Financial Performance - Cardio reported revenue of $6,580 for the three months ended September 30, 2024, down from $10,030 in the same period of 2023, representing a decrease of 34.5%[129] - For the nine months ended September 30, 2024, revenue increased to $30,378 from $11,755 in 2023, marking a significant growth of 158.5%[130] - Cardio's net loss for the three months ended September 30, 2024, was $1,412,566, a reduction of 26.9% from a net loss of $1,932,382 in the same period of 2023[130] - The company had a net loss of $6,864,145 for the nine months ended September 30, 2024, with an accumulated deficit of $21,232,525[156] Expenses - Sales and marketing expenses for the three months ended September 30, 2024, were $52,059, an increase of 52.8% compared to $34,067 in the same period of 2023[132] - Research and development expenses decreased to $5,247 for the three months ended September 30, 2024, from $38,708 in 2023, a decline of 86.5%[134] - General and administrative expenses remained relatively stable at $1,353,439 for the three months ended September 30, 2024, compared to $1,376,644 in 2023, a slight decrease of 1.7%[136] - General and administrative expenses for the nine months ended September 30, 2024, increased by $1,252,937 to $6,697,857 compared to $5,444,920 for the same period in 2023[137] - Total other expenses for the nine months ended September 30, 2024, significantly decreased to $(14,670) from $(1,287,444) in the prior year[140] Cash Flow - Cash at September 30, 2024, totaled $1,982,590, an increase of $699,067 from $1,283,523 at December 31, 2023[151] - Cash used in operating activities for the nine months ended September 30, 2024, was $3,600,809, a decrease from $3,986,498 in the same period of 2023[152] - Cash provided by financing activities for the nine months ended September 30, 2024, was $4,649,453, compared to $3,725,968 for the same period in 2023[155] - Cash used in investing activities for the nine months ended September 30, 2024, was $349,577, compared to $227,343 in the prior year[154] Business Strategy and Development - The company expects ongoing long sales and partnership cycles, with a strategy to develop additional products for stroke, heart failure, and diabetes[124] - Cardio launched its second product, PrecisionCHD™, in March 2023, and a cardiovascular risk intelligence platform, HeartRisk™, in February 2024[121] - The company received preliminary Medicare pricing for its tests, Epi+Gen CHD™ and PrecisionCHD™, which may enhance market access[123] - Cardio aims to expand its business operations and revenue generation through strategic partnerships and acquisitions of synergistic companies[124] Financing and Legal Matters - The company has entered into an At-the-Market Sales Agreement allowing for the sale of up to $17.0 million in Common Stock, with $6,774,902 raised as of November 13, 2024[142] - The company anticipates ongoing cash needs for operations, working capital, and growth strategies, with reliance on equity financing and ATM offerings[144] - The company has no lines of credit or bank financing arrangements and expects to raise additional funds through equity or convertible debt securities[148] - Legacy Cardio has disputed Boustead Securities' claim for success fees following the termination of the Placement Agent Agreement, asserting that no transactions have been consummated with any parties introduced by Boustead[161] - The Company completed a business combination with Mana on October 25, 2022, and assumed the engagement with The Benchmark Company, LLC, which claims it is owed damages for not being offered the right to act as lead placement agent for a transaction[162] - The SEC declared the S-4 Registration Statement effective on October 6, 2022, after the Company filed multiple amendments in response to comments, and it believes the claims in the demand letter are without merit[163] - The Company received a notice from Nasdaq on June 3, 2024, indicating that its common stock bid price had closed below the minimum requirement of $1.00 per share for continued listing, with a compliance period until December 2, 2024[166] - The Company is evaluating claims related to a fee of approximately $150,000 from Northland Securities, which it does not believe it owes[164] Internal Controls and Compliance - The Company has not experienced any material changes in its internal control over financial reporting during the three and nine months ended September 30, 2024[176] - The Company maintains insurance coverage for claims against its directors and officers as part of its contractual obligations[166] - No legal proceedings have been instigated by either party regarding the disputes with Boustead Securities or Benchmark, and the Company believes the outcomes will not materially impact its financial condition[161][162] - The Company’s financial statements are prepared in accordance with GAAP, requiring estimates and judgments that may differ from actual results under different conditions[167] - The Company’s disclosure controls and procedures have been evaluated as not effective, necessitating additional analysis to ensure compliance with U.S. GAAP[173]

Revenue Performance - Cardio reported revenue of $7,870 for the three months ended June 30, 2024, compared to $1,725 for the same period in 2023, representing a significant increase [106]. - For the six months ended June 30, 2024, Cardio's revenue was $23,798, up from $1,725 in the same period in 2023 [107]. Net Loss - The net loss for the three months ended June 30, 2024, was $1,287,995, a decrease of $2,734,910 from a net loss of $4,022,905 in the same period in 2023 [106]. - Cardio's net loss for the six months ended June 30, 2024, was $5,451,579, an increase of $396,056 compared to a net loss of $5,055,523 in the same period in 2023 [106]. Expenses - Sales and marketing expenses for the three months ended June 30, 2024, were $57,779, an increase of $26,171 from $31,608 in the same period in 2023 [107]. - Research and development expenses for the three months ended June 30, 2024, were $7,280, down from $12,317 in the same period in 2023, reflecting a decrease in laboratory runs [108]. - General and administrative expenses for Q2 2024 decreased to $1,220,477 from $2,506,148 in Q2 2023, a reduction of 51.2% [110]. - For the six months ended June 30, 2024, general and administrative expenses increased to $5,344,418 from $4,068,276 in the same period of 2023, an increase of 31.3% [110]. - Total other expenses for Q2 2024 were $(5,535), significantly lower than $(1,469,764) in Q2 2023, marking a decrease of 99.6% [112]. Cash Flow - Cash used in operating activities for the six months ended June 30, 2024 was $2,443,450, down from $2,941,899 in the same period of 2023, a decrease of 17.0% [128]. - Cash provided by financing activities for the six months ended June 30, 2024 was $2,741,056, compared to $4,008,979 in the same period of 2023, a decrease of 31.6% [132]. - Cash at June 30, 2024 totaled $1,310,119, an increase of 2.1% from $1,283,523 at December 31, 2023 [127]. Financing and Capital - The company has entered into an At-the-Market Sales Agreement allowing for the sale of up to $17.0 million in common stock, with $2,504,862 raised as of August 12, 2024 [117]. - The company expects to continue raising additional capital to fund operations and growth, primarily through equity or convertible debt securities [119]. - The company has no lines of credit or other bank financing arrangements, indicating reliance on equity financing for liquidity [123]. - As of June 30, 2024, the company has no ongoing contractual obligations negatively impacting liquidity and cash flows [136]. Legal and Compliance - The company disputes claims from Boustead Securities regarding compensation for transactions post-termination of the Placement Agent Agreement, asserting no transactions have been consummated with any parties introduced by Boustead [139]. - The company received a notice from Nasdaq on June 3, 2024, indicating that its common stock bid price had closed below the minimum $1.00 per share requirement for continued listing, with a compliance period until December 2, 2024 [145]. - The company has not initiated any legal proceedings related to the claims from Boustead Securities or the demand letter from a plaintiffs' securities law firm, believing these claims to be without merit [141]. - The company is evaluating a claim from Northland Securities for approximately $150,000 related to a previous financing agreement, but does not believe it owes any sum [143]. Insurance and Internal Controls - The company has maintained insurance coverage for claims against its directors and officers as part of its contractual obligations [145]. - The company has not experienced any changes in internal control over financial reporting that materially affect its financial reporting [153]. - The company believes its financial statements present fairly its financial position and results of operations, despite ineffective disclosure controls and procedures [150]. Accounting and Regulatory Matters - The company has filed multiple amendments to its S-4 Registration Statement in response to SEC comments, which were declared effective on October 6, 2022 [141]. - The company continues to evaluate its accounting policies and estimates, which are critical to the preparation of its consolidated financial statements [147]. Product Development and Strategy - Cardio launched its second product, PrecisionCHD™, in March 2023, following the initial launch of Epi+Gen CHD™ in 2021 [97]. - The company plans to develop additional products targeting stroke, congestive heart failure, and diabetes as part of its growth strategy [99]. - Cardio aims to expand its product adoption across key channels, including health systems and self-insured employers, particularly for its new SaaS product, HeartRisk [99]. - Cardio's new go-to-market strategy includes leveraging newly-awarded CPT PLA codes to enhance product accessibility and revenue generation [98].

Financial Performance - Cardio generated revenue of $15,928 for the three months ended March 31, 2024, compared to $0 for the same period in 2023[134]. - Net loss for the three months ended March 31, 2024, was $4,163,584, an increase of $3,130,966 from a net loss of $1,032,618 in the same period in 2023[133]. - General and administrative expenses increased to $4,123,941 for the three months ended March 31, 2024, from $1,562,128 in the same period in 2023, primarily due to stock compensation expenses[137]. - Research and development expenses decreased to $10,840 for the three months ended March 31, 2024, from $86,665 in the same period in 2023, due to fewer laboratory runs[136]. - The company incurred a net loss of $4,163,584 for the three months ended March 31, 2024, with an accumulated deficit of $18,531,964[156]. - Cash at March 31, 2024, totaled $1,563,139, an increase of $279,616 from $1,283,523 at December 31, 2023[151]. - Net cash used in operating activities for Q1 2024 was $1,233,050, a decrease from $1,649,067 in Q1 2023[152]. - Cash provided by financing activities for Q1 2024 was $1,582,607, down from $4,291,990 in Q1 2023[155]. - Cash used in investing activities for Q1 2024 was $69,941, compared to $52,674 in Q1 2023[154]. - The company anticipates ongoing losses and negative cash flows from operations for the foreseeable future[146]. - There is substantial doubt about the company's ability to continue as a going concern without additional capital[156]. Product Development - Cardio launched its second product, PrecisionCHD™, in March 2023, following the initial launch of Epi+Gen CHD™ in 2021[125]. - The company plans to develop additional products for stroke, congestive heart failure, and diabetes, and expand its clinical evidence portfolio[131]. - Cardio published a peer-reviewed study indicating that PrecisionCHD™ could save payers over $113 million annually[126]. - Cardio's two proprietary laboratory analysis codes became effective on April 1, 2024, enhancing reimbursement opportunities for its tests[126]. Financing and Capital Structure - Cardio entered into an At-the-Market Issuance Sales Agreement allowing for the sale of up to $17 million in shares of Common Stock[128]. - As of May 15, 2024, Cardio sold 1,543,698 shares under the Sales Agreement, resulting in proceeds of approximately $1,729,464[129]. - The company expects to fund working capital requirements through existing funds and further issuances of securities[149]. - The company has no lines of credit or bank financing arrangements, relying instead on equity financing[149]. - The exercise prices of outstanding warrants range from $1.78 to $11.50 per share, with the last reported trading price at $0.8140[150]. Internal Controls and Compliance - The company has not made any changes in its internal control over financial reporting that materially affected its reporting during the three months ended March 31, 2024[178]. - The company concluded that its disclosure controls and procedures are not effective, necessitating additional analysis to ensure compliance with U.S. generally accepted accounting principles[175]. - Disclosure controls and procedures are designed to ensure timely reporting of required information, but cannot guarantee absolute assurance against errors or fraud[177]. - The company acknowledges that resource constraints affect the design of disclosure controls and procedures, which must balance benefits against costs[177]. Fair Value Measurement - The fair value of certain financial instruments, including cash and cash equivalents, approximates their carrying amounts due to their short-term nature[171]. - The company uses the Black-Scholes option pricing model to estimate the fair value of stock options and warrants, which involves subjective assumptions that can materially affect the fair value estimate[174]. - ASC 820 establishes a fair value hierarchy that requires maximizing observable inputs and minimizing unobservable inputs when measuring fair value[172]. - The estimated fair value of financial instruments is based on historical cost, which approximates fair value for short- and long-term credit obligations[171]. - The company recognizes stock-based compensation expense over the related service period for awards expected to vest[173]. - The company is classified as a "smaller reporting company" and is not required to provide certain market risk disclosures[175].

PART I [Business Overview](index=3&type=section&id=Item%201.%20Business) Cardio Diagnostics develops AI-driven genetic-epigenetic tests for proactive cardiovascular disease management - Cardio Diagnostics was founded in 2017 to develop and commercialize AI-driven DNA biomarker testing technology for cardiovascular diseases, aiming to transform care from reactive to proactive[107](index=107&type=chunk)[108](index=108&type=chunk)[332](index=332&type=chunk) - The company's core technology, the AI-driven Integrated Genetic-Epigenetic Engine™, enables rapid development of diagnostic solutions by identifying robust genetic and epigenetic biomarkers[108](index=108&type=chunk)[131](index=131&type=chunk)[132](index=132&type=chunk) - Key products include Epi+Gen CHD™ (three-year symptomatic CHD risk assessment), PrecisionCHD™ (early detection of coronary heart disease), and HeartRisk™ (a cardiovascular risk intelligence platform)[119](index=119&type=chunk)[133](index=133&type=chunk)[146](index=146&type=chunk) - Cardio's strategy involves building compelling evidence, engaging experts and stakeholders, prioritizing strategic acquisitions, pursuing payor coverage, and evaluating FDA pathways[110](index=110&type=chunk) - The company has secured an Innovative Technology Contract from Vizient, Inc., covering over **60% of U.S. hospitals**, and an agreement with Family Medicine Specialists to test at least **1,200 patients**[119](index=119&type=chunk)[183](index=183&type=chunk) - Cardio holds **five patent families**, including issued patents in multiple countries and numerous pending applications, protecting methods and compositions for detecting cardiovascular disease and diabetes biomarkers[202](index=202&type=chunk)[209](index=209&type=chunk)[215](index=215&type=chunk) [Company Overview](index=6&type=section&id=Company%20Overview) [Industry Background](index=7&type=section&id=Industry%20Background) [Our Strategy](index=9&type=section&id=Our%20Strategy) [Our Technology](index=10&type=section&id=Our%20Technology) [Our Products and Services](index=11&type=section&id=Our%20Products%20and%20Services) [Our Market Opportunity](index=15&type=section&id=Our%20Market%20Opportunity) [Go-To-Market Strategy for Epi+Gen CHD™ and PrecisionCHD™](index=16&type=section&id=Go-To-Market%20Strategy%20for%20Epi%2BGen%20CHD%E2%84%A2%20and%20PrecisionCHD%E2%84%A2) [Our Competitive Strengths](index=18&type=section&id=Our%20Competitive%20Strengths) [Competition](index=19&type=section&id=Competition) [Intellectual Property](index=21&type=section&id=Intellectual%20Property) [Government Regulation](index=23&type=section&id=Government%20Regulation) [Employees and Human Capital Resources](index=29&type=section&id=Employees%20and%20Human%20Capital%20Resources) [Corporation Information](index=29&type=section&id=Corporation%20Information) [Emerging Growth Status](index=29&type=section&id=Emerging%20Growth%20Status) [Available Information](index=30&type=section&id=Available%20Information) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) Cardio Diagnostics faces risks from its limited operating history, unproven business model, intense competition, and regulatory changes - The company has a limited operating history, generated nominal revenue (**$17,065 in 2023**), and incurred significant net losses (**$8,376,834 in 2023**), raising substantial doubt about its ability to continue as a going concern[85](index=85&type=chunk)[299](index=299&type=chunk)[342](index=342&type=chunk) - The market for epigenetic tests is new and unproven, and the company's business model is unproven, making future growth and profitability uncertain[353](index=353&type=chunk)[354](index=354&type=chunk)[355](index=355&type=chunk) - Cardio relies on a limited number of suppliers, contract manufacturers, and a single CLIA laboratory, posing risks of supply chain interruptions and delays[373](index=373&type=chunk)[378](index=378&type=chunk) - The FDA is considering reclassifying Laboratory-Developed Tests (LDTs) as medical devices, which could subject Cardio's tests to stringent premarket clearance/approval and post-market controls, incurring substantial costs and delays[34](index=34&type=chunk)[257](index=257&type=chunk)[236](index=236&type=chunk) - Obtaining adequate coverage and reimbursement from third-party payors for its tests is a challenging, time-consuming, and costly process, which is critical for commercial success and widespread adoption[263](index=263&type=chunk)[283](index=283&type=chunk)[284](index=284&type=chunk) - The company's intellectual property, including core technology licensed from UIRF, could be subject to termination if obligations are breached or if unaffiliated third parties gain access to technical information for competitive products[23](index=23&type=chunk)[25](index=25&type=chunk)[419](index=419&type=chunk)[452](index=452&type=chunk) - Compliance with federal and state privacy and security regulations (e.g., HIPAA, CCPA, CPRA) for personally identifiable and protected health information is critical, with potential for significant liability and reputational harm from breaches or non-compliance[449](index=449&type=chunk)[461](index=461&type=chunk)[474](index=474&type=chunk) [Risk Factor Summary](index=5&type=section&id=Risk%20Factor%20Summary) [Risks Related to Our Limited Operating History and Early Stage of Growth](index=30&type=section&id=Risks%20Related%20to%20Our%20Limited%20Operating%20History%20and%20Early%20Stage%20of%20Growth) [Risks Related to Our Business and Industry](index=34&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Industry) [Risks Related to Our Business Operations](index=38&type=section&id=Risks%20Related%20to%20Our%20Business%20Operations) [Risks Related to Our Intellectual Property](index=40&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) [Risks Related to Government Regulation](index=42&type=section&id=Risks%20Related%20to%20Government%20Regulation) [Risks Related to Customer Privacy, Cybersecurity and Data](index=45&type=section&id=Risks%20Related%20to%20Customer%20Privacy%2C%20Cybersecurity%20and%20Data) [General Risks Affecting Our Company](index=46&type=section&id=General%20Risks%20Affecting%20Our%20Company) [Risks Related to Our Securities](index=47&type=section&id=Risks%20Related%20to%20Our%20Securities) [Unresolved Staff Comments](index=50&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company has no unresolved staff comments to report - The company states that Item 1B is not applicable, indicating no unresolved staff comments[541](index=541&type=chunk) [Cybersecurity](index=50&type=section&id=Item%201C.%20Cybersecurity) Cardio Diagnostics' cybersecurity program, governed by SOC2 and HIPAA, integrates risk management and incident response - Cardio's cybersecurity program is governed by SOC2 and HIPAA frameworks, focusing on identifying, assessing, responding to, and managing cybersecurity risks[532](index=532&type=chunk)[542](index=542&type=chunk) - Key components of the program include skilled information security personnel, external service providers, employee training, periodic policy reviews, and an incident response plan[543](index=543&type=chunk)[544](index=544&type=chunk) - The company has not identified any material risks from known cybersecurity threats that have impacted or are reasonably likely to impact its business[545](index=545&type=chunk) - The Board of Directors oversees cybersecurity risk, with management providing periodic reports on material threats[546](index=546&type=chunk)[547](index=547&type=chunk) [Risk Management and Strategy](index=54&type=section&id=Risk%20Management%20and%20Strategy) [Governance](index=54&type=section&id=Governance) [Properties](index=51&type=section&id=Item%202.%20Properties) Cardio Diagnostics leases its principal executive offices in Chicago and a laboratory in Iowa City under multi-year agreements - The company leases its principal executive offices in Chicago, IL, for approximately **$13,000 per month**, with a **three-year term** commencing December 1, 2023[550](index=550&type=chunk) - A laboratory is leased in Iowa City, IA, for approximately **$8,505 per month**, with a **five-year term** also commencing December 1, 2023[550](index=550&type=chunk) [Legal Proceedings](index=51&type=section&id=Item%203.%20Legal%20Proceedings) Cardio Diagnostics is not currently a party to any material litigation or other legal proceedings - The company is not currently involved in any material litigation or legal proceedings[551](index=551&type=chunk) [Mine Safety Disclosures](index=51&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company has no disclosures related to mine safety - Item 4 is not applicable to the company's operations[557](index=557&type=chunk) PART II [Market for Common Equity and Stockholder Matters](index=51&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Cardio Diagnostics' common stock and warrants are listed on Nasdaq, with no cash dividends anticipated as earnings are reinvested - Common Stock and Warrants are listed on the Nasdaq Capital Market under symbols '**CDIO**' and '**CDIOW**' respectively[574](index=574&type=chunk) - As of April 1, 2024, there were **37 record holders** of common stock and **8,528,766 warrants outstanding**[558](index=558&type=chunk)[560](index=560&type=chunk) - The company has never paid dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future, intending to retain earnings for business operations and expansion[114](index=114&type=chunk)[502](index=502&type=chunk)[559](index=559&type=chunk) [Market Information](index=55&type=section&id=Market%20Information) [Dividends](index=55&type=section&id=Dividends) [Warrants](index=55&type=section&id=Warrants) [Securities Authorized for Issuance Under Equity Compensation Plans](index=55&type=section&id=Securities%20Authorized%20for%20Issuance%20Under%20Equity%20Compensation%20Plans) [Sales of Unregistered Securities](index=55&type=section&id=Sales%20of%20Unregistered%20Securities) [Issuer Purchases of Equity Securities](index=55&type=section&id=Issuer%20Purchases%20of%20Equity%20Securities) [Reserved](index=52&type=section&id=Item%206.%20Reserved) This item is reserved and contains no information [Management's Discussion and Analysis](index=52&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Cardio Diagnostics, an early-stage medical technology company, reported nominal revenue and increased net losses in 2023, relying on external financing - Cardio's strategy involves leveraging CPT PLA codes, developing additional products (stroke, heart failure, diabetes tests), expanding clinical evidence, increasing adoption across key channels (health systems, self-insured employers), scaling internal operations, and pursuing strategic partnerships/acquisitions[588](index=588&type=chunk) - The company recently launched HeartRisk™, a cardiovascular risk intelligence platform, and secured an Innovative Technology Contract from Vizient, Inc[572](index=572&type=chunk)[586](index=586&type=chunk) Key Financial Highlights (Years Ended December 31) | Metric | 2023 | 2022 | | :---------------------------------- | :----------- | :----------- | | Revenue | $17,065 | $950 | | Sales and marketing expenses | $158,514 | $92,700 | | Research and development expenses | $145,182 | $40,448 | | General and administrative expenses | $6,936,646 | $4,400,253 | | Net loss | $(8,376,834) | $(4,660,985) | - Net loss increased by **$3,715,849** in 2023 compared to 2022, primarily due to a **$2,536,393** increase in General and Administrative expenses, including **$1,035,273** in stock compensation[443](index=443&type=chunk)[596](index=596&type=chunk) - The company's continuation as a going concern is dependent on obtaining necessary equity financing and generating revenues, as it has incurred significant losses and accumulated a deficit of **$14,368,380** at December 31, 2023[299](index=299&type=chunk)[342](index=342&type=chunk)[601](index=601&type=chunk) - In 2023, the company received **$4.5 million** from a convertible debenture (fully converted to **10,622,119 common shares**) and **$855,922** (net) from an At-the-Market offering, with **$16.1 million** still available[583](index=583&type=chunk)[590](index=590&type=chunk)[611](index=611&type=chunk) [Overview](index=56&type=section&id=Overview) [Recent Developments](index=57&type=section&id=Recent%20Developments) [Results of Operations](index=58&type=section&id=Results%20of%20Operations) [Liquidity and Capital Resources](index=59&type=section&id=Liquidity%20and%20Capital%20Resources) [Off-Balance Sheet Financing Arrangements](index=60&type=section&id=Off-Balance%20Sheet%20Financing%20Arrangements) [Contractual Obligations](index=60&type=section&id=Contractual%20Obligations) [Critical Accounting Policies and Significant Judgments and Estimates](index=62&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) [Quantitative and Qualitative Disclosures About Market Risk](index=58&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As of December 31, 2023, Cardio Diagnostics was not subject to any material market or interest rate risk - The company reported no exposure to market or interest rate risk as of December 31, 2023[472](index=472&type=chunk) [Financial Statements and Supplemental Data](index=58&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplemental%20Data) This section presents Cardio Diagnostics' audited consolidated financial statements for 2023 and 2022, including balance sheets, statements of operations, cash flows, and notes - The independent auditor, Prager Metis CPA's LLC, issued an opinion stating that the consolidated financial statements for 2023 and 2022 present fairly the company's financial position and cash flows, but noted a 'going concern' uncertainty due to nominal revenue and accumulated deficits[298](index=298&type=chunk)[299](index=299&type=chunk) Consolidated Balance Sheet Highlights (December 31) | Metric | 2023 | 2022 | | :---------------------------------- | :----------- | :----------- | | Cash | $1,283,523 | $4,117,521 | | Total current assets | $2,765,680 | $5,885,887 | | Total assets | $4,462,365 | $6,249,478 | | Total current liabilities | $841,142 | $1,947,770 | | Total liabilities | $1,504,241 | $1,947,770 | | Total stockholders' equity | $2,958,124 | $4,301,708 | | Accumulated deficit | $(14,368,380) | $(5,991,546) | Consolidated Statements of Cash Flows Highlights (Years Ended December 31) | Cash Flow Activity | 2023 | 2022 | | :---------------------------------- | :----------- | :----------- | | Net cash used in operating activities | $(5,672,175) | $(5,090,968) | | Net cash used in investing activities | $(794,291) | $(368,001) | | Net cash provided by financing activities | $3,632,468 | $9,063,723 | | Net increase (decrease) in cash | $(2,833,998) | $3,604,754 | | Cash – End of Year | $1,283,523 | $4,117,521 | - Cash decreased by **$2,833,998** in 2023, primarily due to significant cash used in operating activities (**$5.67 million**) and investing activities (**$0.79 million**), partially offset by cash from financing activities (**$3.63 million**)[614](index=614&type=chunk)[598](index=598&type=chunk)[600](index=600&type=chunk) [Report of Independent Registered Public Accounting Firm](index=65&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) [Consolidated Balance Sheets](index=66&type=section&id=Consolidated%20Balance%20Sheets) [Consolidated Statements of Operations](index=67&type=section&id=Consolidated%20Statements%20of%20Operations) [Consolidated Statements of Changes in Stockholders' Equity](index=68&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) [Consolidated Statements of Cash Flows](index=69&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) [Notes to Consolidated Financial Statements](index=70&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [Changes in and Disagreements with Accountants](index=59&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reported no changes in or disagreements with accountants on accounting and financial disclosure - The company reported no changes in or disagreements with accountants on accounting and financial disclosure[793](index=793&type=chunk) [Controls and Procedures](index=59&type=section&id=Item%209A.%20Controls%20and%20Procedures) Cardio Diagnostics' disclosure controls were ineffective as of December 31, 2023, though financial statements are fairly presented, with no material changes in internal control - As of December 31, 2023, the company's disclosure controls and procedures were deemed not effective[752](index=752&type=chunk) - Despite the ineffectiveness of disclosure controls, management believes the financial statements fairly present the company's financial position, results of operations, and cash flows[752](index=752&type=chunk) - No material changes in internal control over financial reporting occurred during the period ended December 31, 2023[771](index=771&type=chunk) [Evaluation of Disclosure Controls and Procedures](index=84&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) [Changes in Internal Control over Financial Reporting](index=84&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) [Other Information](index=59&type=section&id=Item%209B.%20Other%20Information) The company reported no other information for this item - The company stated that Item 9B is not applicable[796](index=796&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=59&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) The company reported no disclosures regarding foreign jurisdictions that prevent inspections - The company reported no disclosures regarding foreign jurisdictions that prevent inspections[772](index=772&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=60&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Cardio Diagnostics' corporate governance includes a seven-member Board with independent directors, key executive officers, and policies for ethics and related party transactions - The Board of Directors consists of **seven members**, with Paul Burton, James Intrater, Stanley K. Lau, MD, and Oded Levy identified as independent directors[782](index=782&type=chunk)[783](index=783&type=chunk) - Key executive officers include Meeshanthini V. Dogan (CEO), Robert Philibert (CMO), Elisa Luqman (CFO), Timur Dogan (CTO), and Khullani Abdullahi (VP of Revenue and Strategy)[798](index=798&type=chunk)[799](index=799&type=chunk) - The company has an Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee, all with independent director representation[808](index=808&type=chunk)[826](index=826&type=chunk)[831](index=831&type=chunk) - A written code of business conduct and ethics applies to all employees and directors, and a policy for reviewing and approving related party transactions is in place[624](index=624&type=chunk)[879](index=879&type=chunk) - The company provides indemnification agreements to its directors and executive officers, which may be broader than statutory provisions, to attract and retain qualified individuals[627](index=627&type=chunk)[815](index=815&type=chunk) [Executive Officers](index=85&type=section&id=Executive%20Officers) [Non-Employee Members of the Board of Directors](index=86&type=section&id=Non-Employee%20Members%20of%20the%20Board%20of%20Directors) [Family Relationships](index=87&type=section&id=Family%20Relationships) [Corporate Governance](index=88&type=section&id=Corporate%20Governance) [Board Committees](index=88&type=section&id=Board%20Committees) [Guidelines for Selecting Director Nominees](index=90&type=section&id=Guidelines%20for%20Selecting%20Director%20Nominees) [Code of Ethics](index=90&type=section&id=Code%20of%20Ethics) [Conflicts of Interest](index=91&type=section&id=Conflicts%20of%20Interest) [Limitation on Liability and Indemnification of Officers and Directors](index=91&type=section&id=Limitation%20on%20Liability%20and%20Indemnification%20of%20Officers%20and%20Directors) [Section 16(a) Beneficial Ownership Reporting Compliance](index=92&type=section&id=Section%2016(a)%20Beneficial%20Ownership%20Reporting%20Compliance) [Executive Compensation](index=67&type=section&id=Item%2011.%20Executive%20Compensation) Cardio Diagnostics' 2023 executive compensation included base salaries and significant equity awards, with no cash bonuses, and non-employee directors received RSU awards 2023 Summary Compensation Table for Named Executive Officers | Name | Position | 2023 Salary ($) | 2023 Bonus ($) | 2023 Option Awards ($) | 2023 All Other Compensation ($) | 2023 Total ($) | | :---------------------- | :-------------------------------- | :-------------- | :------------- | :--------------------- | :------------------------------ | :------------- | | Meeshanthini V. Dogan | CEO | 300,000 | 0 | 341,640 | 7,253 | 648,893 | | Warren Hosseinion | Non-executive Chairman | 300,000 | 0 | 155,291 | 0 | 455,291 | | Elisa Luqman | CFO | 275,000 | 0 | 72,469 | 0 | 347,469 | - No annual cash bonuses were awarded to NEOs in 2023, though employment agreements provide for eligibility based on performance[866](index=866&type=chunk) - In January 2024, **1,187,826 options** were granted to management under the 2022 Equity Incentive Plan, with most vesting immediately[768](index=768&type=chunk) - Non-employee directors received **$12,500** in RSU awards quarterly in 2023, vesting and settling on the grant date, and similar awards are planned for 2024[664](index=664&type=chunk)[849](index=849&type=chunk) - Employment agreements for the CEO and CFO include annual base salaries (**$300,000** and **$275,000** respectively), eligibility for cash bonuses and long-term incentives, and severance benefits under specific termination conditions[955](index=955&type=chunk)[961](index=961&type=chunk)[962](index=962&type=chunk) [Overview](index=92&type=section&id=Overview) [2023 Summary Compensation Table](index=92&type=section&id=2023%20Summary%20Compensation%20Table) [Narrative to the Summary Compensation Table](index=93&type=section&id=Narrative%20to%20the%20Summary%20Compensation%20Table) [2023 Base Salary](index=93&type=section&id=2023%20Base%20Salary) [Annual Bonuses](index=93&type=section&id=Annual%20Bonuses) [Equity Compensation](index=93&type=section&id=Equity%20Compensation) [Retirement Plan](index=94&type=section&id=Retirement%20Plan) [Employee Benefits and Perquisites](index=94&type=section&id=Employee%20Benefits%20and%20Perquisites) [Outstanding Equity Awards at Fiscal Year-End Table](index=95&type=section&id=Outstanding%20Equity%20Awards%20at%20Fiscal%20Year-End%20Table) [Agreements with Our Executive Officers and Non-Executive Chairman of the Board](index=95&type=section&id=Agreements%20with%20Our%20Executive%20Officers%20and%20Non-Executive%20Chairman%20of%20the%20Board) [Director Compensation](index=96&type=section&id=Director%20Compensation) [Security Ownership of Certain Beneficial Owners and Management](index=71&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) This section details beneficial ownership of Cardio Diagnostics' common stock as of April 1, 2024, with executive officers and directors owning **22.50%** as a group Beneficial Ownership of Common Stock (April 1, 2024) | Name | Amount and Nature of Beneficial Ownership | Approximate Percentage of Outstanding Shares | | :---------------------------------- | :---------------------------------------- | :------------------------------------------- | | Meeshanthini V. Dogan | 3,020,422 | 9.04% | | Robert Philibert | 2,455,257 | 7.35% | | Warren Hosseinion | 618,248 | 1.85% | | Elisa Luqman | 322,772 | 0.97% | | James Intrater | 62,793 | — | | Stanley K. Lau | 91,522 | — | | Oded Levy | 62,793 | — | | Paul Burton | — | — | | Timur Dogan | 563,812 | 1.69% | | Khullani Abdullahi | 318,682 | 0.95% | | All Executive Officers and Directors as a Group (10 individuals) | 7,516,301 | 22.50% | - Percentage ownership is based on **21,591,119 shares** of Common Stock outstanding as of April 1, 2024[4](index=4&type=chunk)[876](index=876&type=chunk) - Beneficial ownership includes shares subject to options or warrants exercisable within **60 days**[665](index=665&type=chunk) [Beneficial Ownership Table](index=96&type=section&id=Beneficial%20Ownership%20Table) [Certain Relationships and Related Transactions, and Director Independence](index=71&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Cardio Diagnostics has a policy for reviewing and approving related party transactions, including an exclusive patent license from UIRF and employment of the CEO's spouse - The company has a policy for reviewing and approving 'related party transactions' exceeding **$120,000** or **1% of average total assets**, involving directors, executive officers, or **5%+ beneficial owners**[879](index=879&type=chunk) - The audit committee is responsible for considering the facts and circumstances of each related party transaction, including comparability to arm's-length dealings[879](index=879&type=chunk) - Cardio has an exclusive, worldwide patent license from the University of Iowa Research Foundation (UIRF), and co-founders Meeshanthini Dogan and Robert Philibert are entitled to **25% of income** from earnings from their inventions under UIRF's policy[667](index=667&type=chunk)[878](index=878&type=chunk) - Timur Dogan, spouse of CEO Meeshanthini Dogan, is a full-time employee of the company[878](index=878&type=chunk) [Related Party Policy](index=98&type=section&id=Related%20Party%20Policy) [Exclusive License Agreement with UIRF](index=98&type=section&id=Exclusive%20License%20Agreement%20with%20UIRF) [Invention and Non-Disclosure Agreements](index=98&type=section&id=Invention%20and%20Non-Disclosure%20Agreements) [Principal Accounting Fees and Services](index=72&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) This section details fees paid to Prager Metis CPA's LLC for audit services in 2023 and 2022, with no other services provided, and an audit committee pre-approval policy Fees Paid to Prager Metis CPA's LLC (Years Ended December 31) | Fee Type | 2023 ($) | 2022 ($) | | :------------------ | :------- | :------- | | Audit Fees | 85,500 | 84,000 | | Audit-Related Fees | — | — | | Tax Fees | — | — | | All Other Fees | — | — | | Total Fees | 85,500 | 84,000 | - The audit committee has a policy for pre-approving all auditing services and permitted non-audit services[647](index=647&type=chunk)[882](index=882&type=chunk) - No other professional services were provided by Prager Metis in 2023 that would require considering their compatibility with auditor independence[856](index=856&type=chunk) [Fees Paid to the Independent Registered Public Accounting Firm](index=98&type=section&id=Fees%20Paid%20to%20the%20Independent%20Registered%20Public%20Accounting%20Firm) [Auditor Independence](index=98&type=section&id=Auditor%20Independence) [Pre-Approval Policy](index=98&type=section&id=Pre-Approval%20Policy) PART IV [Exhibits, Financial Statement Schedules](index=73&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists all exhibits and financial statement schedules filed as part of the Annual Report on Form 10-K, including key agreements and certifications - All schedules are omitted if not applicable or if the required information is shown in the Financial Statements or notes[858](index=858&type=chunk) - The consolidated financial statements are listed in the accompanying Index to Financial Statements on page F-1[884](index=884&type=chunk) - The exhibit index includes key documents such as the Agreement and Plan of Merger, the 2022 Equity Incentive Plan, employment agreements, and certifications of principal executive and financial officers[885](index=885&type=chunk) [Financial Statements](index=100&type=section&id=Financial%20Statements) [Exhibit Index](index=100&type=section&id=Exhibit%20Index) [Form 10-K Summary](index=101&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company states that there is no Form 10-K Summary - The company states that there is no Form 10-K Summary[859](index=859&type=chunk)

CHICAGO--(BUSINESS WIRE)--Cardio Diagnostics Holdings, Inc. (NASDAQ: CDIO), an AI-powered precision cardiovascular medicine company, announces that the Company will showcase its groundbreaking HeartRiskTM and Actionable Clinical IntelligenceTM platforms at the American College of Cardiology’s 73rd Annual Scientific Session (ACC.24), taking place in Atlanta, GA, from April 6-8, 2024. Cardio Diagnostics' mission is in lockstep with this year's ACC.24 conference theme, "Advancing Cardiovascular Care for All." ...

CHICAGO--(BUSINESS WIRE)--Cardio Diagnostics Holdings, Inc. (NASDAQ: CDIO), an AI-driven precision cardiovascular medicine company, announces that the U.S. Patent and Trademark Office has issued a notice of allowance to University of Iowa Research Foundation ("UIRF") for U.S. Application No. 17,857,723 titled Compositions and Methods for Detecting Predisposition to Cardiovascular Disease, which is exclusively licensed to the Company from UIRF, and that was co-invented by Cardio Diagnostics' founders, Meesha ...

CHICAGO--(BUSINESS WIRE)--Cardio Diagnostics Holdings, Inc. (Nasdaq: CDIO), an AI-driven precision cardiovascular medicine company, announced today the nationwide rollout and a significant expansion of its groundbreaking HeartRisk™ platform. HeartRisk combines insights from HIPAA-compliant anonymized and aggregated clinical cardiovascular data obtained through Cardio Diagnostics’ Epi+Gen CHD and PrecisionCHD clinical tests, with industry and geographic data to enable real-time population-level cardiovascula ...

CHICAGO--(BUSINESS WIRE)--Cardio Diagnostics Holdings, Inc. (NASDAQ: CDIO), an AI-driven precision cardiovascular medicine company, today announced that the Company’s AI-driven epigenetic-genetic blood tests, Epi+Gen CHD and PrecisionCHD, will be available beginning Q2 2024 in a retail healthcare setting inside the Walmart Supercenter in Round Lake Beach, Illinois. Round Lake Beach, a northern suburb of Chicago in Lake County, has been chosen as the strategic starting point for this retail healthcare initi ...

CHICAGO--(BUSINESS WIRE)--Cardio Diagnostics Holdings, Inc. (NASDAQ: CDIO), an AI-driven precision cardiovascular medicine company, announces that Houston-based resTOR Longevity Clinic will integrate Cardio Diagnostics' solutions into its battery of tests for new patients in its longevity-focused concierge clinic. This collaboration marks a significant milestone for Cardio Diagnostics, as resTOR will be the first longevity clinic in America to incorporate Cardio Diagnostics' innovative blood-based epigeneti ...

CHICAGO--(BUSINESS WIRE)--Cardio Diagnostics Holdings, Inc. (Nasdaq: CDIO), an AI-driven precision cardiovascular medicine company, today announced the appointment of Dr. Vimal Ramjee, MD FACC CCMS, as a Strategic Advisor. Dr. Ramjee is a cardiologist and a health innovation leader, serving as the National Co-Chair of Cardiology and Innovation at CommonSpirit Health Enterprise and is also a member of the American Heart Association Board of Directors. The appointment of Dr. Ramjee as a Strategic Advisor t ...