News Column


August 12, 2014

Item 8.01 - Other Events

In its Current Report on Form 8-K filed on June 13, 2014, CardioGenics Holdings Inc. (the "Company") reported that it had entered into subscription agreements with 13 investors (including three institutional investors) for the sale and issuance of 12,000,000 shares of its common stock (the "Private Placement Shares") in exchange for $1,300,000, or $0.11 per share (the "Polish Offering").

On July 25, 2014, the Company was informed by WDM Autoryzowny Doradca Sp. Z o.o., which was providing advisory services to the Company in connection with the listing of the Private Placement Shares on the NewConnect Market of the Warsaw Stock Exchange (the "Advisor") and WDM Dom Maklerski S.A., which was acting as the offering agent for the Polish Offering (the "Offering Agent"), that efforts to list the Private Placement Shares on the NewConnect Market were being terminated due to the Company not currently meeting the shareholder equity requirements of the Warsaw Stock Exchange and the unlikelihood that it will be able to do so in the near term. The Advisor also cited the approximate 50% decrease in the Company's stock price from June 1, 2014 to July 1, 2014 as a significant concern.

The Advisor and the Offering Agent also informed the Company that their respective agreements with the Company have been terminated and the proceeds from the Polish Offering, which were being held in escrow by the Offering Agent, have been returned to the respective investors.

The Advisor and the Placement Agent have proposed an alternative strategy for achieving a listing on the NewConnect Market, which would utilize a "reverse merger" structure involving a to-be-established Polish subsidiary of the Company and an entity already listed on the NewConnect Market. The Company is currently reviewing this proposal but no determination has been made as to whether such an alternative listing approach would be feasible.

The Company is currently in discussions with other parties regarding alternative financing arrangements.


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Source: Edgar Glimpses

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