UNITED STATES ~~SECURITIES AND EXCHANGE COMMISSION~~

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended ~~July~~January 31, ~~2015~~2016.

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

For the transition period from ~~____________~~ to ~~____________~~ .

Commission file number 000-28761

CARDIOGENICS HOLDINGS INC.

(Exact name of registrant as specified in its Charter)

Nevada		88-0380546
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

6295 Northam Drive, Unit 8

Mississauga, Ontario L4V 1WB

(Address of Principal Executive Offices)

(905) 673-8501

(Registrant’s Telephone Number, Including Area Code)

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

Yes [X] No [ ]

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

	Large Accelerated filer	[ ]	Accelerated Filer	[ ]

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

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

Yes [ ] No [X]

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

Yes [X] No [ ]

As of ~~September~~March 18, ~~2015~~2016 the Registrant had the following number of shares of its capital stock outstanding: 8096,~~566~~050,~~160~~558 shares of ~~Common~~ Common Stock and 1 share of Series 1 Preferred Voting Stock, par value $0.0001, representing 13 exchangeable shares of the Registrant’s subsidiary, CardioGenics ExchangeCo Inc., which are exchangeable into 24,176,927 shares of the Registrant’s Common Stock.

CARDIOGENICS HOLDINGS INC.

FORM 10-Q

For the Quarter Ended ~~July~~January 31, ~~2015~~2016

INDEX

		Page
Part I. Financial Information
		F-1
Item 1: Financial Statements (Unaudited)		F-1
Item 1: Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets at January 31, 2016 (Unaudited) and October 31, 2015		F-1
Condensed Consolidated Balance Sheets at July 31, 2015 (Unaudited) and October 31, 2014		F-1
Condensed Consolidated Statements of Operations (Unaudited) for the Three Months Ended January 31, 2016 and 2015		F-2
Condensed Consolidated Statements of Operations (Unaudited) for the Three and Nine Months Ended July 31, 2015 and 2014		F-2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) for the Three Months Ended January 31, 2016 and 2015		F-3
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) for the Three and Nine Months Ended July 31, 2015 and 2014		F-3
Condensed Consolidated Statement of Changes in Deficiency (Unaudited) for the Three Months ended January 31, 2016		F-4
Condensed Consolidated Statement of Changes in Deficiency (Unaudited) for the Nine Months ended July 31, 2015		F-4
Condensed Consolidated Statements of Cash Flows (Unaudited) for the Three Months ended January 31, 2016 and 2015		F-5
Condensed Consolidated Statements of Cash Flows (Unaudited) for the Nine Months ended July 31, 2015 and 2014		F-5
Notes to Condensed Consolidated Financial Statements (Unaudited)		F-6
Item 2: Management’s Discussion and Analysis of Financial Conditions and Results of Operations		3
Item 2: Management’s Discussion and Analysis of Financial Condition and Operations		3
Item 3: Quantitative and Qualitative Disclosures About Market Risk		65
Item 4: Controls and Procedures		65
Part II. Other Information
Item 1: Legal Proceedings		76
Item 1A: Risk Factors		76
Item 2: Unregistered Sales of Equity Securities and Use of Proceeds		76
Item 3: Defaults Upon Senior Securities		76
Item 4: Mine Safety Disclosures		76
Item 5: Other Information		76
Item 6: Exhibits		87
Signatures		98

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

CardioGenics Holdings Inc.

Condensed Consolidated Balance Sheets

	July 31, 2015			October 31, 2014
	January 31, 2016			October 31, 2015
		(Unaudited)
Assets
Current assets:
Current Assets
Cash and cash equivalents	$	49,240		$	70,676
Accounts Receivable	$	96,810		$	49,875
Accounts Receivable		196			228
Advances Receivable		283,371			-
Refundable Taxes Receivable		24,~~465~~921			2,~~625~~385
Total current assets		51,901			73,529
		385,102			52,260
Property and Equipment, net		36,740			42,693
Long-Term Assets
Deposits and Prepaid Expenses		41,567			45,576
Property and Equipment, net		33,795			41,558
Patents, net		104,740			108,132
Deposits and Prepaid Expenses		38,819			35,174
Totals	$	234,948		$	269,930
Patents, net		100,729			102,940
Total Assets	$	558,445		$	231,932
Liabilities and Deficiency
Current liabilities:
Current Liabilities
Accounts Payable and Accrued Expenses	$	~~981~~1,~~199~~342,235		$	1,~~020~~244,~~809~~446
Funds Held in Trust for Redemption of Class B Common Shares		4			4
Due to Shareholders		107,645			131,052
Loan Payable		214,194			-
Notes Payable, net of debt discount		133,843			71,863
Due to Shareholders		124,274			133,773
Derivative Liability on Notes Payable		645,594			201,260
Notes Payable, net of debt discount		164,302			72,614
Total current liabilities and total liabilities		1,868,285			1,424,988
Derivative Liabilities on Notes Payable		499,952			344,086
Commitments and contingencies
Total Liabilities		2,344,961			1,794,923
Commitments and Contingent Liabilities
Deficiency
Preferred stock; par value $.0001 per share, 50,000,000 shares authorized, none issued		-			-
Common stock; par value $.00001 per share; 150,000,000 shares authorized, 76,060,520 and 47,383,379 common shares and 24,176,927 and 24,176,927 exchangeable shares issued and outstanding as of July 31, 2015 and October 31, 2014		979			692
Common stock; par value $.00001 per share; 150,000,000 shares authorized, 92,866,724 and 92,214,030 common shares and 24,176,927 and 24,176,927 exchangeable shares issued and outstanding as of January 31, 2016 and October 31, 2015, respectively		1,146			1,139
Additional paid-in capital		47,400,545			46,505,954
Additional Paid-in Capital		47,864,720			47,838,139
Accumulated deficit		(49,186,943	)		(47,637,746	)
Accumulated Deficit		(49,679,362	)		(49,554,070	)
Accumulated other comprehensive loss		152,082			(23,958	)
Accumulated Other Comprehensive Income		26,980			151,801
Total deficiency		(1,633,337	)		(1,155,058	)
Total Deficiency		(1,786,516	)		(1,562,991	)
Totals	$	234,948		$	269,930
Total Liabilities and Deficiency	$	558,445		$	231,932

See notes to condensed consolidated financial statements.

F-1

CardioGenics Holdings Inc.

Condensed Consolidated Statements of Operations (unaudited)

For the Three and Nine Months Ended July 31, 2015 and 2014

	Three Months Ended January 31,
	2016			2015

Revenue	$	-		$	-

Operating Expenses
Depreciation and Amortization of Property and Equipment		1,379			1,986
Amortization of Patent Application Costs		2,211			2,379
General and Administrative		138,346			133,611
Research and Product Development		59,160			67,720
Total operating expenses		201,096			205,696
Operating Loss		(201,096	)		(205,696	)

Other Expenses (Income)
Interest Expense and Bank Charges, net		126,176			159,115
Loss (Gain) on Change in Value of Derivative Liability		(54,634	)		652,348
Loss (Gain) on Foreign Exchange Transactions		(147,346	)		43,671
Total Other Expenses (Income)		(75,804	)		(855,134	)

Net Loss	$	(125,292	)	$	(1,060,830	)

Basic and Diluted Net Loss per Common Share	$	0.00		$	(0.01	)

Weighted-average Number of Shares of Common Stock Outstanding		116,716,036			74,095,036

	For the Three Months Ended July 31,						For the Nine Months Ended July 31,
	2015			2014			2015			2014
Revenue	$	-		$	-		$	-		$	-
Operating Expenses
Depreciation and Amortization of Property and Equipment		2,061			2,740			5,953			8,168
Amortization of Patent Application Costs		788			1,724			5,449			5,140
General and Administrative		46,626			107,751			262,141			375,796
Research and Product Development, Net of Investment Tax Credits		50,430			85,241			186,867			275,916
Total operating expenses		99,905			197,456			460,410			665,020
Operating Loss		(99,905	)		(197,456	)		(460,410	)		(665,020	)
Other Expenses (Income)
Interest Expense and Bank Charges (Net)		130,118			142,256			392,511			379,836
Loss on Change in Fair Value of Derivative Liability		314,345			246,430			643,194			247,249
Loss (Gain) on Foreign Exchange Transactions		67,122			(20,515	)		53,082			21,664
Total other expenses(income)		511,585			368,171			1,088,787			648,749
Net Loss	$	(611,490	)	$	(565,627	)	$	(1,549,197	)	$	(1,313,769	)
Basic and Fully Diluted Net Loss per Common Share Shareholders	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)
Weighted-average shares of Common Stock outstanding		98,626,734			60,938,316			86,990,095			60,260,456

See notes to condensed consolidated financial statements.

F-2

CardioGenics Holdings Inc.

Condensed Consolidated Statements of Comprehensive ~~Income (~~Loss) (unaudited)

For the Three and Nine Months Ended July 31, 2015 and 2014

	Three Months Ended January 31,
	2016			2015

Net loss	$	(125,292	)	$	(1,060,830	)

Other comprehensive income (loss), currency translation adjustments		(124,821	)		143,582

Comprehensive Loss	$	(250,113	)	$	(917,248	)

	Three Months Ended						Nine Months Ended
	July 31,						July 31,
	2015			2014			2015			2014
Net (loss)	$	(611,490	)	$	(565,627	)	$	(1,549,197	)	$	(1,313,769	)
Other comprehensive income (loss), currency translation adjustments		105,653			(10,262	)		176,040			66,415
Comprehensive (loss)	$	(505,837	)	$	(575,889	)	$	(1,373,157	)	$	(1,247,354	)

See notes to condensed consolidated financial statements.

F-3

CardioGenics Holdings Inc.

Condensed Consolidated ~~Statements~~Statement of Changes in Deficiency (unaudited)

For the Nine Months Ended July 31, 2015

	Three Months Ended January 31, 2016
										Accumulated
					Additional					Other
	Common Stock				Paid-in		Accumulated			Comprehensive			Total
	Shares		Amount		Capital		Deficit			Income (Loss)			Deficiency
Balance November 1, 2015		116,390,957	$	1,139	$	47,838,139	$	(49,554,070	)	$	151,801		$	(1,562,991	)

Issuance of common shares on settlement of notes payable November 2015		160,425		2		6,434								6,436

Issuance of common shares for cash December 2015		205,000		2		7,277								7,279

Issuance of common shares on settlement of notes payable December 2015		135,614		1		6,435								6,436

Issuance of common shares on settlement of notes payable January 2016		151,655		2		6,435								6,437

Net Loss								(125,292	)					(125,292	)

Currency Translation Adjustment											(124,821	)		(124,821	)
Balance January 31, 2016		117,043,651	$	1,146	$	47,864,720	$	(49,679,362	)	$	26,980		$	(1,786,516	)

										Accumulated
					Additional					Other
	Common Stock				Paid-in		Accumulated			Comprehensive			Total
	Shares		Amount		Capital		Deficit			Income (Loss)			(Deficiency)
Balance November 1, 2014		71,560,306	$	692	$	46,505,954	$	(47,637,746	)	$	(23,958	)	$	(1,155,058	)
Issuance of common shares on conversion of notes payable November 2014		589,679		6		22,528								22,534
Issuance of common shares on conversion of notes payable December 2014		2,977,637		30		32,230								32,260
Issuance of common shares on conversion of notes payable January 2015		7,349,902		73		83,051								83,124
Issuance of common shares on conversion of shareholder’s loan February 2015		227,273		2		22,854								22,856
Issuance of common shares on conversion of notes payable February 2015		4,684,409		47		40,995								41,042
Issuance of common shares on conversion of notes payable March 2015		3,039,913		29		23,525								23,554
Issuance of common shares for services rendered March 2015		250,000		3		7,497								7,500
Issuance of common shares on conversion of notes payable April 2015		718,390		7		10,720								10,727
Issuance of common shares on conversion of notes payable May 2015		5,894,104		59		51,301								51,360
Issuance of common shares on conversion of notes payable June 2015		1,345,834		15		18,470								18,485
Issuance of common shares for cash May 2015		1,600,000		16		39,984								40,000
Settlement of derivative value of notes payable on conversion to common shares						541,436								541,436
Comprehensive Income (Loss):
Net Loss								(1,549,197	)					(1,549,197	)
Other Comprehensive Income
Currency Translation Adjustment											176,040			176,040
Total Comprehensive Income (Loss)								(1,549,197	)		176,040			(1,373,157	)
Balance July 31, 2015		100,237,447	$	979	$	47,400,545	$	(49,186,943	)	$	152,082		$	(1,633,337	)

See notes to condensed consolidated financial statements.

F-4

CardioGenics Holdings Inc.

Condensed Consolidated Statements of Cash Flows (unaudited)

Nine Months Ended July 31, 2015 and 2014

	Three Months Ended January 31
	2016			2015

Cash flows from operating activities:
Consolidated Net loss	$	(125,292	)	$	(1,060,830	)
Adjustments to reconcile consolidated net loss to net cash provided by (used in) operating activities
Depreciation and amortization		1,379			1,986
Amortization of Patent Application Costs		2,211			2,379
Loss (Gain) on Change in Value of Derivative Liability		(54,634	)		652,348
Interest and Discount on Notes Payable		114,789			152,781
Changes in working capital items:
Accounts receivable		-			26
Deposits and Prepaid Expenses		(3,645	)		4,600
Refundable Taxes Receivable		(2,536	)		(193	)
Accounts Payable and Accrued Expenses		97,789			36,733
Net cash provided by (used in) operating activities		30,061			(210,170	)

Cash Flows from Investing Activities:
Advances receivable		(283,371	)		-
Net cash used in investing activities		(283,371	)		-

Cash flows from financing activities:
Proceeds from Loan Payable		214,194			-
Proceeds from Notes Payable		200,000			185,276
Due to Shareholders		(7,279	)		(3,517	)
Issue of Common Shares for Cash		7,279			-
Net cash provided by financing activities		414,194			181,759

Effects of exchange rate changes on cash		(113,949	)		42,355

Net increase in cash and cash equivalents		46,935			13,944

Cash and cash equivalents, beginning of period		49,875			70,676

Cash and cash equivalents, end of period	$	96,810		$	84,620

	Nine Months Ended July 31,
	2015			2014
Cash flows from operating activities:
Consolidated net income (loss)	$	(1,549,197	)	$	(1,313,769	)
Adjustments to reconcile consolidated net income (loss) to net cash used in operating activities:
Depreciation and amortization		5,953			8,168
Amortization of Patent Application Costs		5,449			5,140
Loss on Change in Value of Derivative Liability		643,194			247,249
Interest and Discount on Notes Payable		376,248			123,521
Amortization of Discount on Debentures Payable		-			186,489
Common stock issued for services rendered		7,500			25,000
Changes in working capital items:
Accounts receivable		32			10
Deposits and Prepaid Expenses		(1,241	)		2,094
Refundable Taxes Receivable		160			(580	)
Government Grants and Investment Tax Credits Receivable		-			(11,218	)
Accounts Payable and Accrued Expenses		38,416			186,909
Cash used in operating activities		(473,486	)		(540,987	)
Cash flows from investing activities:
Patent Application Costs		(2,057	)		-
Cash used in investing activities		(2,057	)		-
Cash flows from financing activities:
Due to Shareholders		-			22,957
Payment on Notes Payable		(4,291	)		-
Proceeds from Notes Payable		255,000			180,000
Issue of Common Shares for Cash		40,000			50,000
Cash provided by financing activities		290,709			252,957
Effects of exchange rate changes on cash		163,798			39,284
Net decrease in cash and cash equivalents		(21,036	)		(248,746	)
Cash and cash equivalents, beginning of period		70,276			263,103
Cash and cash equivalents, end of period	$	49,240		$	14,357

See notes to condensed consolidated financial statements.

F-5

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

Nature of Business

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

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

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

Basis of Presentation

In the opinion of management, the unaudited condensed interim consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary to present fairly the condensed interim consolidated financial position of CardioGenics Holdings Inc. and its subsidiaries under generally accepted accounting principles in the United States (“US GAAP”) as of ~~July~~January 31, ~~2015~~2016, their results of operations and cash flows for the three ~~and nine~~ months ended ~~July~~January 31, ~~2015~~2016 and ~~2014~~2015, and the changes in deficiency ~~for~~ ~~the nine months ended July 31, 2015 and cash flows~~ for the ~~nine~~three months ended ~~July~~January 31, ~~2015 and 2014~~2016. CardioGenics Holdings Inc. and its subsidiaries are referred to together herein as the “Company”. Pursuant to rules and regulations of the SEC, certain information and disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted from these consolidated financial statements unless significant changes have taken place since the end of the most recent fiscal year. Accordingly, these condensed interim consolidated financial statements should be read in conjunction with the consolidated financial statements, notes to consolidated financial statements and the other information in the audited consolidated financial statements of the Company as of October 31, ~~2014~~2015 ~~and 2013~~ (the “Audited Financial Statements”) included in the Company’s Form 10-K that was previously filed with the SEC on February 1226, ~~2015~~2016 and from which the October 31, ~~2014~~2015 consolidated balance sheet was derived.

The results of the Company’s operations for the ~~nine~~three months ended ~~July~~January 31, ~~2015~~2016 are not necessarily indicative of the results of operations to be expected for the full year ending October 31, ~~2015~~2016.

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

The Company has incurred operating losses and has experienced negative cash flows from operations since inception. The Company has an accumulated deficit at ~~July~~January 31, ~~2015~~2016 of approximately $49.27 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.

F-6

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

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

Summary of Significant Accounting Policies.

Derivative Instruments

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

Beneficial Conversion Charge

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

Income Taxes

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

The Company has incurred losses in Canada since inception, which have generated net operating loss carryforwards for income tax purposes. The net operating loss carryforwards arising from Canadian sources as of ~~July~~January 31, ~~2015~~2016 approximated $7,~~561~~730,000, which will ~~expire~~ expire from ~~2015~~2016 through ~~2033~~2035. All fiscal years asexcept ~~originally~~2015 ~~filed~~ have been assessed. ~~Claims~~as ~~relating~~filed toby ~~research~~Canadian ~~and~~tax ~~development credits are open for review for the fiscal years ended October 2014 and 2013~~authorities.

A research and development tax credit for 2012 for which the Company received a refund of $81,460 is being refuted by Canadian taxation authorities. The Company is disputing the position taken by the taxation authorities, but has established a reserve ~~against~~for possible repayment.

As of January 31, 2016, the Company had net operating loss carryforwards from US sources of approximately $45,409,000 available to reduce future Federal taxable income which will expire from 2019 through 2035. Returns for the years 2008 through 2015 are yet to be filed.

For the three months ended January 31, 2016 and 2015, the Company’s effective tax rate differs from the statutory rate principally due to the net operating losses for which no benefit was recorded.

Loan Payable

On November 4, 2015, a third party loaned the Company $214,194 for a term of one year at an interest rate of 10% per annum.

Notes Payable

On November 19, 2012, the Company entered into an agreement (“Line”) with JMJ Financial (“Lender”) whereby the Company may borrow up to $350,000 from the Lender in increments of $50,000. The Line is subject to an original issue discount of $50,000. Advances under the Line (“Notes”) have a maturity date of one year from the date of the advance. If the advance is repaid within three months, the advance is interest free. If not repaid within three months, the advance may not be repaid before maturity and carries interest at 5%. The Lender has the right at any time to convert all or part of the outstanding principal and accrued interest (and any other fees) into shares of fully paid and non-assessable shares of common stock of the Company at a price equal to the lesser of $0.23 and 60% of the lowest trade price in the 25 trading days previous to the conversion. Unless agreed in writing by the parties, at no time will the Lender convert any amount owing under the Line into common stock that would result in the Lender owning more than 4.99% of the common stock outstanding. On June 22, 2015, the Company and the Lender entered into a settlement agreement, whereby in exchange for the remaining indebtedness of $77,235, the Company agreed that on the 15th of each month commencing July 2015 and ending June 2016, the Company would either pay the lender $6,436 or issue to the lender common shares in the equivalent dollar amount at a price equal to the average closing price of the common stock in the five trading days prior to the scheduled payment date. During the three months ended January 31, 2016, the Company issued a total of 447,694 common shares for three installments.

F-7

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

~~Returns~~On ~~for~~May 23, 2014, the ~~years~~Company ~~2008~~issued ~~through~~promissory ~~2014~~notes ~~are~~(the ~~yet~~“LG Notes”) to beLG ~~filed.~~Capital AsFunding, ofLLC ~~July~~and ~~31,~~Adar ~~2015~~Bays, LLC (collectively the ~~Company~~“Holders”) ~~believes~~in itthe ~~has~~amount ~~net~~of ~~operating~~$52,500 ~~loss~~each ~~carryforwards~~bearing interest at 8% annually due May 23, 2015. The LG Notes and accrued ~~from~~interest USmay ~~sources~~be converted into shares of ~~approximately~~the ~~$46,927,000~~Common ~~available~~Stock toof ~~reduce~~the ~~future~~Company ~~Federal~~at ~~taxable~~a ~~income~~42% ~~which~~discount ~~will~~to ~~expire~~the ~~from~~lowest ~~2020~~closing ~~through~~bid with a 12 ~~2033~~day look back.

~~For~~On ~~the~~December ~~nine~~15, ~~months~~2014, ~~ended~~the ~~July~~Company 31received $52,500 ~~2015~~from ~~and~~LG ~~2014~~Capital in exchange for a note payable bearing interest at 8% due in one year, convertible into shares of the Company’s ~~effective~~common ~~tax~~stock ~~rate~~at ~~differs~~a 42% discount from the ~~statutory~~lowest ~~rate~~closing ~~principally~~price of the common ~~due~~shares toover the ~~net~~prior ~~operating~~15 ~~losses~~days. ~~for~~As ~~which~~of noJanuary ~~benefit~~31, ~~was~~2016, ~~recorded~~all but $16,500 of the notes have been converted to common shares.

5.On July ~~Notes~~31, ~~Payable~~2015, the Company received $55,250 from Auctus, LLC in exchange for a note payable bearing interest at 8% due in nine months, convertible into shares of the Company’s common stock at a 45% discount from the lowest closing price of the common shares over the prior 15 days.

On ~~November~~August 1914, ~~2012~~2015, the Company ~~entered~~received ~~into an agreement (“Line”) with JMJ Financial (“Lender”) whereby the Company may borrow up to~~ $~~350~~27,~~000~~500 from ~~the~~Iliad ~~Lender~~Research in& ~~increments of $50~~Trading,~~000.~~ ~~The Line is subject to an original issue discount of $50,000~~L.P. ~~Advances~~in ~~under~~exchange ~~the~~for ~~Line (“Notes”) have~~ a ~~maturity~~note ~~date~~payable ofbearing ~~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 510%. ~~The~~due ~~Lender~~in ~~has~~one ~~the~~year, ~~right~~convertible ~~at any time to convert all or part of the outstanding principal and accrued interest (and any other fees)~~ into shares of ~~fully~~the ~~paid~~Company’s ~~and non-assessable shares of~~ common stock ~~of the Company~~ at a ~~price~~40% ~~equal~~discount tofrom the ~~lesser of $0.23 and 60% of the~~ lowest ~~trade~~ closing price inof the ~~25 trading days previous to the conversion. Unless agreed in writing by the parties, at no time will the Lender convert any amount owing under the Line into~~ common ~~stock that~~shares ~~would~~over ~~result in~~ the ~~Lender~~prior ~~owing~~15 ~~more than 4~~days.~~99% of the common stock outstanding.~~

On ~~May~~October 2313, ~~2014~~2015, the Company ~~issued~~received ~~promissory notes (the “LG Notes”) to LG Capital Funding~~$27,500 ~~LLC~~from ~~and~~Chicago ~~Adar~~Ventures ~~Bays, LLC (collectively the “Holders”)~~ in ~~the~~exchange ~~amount~~for ofa ~~$52,500~~note ~~each~~payable bearing interest at 810% ~~annually~~ due in ~~May~~one 23year, ~~2015.~~convertible ~~The LG Notes and accrued interest may be converted~~ into shares of the ~~Common~~Company’s ~~Stock~~common ofstock ~~the Company~~ at a 4240% discount tofrom the lowest closing ~~bid~~price ~~with a 12 day look back. The LG Notes may be prepaid with the following penalties: (i) if the Notes are prepaid within 60 days~~ of the ~~issue~~ ~~date,~~common ~~then~~shares atover ~~130% of~~ the ~~face~~prior ~~amount~~15 ~~plus any accrued interest; and, (ii) if the LG Notes are prepaid after 60~~ days ~~after the issue date but less than 181 days after the issue date, then at 140% of the face amount plus any accrued interest~~. ~~The LG Notes may not be prepaid after the 180th day after issue. The LG Notes were all converted to common shares in 2015.~~

On November 1220, ~~2014~~2015, the Company received $50,000 from ~~Chicago~~Bay ~~Ventures~~Private Equity Inc. in exchange for a note payable bearing interest at 10 8% due in one year, convertible into shares inof the Company’s common stock at a 4045% discount from the lowest closing price of the common shares over the prior 15 days.

On November 2025, ~~2014~~2015, the Company ~~reached~~received a$160,500 ~~settlement~~from ~~with~~FirstFire ~~IBC~~Opportunities ~~Funds,~~Fund ~~LLC~~LLP ~~(“IBC”)~~in ~~whereby~~exchange ~~IBC~~for ~~agreed~~a tonote ~~pay~~payable ~~$78,026~~bearing ofinterest ~~the~~at ~~Company’s~~4% ~~debts~~due in ~~exchange~~six ~~for~~months, ~~the~~convertible ~~right~~into ~~to purchase~~ shares inof the Company’s common stock at a 4060% discount from the lowest closing price of the common shares over the prior 15 days.

On December 15, 2014, the Company received $52,500 from LG Capital in exchange for a note payable bearing interest at 8% due in one year, convertible into shares in the Company’s common stock at a 42% discount from the lowest closing price of the common shares over the prior 15 days.

On March 5, 2015, the Company received $55,250 from Actus Private Equity Fund, LLC in exchange for a note payable bearing interest at 8% due November 26, 2015, convertible into shares in the Company’s common stock at a 40% discount from the average of the lowest two trading prices of the common shares over the prior 10 trading days.

On July 31, 2015, the Company received $52,500 from Adar Bays in exchange for a note payable bearing interest at 8% due in nine months, convertible into shares in the Company’s common stock at a 45% discount from the lowest closing price of the common shares over the prior 15 days.

F-8

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

A summary of the Notes Payable at ~~July~~January 31, ~~2015~~2016 and October 31, ~~2014~~2015 follows:

	July 31, 2015			October 31, 2014
	January 31, 2016			October 31, 2015
Convertible Note Payable, due February 20, 2015	$	-		$	12,529
Convertible Note Payable, due December 15, 2015	$	16,500		$	16,500
Convertible Notes Payable, due May 23, 2015		-			105,000
Convertible Notes Payable, due May 23, 2016		160,500			-
Convertible Note Payable, due June 23, 2016		2135,~~449~~616			4054,~~000~~925
Convertible Note Payable, due October 22, 2015		35,000			35,000
Convertible Note Payable, due July 31, 2016		55,250			55,250
Convertible Note Payable, due November 12, 2015		35,000			-
Convertible Note Payable, due August 14, 2016		27,500			27,500
Convertible IBC Funds, LLC Payable, due November 21, 2015		16,421			-
Convertible Note Payable, due October 9, 2016		27,500			27,500
Convertible Note Payable, due December 15, 2015		26,500			-
Convertible Note Payable, due November 20, 2016		50,000			-
Convertible Note Payable, due November 26, 2015		55,250			-
Debt Discount - value attributable to conversion feature attached to notes, net of accumulated amortization of $164,302 and $72,614		(208,564	)		(109,061	)
Convertible Note Payable, due March 25, 2016		23,000			-
Total		164,302			72,614
Convertible Note Payable, due July 31, 2016		55,250
Less: Current portion		164,302			72,614
Debt Discount - value attributable to conversion feature attached to Notes, net of accumulated amortization of $133,843 and $71,863		(134,027	)		(120,666	)
Total		133,843			71,863
Less: Current portion		133,843			71,863
Total Long-term portion	$	-		$	-

As described in further detail in Note 67, “Derivative Liabilities”, the Company determines the fair value of the embedded derivatives and records them as a discount to the Notes and as a derivative liability. Upon conversion of the Notes to Common Stock, any remaining unamortized discount is charged to financing expense.

67. Derivative Liabilities

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

The ~~Notes~~Company ~~meet~~determines the ~~definition~~fair value of athe ~~hybrid~~embedded ~~instrument,~~derivatives asand ~~defined~~records inthem ~~ASC~~as ~~815.~~a ~~The~~discount ~~hybrid~~to ~~instrument~~the isNotes ~~comprised~~and ~~of i)~~ a ~~debt~~derivative ~~instrument,~~liability. asThe ~~the~~Company ~~host~~has ~~contract~~recognized ~~and~~a ~~ii)~~derivative anliability ~~option~~of to$499,952 ~~convert~~at ~~the~~January ~~debentures~~31, ~~into~~2016. ~~common~~Accordingly, ~~stock~~changes ofin the ~~Company,~~fair asvalue anof ~~embedded derivative.~~the ~~The~~ embedded derivatives ~~derive~~are ~~their~~immediately ~~value~~recognized ~~based~~in onearnings ~~the~~and ~~underlying~~classified ~~fair~~as ~~value~~a ofgain ~~the~~or ~~Company’s~~loss ~~common~~on ~~stock.~~the ~~The~~ embedded derivative financial ~~derivatives~~instrument ~~are~~in ~~not~~the ~~clearly~~accompanying ~~and~~condensed ~~closely~~consolidated ~~related~~statements toof ~~the~~operations. ~~underlying~~The ~~host~~Company ~~debt~~recorded ~~instrument~~a ~~since~~gain ~~the~~of ~~economic~~$54,634 ~~characteristics~~in ~~and~~the ~~risk~~fair ~~associated~~value ~~with~~for ~~these~~the ~~derivatives~~three ~~are~~months ~~based~~ended onJanuary ~~the~~31, ~~common stock fair value~~2016.

The Company ~~determines~~estimated the fair value of the embedded derivatives ~~and~~using ~~records~~a ~~them~~Black asScholes amodel ~~discount~~with the following assumptions: conversion price $0.012 - $0.022 per share according to the ~~Notes~~agreements; ~~and~~risk afree ~~derivative~~interest ~~liability~~rate of . ~~The~~11%; ~~Company~~expected ~~has~~life ~~recognized~~of up to 1 year; expected dividend of zero; a ~~derivative~~volatility ~~liability~~factor of ~~$645~~194% to 278%,~~594~~ atas ~~July~~of January 31, ~~2015~~2016. ~~Accordingly,~~The ~~changes~~expected inlives ~~the fair value~~ of the ~~embedded~~ ~~derivative~~instruments are ~~immediately~~equal to ~~recognized~~the incontractual ~~earnings~~term ~~and~~of ~~classified~~the asconversion aoption. ~~gain~~The orexpected ~~loss~~volatility is based on the ~~embedded~~historical ~~derivative~~price ~~financial~~volatility of the Company’s ~~instrument~~common instock. The risk-free interest rate represents the ~~accompanying~~U.S. ~~condensed~~Treasury ~~consolidated~~constant ~~statements~~maturities rate for the expected life of ~~operations~~the related conversion option. The ~~Company~~dividend ~~recognized~~yield arepresents ~~loss~~anticipated ofcash ~~$643,194~~dividends into ~~the fair~~be ~~value~~paid ~~for~~over the ~~nine~~expected ~~months~~life ~~ended~~of ~~July~~the ~~31, 2015~~conversion option.

~~The Company estimated the fair value of the embedded derivatives using a Black Scholes model with the following assumptions: conversion price $0~~8.~~012~~ ~~per~~Fair ~~share~~Value according to the agreements; risk free interest rate of .11%; expected life of 1 year; expected dividend of zero; a volatility factor of 249% to 254%, as of July 31, 2015. The expected lives of the instruments are equal to the contractual term of the conversion option. The expected volatility is based on the historical price volatility of the Company’s common stock. The risk-free interest rate represents the U.S. Treasury constant maturities rate for the expected life of the related conversion option. The dividend yield represents anticipated cash dividends to be paid over the expected life of the conversion option.Measurements

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

	●	Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities.

	●	Level 2: Inputs other than quoted market prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly-quoted intervals.

	●	Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions, as there is little, if any, related market activity.

F-9

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

7.The following ~~Fair~~table ~~Value~~summarizes ~~Measurements~~the financial liabilities measured at fair value on a recurring basis as of January 31, 2016, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

Quoted Prices in
Active

Significant Other

Total Increase
(Reduction)

Markets for

Observable

Significant

in Fair Value

Balance Sheet

Identical Assets or

Inputs

Unobservable

January 31, 2016

Recorded at

Location

Liabilities (Level 1)

(Level 2)

Inputs (Level 3)

Total

January 31, 2015

Liabilities:

Derivative liability

499,952

(54,634

)

●The table ~~Level~~below 1:sets ~~Observable~~forth ~~inputs~~a ~~such~~summary asof ~~quoted~~changes ~~market prices~~ in ~~active~~the ~~markets~~fair ~~for~~value ~~identical~~of ~~assets~~the orCompany’s ~~liabilities. ●~~ Level 2:3 ~~Inputs~~financial ~~other than quoted market prices that are observable for the asset or~~ liability, ~~either directly~~ or ~~indirectly; these include quoted prices for similar assets or~~ derivative liabilities inrelated ~~active~~to ~~markets,~~the ~~such~~senior assecured ~~interest~~convertible ~~rates~~notes and ~~yield~~warrants, ~~curves~~for ~~that are observable at commonly-quoted intervals. ● Level 3: Unobservable inputs that reflect~~ the ~~reporting~~three ~~entity’s~~months ~~own~~ended ~~assumptions,~~January ~~as there is little~~31, if2016 ~~any,~~and ~~related market activity~~2015.

The following table summarizes the financial liabilities measured at fair value on a recurring basis as of July 31, 2015, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

	2016			2015

Balance at beginning of period	$	344,086		$	201,260
Additions to derivative instruments		210,500			179,820
Change in fair value of derivative liabilities		(54,634	)		652,348
Settlements		-			(385,699	)
Balance at end of period	$	499,952		$	647,729

Quoted Prices in

Total Increase (Reduction)

Active Markets for

Significant Other

Significant

in Fair Value

Balance Sheet

Identical Assets or

Observable Inputs

Unobservable

July 31, 2015

Recorded at

Location

Liabilities (Level 1)

(Level 2)

Inputs (Level 3)

Total

July 31, 2015

Liabilities:

Derivative liability – on Notes Payable

645,594

643,194

Stock-Based Compensation

~~The~~Stock-based ~~table~~employee ~~below~~compensation ~~sets forth a summary of changes in the fair value of the Company’s Level 3 financial liability, or derivative liabilities~~ related to ~~the~~stock ~~senior~~options ~~secured convertible notes and warrants,~~ for the ~~nine~~three months ended ~~July~~January 31, 2016 and 2015: amounted to $-0-.

	2015			2014
Balance at beginning of period	$	201,260		$	99,702
Additions to derivative instruments		342,576			180,000
Change in fair value of derivative liabilities		643,194			247,249
Settlements		(541,436	)		(98,276	)
Balance at end of period	$	645,594		$	428,675

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, 2014		30,000	$	0.90
Granted		-		-
Forfeited/Expired		-		-
Exercised		-		-
Outstanding – October 31, 2015		30,000	$	0.90
Granted		-		-
Forfeited/Expired		-		-
Exercised		-		-
Outstanding – January 31, 2016		30,000	$	0.90

Options typically vest immediately at the date of grant. As such, the Company does not have any unvested options or unrecognized compensation expense at January 31, 2016.

F-10

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

810. ~~Stock Based Compensation~~Warrants

Stock-based employee compensation related to stock options for the nine months ended July 31, 2015 and 2014 amounted to $-0-.

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

			Weighted Average
	Options		Exercise Price
Outstanding - October 31, 2013		30,000	$	0.90
Granted		-		-
Forfeited/Expired		-		-
Exercised		-		-
Outstanding - October 31, 2014		30,000	$	0.90
Granted		-		-
Forfeited/Expired		-		-
Exercised		-		-
Outstanding - July 31, 2015		30,000	$	0.90

Options typically vest immediately at the date of grant. As such, the Company does not have any unvested options or unrecognized compensation expense at July 31, 2015.

9. Warrants

Outstanding warrants are as follows:

	July 31, 2015		October 31, 2014
	January 31, 2016		October 31, 2015
Issued to Flow Capital Advisors Inc. on settlement of lawsuit in August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.30 per common share up to and including August 23, 2016		250,000		250,000
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.50 per common share up to and including August 23, 2016		250,000		250,000
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.75 per common share up to and including August 23, 2016		500,000		500,000
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $1.00 per common share up to and including August 23, 2016		500,000		500,000
Issued to Flow Capital Advisors Inc. on settlement of lawsuit August 2011, entitling the holder to purchase 1 common share in the Company at an exercise price of $0.75 per common share up to and including August 23, 2016		500,000		500,000
Issued to debenture holders February 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.25 per common share up to and including February 27, 2016		600,000		600,000
Issued to debenture holders May 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including June 3, 2016		750,000		750,000
Issued to debenture holders June 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including June 3, 2016		232,500		232,500
Issued to consultants on August 5, 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including August 4, 2023		2,500,000		2,500,000
Issued to consultants in August 5, 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including August 4, 2023		2,500,000		2,500,000
Issued to consultants on August 5, 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.10 per common share up to and including August 4, 2023		1,500,000		1,500,000
Issued to consultants in August 5, 2013 entitling the holders to purchase 1 common share in the Company at an exercise price of $0.10 per common share up to and including August 4, 2023		1,500,000		1,500,000
Issued to consultant on September 3, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.50 per common share up to and including July 31, 2018		500,000		500,000
Issued to consultant in September 3, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.50 per common share up to and including July 31, 2018		500,000		500,000
Issued to shareholder on October 29, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including October 29, 2016		250,000		250,000
Issued to shareholder October 29, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including October 29, 2016		250,000		250,000
Issued to shareholder on November 7, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including November 7, 2016		125,000		-
Issued to shareholder November 7, 2013 entitling the holder to purchase 1 common share in the Company at an exercise price of $0.15 per common share up to and including November 7, 2016		125,000		125,000
Total Warrants outstanding		8,457,500		8,~~332~~457,500

F-11

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

1011. Issuance of Common Stock

During the ~~nine~~three months ended ~~July~~January 31, ~~2015~~2016, the Company issued the following common shares:

Issued for cash consideration of $40,000			1,600,000
Issued on settlement of notes payable			447,694
Issued for services rendered			250,000
Issued for cash consideration of $7,279			205,000
Issued to shareholder on conversion of shareholders loan at $0.11 per share			227,273
			652,694
Issued on conversion of Notes Payable			26,599,868
			28,677,141

1112. Net Loss per Share

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

	Three Months Ended July 31,				Nine Months Ended July 31,
	Three Months Ended January 31,
	2015		2014		2015		2014
	2016		2015
Weighted-average shares - basic		98116,~~626~~716,~~734~~036		6074,~~938~~095,~~316~~036		~~86,990,095~~		~~60,260,456~~
Effect of dilutive securities		-		-		-		-
Weighted-average shares - diluted		98116,~~626~~716,~~734~~036		6074,~~938~~095,~~316~~036		~~86,990,095~~		~~60,260,456~~

Basic ~~earnings~~and (diluted loss) per share ~~“EPS” and diluted EPS~~ for the three ~~and nine~~ months ended ~~July~~January 31, ~~2015~~2016 and ~~2014~~2015 have been computed by dividing the net ~~income (~~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, warrants and shares to be issued upon the exercise of the outstanding ~~options~~convertible ~~and~~notes ~~warrants and conversion of debt~~ representing 28 34,~~350~~870,~~458~~971 and 1529,~~367~~074,~~845~~ 285 incremental shares, respectively, have been excluded from the three ~~and nine~~ months ended ~~July~~January 31, ~~2015~~ 2016 and ~~2014~~2015 ~~computation~~computations of diluted earnings ~~EPS~~per shares as they are antidilutive given the net losses generated ~~for the periods presented~~.

1213. Supplemental Disclosure of Cash Flow Information

	For the Nine Months Ended July 31,
	For the Three Months Ended January 31,
	2015		2014
Cash paid during the period for:	2016		2015
Cash paid during the year for:
Interest	$	3,264	$	6,344
Interest	$	16,263	$	12,352
Non-cash financing activities:
Income taxes	$	-	$	-
Conversion of notes payable	$	19,309	$	137,821
Non-cash financing activities
Settlement of derivative liability	$	-	$	385,699
Conversion of notes payable	$	283,086	$	73,501
Settlement of derivative liability	$	541,436	$	98,276
Issuance of shares on settlement of suit	$	-	$	189,000
Common share issued for services	$	7,500	$	-
Common shares issued for shareholder’s loan	$	22,856	$	-

F-12

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

~~July~~January 31, ~~2015~~2016 and ~~2014~~2015

1314. ~~Commitments and contingent liabilities~~Acquisition

~~Lawsuit~~On November 4, 2015, the Company, through 2489528 Ontario Inc., an Ontario corporation and indirect subsidiary of the Company (“Acquisition Sub”), Plasticap Corporation, an Ontario corporation (“Plasticap”) and 1731861 Ontario Inc., an Ontario corporation (“173 Corp”) entered into an asset purchase agreement, dated as of November 2, 2015, pursuant to which Acquisition Sub was to acquire all of the assets of Plasticap and 173 Corp (collectively, the “Sellers”) (the “Asset Purchase Agreement”).

OnIn ~~June~~consideration 3,for ~~2015~~the sale of the assets by the Sellers, ~~JMJ~~the ~~Financial~~Company ~~filed~~is ato ~~suit~~issue into ~~Florida~~the ~~court~~Sellers, ~~demanding~~or ~~payment~~their ofnominees, ~~its~~(i) ~~outstanding~~a ~~note~~convertible debt ~~payable~~instrument, in the original principal amount of ten million Canadian dollars (CDN$7710,~~235 for~~000,000), ~~failure~~which toshall ~~convert~~bear interest at a ~~portion~~rate of ~~its~~8% ~~note~~(the ~~into~~“Convertible 1Debt”); (ii) twenty million (20,~~800~~000,000) shares of the Company’s common ~~shares~~stock, par value $0.00001 ~~The~~(the “Common Stock”), which shares shall not be registered for resale by the Company ~~has~~and ~~agreed~~shall be subject to ~~pay~~the ~~JMJ~~rights ~~Financial~~and ~~cash~~restrictions ~~monthly payments~~of Rule 144 of $6the Securities Act of 1933 (“Rule 144”); and (iii) a warrant to purchase ten million (10,~~436~~000,000) ~~over~~shares ~~the~~of ~~next~~Common ~~eleven~~Stock, ~~months~~which orwarrant ~~the~~shall ~~equivalent~~have ~~number~~a term of ~~common~~three ~~shares~~(3) years, be exercisable on a net cashless basis at an exercise price of $0.50 per share, not be registered for resale by Seller and be subject to the rights ~~trading~~and ~~value~~restrictions atof Rule 144 (the ~~payment~~“Warrant”). ~~due~~In addition, Acquisition Sub will assume two million nine-hundred ~~date.~~thousand ACanadian ~~payment~~dollars of(CDN $62,~~436~~900,000) ~~was~~in ~~made~~secured indebt ~~July~~from ~~2015~~the Sellers (the “Secured Debt”) as part of the consideration.

14The Asset Purchase Agreement contains customary representations and warranties from the parties. ~~Subsequent~~Acquisition ~~Events~~Sub and 173 Corp also agreed to various post-closing undertakings described in Item 2. below.

	(i)	On August 21, 2015 the Company issued JMJ Financial 233,875 common shares in settlement of that month’s obligation under the lawsuit settlement.
	(ii)	On September 15, 2015 the Company issued JMJ Financial 232,860 common shares in settlement of that month’s obligation under the lawsuit settlement.

On November 4, 2015 and subject to post-closing undertakings, the Company, Acquisition Sub and the Sellers closed the sale and purchase of all of the assets of the Sellers by Acquisition Sub, pursuant to the terms of the Asset Purchase Agreement. The assets acquired by Acquisition Sub comprised all of the assets of the Sellers, which include, among others, the “Plasticap” trademark, all furnishings, fixtures and equipment related to Plasticap’s specialty cap and closure manufacturing business and all of the Sellers’ customer contracts, all as more particularly set forth in the Asset Purchase Agreement.

As part of the closing, Acquisition Sub and 173 Corp agreed to various post-closing undertakings. The following undertakings have yet to be completed and hence the sale has not closed and the notes and warrants above have not been issued, nor has the CDN $2,900,000 secured debt been assumed.

	(i)	173 Corp undertakes that by January 31, 2016 it shall pay all the outstanding indebtedness of Bibby Financial Services located at 4 Robert Speck Parkway, Unit 310, Mississauga, ON, L4Z 1S1.

	(ii)	Following the fulfilment of the undertaking specified in paragraph (i), which shall be considered fulfilled upon 173 Corp providing Acquisition Sub with a copy of the check payable to Bibby Financial Services for the full amount of the indebtedness, 173 Corp undertakes to provide Acquisition Sub, or as it directs, with a full and comprehensive release against any future claims Bibby Financial Services may have and a full indemnity against any future claims.

	(iii)	Acquisition Sub undertakes that it will advance up to fifty thousand Canadian dollars (CDN$50,000) as a deposit against any outstanding claims Jacob Van Halteran may have through any security interests duly registered on any of the Sellers’ assets and that the Sellers shall provide a full and comprehensive release of those security interests other than any rights that may be asserted under the Asset Purchase Agreement specifying any assumed liabilities.

F-13

CardioGenics Holdings Inc.

Notes to Condensed Consolidated Financial Statements (unaudited)

January 31, 2016 and 2015

	(iv)	A Seller’s lender will be paid fifty thousand Canadian dollars (CDN$50,000) against the debt in 173 Corp.

	(v)	Acquisition Sub undertakes to pay from earnings received from time-to-time from its primary customer contract, based on a calculation of 50% before interest, taxes, depreciation and amortization, amounts to reduce the principal amount of the Secured Debt to zero by December 31, 2018. In the event, a residual balance exists, a balloon payment will be made to complete the payment. After Acquisition Sub completes the payment obligation specified under this subparagraph, the Sellers undertake, acknowledge and agree that the Acquisition Sub shall have no further responsibility to make any further payments on the balance of the Secured Debt.

	(vi)	Acquisition Sub and 1646813 Ontario Limited undertake to enter into a new lease agreement for the premises located at 177 Crosby Avenue, Richmond Hill, Ontario, effective November 2015, with an option for Acquisition Sub to purchase the premises on the following terms:

The term of the lease will be 5 years, with an option for an additional 5 years. Acquisition Sub has the option to acquire the building until January 15, 2016, through a purchase of all of the outstanding shares of 1646813 Ontario Limited, the owner of the real property and subject to refinancing the existing mortgages. In the event Acquisition Sub does not exercise the option, the lease shall remain in force for the duration of the lease and the Convertible Debt will be reduced by one million (CDN$1,000,000) Canadian dollars.

The option for acquiring the real property has expired and therefore not in consideration any more. Further, the legal position of both parties is being disputed and has currently not concluded. There are no guarantees that this acquisition will be consummated and if it does, the terms might be different than stated above.

The Company has advanced/loaned $283,371 to Acquisition Sub, Plasticap or 173 Corp from November 4, 2015 to March 18, 2016.

15.

Subsequent Events

	1.	In March 2016, $12,872 in principal amount of JMJ Financial notes payable were settled with 572,448 common shares of the Company.

	2.	In March 2016, $12,760 in principal amount and $2,240 of accrued and unpaid interest of Auctus Fund, LLC notes payable were converted to 1,250,000 common shares of the Company.

	3.	In March 2016, $15,125 in principal amount of Iliad Research & Trading, L.P. notes payable were converted to 1,361,386 common shares of the Company.

F-14

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

You should read this Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) in combination with the accompanying unaudited condensed interim consolidated financial statements and related notes as well as the audited consolidated financial statements and the accompanying notes to the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) included within the Company’s Annual Report on Form 10-K filed on February 1226, ~~2015~~2016.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our ~~unaudited~~ condensed ~~interim~~ consolidated ~~financial~~ financial statements, which have been prepared in accordance with ~~U.S.~~accounting ~~GAAP~~principles generally accepted in the United States of America for interim financial statements filed with the Securities and Exchange Commission. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to accounts receivable, equipment, stock-based compensation, derivative liabilities, income taxes and contingencies. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

The ~~preparation~~accounting ofpolicies ~~these~~and ~~unaudited condensed interim consolidated financial statements requires us to make~~ estimates ~~and~~used ~~judgments that~~as ~~affect the reported amounts~~ of ~~assets,~~October ~~liabilities~~31, ~~revenues and expenses~~2015, ~~and~~as ~~related~~outlined ~~disclosure~~in ~~of contingent assets and liabilities. On an on-going basis, we evaluate~~ our ~~estimates,~~previously ~~including~~filed ~~those~~Form ~~related to accounts receivable, equipment, stock~~10-~~based compensation~~K, ~~income~~have ~~taxes~~been ~~and contingencies. We base our estimates on historical experience and on various other assumptions~~applied ~~that~~consistently ~~are~~as ~~believed to be reasonable under the circumstances, the results~~ of ~~which~~and ~~form the basis~~ for ~~making judgments about~~ the ~~carrying~~ ~~values~~three ofmonths ~~assets~~ended ~~and~~January ~~liabilities~~31, ~~that are not readily apparent from other sources~~2016. ~~Actual results may differ from these estimates under different assumptions or conditions.~~

The accounting policies and estimates used as of October 31, 2014, as outlined in our previously filed Form 10-K, have been applied consistently for the nine months ended July 31, 2015.

Related Party Transactions

In February 2015, a shareholder’s loan in the amount of $22,856 was exchanged for 227,273 common shares.

Off-Balance Sheet arrangements

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

Results of operations

~~Nine~~Three months ended ~~July~~January 31, ~~2015~~2016 as compared to ~~nine~~three months ended ~~July~~January 31, ~~2014~~2015.

	Nine Months
	Three Months
	Ended July 31,
	Ended January 31,
	2015			2014			$ Change
	2016			2015			$ Change
Revenue	$	-▬		$	-▬		$	-▬
Operating expenses:
Depreciation and amortization of property and equipment		51,~~953~~379			81,~~168~~986			~~2,215~~(607	)
Amortization of patent application costs		52,~~449~~211			52,~~140~~379			(~~309~~168	)
General and administrative expenses		~~262~~138,~~141~~346			~~375~~133,~~796~~611			~~113~~4,~~655~~735
Research and product development, net of investment tax credits		186,867			275,916			89,049
Research and product development		59,160			67,720			(8,560	)
Total operating expenses		~~460~~201,~~410~~096			~~665~~205,~~020~~696			~~204~~(4,~~610~~600	)
Operating Loss		(~~460~~201,~~410~~096	)		(~~665~~205,~~020~~696	)		~~204~~(4,~~610~~600	)
Other expenses
Other expenses (income)
Interest expense and bank charges, net		~~392~~126,~~511~~176			~~379~~159,~~836~~115			(1232,~~675~~939	)
Loss on change in value of derivative liability		643,194			247,249			(395,945	)
Loss (Gain) on change in fair value of derivative liability		(54,634	)		652,348			(706,982	)
Loss on foreign exchange transactions		53,082			21,664			(31,418	)
Loss (Gain) on foreign exchange transactions		(147,346	)		43,671			(191,017	)
Net loss	$	(1,549,197	)	$	(1,313,769	)	$	(235,428	)
Net Loss	$	(125,292	)	$	(1,060,830	)	$	(935,538	)

Revenues

During the ~~nine~~three months ended ~~July~~January 31, ~~2015~~2016 and ~~2014~~2015, we generated no revenues.

Operating expenses

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

General and administrative expenses

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

Research and product development~~, net of investment tax credits~~

Research and development expenses consist primarily of salaries and wages paid to officers and employees engaged in those activities and supplies consumed therefor. ~~Research~~The decrease in research and development expenses ~~have~~is ~~reduced~~attributed ~~from~~primarily to a decrease in staff engaged in those activities in the ~~previous~~current ~~year~~quarter ~~through~~vs. athe ~~reduction~~same period in ~~staff~~the prior year.

Interest expense and bank charges

Interest expense consists primarily of interest on notes and debt discount amortization on those notes.

Three months ended July 31, 2015 as compared to three months ended July 31, 2014

	Three Months
	Ended July 31,
	2015			2014			$ Change
Revenue	$	-		$	-		$	-
Operating expenses:
Depreciation of property and equipment		2,061			2,740			679
Amortization of patent application costs		788			1,724			936
General and administrative expenses		46,626			107,751			61,125
Research and product development, net of investment tax credits		50,430			85,241			34,811
Total operating expenses		99,905			197,456			97,551
Operating Loss		(99,905	)		(197,456	)		97,551
Other expenses (income)
Interest expense and bank charges, net		130,118			142,256			12,138
Loss on change in value of derivative liability		314,345			246,430			(67,915	)
Loss (gain) on foreign exchange transactions		67,122			(20,515	)		(87,637	)
Net (loss)	$	(611,490	)	$	(565,627	)	$	(45,863	)

Revenues

During the three months ended July 31, 2015 and 2014, we generated no revenues.

Operating expenses

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

General and administrative expenses

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

Research and product development, net of investment tax credits

Research and development expenses consist primarily of salaries and wages paid to officers and employees engaged in those activities and supplies consumed therefor. Research and development expenses in 2015 are lower than for the same period in 2014 due to the reduction in staff in the current period.

Interest expense and bank charges

Interest expense consists primarily of interest on Notes and debt discount amortization on those Notes.

Liquidity and Capital Resources

We have not generated significant revenues since inception. We ~~incurred~~experienced a net (loss) of approximately ($1126,~~549,~~000) in the three months ended January 31, 2016, and aas ~~cash~~of ~~flow~~January ~~deficiency~~31, 2016 we have an accumulated deficit of approximately $50 million and cash flow from operating activities of approximately $~~473~~30,~~486~~000 for the ~~nine~~three months ended ~~July~~January 31, ~~2015~~2016. We had sufficient cash at January 31, 2016 to fund approximately two months’ operations. We have not yet established an ongoing source of ~~revenues~~ revenues sufficient to cover our operating costs and allow us to continue as a going concern. We have funded our activities to date almost exclusively from debt and equity financings. These matters raise substantial doubt about our ability to continue as a going concern.

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

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

Seasonality

We do not believe that our business is subject to seasonal trends or inflation. On an ongoing basis, we will attempt to minimize any effect of inflation on our operating results by controlling operating costs and whenever possible, seek to insure that subscription rates reflect increases in costs due to inflation.

~~Recent Accounting Pronouncements~~4

In June 2014, the Financial Accounting Standards Board issued ASU 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements. ASU 2014-10 eliminates the distinction of a development stage entity and certain related disclosure requirements, including the elimination of the inception-to-date information on the statements of operations, cash flows and stockholders’ equity. The amendments in ASU 2014-10 will be effective prospectively for annual reporting periods beginning after December 15, 2014, and interim periods within those annual periods, however early adoption is permitted. The Company has effective early adoption of ASU 2014-10 in these interim condensed consolidated financial statements.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

~~N/A~~Not applicable.

Item 4. Controls and Procedures

(a)	Evaluation of Disclosure Controls and Procedures:

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

Our management assessed the effectiveness of our internal control over disclosure controls and procedures for the quarter ended ~~July~~January 31, ~~2015,~~2016 based on the criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on such assessment, our management concluded that during the period covered by this report, our internal control over financial reporting was not effective. Management has identified the following material weaknesses in our internal control over financial reporting:

● Lack of documented policies and procedures; ● Lack of effective separation of duties, which includes monitoring controls, between the members of management; ● Lack of resources towith ~~account~~income ~~for~~tax ~~complex~~expertise; ~~and~~● ~~unusual~~Lack of controls to ensure equity transactions; ~~and~~are recorded accurately; ● Lack of effective review of the consolidated financial statements; and ● Lack of resources to account for complex and unusual transactions.

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

(b)	Changes in Internal Control over Financial Reporting:

During the fiscal quarter ended ~~July~~January 31, ~~2015~~2016, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

On June 3, 2015, JMJ Financial filed a suit in Florida court demanding payment of its outstanding note payable in the amount of $77,235 for failure to convert a portion of its note into 1,800,000 common sharesNone. The parties have agreed to resolve the matter by the Company agreeing with JMJ Financial to repay the $77,235 in equal monthly installments of $6,436 over twelve (12) months commencing June 23, 2015. The Company may elect to pay any of the scheduled payments in the form of common stock calculated using the lowest closing price of the common stock in the five trading days prior to the Company delivering the common stock. The suit was subsequently withdrawn June 19, 2015.

Item 1A. Risk Factors

Not Applicable.

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

The ~~following~~ following table summarizes sales of unregistered securities by the Company during the fiscal quarter ended ~~July~~January 31, ~~2015~~2016:

Investor	Investment Type	Am’t of Debt Converted ($)		Conversion Price/Share		Conversion Date	Shares issued Pursuant to Conversion
Iliad Research	Convertible Note	$	15,000	$	0.006	5/12/15		2,457,002
JMJ Capital	Convertible Note	$	6,436		0.048	11/13/15		160,425
Sub-Total		$	15,000					2,457,002
JMJ Capital	Convertible Note	$	6,436		0.048	12/15/15		135,614
LG Capital	Convertible Note	$	26,000	$	0.009	5/8/15		2,983,381
JMJ Capital	Convertible Note	$	6,437		0.042	1/13/16		151,655
Sub-Total		$	26,000					2,983,381
Total		$	19,309					447,694
Adar Bays	Convertible Note	$	5,000	$	0.011	5/11/15		453,721
Adar Bays	Convertible Note	$	7,500	$	0.016	6/4/15		483,765
Adar Bays	Convertible Note	$	7,000	$	0.008	6/23/15		862,069
Sub-Total		$	19,500					1,799,555
TOTALS		$	60,500					7,239,938

All ~~of the~~ ~~above-referenced~~ sales were exempt from registration pursuant to Section 4 (a)(2) of the Securities Act of 1933.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

Item 6. Exhibits

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

* Filed herewith7

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

SIGNATURES

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

	CARDIOGENICS HOLDINGS INC.
Date: September 23, 2015	By:	/s/ Yahia Gawad
Date: March 28, 2016	By:	/s/ Yahia Gawad
	Name:	Yahia Gawad
	Title:	Chief Executive Officer
Date: September 23, 2015	By:	/s/ James Essex
Date: March 28, 2016	By:	/s/ James Essex
	Name:	James Essex
	Title:	Chief Financial Officer

EXHIBIT INDEX

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

* Filed herewith9

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

Filing Compare · CardioGenics Holdings Inc.