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Share Name | Share Symbol | Market | Type |
---|---|---|---|
I ON Digital Corporation (PK) | USOTC:IONI | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.43 | 0.41 | 0.455 | 0.00 | 14:30:01 |
Filed by Registrant ☒
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Filed by a Party other than the Registrant ☐
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Under Rule 14a-12
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
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Title of each class of securities to which transaction applies:
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2)
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Aggregate number of securities to which transaction applies:
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3)
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
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4)
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Proposed maximum aggregate value of transaction:
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5)
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Total fee paid:
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Fee paid previously with preliminary materials:
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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1)
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Amount Previously Paid: $0
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2)
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Form, Schedule or Registration Statement No.:
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3)
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Filing Party:
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4)
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Date Filed:
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Copies to:
Peter Campitiello, Esq.
McCarter & English, LLP
Two Tower Center Boulevard
East Brunswick, NJ 08816
Tel: 723-867-9741
Fax: 732.393.1901
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Cordially,
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I-ON DIGITAL, CORP.
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Jae Cheol Oh,
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Chairman, Chief Executive and Financial Officer
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1.
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To approve an equity transfer agreement in which the Company will sell transfer of the issued and outstanding equity of I-On Communications Ltd., a wholly-owned subsidiary of the Company organized under the laws of the Republic of Korea, in exchange for the transfer of 20,000,000 shares of the Company’s stock and the assumption of any and all liabilities, as set forth in further detail below in Proposal 1 (Proposal 1);
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2.
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To approve an amendment to our Amended and Restated Certificate of Incorporation to: change the name of the Company from “I-On Digital Corp.” to “Cardio Diagnostics Holdings, Inc.”; and to approve the reverse split of the number of the Company’s outstanding shares of common stock on the basis of one share for every ten (10) to fifteen (15) outstanding shares (Proposal 2); and
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3.
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To consider and vote upon an adjournment of the special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposals 1 and 2 (Proposal 3).
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By Order of the Board of Directors
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/s/ Jae Cheol Oh
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Name: Jae Cheol Oh
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Title: Chairman, Chief Executive and Financial Officer
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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER
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Interests of I-On’s Directors and Executive Officers in the Merger
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ANNEX A – MERGER AGREEMENT
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ANNEX B – SPLIT-OFF AGREEMENT
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Name
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Position with the Combined Company
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Current Position
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Meeshanthini (Meesha) Dogan, PhD
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Chief Executive Officer
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Chief Executive Officer
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Robert (Rob) Philibert, MD PhD
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Chief Medical Officer
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Chief Medical Officer
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Elisa Luqman, JD MBA
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Chief Financial Officer
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Chief Financial Officer
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DECEMBER 31,
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2020
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2019
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Consolidated Statement of Operations (Loss) Data:
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Sales
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$7,954,015
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$7,091,647
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Operating expenses
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2,710,055
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2,264,265
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Net Income (Loss)
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(712,448)
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81,837
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DECEMBER 31,
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2020
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2019
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Consolidated Statement of Cash Flow Data:
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Net cash provided (used in)
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Operating activates
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$134,444
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$171,880
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Investing activities
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(462,131)
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(162,680)
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Financing activities
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57,296
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328,923
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DECEMBER 31,
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2020
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2019
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Consolidated Statement of Operations (Loss) Data:
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Sales
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$—
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$—
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Operating expenses
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609,164
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313
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Other Inome
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4,000
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—
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Net Loss
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(605,164)
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(313)
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DECEMBER 31,
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2020
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2019
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Consolidated Statement of Cash Flow Data:
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Net cash provided (used in)
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Operating activates
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$25,859
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$(697)
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Investing activities
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(29,910)
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—
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Financing activities
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240,000
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964
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I-ON Digital
Corp.)
Historical
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Cardio
Diagnostics, Inc.
(Historical)
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Pro Form
Combined
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Assets
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Current assets
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Cash and cash equivalents
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$2,638,825
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$929,794
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$3,568,619
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Restricted cash
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1,603,511
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—
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1,603,511
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Short-term financial instruments
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703,857
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—
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703,857
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Short-term loan receivable
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126,593
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—
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126,593
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Accounts receivables, net of allowance for doubtful accounts $638,924 and $619,336, respectively
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4,287,878
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—
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4,287,878
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Deferred tax assets - current
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365,636
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—
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365,636
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Prepaid expenses and other current assets
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1,326,888
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17,629
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1,344,517
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Total Current Assets:
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$11,053,188
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947,423+
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$12,000,611
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Non-current assets:
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Investments
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93,215
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93,215
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Property and equipment, net
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89,400
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89,400
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Intangible assets, net
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208,609
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57,333
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265,942
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Deposits
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764,992
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199,873
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964,865
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Deferred tax assets - non current
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822,598
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822,598
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Total non-current assets
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$1,978,814
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$—
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$1,978,814
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Total Assets
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$13,032,002
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257,206
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13,289,208
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Liabilities and Stockholders’ Equity
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Accounts payable and accrued expenses
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$2,212,381
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35,549
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2,247,930
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Value added tax payable
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43,535
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43,535
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Income tax payable
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—
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—
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Short-term loan payable
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337,581
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337,581
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Current portion of long term debt
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21,090
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21,090
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Government grants outstanding
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401,153
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401,153
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Total current liabilities
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3,035,519
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35,549
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3,071,068
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Long term debt, net of current portion
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—
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Total liabilities
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$3,035,519
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—
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3,035,519
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Stockholders’ equity
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Common stock
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3,503
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1,185
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4,688
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Treasury stock
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(709,478)
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(709,478)
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Additional paid-in-capital
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3,713,370
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1,856,014
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5,569,384
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Accumulated deficit
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(725,501)
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(1,139,590)
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(1,865,091)
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Accumulated retained earnings
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7,234,130
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—
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7,234,130
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Total company stockholders’ equity
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9,156,024
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—
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9,156,024
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Preferred stock (I-ON Korea)
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475,036
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—
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475,036
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Non-controlling interests
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5,423
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—
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5,423
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Total stockholders’ equity
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9,996,483
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717,609
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10,714,092
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Total Liabilities and Stockholders’ Equity
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$13,032,002
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1,204,629
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14,236,631
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I-ON Digital Corp.
(Historical)
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Cardio
Diagnostics, Inc.
(Historical )
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Pro Forma
Combined
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Net sales
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$3,616,267
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—
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3,616,267
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Cost of goods sold
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2,494,644
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2,494,644
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Gross profit (loss)
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1,121,623
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1,121,623
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Operating expense:
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Sales and marketing
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—
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65,990
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65,990
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Research and development
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239,108
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87,451
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326,559
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General and administrative expenses
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491,738
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264,927
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756,665
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Amortization
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12,000
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12,000
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Total operating expense
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730,846
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429,477
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1,160,323
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Loss from operations
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—
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(429,477)
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(429,477)
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Other income (expense):
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Interest income
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9,072
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—
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9,072
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Foreign currency transaction gain(loss)
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(6,953)
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(6,953)
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Miscellaneous income, net
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12,603
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12,603
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Interest expense
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(2,512)
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(2,512)
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Total other income (expense), net
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12,210
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12,210
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Income (loss) before provision for income taxes, loss on equity investments in affiliates, and non-controlling interest
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402,987
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(429,477)
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(26,490)
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Provision for income tax
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(579,022)
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—
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(579,022)
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Net Income before income or loss on equity investments in affiliates and non-controlling interest
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982,009
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(429,477)
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552,532
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Net Income(loss)
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981,920
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—
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1,981,920
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•
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be time-consuming and expensive to defend, whether meritorious or not;
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require us to stop providing products or services that use the technology that allegedly infringes the other party’s intellectual property;
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divert the attention of our technical and managerial resources;
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require us to enter into royalty or licensing agreements with third-parties, which may not be available on terms that we deem acceptable;
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prevent us from operating all or a portion of our business or force us to redesign our products, services or technology platforms, which could be difficult and expensive and may make the performance or value of our product or service offerings less attractive;
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subject us to significant liability for damages or result in significant settlement payments; or
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require us to indemnify our customers.
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the concentration of the ownership of our shares by a limited number of affiliated stockholders may limit interest in our securities;
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limited “public float” with a small number of persons whose sales or lack of sales could result in positive or negative pricing pressure on the market price for our common stock;
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additions or departures of key personnel;
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loss of a strategic relationship;
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variations in operating results from the expectations of securities analysts or investors;
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announcements of new products or services by us or our competitors;
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reductions in the market share of our products;
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announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments;
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investor perception of our industry or prospects;
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insider selling or buying;
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investors entering into short sale contracts;
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regulatory developments affecting our industry; and
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changes in our industry;
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competitive pricing pressures;
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our ability to obtain working capital financing;
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sales of our common stock;
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our ability to execute our business plan;
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operating results that fall below expectations;
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revisions in securities analysts’ estimates or reductions in security analysts’ coverage; and
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economic and other external factors.
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I-On has incurred and expects to continue to incur significant expenses related to the proposed merger with CDI even if the merger is not consummated.
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I-On’s customers, prospective customers, collaborators and other business partners and investors in general may view the failure to consummate the merger as a poor reflection on its business or prospects.
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Some of I-On’s suppliers, distributors, collaborators and other business partners may seek to change or terminate their relationships with I-On as a result of the proposed merger.
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As a result of the proposed merger, current and prospective employees could experience uncertainty about their future roles within the combined company. This uncertainty may adversely affect I-On’s ability to retain its key employees, who may seek other employment opportunities.
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I-On’s management team may be distracted from day to day operations as a result of the proposed merger.
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The market price of I-On common stock may decline to the extent that the current market price reflects a market assumption that the proposed merger will be completed.
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the announcement or pendency of the merger agreement or the transactions contemplated thereby;
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the taking of any action, or the failure to take any action, by any party that is required to comply with the terms of the merger agreement;
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any natural disaster or any act or threat of terrorism or war anywhere in the world, any armed hostilities or terrorist activities anywhere in the world, any threat or escalation or armed hostilities or terrorist activities anywhere in the world or any governmental or other response or reaction to any of the foregoing;
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•
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any change in generally accepted accounting principles or any change in applicable laws, rules or regulations or the interpretation thereof;
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general economic or political conditions or conditions generally affecting the industries in which either party and its subsidiaries operate; or
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•
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with respect to I-On, any change in the stock price or trading volume of I-On common stock.
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•
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the combined company does not achieve the perceived benefits of the merger;
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•
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the effect of the merger on the combined company’s business and prospects is not consistent with expectations; or
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•
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investors react negatively to the effect on the combined company’s business and prospects from the merger.
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the federal physician self-referral law, commonly referred to as the Stark Law;
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the federal Anti-Kickback Act;
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•
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the criminal healthcare fraud provisions of HIPAA;
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•
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the federal False Claims Act;
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•
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reassignment of payment rules that prohibit certain types of billing and collection;
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•
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similar state law provisions pertaining to anti-kickback, self-referral and false claims issues;
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•
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state laws that prohibit general business corporations, such as us, from practicing medicine;
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•
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laws that regulate debt collection practices as applied to our debt collection practices;
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1.
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To approve an equity transfer agreement in which the Company will transfer all of the issued and outstanding equity of I-On Communications Ltd., a wholly-owned subsidiary of the Company organized under the laws of the Republic of Korea, in exchange for the transfer of 20,000,000 shares of the Company’s stock and the assumption of any and all liabilities (Proposal 2);
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2.
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To approve an amendment to our Amended and Restated Certificate of Incorporation to: change the name of the Company from “I-On Digital Corp.” to “Cardio Diagnostics Holdings, Inc.”; and to approve the reverse split of the number of the Company’s outstanding shares of common stock on the basis of one share for every ten (10) to fifteen (15) outstanding shares (Proposal 2); and
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3.
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To consider and vote upon an adjournment of the special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposals 1 and/or 2 (Proposal 3).
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•
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Submitting a Proxy by Mail: If you choose to submit a proxy by mail, simply mark the enclosed proxy card, date and sign it, and return it in the postage paid envelope provided or return it to I-On Digital Corp., Attn:, Corporate Secretary, 15, Tehran-ro 10-gil, Gangam-gu, Seoul, Korea.
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•
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sending a written notice stating that he, she or it would like to revoke his, her or its proxy to the Corporate Secretary of I-On;
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•
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delivering a duly executed proxy card to the Corporate Secretary of I-On bearing a later date than the proxy being revoked; or
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•
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attending the special meeting, withdrawing your proxy, and voting in person. Attendance alone at the special meeting will not revoke a proxy.
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•
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To approve the equity transfer agreement in which the Company will transfer all of the issued and outstanding equity of I-On Communications Ltd., a wholly-owned subsidiary of the Company organized under the laws of the Republic of Korea, in exchange for the transfer of 20,000,000 shares of the Company’s stock to the Company and the assumption of any and all liabilities, as set forth in further detail below in Proposal 2 A failure to submit a proxy card or vote at the special meeting, or an abstention will have the same effect as a vote against the approval of this proposal.
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•
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To approve an amendment to I-On’s certificate of incorporation to change the name of I-On to Cardio Diagnostic Holdings, Inc. and effectuate the reverse split of the number of outstanding I-On shares on the basis of one share for a range of per every ten (10) to fifteen (15) shares of I-On Common Stock outstanding A failure to submit a proxy card or vote at the special meeting, or an abstention will have the same effect as a vote against the approval of this proposal.
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•
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To consider and vote upon an adjournment of the special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposals 1 and 2. A failure to submit a proxy card or vote at the special meeting, or an abstention or “broker non-vote” will have no effect on the outcome of Proposal 4.
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Nine months
ended
September 30,
2021
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| |
Nine months
ended
September 30,
2020
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Revenue
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Sales
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| |
$—
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| |
$—
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Total revenue
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—
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| |
—
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Operating expenses
|
| |
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| |
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Sales and marketing
|
| |
65,099
|
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2,931
|
Research and Development
|
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87,451
|
| |
1,500
|
General and administrative expenses
|
| |
264,927
|
| |
587,502
|
Amortization
|
| |
12,000
|
| |
—
|
Total operating expenses
|
| |
429,477
|
| |
591,933
|
|
| |
Nine months
ended
September 30,
2021
|
| |
Nine months
ended
September 30,
2020
|
Other Income
|
| |
—
|
| |
3,500
|
Net loss
|
| |
$(429,477)
|
| |
$(588,433)
|
|
| |
Year ended
December 31,
2020
|
| |
Year ended
December 31,
2019
|
Revenue
|
| |
|
| |
|
Sales
|
| |
$—
|
| |
$—
|
Total revenue
|
| |
—
|
| |
—
|
|
| |
|
| |
|
Operating expenses
|
| |
|
| |
|
Sales and marketing
|
| |
5,476
|
| |
1,004
|
Research and Development
|
| |
1,500
|
| |
—
|
General and administrative expenses
|
| |
591,521
|
| |
(691)
|
Amortization
|
| |
10,667
|
| |
—
|
Total operating expenses
|
| |
609,164
|
| |
(313)
|
Net loss
|
| |
$(605,164)
|
| |
$(313)
|
(a)
|
The total number of authorized shares which the corporation is authorized to issue is 100,000,000 shares of common stock having a par value of $0.0001 per share and 10,000,000 shares of preferred stock having a par value of $0.0001 per share.
|
(b)
|
Upon the effectiveness (the “Effective Time”) pursuant to the General Corporation Law of the State of Delaware (the “DGCL”) of this Certificate of Amendment to the Certificate of Incorporation of the Corporation, each ( ) shares of the Corporation’s common stock, par value $0.0001 per share (the “Common Stock”), issued and outstanding or held by the Corporation in treasury stock immediately prior to the Effective Time shall automatically be combined into one (1) validly issued, fully paid and non-assessable share of Common Stock without any further action by the Corporation or the holder thereof, subject to the treatment of fractional interests as described below. Notwithstanding the immediately preceding sentence, no fractional shares will be issued in connection with the reverse stock split. Stockholders of record who otherwise would be entitled to receive fractional shares, will be entitled to rounding up of their fractional share to the nearest whole share. No stockholder will receive cash in lieu of fractional shares. Each certificate that immediately prior to the Effective Time represented shares of Common Stock (the “Old Certificates”) shall thereafter represent that number of shares of Common Stock into which the shares of Common Stock represented by the Old Certificate shall have been combined, subject to the adjustment for fractional shares as described above.
|
Shareholder(1)
|
| |
Beneficial
Ownership
|
| |
Percent of
Class(2)
|
Jae Cheol Oh
|
| |
14,292,723
|
| |
40.8%
|
Hong Rae Kim
|
| |
1,013,396
|
| |
2.9%
|
Jae Ho Cho
|
| |
0
|
| |
0%
|
Eugene Hong
|
| |
0
|
| |
0%
|
Jean Koh
|
| |
0
|
| |
0%
|
Charlie Baik
|
| |
0
|
| |
0%
|
Officers and Directors as a Group (3 persons)
|
| |
15,306,119
|
| |
43.7%
|
(1)
|
The address for all officers, directors and beneficial owners is 15, Teheran-ro 10-gil, Gangnam-gu, Seoul, Korea.
|
|
| |
FOR THE BOARD OF DIRECTORS
|
|
| |
|
|
| |
/s/ Jae Cheol Oh
|
|
| |
Chairman of the Board of Directors,
|
|
| |
Chief Executive Officer
|
| | ||
FINANCIAL STATEMENTS:
|
| |
|
| | ||
| | ||
| | ||
| | ||
| |
|
| |
2020
|
| |
2019
|
ASSETS
|
| |
|
| |
|
Current assets
|
| |
|
| |
|
Cash
|
| |
$237,087
|
| |
$1,138
|
Prepaid expenses and other current assets
|
| |
8,830
|
| |
763
|
Total current assets
|
| |
245,917
|
| |
1,901
|
Long-term assets
|
| |
|
| |
|
Intangible assets, net
|
| |
69,333
|
| |
—
|
Deposits
|
| |
131,125
|
| |
—
|
Total assets
|
| |
$446,375
|
| |
$1,901
|
|
| |
|
| |
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
|
| |
|
| |
|
Current liabilities
|
| |
|
| |
|
Accounts payable and accrued expenses
|
| |
$39,539
|
| |
$379
|
Convertible notes payable
|
| |
346,471
|
| |
106,471
|
Total liabilities
|
| |
386,010
|
| |
106,850
|
|
| |
|
| |
|
Stockholders' equity (deficiency)
|
| |
|
| |
|
Common stock, $.001 par value; authorized - 2,300,000 shares; 1,050,318 and 0 shares issued and outstanding as of December 31, 2020 and 2019, respectively
|
| |
1,050
|
| |
—
|
Additional paid-in capital
|
| |
769,428
|
| |
—
|
Accumulated deficit
|
| |
(710,113)
|
| |
(104,949)
|
Total stockholders' equity (deficiency)
|
| |
60,365
|
| |
(104,949)
|
Total liabilities and stockholders' equity (deficiency)
|
| |
$446,375
|
| |
$1,901
|
|
| |
2020
|
| |
2019
|
Sales
|
| |
$—
|
| |
$—
|
|
| |
|
| |
|
Operating expenses
|
| |
|
| |
|
Sales and marketing
|
| |
5,476
|
| |
1,004
|
Research and Development
|
| |
1,500
|
| |
—
|
General and administrative expenses
|
| |
591,521
|
| |
(691)
|
Amortization
|
| |
10,667
|
| |
—
|
Loss from operations
|
| |
609,164
|
| |
313
|
|
| |
|
| |
|
Other income
|
| |
|
| |
|
Other income
|
| |
4,000
|
| |
—
|
Loss before provision for income taxes
|
| |
(605,164)
|
| |
(313)
|
Provision for Income taxes
|
| |
—
|
| |
—
|
Net loss
|
| |
$(605,164)
|
| |
$(313)
|
|
| |
|
| |
|
Basic and fully diluted income (loss) per common share:
|
| |
|
| |
|
Net loss per common share
|
| |
$(.58)
|
| |
$—
|
Weighted average common shares outstanding - basic and fully diluted
|
| |
1,035,403
|
| |
—
|
|
| |
Common stock
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Deficit
|
| |
Totals
|
|||
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balances, December 31, 2018
|
| |
—
|
| |
$—
|
| |
$—
|
| |
$(104,636)
|
| |
$(104,636)
|
Net loss
|
| |
|
| |
|
| |
|
| |
(313)
|
| |
(313)
|
Balances, December 31, 2019
|
| |
—
|
| |
—
|
| |
—
|
| |
(104,949)
|
| |
(104,949)
|
Common stock issued to members per contribution agreement
|
| |
1,000,000
|
| |
1,000
|
| |
—
|
| |
—
|
| |
1,000
|
Stock-based compensation
|
| |
44,753
|
| |
45
|
| |
588,218
|
| |
—
|
| |
589,263
|
Common stock issued for intangible assets
|
| |
5,565
|
| |
5
|
| |
79,995
|
| |
—
|
| |
80,000
|
Patent deposits contributed by shareholders
|
| |
—
|
| |
—
|
| |
101,215
|
| |
—
|
| |
101,215
|
Net loss
|
| |
|
| |
|
| |
|
| |
(605,164)
|
| |
(605,164)
|
Balances, December 31, 2020
|
| |
1,050,318
|
| |
$1,050
|
| |
$769,428
|
| |
$(710,113)
|
| |
$60,365
|
|
| |
2020
|
| |
2019
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
| |
|
| |
|
Net loss
|
| |
$(605,164)
|
| |
$(313)
|
Adjustments to reconcile net loss to net cash used in operating activities Amortization
|
| |
10,667
|
| |
—
|
Stock-based compensation expense
|
| |
589,263
|
| |
—
|
|
| |
|
| |
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses and other current assets
|
| |
(8,067)
|
| |
(763)
|
Accounts payable and accrued expenses
|
| |
39,160
|
| |
379
|
NET CASH PROVDIED BY (USED IN) OPERATING ACTIVITIES
|
| |
25,859
|
| |
(697)
|
NET CASH USED IN INVESTING ACTIVITIES
|
| |
|
| |
|
Increase in deposits
|
| |
(29,910)
|
| |
—
|
|
| |
|
| |
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
| |
|
| |
|
Proceeds from issuance of convertible notes payable
|
| |
300,000
|
| |
1,000
|
Payments on convertible notes payable
|
| |
(60,000)
|
| |
(36)
|
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
| |
240,000
|
| |
964
|
NET INCREASE IN CASH
|
| |
235,949
|
| |
267
|
CASH - BEGINNING OF YEAR
|
| |
1,138
|
| |
871
|
CASH - END OF YEAR
|
| |
$237,087
|
| |
$1,138
|
|
| |
|
| |
|
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
| |
|
| |
|
Cash paid during the year for:
|
| |
|
| |
|
Interest
|
| |
$—
|
| |
$—
|
|
| |
|
| |
|
Non-cash investing and financing activities:
|
| |
|
| |
|
Common stock issued for intangible assets
|
| |
$80,000
|
| |
$—
|
Patent deposits contributed by shareholders
|
| |
101,215
|
| |
—
|
1.
|
Identifying the contract with a customer;
|
2.
|
Identifying the performance obligations in the contract;
|
3.
|
Determining the transaction price;
|
4.
|
Allocating the transaction price to the performance obligations in the contract; and
|
5.
|
Recognizing revenue when (or as) the Company satisfies its performance obligations.
|
Know-how license
|
| |
5 years
|
|
| |
As of December 31, 2020
|
|||||||||
|
| |
Gross
Carrying
Amount
|
| |
Accumulated
Amortization
|
| |
Net Carrying
Amount
|
| |
Weighted
Average
Useful Life
(in years)
|
Amortized intangible assets:
|
| |
|
| |
|
| |
|
| |
|
Know-how license
|
| |
$80,000
|
| |
$(10,667)
|
| |
$69,333
|
| |
5
|
Total
|
| |
$80,000
|
| |
$(10,667)
|
| |
$69,333
|
| |
|
Aggregate Amortization Expense:
|
| |
|
| |
|
| |
|
| |
|
For the year ended December 31, 2020
|
| |
$10,667
|
| |
|
| |
|
| |
|
|
| |
Years Ended December 31,
|
|||
|
| |
2020
|
| |
2019
|
Stock warrants
|
| |
21,450
|
| |
21,450
|
Total shares excluded from calculation
|
| |
21,450
|
| |
21,450
|
Statutory U.S. federal income tax rate
|
| |
21.0%
|
State income taxes, net of federal income tax benefit
|
| |
(2.4)%
|
Tax effect of expenses that are not deductible for income tax purposes:
|
| |
|
Change in Valuation Allowance
|
| |
(18.6)%
|
Effective tax rate
|
| |
0.0%
|
|
| |
2020
|
| |
2019
|
Deferred Tax Assets:
|
| |
|
| |
|
Net Operating Losses
|
| |
$4,048
|
| |
$—
|
Stock-based compensation
|
| |
179,607
|
| |
—
|
Total deferred tax assets
|
| |
183,655
|
| |
—
|
Deferred Tax Liabilities
|
| |
—
|
| |
—
|
Valuation Allowance
|
| |
(183,655)
|
| |
(—)
|
Net deferred tax assets
|
| |
$—
|
| |
$—
|
FINANCIAL STATEMENTS:
|
| |
|
| | ||
| | ||
| | ||
| | ||
| |
|
| |
SEPTEMBER 30,
2021
|
| |
DECEMBER 31,
2020
|
ASSETS
|
| |
|
| |
|
|
| |
|
| |
|
Current assets
|
| |
|
| |
|
Cash
|
| |
$929,794
|
| |
$237,087
|
Prepaid expenses and other current assets
|
| |
17,629
|
| |
8,830
|
Total current assets
|
| |
947,423
|
| |
245,917
|
|
| |
|
| |
|
Long-term assets
|
| |
|
| |
|
Intangible assets, net
|
| |
57,333
|
| |
69,333
|
Deposits
|
| |
199,873
|
| |
131,125
|
Total assets
|
| |
$1,204,629
|
| |
$446,375
|
|
| |
|
| |
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
| |
|
| |
|
|
| |
|
| |
|
Current liabilities
|
| |
|
| |
|
Accounts payable and accrued expenses
|
| |
$35,549
|
| |
$39,539
|
Stock to be issued
|
| |
451,471
|
| |
346,471
|
Total liabilities
|
| |
487,020
|
| |
386,010
|
|
| |
|
| |
|
Stockholders' equity
|
| |
|
| |
|
Common stock, $.001 par value; authorized - 2,300,000 shares; 1,185,038 and 1,050,318 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively
|
| |
1,185
|
| |
1,050
|
Additional paid-in capital
|
| |
1,856,014
|
| |
769,428
|
Accumulated deficit
|
| |
(1,139,590)
|
| |
(710,113)
|
Total stockholders' equity
|
| |
717,609
|
| |
60,365
|
Total liabilities and stockholders' equity
|
| |
$1,204,629
|
| |
$446,375
|
|
| |
2021
|
| |
2020
|
Revenue
|
| |
$—
|
| |
$—
|
|
| |
|
| |
|
Operating expenses
|
| |
|
| |
|
Sales and marketing
|
| |
65,099
|
| |
2,931
|
Research and development
|
| |
87,451
|
| |
1,500
|
General and administrative expenses
|
| |
264,927
|
| |
587,502
|
Amortization
|
| |
12,000
|
| |
—
|
Total operating expenses
|
| |
429,477
|
| |
591,933
|
Loss from operations
|
| |
(429,477)
|
| |
(591,933)
|
|
| |
|
| |
|
Other income
|
| |
|
| |
|
Other income
|
| |
—
|
| |
3,500
|
Loss before provision for income taxes
|
| |
(429,477)
|
| |
(588,433)
|
Provision for income taxes
|
| |
—
|
| |
—
|
Net loss
|
| |
$(429,477)
|
| |
$(588,433)
|
|
| |
|
| |
|
Basic and fully diluted loss per common share:
|
| |
|
| |
|
Net loss per common share
|
| |
$(.39)
|
| |
$(.57)
|
Weighted average common shares outstanding - basic and fully diluted
|
| |
1,111,120
|
| |
$1,030,395
|
|
| |
Common stock
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Deficit
|
| |
Totals
|
|||
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balances, December 31, 2020
|
| |
1,050,318
|
| |
$1,050
|
| |
$769,428
|
| |
$(710,113)
|
| |
$60,365
|
Common stock issued for cash
|
| |
84,270
|
| |
84
|
| |
1,124,916
|
| |
—
|
| |
1,125,000
|
Placement agent fee
|
| |
—
|
| |
—
|
| |
(95,000)
|
| |
—
|
| |
(95,000)
|
Stock-based compensation
|
| |
50,450
|
| |
51
|
| |
59,949
|
| |
—
|
| |
60,000
|
Adjustment to patent deposits contributed by shareholders
|
| |
—
|
| |
—
|
| |
(3,279)
|
| |
—
|
| |
(3,279)
|
Net loss
|
| |
|
| |
|
| |
|
| |
(429,477)
|
| |
(429,477)
|
Balances, September 30, 2021
|
| |
1,185,038
|
| |
$1,185
|
| |
$1,856,014
|
| |
$(1,139,590)
|
| |
$717,609
|
Balances, December 31, 2019
|
| |
—
|
| |
$—
|
| |
$—
|
| |
$(104,949)
|
| |
$(104,949)
|
Common stock issued to members per contribution agreement
|
| |
1,000,000
|
| |
1,000
|
| |
—
|
| |
—
|
| |
1,000
|
Stock-based compensation
|
| |
44,753
|
| |
45
|
| |
588,218
|
| |
—
|
| |
588,263
|
Common stock issued for intangible assets
|
| |
5,565
|
| |
5
|
| |
79,995
|
| |
—
|
| |
80,000
|
Net loss
|
| |
|
| |
|
| |
|
| |
(588,433)
|
| |
(588,433)
|
Balances, September 30, 2020
|
| |
1,050,318
|
| |
$1,050
|
| |
$668,213
|
| |
$(693,382)
|
| |
$(24,119)
|
|
| |
2021
|
| |
2020
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
| |
|
| |
|
Net loss
|
| |
$(429,477)
|
| |
$(588,433)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities
|
| |
|
| |
|
Amortization
|
| |
12,000
|
| |
—
|
Stock-based compensation expense
|
| |
60,000
|
| |
589,263
|
Adjustment to patent deposits contributed by shareholders
|
| |
(3,279)
|
| |
—
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses and other current assets
|
| |
(8,799)
|
| |
763
|
Accounts payable and accrued expenses
|
| |
(3,990)
|
| |
65,338
|
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
|
| |
(373,545)
|
| |
66,931
|
NET CASH USED IN INVESTING ACTIVITIES:
|
| |
|
| |
|
Increase in deposits
|
| |
(68,748)
|
| |
—
|
|
| |
|
| |
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
| |
|
| |
|
Proceeds from sale of common stock
|
| |
1,125,000
|
| |
—
|
Proceeds from stock to be issued
|
| |
105,000
|
| |
225,000
|
Payments on stock to be issued
|
| |
—
|
| |
(60,000)
|
Placement agent fees
|
| |
(95,000)
|
| |
—
|
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
| |
1,135,000
|
| |
165,000
|
NET INCREASE IN CASH
|
| |
692,707
|
| |
231,931
|
CASH - BEGINNING OF YEAR
|
| |
237,087
|
| |
1,138
|
CASH - END OF YEAR
|
| |
$929,794
|
| |
$233,069
|
|
| |
|
| |
|
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
| |
|
| |
|
Cash paid during the period for:
|
| |
|
| |
|
Interest
|
| |
$—
|
| |
$—
|
Non-cash investing and financing activities:
|
| |
|
| |
|
Common stock issued for intangible assets
|
| |
$—
|
| |
$80,000
|
1.
|
Identifying the contract with a customer;
|
2.
|
Identifying the performance obligations in the contract;
|
3.
|
Determining the transaction price;
|
4.
|
Allocating the transaction price to the performance obligations in the contract; and
|
5.
|
Recognizing revenue when (or as) the Company satisfies its performance obligations.
|
Know-how license
|
| |
5 years
|
|
| |
As of September 30, 2021
|
|||||||||
|
| |
Gross
Carrying
Amount
|
| |
Accumulated
Amortization
|
| |
Net Carrying
Amount
|
| |
Weighted
Average
Useful Life
(in years)
|
Amortized intangible assets:
|
| |
|
| |
|
| |
|
| |
|
Know-how license
|
| |
$80,000
|
| |
$(22,667)
|
| |
$57,333
|
| |
5
|
Total
|
| |
$80,000
|
| |
$(22,667)
|
| |
$57,333
|
| |
|
Aggregate Amortization Expense:
|
| |
|
| |
|
| |
|
| |
|
For the nine months ended September 30, 2021
|
| |
|
| |
|
| |
|
| |
$12,000
|
|
| |
Nine Months Ended
September 30,
|
|||
|
| |
2021
|
| |
2020
|
Stock warrants
|
| |
78,379
|
| |
21,450
|
Total shares excluded from calculation
|
| |
78,379
|
| |
21,450
|
I-ON DIGITAL CORP.
|
| |
|
|||
|
| |
|
| |
|
By:
|
| |
/s/ Jae Cheol Oh
|
| |
|
|
| |
Name: Jae Cheol Oh
|
| |
|
|
| |
Title: Chief Executive Officer
|
| |
|
|
| |
|
| |
|
CDI ACQUISITION CORP.
|
| |
|
|||
|
| |
|
| |
|
By:
|
| |
/s/ Jae Cheol Oh
|
| |
|
|
| |
Name: Jae Cheol Oh
|
| |
|
|
| |
Title: President
|
| |
|
|
| |
|
| |
|
CARDIO DIAGNOSTICS, INC.
|
| |
|
|||
|
| |
|
| |
|
By:
|
| |
|
| |
|
|
| |
Name:
|
| |
|
|
| |
Title:
|
| |
|
|
| |
(a)
|
| |
If to Seller, addressed to:
|
|
| |
|
| |
|
|
| |
|
| |
I-ON DIGITAL CORP.
|
|
| |
|
| |
15 Tehran-ro 10-gil
|
|
| |
|
| |
Gangam-gu, Seoul, Korea
|
|
| |
|
| |
Attn.: Bruce Sangmin Lee
|
|
| |
|
| |
Email: bruce@i-on.net
|
|
| |
|
| |
|
|
| |
|
| |
With a copy to (which shall not constitute notice hereunder):
|
|
| |
|
| |
|
|
| |
(b)
|
| |
If to Buyer or the Subsidiary, addressed to:
|
|
| |
|
| |
|
|
| |
|
| |
JFJ Digital Corp.
|
|
| |
|
| |
15 Tehran-ro 10-gil
|
|
| |
|
| |
Gangam-gu, Seoul, Korea
|
|
| |
|
| |
Attn.: Bruce Sangmin Lee
|
|
| |
|
| |
Email: bruce@i-on.net
|
|
| |
|
| |
|
|
| |
|
| |
With a copy to (which shall not constitute notice hereunder):
|
|
| |
|
| |
|
|
| |
|
| |
McCARTER & ENGLISH, LLP
|
|
| |
|
| |
Two Tower Center Boulevard
|
|
| |
|
| |
Est Brunswick, NJ 08816
|
|
| |
|
| |
Attn: Peter Campitiello, Esq.
|
|
| |
|
| |
Email: pcampitiello@mccarter.com
|
|
| |
|
| |
|
or to such other address as any party hereto shall specify pursuant to this Section 14.1 from time to time.
|
SELLER:
|
| |
|
|||
|
| |
|
| |
|
I-ON DIGITAL CORP.
|
| |
|
|||
|
| |
|
| |
|
By:
|
| |
|
| |
|
|
| |
Name:
|
| |
|
|
| |
Title:
|
| |
|
|
| |
|
| |
|
SUBSIDIARY:
|
| |
|
|||
|
| |
|
| |
|
I-ON COMMUNICATIONS, CO. LTD
|
| |
|
|||
|
| |
|
| |
|
By:
|
| |
|
| |
|
|
| |
Name:
|
| |
|
|
| |
Title:
|
| |
|
|
| |
|
| |
|
BUYER:
|
| |
|
|||
|
| |
|
| |
|
JFJ DIGITAL CORP.
|
| |
|
|||
|
| |
|
| |
|
By:
|
| |
|
| |
|
|
| |
Name:
|
| |
|
|
| |
Title:
|
| |
|
1 Year I ON Digital (PK) Chart |
1 Month I ON Digital (PK) Chart |
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