Years Ended
|
|
|
|
October 31
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
Cash paid during the year for:
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
18,221
|
|
|
$
|
18,748
|
|
Non-cash financing activity:
|
|
|
|
|
|
|
|
|
Fixed assets acquired through capital lease
|
|
$
|
—
|
|
|
$
|
10,660
|
|
|
(a)
|
Equity Line of Credit
|
On November 19, 2012, the Company
entered into an agreement (the “Line”) with JMJ Financial (the “Lender”) whereby the Company may borrow
up to $350,000 from the Lender in increments of $50,000. The Line is subject to an original issue discount of $50,000. Advances
under the Line 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 previous 25 trading days prior 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 owning more
than 4.99% of the Company’s common stock outstanding.
Subsequent to the year end, a shareholder who is
also a director and an officer advanced $100,000 to the Company and another shareholder who is also a director advanced $100,000
to the Company.
|
|
On January 17, 2013, the Company filed a Certificate of Amendment to
the Company’s
Certificate of Incorporation (the “Certificate of Amendment”)
to (i) increase the number of shares of common stock authorized for issuance from 65,000,000 to 150,000,000 and (ii) de-authorize
the Company’s Class B common stock.
|
SIGNATURES
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.
|
CARDIOGENICS HOLDINGS INC.
|
|
|
|
|
|
By:
|
/s/ Yahia Gawad
|
|
|
|
Yahia Gawad
|
|
|
|
Chief Executive Officer
|
|
Dated: January 29, 2013
Pursuant to the requirements of the Securities
Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities
and on the date indicated.
Signature
|
|
Title
|
|
DATE
|
|
|
|
|
|
/s/
Yahia Gawad
|
|
Chief Executive Officer
|
|
January 29, 2013
|
Yahia Gawad
|
|
|
|
|
|
|
|
|
|
/s/
James Essex
|
|
Chief Financial Officer
|
|
January 29, 2013
|
James Essex
|
|
|
|
|
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