Bluejay Diagnostics, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Our President and Chief Executive Officer, who serves as our principal executive officer and our principal financial and accounting officer, has conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2024. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our President and Chief Executive Officer, to allow timely decisions regarding required disclosure. Based on this evaluation, our President and Chief Executive Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2024. Management’s Annual Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act). Our President and Chief Executive Officer, who serves as our principal executive officer and our principal financial and accounting officer, has conducted an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2024. In making this assessment, our President and Chief Executive Officer used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO, in Internal Control—Integrated Framework. Based on that assessment and using the COSO criteria, our President and Chief Executive Officer have concluded that, as a result of a material weakness in internal control over financial reporting arising from a lack of sufficient internal accounting expertise at the Company, our internal control over financial reporting was not effective as of December 31, 2024. The foregoing determination was made in connection with the preparation and finalization of this Form 10-K. In connection therewith, our independent registered public accounting firm identified an issue with respect to the Company’s application of provisions of the Accounting Standards Codification of the FASB related to the accounting and valuation of certain warrants. In particular, in June 2024, the Company issued Class C and Class D warrants that contained “reset” features that caused the exercise prices and number of shares of Company common stock issuable upon exercise of such warrants to increase following stockholder approval of such warrants in August 2024 and changes in the market price of our common stock that were measured in the period that immediately followed. Under applicable accounting guidance, upon reset, the Company should have recorded in its consolidated statement of operations the “deemed dividend on warrant modification” and “net loss applicable to common stockholders,” in each case, below the presentation of net loss. In addition, these non-book entry line items were not included in the Company’s consolidated statement of operations for the three and nine months ended September 30, 2024 in the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2024. 35 Notwithstanding the material weaknesses, management has concluded that the financial statements included elsewhere in this Form 10-K present fairly, in all material respects, our financial position, results of operations, and cash flows in conformity with GAAP. In addition, the Company intends to include an “out-of-period adjustment” in its upcoming Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2025 to provide these additional non-book entry line item amounts for the three and nine months ended September 30, 2024. Our independent registered public accounting firm will not be required to formally attest to the effectiveness of our internal controls over financial reporting for as long as we are an “emerging growth company” pursuant to the provisions of the Jumpstart Our Business Startups Act. Plan to Remediate Material Weakness As noted above, our President and Chief Executive Officer currently serves as our principal executive officer, and our principal financial and accounting officer, and has done so since we separated with our prior Chief Financial Officer in October 2023 and our prior Interim Chief Financial Officer in March 2024. Our President and Chief Financial Officer, who is not a certified public accountant and does not have a prior background in public accounting, works with external and internal consultants in preparing and reviewing the Company’s consolidated financial statements. As a result of the material weakness determination that occurred in connection with the preparation of this Form 10-K, we plan to enhance our processes by designing and implementing controls to review the results of valuations and estimates, including the completeness and accuracy of relevant data elements included in the valuation or estimate. We also plan, subject to the availability of sufficient financial resources in the future, to engage additional qualified resources and/or hire additional staff to ensure these incremental controls are properly implemented and to ensure proper segregation of duties around the review of manual journal entries. Management is currently evaluating steps to remediate the material weaknesses, including enhanced processes to identify and appropriately apply applicable accounting requirements to better evaluate and understand the nuances of the complex accounting standards that apply to our consolidated financial statements. This includes providing enhanced access to accounting literature, research materials, and documents, and increasing communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. When fully implemented and operational, we believe the measures described above will remediate the underlying causes of the control deficiencies that gave rise to the material weakness and will strengthen our internal control over financial reporting. However, remediation efforts are expected to continue into future fiscal quarters. Further, we will not be able to fully remediate this material weakness until these steps have been completed and have been operating effectively for a sufficient period of time. We may also identify additional measures that may be required to remediate the material weakness in our internal control over financial reporting, necessitating further action. Changes in Internal Control Over Financial Reporting Other than the material weakness determination described above and the commencement of the Company’s remediation activities in connection therewith, there have been no changes in our internal control over financial reporting during the most recent fiscal quarter, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Inherent Limitations of Controls Management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. Controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or deterioration in the degree of compliance with the policies or procedures. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. ITEM 9B. OTHER INFORMATION During the three months ended December 31, 2024, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. 36 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information required by this item is hereby incorporated by reference to our definitive proxy statement for our 2025 annual meeting of stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024. ITEM 11. EXECUTIVE COMPENSATION The information required by this item is hereby incorporated by reference to our definitive proxy statement for our 2025 annual meeting of stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information required by this item is hereby incorporated by reference to our definitive proxy statement for our 2025 annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days of the fiscal year ended December 31, 2024. Securities Authorized for Issuance under Equity Compensation Plans The following table sets forth information regarding our equity compensation plans at December 31, 2024: Plan category Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) Weighted- average exercise price of outstanding options, warrants and rights (b) Number of securities (by class) remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) Equity compensation plans approved by security holders (1) 73 $ 14,902.00 136 Equity compensation plans not approved by security holders (2) 108 $ 7,180.00 - (1) Represents shares of common stock issuable upon exercise of outstanding stock options and rights under our 2018 Stock Incentive Plan (the “2018 Plan”) and 2021 Stock Plan (the “2021 Plan”). Both plans permit the Company to grant incentive and nonqualified stock options for the purchase of common stock, and restricted stock awards. The maximum number of shares of common stock reserved for issuance under the 2018 Plan and 2021 Plan are 79 and 245, respectively. At December 31, 2024 there were 35 and 101 shares of common stock available for grant under the 2018 Plan and 2021 Plan, respectively. (2) Consists of warrants issued to placement agents, underwriters and consultants. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information required by this item is hereby incorporated by reference to our definitive proxy statement for our 2025 annual meeting of stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information required by this item is hereby incorporated by reference to our definitive proxy statement for our 2025 annual meeting of stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024. 37 PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) The following documents are filed as part of this report: (1) Financial Statements—See Index to Consolidated Financial Statements at Part II, Item 8 on page F-1 of this Form 10-K. (2) All financial statement schedules have been omitted because they are not applicable or not required or because the information is included elsewhere in the financial statements or the Notes thereto. (3) See the accompanying Index to Exhibits filed as a part of this Form 10-K, which list is incorporated by reference in this Item. (b) See the accompanying Index to Exhibits filed as a part of this Form 10-K. (c) Other schedules are not applicable. INDEX TO EXHIBITS Exhibit No. Description of Document 3.1 Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 3.2 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Bluejay Diagnostics, Inc., filed with the Delaware Secretary of State on July 21, 2023 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on July 21, 2023). 3.3 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Bluejay Diagnostics, Inc., filed with the Delaware Secretary of State on May 14, 2024 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on May 16, 2024). 3.4 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Bluejay Diagnostics, Inc., filed with the Delaware Secretary of State on June 17, 2024 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on June 20, 2024). 3.5 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Bluejay Diagnostics, Inc., filed with the Delaware Secretary of State on August 28, 2024 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on August 23, 2024). 3.6 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Bluejay Diagnostics, Inc., filed with the Delaware Secretary of State on November 15, 2024 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on November 18, 2024). 3.7 Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 3.8 Amendment No. 1 to Amended and Restated Bylaws (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on October 16, 2024). 4.1 Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 4.2 Form of Prefunded Common Stock Warrant (January 2024 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on January 2, 2024). 4.3 Form of Common Stock Warrant (January 2024 Offering (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on January 2, 2024). 4.4 Form of Placement Agent Common Stock Warrant (incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K filed on January 2, 2024). 4.5 Form of Common Stock (August 2023 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s Form 8-K filed on August 28, 2023). 4.6 Form of Class A Warrant (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on November 16, 2021). 4.7 Form of Class B Warrant (incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 4.8 Form of Warrant Agency Agreement (incorporated by reference to Exhibit 4.4 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 4.9 Form of IPO Underwriters’ Warrant (incorporated by reference to Exhibit 4.5 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 4.10 * Description of Securities of Bluejay Diagnostics, Inc. 4.11 Form of Prefunded Warrant (incorporated by reference to Exhibit 4.11 to the Company’s Registration Statement on Form S-1 (File No. 333-280253), filed on June 17, 2024). 4.12 Form of Class C Warrant (incorporated by reference to Exhibit 4.12 to the Company’s Registration Statement on Form S-1 (File No. 333-280253), filed on June 17, 2024). 38 4.13 Form of Class D Warrant (incorporated by reference to Exhibit 4.13 to the Company’s Registration Statement on Form S-1 (File No. 333-280253), filed on June 17, 2024). 10.1** 2021 Stock Plan (incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 10.2** Employment Agreement, dated July 1, 2021, between Neil Dey and Bluejay Diagnostics, Inc. (incorporated by reference to Exhibit 10.3 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 10.3** First Amendment to Employment Agreement, dated January 27, 2023, between Neil Dey and Bluejay Diagnostics, Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 27, 2023). 10.4** Employment Agreement, dated July 1, 2021, between Jason Cook and Bluejay Diagnostics, Inc. * (incorporated by reference to Exhibit 10.5 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 10.5 Form of Securities Purchase Agreement, dated December 27, 2023, between certain purchasers and Bluejay Diagnostics, Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 2, 2024). 10.6 Form of Securities Purchase Agreement, dated August 24, 2023, by and between the Company and each of the Purchasers signatory thereto (incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on August 28, 2023). 10.7 Securities Purchase Agreement, dated June 7, 2021, between certain purchasers and Bluejay Diagnostics, Inc. (incorporated by reference to Exhibit 10.7 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 10.8 Registration Rights Agreement, dated June 7, 2021, between certain purchasers and Bluejay Diagnostics, Inc. (incorporated by reference to Exhibit 10.8 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 10.9 Amended and Restated License Agreement, entered into on October 23, 2023, by and between Bluejay Diagnostics, Inc. and Toray Industries, Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 26, 2023). 10.10 Master Supply Agreement, entered into on October 23, 2023, by and between Bluejay Diagnostics, Inc. and Toray Industries, Inc. (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on October 26, 2023). 10.11 Form of Note Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on May 31, 2024). 10.12 Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on May 31, 2024). 10.13 Form of Senior Secured Note (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on May 31, 2024). 10.14 Underwriting Agreement, dated June 27, 2024, between Aegis and Bluejay Diagnostics, Inc. (incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K filed on June 28, 2024). 14.1 Code of Ethics (incorporated by reference to Exhibit 14.1 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 19.1* Insider Trading Policy. 21.1 List of Subsidiaries (incorporated by reference to Exhibit 21.1 to the Company’s Registration Statement on Form S-1 (File No. 333-260029), filed on October 4, 2021). 31.1* Certification of Principal Executive Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended 31.2* Certification of Principal Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended 32.1* Certification of Principal Executive Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2* Certification of Principal Financial Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 97.1 Incentive Compensation Recovery Policy (incorporated by reference to Exhibit 97.1 to the Company’s Annual Report on Form 10-K filed March 28, 2024) 101.INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL and included in Exhibit 101) * Filed herewith. ** Management contract or compensatory plan, contract or arrangement. ITEM 16. FORM 10-K SUMMARY. None. 39 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on March 31, 2025. Bluejay Diagnostics, Inc. By: /s/ Neil Dey Neil Dey President, Chief Executive Officer and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Neil Dey President, Chief Executive Officer and Director March 31, 2025 Neil Dey (Principal Executive Officer and Principal Financial and Accounting Officer) /s/ Douglas C. Wurth Chairman of the Board of Directors March 31, 2025 Douglas C. Wurth /s/ Donald R. Chase Director March 31, 2025 Donald R. Chase /s/ Svetlana Dey Director March 31, 2025 Svetlana Dey /s/ Fred S. Zeidman Director March 31, 2025 Fred S. Zeidman /s/ Gary Gemignani Director March 31, 2025 Gary Gemignani 40 Index to Consolidated Financial Statements Contents Report of Independent Registered Public Accounting Firm (PCAOB ID # 392 ) F-2 Consolidated Balance Sheets F-3 Consolidated Statements of Operations F-4 Consolidated Statements of Changes in Stockholders’ Equity F-5 Consolidated Statements of Cash Flows F-6 Notes to Consolidated Financial Statements F-7 F- 1 Report of Independent Registered Public Accounting Firm Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Bluejay Diagnostics, Inc.: Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Bluejay Diagnostics, Inc. (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, stockholders’ equity and cash flows for the years then ended, and the related notes to the consolidated financial statements (collectively, the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. Emphasis of Matter Regarding Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has incurred net losses since its inception, and has negative cash flows from operations and will need additional funding to complete planned development efforts. This raises substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters also are described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Wolf & Company, P.C. We have served as the Company’s auditor since 2017. Boston, Massachusetts March 31, 2025 F- 2 Bluejay Diagnostics, Inc. Consolidated Balance Sheets December 31, 2024 2023 ASSETS Current assets: Cash and cash equivalents $ 4,301,945 $ 2,208,516 Prepaid expenses and other current assets 596,938 747,263 Deferred offering costs - 265,081 Total current assets 4,898,883 3,220,860 Property and equipment, net 1,513,495 1,285,741 Operating lease right-of-use assets 209,788 333,267 Other non-current assets 35,257 28,663 Total assets $ 6,657,423 $ 4,868,531 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 145,122 $ 491,474 Operating lease liability, current 113,260 162,990 Accrued expenses 551,986 1,116,911 Total current liabilities 810,368 1,771,375 Operating lease liability, non-current 108,989 189,987 Other non-current liabilities 8,567 12,321 Total liabilities 927,924 1,973,683 Commitments and contingencies (Note 10) Stockholders’ equity: Common stock, $ 0.0001 par value; 250,000,000 shares authorized; 554,012 and 3,098 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively 55 - Additional paid-in capital 40,398,228 29,845,838 Accumulated deficit ( 34,668,784 ) ( 26,950,990 ) Total stockholders’ equity 5,729,499 2,894,848 Total liabilities and stockholders’ equity $ 6,657,423 $ 4,868,531 See report of independent registered public accounting firm and notes to consolidated financial statements. Reflects a 1-for-50 reverse stock split effective November 18, 2024 and 1-for-8 reverse stock split effective June 20, 2024. F- 3 Bluejay Diagnostics, Inc. Consolidated Statements of Operations For Years Ended December 31, 2024 2023 Operating expenses: Research and development $ 3,471,671 $ 5,714,574 General and administrative 3,689,648 4,313,200 Sales and marketing 8,297 283,443 Total operating expenses 7,169,616 10,311,217 Operating loss ( 7,169,616 ) ( 10,311,217 ) Other income (expense): Interest expense ( 823,028 ) - Interest income 145,823 164,900 Other income, net 129,027 192,429 Total other income (expense), net ( 548,178 ) 357,329 Net loss ( 7,717,794 ) ( 9,953,888 ) Deemed dividend on warrant modification 13,223,053 - Net loss applicable to common stockholders $ ( 20,940,847 ) $ ( 9,953,888 ) Net loss per share to common stockholders - Basic and diluted $ ( 114.19 ) $ ( 3,631.48 ) Weighted average common shares outstanding: Basic and diluted 183,392 2,741 See report of independent registered public accounting firm and notes to consolidated financial statements. Reflects a 1-for-50 reverse stock split effective November 18, 2024 and 1-for-8 reverse stock split effective June 20, 2024. F- 4 Bluejay Diagnostics, Inc. Consolidated Statements of Changes in Stockholders’ Equity Common Stock Additional Paid-In Accumulated Total Stockholders’ Shares Amount Capital Deficit Equity Balance as of December 31, 2022 2,526 $ - $ 28,538,375 $ ( 16,997,102 ) $ 11,541,273 Stock-based compensation expense - - 24,385 - 24,385 Issuance of common stock from exercised RSU’s, net of RSU tax withholding 1 - ( 1,453 ) - ( 1,453 ) Issuance of common stock to settle accrued bonus, net of shares withheld 31 - 107,235 - 107,235 Issuance of common stock, net of issuance costs of $ 413,544 540 - 1,177,296 - 1,177,296 Net loss - - - ( 9,953,888 ) ( 9,953,888 ) Balance as of December 31, 2023 3,098 - 29,845,838 ( 26,950,990 ) 2,894,848 Stock-based compensation expense - - 20,094 - 20,094 Issuance of common stock in connection with January 2024 Offering, net of issuance costs of $ 711,031 6,730 - 2,788,969 - 2,788,969 Issuance of common stock in connection with Bridge Note Financing 1,451 - 307,563 - 307,563 Issuance of common stock in connection with June 2024 Offering, net of issuance costs of $ 1,133,419 107,356 11 7,435,645 - 7,435,656 Exercise of Series D Warrants 435,377 44 514 - 558 Cash for fractional shares from reverse stock split - - ( 395 ) - ( 395 ) Net loss - - - ( 7,717,794 ) ( 7,717,794 ) Balance as of December 31, 2024 554,012 $ 55 $ 40,398,228 $ ( 34,668,784 ) $ 5,729,499 See report of independent registered public accounting firm and notes to consolidated financial statements. Reflects a 1-for-50 reverse stock split effective November 18, 2024 and 1-for-8 reverse stock split effective June 20, 2024. F- 5 Bluejay Diagnostics, Inc. Consolidated Statements of Cash Flows For the Years Ended December 31, 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 7,717,794 ) $ ( 9,953,888 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation expense 75,618 648,708 Stock-based compensation expense 20,094 189,245 Amortization of right-of-use asset 123,479 132,247 Non-cash interest expense for finance lease 1,053 1,305 Non-cash interest expense for note payable 307,563 - Loss on disposal of property and equipment 3,411 1,787 Changes in operating assets and liabilities: Prepaid expenses and other current assets 150,325 926,217 Deferred offering costs 265,081 - Other non-current assets ( 6,594 ) 6,548 Accounts payable ( 346,352 ) ( 235,760 ) Accrued expenses and other current and non-current liabilities ( 695,653 ) ( 30,279 ) Net cash used in operating activities ( 7,819,769 ) ( 8,313,870 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment ( 306,783 ) ( 704,166 ) Net cash used in investing activities ( 306,783 ) ( 704,166 ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common stock, gross 12,069,075 1,590,840 Payment for issuance costs of common stock ( 1,844,450 ) ( 413,544 ) Proceeds from issuance of notes payable 2,000,000 - Repayment of notes payable ( 2,000,000 ) - Proceeds from exercise of Class D warrants 558 - Fractional shares adjustment for reverse stock split ( 395 ) - Payment of deferred offering costs - ( 1,849 ) Payment of tax withholding on obligations on restricted stock units - ( 59,078 ) Payment of finance lease ( 4,807 ) ( 4,807 ) Net cash provided by financing activities 10,219,981 1,111,562 Net increase (decrease) in cash and cash equivalents 2,093,429 ( 7,906,474 ) Cash and cash equivalents, beginning of period 2,208,516 10,114,990 Cash and cash equivalents, end of period $ 4,301,945 $ 2,208,516 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION AND NON-CASH INVESTING ACTIVITIES Offering costs included in accounts payable and accrued expenses $ - $ 263,232 Fair value of common stock issued in connection with notes payable $ 307,563 $ - See report of independent registered public accounting firm and notes to consolidated financial statements. F- 6 Bluejay Diagnostics, Inc. Notes to the Consolidated Financial Statements 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION Business Bluejay Diagnostics, Inc. (“Bluejay” and/or the “Company”) is a medical diagnostics company focused on improving patient outcomes in critical care settings. The Company is working on developing rapid tests using whole blood on its Symphony technology platform (“Symphony”), which consists of an analyzer and cartridges. The Company’s Symphony platform is a combination of Bluejay’s intellectual property (“IP”) and exclusively licensed and patented IP that consists of a mobile device and single-use test cartridges that if cleared, authorized, or approved by the U.S. Food and Drug Administration (the “FDA”), could provide a solution to a significant market need in the United States. On June 4, 2021, the Company formed Bluejay Spinco, LLC, a wholly-owned subsidiary of the Company, for purposes of further development of the Company’s ALLEREYE diagnostic test. ALLEREYE is a point-of-care device offering healthcare providers a solution for diagnosing Allergic Conjunctivitis. FDA Regulatory Strategy The Company’s current regulatory strategy is designed to support commercialization of Symphony in the United States pending marketing authorization from the FDA. In May 2023, the Company submitted a pre-submission application to the FDA presenting study designs to validate Symphony IL-6 for use with hospitalized sepsis patients. We participated in a pre-submission meeting with the FDA on August 11, 2023, and at the meeting the FDA provided feedback on the new study design, determined that the submission of a 510(k) is the appropriate premarket submission pathway, and requested that certain data be provided in the 510(k). Based on this feedback, the Company determined to proceed on this basis, which considers the FDA’s feedback. In the second quarter of 2024, we completed a multicenter SYmphony IL-6 MONitoring Sepsis (“SYMON”) clinical study investigating the role of interleukin-6 (IL-6) in patients diagnosed with sepsis and septic shock. This prospective study assessed the performance of IL-6 upon initial presentation to the intensive care unit (ICU). A primary analysis of the SYMON-I pilot clinical study (registered clinical trial number NCT06181604) highlighted that IL-6 levels within 24 hours of sepsis or septic shock diagnosis and admission to the ICU may predict patient mortality out to 28 days. Furthermore, a secondary outcome of the SYMON-I study showed that IL-6 levels within 24 hours of sepsis or septic shock diagnosis and admission to the ICU is a predictor of patient mortality during their hospitalization. Other secondary outcomes showed that lactate and Sequential Organ Failure Assessment (SOFA), standard clinical tests used for sepsis and septic shock patients, were not predictors of patient mortality out to 28 days. We believe that the findings underscore the potential importance of IL-6 as a predictor and provide new insights into the potential pathways for improving sepsis outcomes. In the third quarter of 2024, we initiated SYMON-II pivotal clinical study to validate the findings of the SYMON-I pilot clinical study. As a result of its lack of cash resources, the Company has recently slowed the timeline of this study to preserve cash resources in the near-term, and the Company expects that these delays will prevent the Company from submitting an FDA application for its Symphony platform before the fourth quarter of 2027. Product Manufacturing The Company maintains contracts with Sanyoseiko Co. Ltd (“Sanyoseiko”) to manufacture its analyzer. Once redeveloped, the Company plans to transfer manufacturing of its cartridges to Sanyoseiko, or other suitable CMO, to manufacture the cartridges. Risks and Uncertainties As noted above, Bluejay is reliant upon Sanyoseiko to provide analyzers in sufficient quantity and quality to complete the validations for our FDA application. Our FDA application submission could be delayed if the Company encounters any material supply interruptions. In addition, there can be no assurance that we will be able to obtain necessary regulatory authorization for the manufacturing or marketing of the Symphony in the United States or elsewhere. There also can be no assurance that we will successfully complete any clinical evaluations necessary to receive regulatory approvals, or that the clinical study will demonstrate sufficient safety and effectiveness of the Symphony IL-6 test. The failure to adequately demonstrate the clinical performance of the Symphony IL-6 test could delay or prevent regulatory approval, which could prevent or result in delays to market launch and could materially harm our business. In addition to the FDA regulatory strategy risks and uncertainties, the Company is subject to a number of risks similar to other companies in its industry, including rapid technological change, competition from larger biotechnology companies and dependence on key personnel. The Company is also impacted by inflationary pressures and global supply chain disruptions currently impacting many companies. F- 7 Reverse Stock Splits and Increase to Authorized Capital On July 24, 2023, the Company effected the first reverse stock split of its shares of common stock at a ratio of 1-for-20 (the “July 2023 Reverse Stock Split”). On June 20, 2024, the Company effected a second reverse stock split of its shares of common stock at a ratio of 1-for-8 (the “June 2024 Reverse Stock Split”). On November 18, 2024, the Company effected a third reverse stock split of its shares of common stock at a ratio of 1-for-50 (the “November 2024 Reverse Stock Split” and, together with the July 2023 Reverse Stock Split and June 2024 Reverse Stock Split, the “Reverse Stock Splits”). As such, collectively, the Company’s common stock has undergone reverse stock splits that have combined the shares on a 1-for-8,000 aggregate basis since July 2023. All of the Company’s historical share and per share information related to issued and outstanding common stock and outstanding options and warrants exercisable for common stock in these financial statements have been adjusted, on a retroactive basis, to reflect these reverse stock splits. On October 23, 2024, the stockholders of the Company approved and adopted an amendment to the Company’s amended and restated certificate of incorporation, to increase the number of authorized shares of the Company’s Common Stock to 250,000,000 . Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“US GAAP”) and include all adjustments necessary for the presentation of the Company’s consolidated financial position, results of operations and cash flows for the periods presented. The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation. Going Concern The consolidated financial statements for the years ended December 31, 2024 and 2023 were prepared under the assumption that the Company will continue as a going concern, which contemplates that the Company will be able to realize assets and discharge liabilities in the normal course of business. The Company had cash and cash equivalents of $ 4,301,945 and current liabilities of $ 810,368 as of December 31, 2024. The Company has incurred net losses since its inception, has incurred negative cash flows from operations and has an accumulated deficit of $ 34,668,784 as of December 31, 2024. The Company estimates cash resources will be sufficient to fund its operations up to the third quarter of 2025. These conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these financial statements were issued. The Company continues to develop the Symphony device and its first test for the measurement of IL-6. The Company remains committed to obtaining FDA clearance and will conduct clinical studies to obtain sufficient data to support its FDA submission, while also continuing to build its manufacturing operations with its contract manufacturing organizations. The Company expects that it will seek to raise additional capital through public or private equity offerings, grant financing and support from governmental agencies, convertible debt, collaborations, strategic alliances and distribution arrangements. Additional funds may not be available when it needs them on terms that are acceptable to them, or at all. If adequate funds are not available, it may be required to delay its FDA regulatory strategy, and to delay or reduce the scope of its research or development programs, commercialization efforts or manufacturing commitments and capacity, or even cease operations and enter into receivership. In addition, if the Company raises additional funds through collaborations, strategic alliances or distribution arrangements with third parties, it may have to relinquish valuable rights to its technologies or future revenue streams. These accompanying financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in these consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. The Company evaluates its estimates and assumptions as facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates and assumptions, and those differences could be material to the consolidated financial statements. F- 8 Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less at the date of purchase to be cash equivalents. Cash equivalents, consisting of highly liquid money market funds are carried at fair market value which approximates cost. The Company recognized interest income associated with cash equivalents of $ 145,823 and $ 164,900 for the years ended December 31, 2024 and 2023, respectively. Leases The Company accounts for its leases under the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) ASC 842, Leases (“ASC 842”). The Company has arrangements involving the lease of facilities and the lease of copiers. Under ASC 842, at inception of the arrangement, the Company determines whether the contract is or contains a lease and whether the lease should be classified as an operating or a financing lease. This determination, among other considerations, involves an assessment of whether the Company can control the underlying asset and have the right to obtain substantially all of the economic benefits or outputs from the asset. The Company accounts for the leases of less than 12 months as short-term leases. The Company recognizes right-of-use (“ROU”) assets and lease liabilities as of the lease commencement date based on the net present value of the future minimum lease payments over the lease term. The Company amortizes the right-of-use assets over the remaining terms of the lease. ASC 842 requires the leases to use the rate implicit in the lease unless it is not readily determinable and then it may use its incremental borrowing rate (“IBR”) to discount the future minimum lease payments. Most of the Company’s leases do not provide an implicit rate; therefore, the Company uses its IBR to discount the future minimum lease payments. The Company determines its IBR with its credit rating and other economic information available as of the commencement date, as well as the identified lease term. During the assessment of the lease term, the Company considers its renewal options and extensions within the arrangements and the Company includes these options when it’s reasonably certain to extend the term of the lease. The Company has lease arrangements that contain incentives for tenant improvements as well as fixed rent escalation clauses. For contracts with tenant improvement incentives that are determined to be leasehold improvements and the Company is reasonably certain to exercise, it records a reduction to the lease liability and amortizes the incentive over the identified term of the lease as a reduction to rent expense. The Company records rental expense on a straight-line basis over the identified lease term on contracts with rent escalation clauses. Fair Value Measurements The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and requires disclosure for each major asset and liability category measured at fair value on either a recurring or non-recurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as quoted prices in active markets. Level 2: Inputs, other than the quoted prices in active markets that are observable either directly or indirectly. Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its ow n assumptions. The Company determines fair value for cash equivalents with Level 1 inputs through the reference to the quoted market prices. There were no liabilities measured at fair value on a recurring basis, and no assets or liabilities measured at fair value on a non-recurring basis as of December 31, 2024 and 2023. The carrying values of financial instruments such as prepaid expenses, accounts payable, and accrued expenses approximated fair value as of December 31, 2024 and 2023 due to their short-term maturities. Impairment of Property and Equipment The Company evaluates its long-lived assets with definite lives, such as fixed assets and right-of-use assets for impairment. The carrying value of fixed assets and right-of use assets is reviewed on a regular basis for the existence of facts or circumstances, both internally and externally, that may suggest impairment. Some factors which the Company considers to be triggering events for impairment review include a significant decrease in the market value of an asset, a significant change in the extent or manner in which an asset is used, a significant adverse change in the business climate that could affect the value of an asset, an accumulation of costs for an asset in excess of the amount originally expected, a current period operating loss or cash flow decline combined with a history of operating loss or cash flow uses or a projection that demonstrates continuing losses and a current expectation that, it is more likely than not, a long-lived asset will be disposed of at a loss before the end of its estimated useful life. The factors that drive the estimate of the life are often uncertain and are reviewed on a periodic basis or when events occur that warrant review. Recoverability is measured by comparison of the assets’ book value to future net undiscounted cash flows that the assets are expected to generate. If the assets are not recoverable, the impairment charge is measured as the amount by which the carrying value of the asset group exceeds the fair value. F- 9 Concentration of Credit Risk Cash, and cash equivalents consist of financial instruments that potentially subject the Company to a concentration of credit risk in the event of a default by the related financial institution holding the securities, to the extent of the value recorded in the balance sheet. The Company invests cash that is not required for immediate operating needs primarily in highly liquid instruments with lower credit risk. Research and Development Expenses Costs incurred in the research and development of new products are expensed as incurred. Research and development costs include, but are not limited to, salaries, benefits, stock-based compensation, laboratory supplies, fees for professional service providers and costs associated with product development efforts, including preclinical studies and clinical trials. The Company estimates preclinical study and clinical trial expenses based on the services performed, pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered. Stock-Based Compensation Share-based compensation expense for all share-based payment awards made to employees, directors and non-employees is measured based on the grant-date fair value of the award. Share-based compensation expense for awards granted to non-employees is determined using the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measured. The Company uses the Black-Scholes option pricing model to determine the fair value of options granted. The Company recognizes the compensation cost of share-based awards on a straight-line basis over the requisite service period. For stock awards for which vesting is subject to performance-based milestones, the expense is recorded over the implied service period after the point when the achievement of the milestone is probable, or the performance condition has been achieved. The determination of the fair value of share-based payment awards utilizing the Black-Scholes model is affected by the stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The Company does not have a history of market prices of its common stock, and as such, volatility is estimated using historical volatilities of similar public entities. The expected life of the awards is estimated based on the simplified method for grants to employees and is based on the contractual term for non-employee awards. The risk-free interest rate assumption is based on observed interest rates appropriate for the terms of the awards. The dividend yield assumption is based on history and expectation of paying no dividends. The Company recognizes forfeitures related to employee share-based payments when they occur. Warrants The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in the Financial Accounting Standards Board, or the FASB, ASC, 480, Distinguishing Liabilities from Equity, or ASC 480, and ASC 815, Derivatives and Hedging, or ASC 815. The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. Finally, the Company determines if the warrants meet the definition of a derivative based on their contractual terms. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and at each balance sheet date thereafter. Changes in the estimated fair value of liability-classified warrants are recognized as a non-cash gain or loss on the consolidated statements of operations. The Company also evaluates if changes in contractual terms or other considerations would result in the reclassification of outstanding warrants from liabilities to stockholders’ equity (or vice versa). Segment Reporting Management has determined that the Company has one operating segment, which is consistent with the Company’s structure and how it manages the business. Income Taxes The Company follows accounting guidance regarding the recognition, measurement, presentation and disclosure of uncertain tax positions in the consolidated financial statements. Tax positions taken or expected to be taken in the course of preparing the Company’s tax returns are required to be evaluated to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authorities. Tax positions not deemed to meet a more-likely-than-not threshold would be recorded in the consolidated financial statements. There are no uncertain tax positions that require accrual or disclosure as of December 31, 2024. Any interest or penalties are charged to expense. During the years ended December 31, 2024 and 2023, the Company had no significant interest and penalties. Tax years subsequent to December 31, 2021 are subject to examination by federal and state authorities. F- 10 The Company recognizes deferred tax assets and liabilities based on the impact of temporary differences between assets and liabilities recognized for tax and financial reporting purposes measured by applying enacted tax rates and laws that will be in effect when the differences are expected to reverse, net operating loss carryforwards and tax credits. Valuation allowances are provided when necessary to reduce net deferred tax assets to an amount that is more likely than not to be realized. The deferred tax benefit or expense for the period represents the change in the deferred tax asset or liability from the beginning to the end of the period. Deferred Offering Costs Deferred offering costs consist of underwriting, legal, accounting and other expenses incurred through December 31, 2023 that are directly related to the January 2024 Offering and that were charged to stockholders’ equity upon the completion of the January 2024 Offering. Net Loss per Share Basic net loss per share to common stockholders is computed by dividing the net loss applicable to common stockholders by the weighted-average number of shares of common stock outstanding for the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and dilutive common stock equivalents outstanding for the period determined using the treasury stock and if-converted methods. Dilutive common stock equivalents are comprised of options outstanding under the Company’s stock option plan, restricted stock units, and warrants. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding as inclusion of the potentially dilutive securities would be antidilutive. Potentially dilutive securities not included in the calculation of diluted net loss per share, because to do so would be anti-dilutive, are as follows (in common stock equivalent shares): December 31, 2024 2023 Options to purchase common stock 72 74 Restricted stock units 1 20 Warrants for common stock 660 679 Class A Warrants for common stock 310 311 Class B Warrants for common stock 9 9 5-Year warrants for common stock 6,730 - Class C warrants for common stock 1,372,586 - Placement agent warrants 471 - Recently Issued Accounting Standards The Company does not believe that any recently issued but not yet effective accounting pronouncements will have a material effect on the accompanying consolidated financial statements. 3. LICENSE AND SUPPLY AGREEMENT WITH TORAY INDUSTRIES On October 6, 2020, the Company entered into a License and Supply Agreement (“License Agreement”) with Toray Industries, Inc. (“Toray”). Under the License Agreement, the Company received the exclusive license (outside of Japan) to make and distribute protein detection cartridges that have a function of automatic stepwise feeding of reagent (the “Cartridges”). In exchange for the license, the Company committed to make two payments of $ 120,000 each, both of which were made in 2021. In addition, following the first sale of the Cartridges after regulatory approval, the Company will make royalty payments to Toray equal to 15 % of the net sales of the Cartridges for the period that any underlying patents exist or five years after the first sale. Following the first sale after obtaining regulatory approval, the Company will make minimum annual royalty payments of $ 60,000 for the first year and $ 100,000 for each year thereafter, which shall be creditable against any royalties owed to Toray in such calendar year. On October 23, 2023, the Company and Toray entered into an Amended and Restated License Agreement (the “New Toray License Agreement”) and a Master Supply Agreement (the “New Toray Supply Agreement”). Under the New Toray License Agreement, the Company continues to license from Toray intellectual property rights needed to manufacture single-use test cartridges, and the Company has received the right to sublicense certain Toray intellectual property to Sanyoseiko in connection with Sanyoseiko’s ongoing agreement with the Company to manufacture its Symphony device and cartridges (including in connection with the Company’s clinical trials). In addition, the New Toray License Agreement provides for the transfer of certain technology related to the cartridges to Sanyoseiko. The royalty payments payable by the Company to Toray have been reduced under the New Toray License Agreement from 15 % to 7.5 % (or less in certain circumstances) of net sales of certain cartridges for a term of 10 years. A 50 % reduction in the royalty rate applies upon expiry of applicable Toray patents on a product-by-product and country-by-country basis. The New Toray License Agreement contemplates that applicable royalty payment obligations from the Company to Toray for other products will be determined separately by the parties in the future. There were no sales of or revenues from the cartridges during the 12-month periods ended December 31, 2024 and 2023. F- 11 Under the New Toray Supply Agreement, Toray will manufacture in the near-term (through its wholly owned subsidiary Kamakura Techno- Science, Inc.) certain product intermediate components for use in cartridges being manufactured for the Company by Sanyoseiko. These cartridges made using Toray intermediates are only suitable for the purpose of obtaining FDA approval and not for commercial sale. The New Toray Supply Agreement has a term ending on the earlier of October 23, 2025 or the date that the Company obtains FDA approval for its product, and may be extended for up to six months by mutual agreement of the parties. Once FDA approval has been obtained, the intermediates and cartridges will be manufactured by SanyoSeiko under a separate supply agreement between the Company and SanyoSeiko. At December 31, 2024 and 2023, there were no amounts accrued related to the New Toray License Agreement or the License Agreement. 4. FINANCINGS June 2024 Offering On June 28, 2024, the Company sold in a public offering ( the “June 2024 Offering”), (i) 11,541 common units (the “Common Units”), each consisting of one share of common stock, two Class C Warrants and one Class D Warrant and (ii) 95,815 prefunded units (the “Prefunded Units”), each consisting of one prefunded warrant to purchase one share of common stock (each, a “Prefunded Warrant”), two Class C Warrants and one Class D Warrant. The Common Units were sold at a price of $ 81.50 per unit and the Prefunded Warrants were sold at a price of $ 81.495 per unit. As of December 31, 2024, all Prefunded Warrants have been exercised in full. Pursuant to an engagement letter dated June 6, 2024, by and between the Company and Aegis, the Company paid Aegis a total cash fee of $ 743,750 equal to 8.5 % of the gross proceeds received in the June 2024 Offering. The gross proceeds to the Company from the June 2024 Offering were $ 8,569,075 . The Company incurred offering costs of $ 1,133,419 . May 2024 Bridge Note Financing On May 31, 2024, the Company entered into a Note Purchase Agreement with an accredited investor (the “NPA”), and a Securities Purchase Agreement with three accredited investors (the “SPA”). This transaction closed on June 3, 2024. Debt issuance costs related to the NPA and SPA totaled $ 212,654 . Under the terms of the NPA, the investor provided the Company with a $ 1,000,000 cash subscription in exchange for the issuance of a senior secured note (the “Bridge Note”). As of December 31, 2024, a total of $ 1,176,470 was repaid to the NPA investor in full satisfaction of the Bridge Note. The difference between the Bridge Note and the subscription amount, initially recorded as a discount on the notes, was the result of the discount factor included in the NPA of approximately 17.6 %. Under the terms of the SPA, the three investors agreed to collectively provide the Company with a separate $ 1,000,000 cash subscription in exchange for the issuance of senior secured notes (the “SPA Notes”), and the collective issuance of 1,451 shares of the Company’s common stock. The fair value of the common stock issued in connection with the SPA was $ 307,563 . As of December 31, 2024, a total of $ 1,111,110 has been repaid to the SPA investors, in full satisfaction of the SPA Notes. The difference between the SPA Notes and the subscription amounts, initially recorded as a discount on the SPA Notes, was the result of the discount factor included in the SPA of 11.11 %. The interest expense recorded on the NPA and SPAs was $ 807,797 for the year ended December 31, 2024, including debt issuance costs related to the NPA and SPA totaling $ 212,654 . January 2024 Offering On January 2, 2024, the Company sold in a public offering (such transaction, the “January 2024 Offering”) (i) 1,344 shares of the Company’s Common stock, par value $ 0.0001 per share and (ii) prefunded warrants to purchase up to an aggregate 5,386 shares of Common Stock (the “Prefunded Warrants”). The Shares and Prefunded Warrants were sold together with warrants to purchase up to an aggregate of 6,730 shares of Common Stock at an exercise price of $ 520.00 per share (the “January 2024 Warrants”). The combined public offering price was $ 520.00 per share of Common Stock and related January 2024 Warrant and $ 519.96 per Prefunded Warrant and related January 2024 Warrant. As of December 31, 2024, all Prefunded Warrants have been exercised in full. The January 2024 Warrants are exercisable immediately and for a period of five years following the date of issuance. F- 12 Pursuant to an engagement letter, dated as of August 7, 2023, as amended October 11, 2023 (the “Amended Engagement Letter”), by and between the Company and the Placement Agent, the Company paid the Placement Agent a total cash fee of $ 245,000 equal to 7.0 % of the gross proceeds received in the January 2024 Offering. The Company also paid the Placement Agent in connection with the January Offering a management fee of $ 35,000 equal to 1.0 % of the gross proceeds raised in the January 2024 Offering and certain expenses incurred in connection with the January Offering. In addition, the Company issued to the Placement Agent, warrants to purchase up to an aggregate 471 shares of Common Stock (the “January 2024 Placement Agent Warrants”), which represents 7.0 % of the aggregate number of shares of Common Stock and Prefunded Warrants sold in the January 2024 Offering. The January 2024 Placement Agent Warrants have substantially the same terms as the January 2024 Warrants, except that the January 2024 Placement Agent Warrants have an exercise price equal to $ 650.00 , or 125 % of the offering price per share of Common Stock and related January 2024 Warrant sold in the January Offering and expire on the fifth anniversary from the date of the commencement of sales in the January 2024 Offering. The gross proceeds to the Company from the January 2024 Offering were $ 3,500,000 . The Company incurred offering costs of $ 711,031 . August 2023 Offering On August 24, 2023, the Company entered into a securities purchase agreement with certain institutional and accredited investors (the “Purchase Agreement”) relating to the registered direct offering and sale of 540 shares of the Company’s common stock at a purchase price of $ 2,946.00 per share (the “August 2023 Offering”). In a concurrent private placement, the Company also issued to such institutional and accredited investors unregistered warrants to purchase up to 540 shares of Common Stock (the “Warrants”). Pursuant to the terms of the Purchase Agreement, for each share of Common Stock issued in this offering an accompanying Warrant was issued to the purchaser thereof. Each Warrant is exercisable for one share of Common Stock (the “August 2023 Warrant Shares”) at an exercise price of $ 2,896.00 per share, is immediately exercisable upon issuance and will expire five years from the date of issuance. The Warrants were offered and sold at a purchase price of $ 50.00 per underlying warrant share, which purchase price is included in the offering price per share of Common Stock issued in the Offering (the “Private Placement”). Pursuant to an engagement letter, dated as of August 7, 2023, between the Company and H.C. Wainwright & Co., LLC (the “Placement Agent”) the Company paid the placement agent a total cash fee of $ 111,359 equal to 7.0 % of the gross proceeds received in the Offering and the Private Placement. The Company also paid the placement agent the management fee equal to $ 15,908 or 1.0 % of the gross proceeds raised in the Offering and Private Placement, $ 45,000 for non-accountable expenses, and $ 15,950 for clearing fees. In addition, the Company issued to the placement agent, warrants to purchase up to 36 shares of Common Stock (the “Placement Agent Warrants”), which represents 7.0 % of the aggregate number of shares of Common Stock sold in the Offering. The Placement Agent Warrants have substantially the same terms as the Warrants, except that the Placement Agent Warrants have an exercise price equal to $ 3,684.00 , or 125 % of the offering price per share of Common Stock sold in the Offering, and a term of five years from the commencement of the sales pursuant to the Offering. The gross proceeds to the Company from the August 2023 Offering and the August 2023 Private Placement are $ 1,590,840 . The Company incurred offering costs of $ 413,544 . 5. WARRANTS The following table summarizes information with regard to warrants outstanding at December 31, 2024: Shares Exercisable for Weighted Average Exercise Price Weighted Average Remaining Life (in Years) June 2024 Class C Warrants 1,372,586 Common Stock $ 16.30 4.5 January 2024 Common Stock Warrants 6,730 Common Stock $ 520.00 4.0 January 2024 Placement Agent Warrants 471 Common Stock $ 650.00 4.0 August 2023 Common Stock Warrants 540 Common Stock $ 2,896.00 3.6 August 2023 Placement Agent Warrants 36 Common Stock $ 3,684.00 3.6 Class A Warrants 310 Common Stock $ 56,000.00 1.9 Class B Warrants 9 Common Stock $ 80,000.00 1.9 Other Pre-2024 Common Stock Warrants 84 Common Stock $ 27,327.00 1.4 F- 13 June 2024 Common Stock Warrants and June 2024 Underwriter Warrants As a part of the June 2024 Offering, the Company issued 214,724 Class C Warrants and 107,362 Class D Warrants. The Underwriter partially exercised its over-allotment option with respect to 13,573 Class C Warrants and 6,787 Class D Warrants (the “Over-Allotment Warrants”). Upon stockholder approval of the issuance of Class C Warrants on August 21, 2024, the Class C Warrants, which had an initial exercise price of $ 98.00 per share of common stock, were adjusted to be exercisable at an exercise price of $ 16.30 per share (representing 20 % of the Nasdaq Minimum Price), and the number of shares issuable upon exercise were proportionately adjusted to 1,372,586 shares. In connection with this reset price and number of Class C Warrants, we recorded a deemed dividend of $ 9,282,075 based on the excess of the fair value of the modified Class C Warrants over the fair value of the Class C Warrants before the modification, the effect of which was an increase in the net loss attributable to common shareholders in the statement of operations for the year ended December 31, 2024. The Class C Warrants may be exercised at any time for a period of five (5) years following the first exercisable date. The Class D Warrants were immediately exercisable at an exercise price of $ 0.0001 per share of common stock for a period of five (5) years following the date of issuance. Upon stockholder approval of issuance of Class D Warrants on August 21, 2021, the number of shares of common stock issuable under the Class D Warrants increased to four shares per warrant for the remaining unexercised Class D Warrants as the weighted average price of our common stock over a rolling five (5)-trading day period fell below $ 16.30 per share (representing 20 % of the Nasdaq Minimum Price) following the issuance date. In connection with this reset price and number of Class D Warrants, we recorded a deemed dividend of $ 3,940,978 based on the excess of the fair value of the modified Class D Warrants over the fair value of the Class D Warrants before the modification, the effect of which was an increase in the net loss attributable to common shareholders in the statement of operations for the year ended December 31, 2024. As of December 31, 2024, all Class D Warrants have been exercised and none remain outstanding. During 2024, the Company issued 435,377 shares of common stock upon exercise of the June 2024 Class D Warrants. The Class D Warrants were exercised on either a cash basis at $ 0.0001 per share exercise price or on a proportional cashless basis. During the years ended December 31, 2024 and 2023, no other warrants were exercised. January 2024 Common Stock Warrants and January 2024 Placement Agent Warrants As part of the January 2024 Offering, the Company issued 6,730 Common Stock Warrants with an exercise price of $ 520.00 per share and 471 Placement Agent Warrants with an exercise price of $ 650.00 per share. The January 2024 Warrants became exercisable immediately upon issuance for a period of five years following the date of issuance. August 2023 Common Stock Warrants and August 2023 Placement Agent Warrants As part of the August 2023 Offering that occurred during the year ended December 31, 2023, the Company issued 540 Warrants with a purchase price of $ 2,896.00 per share and 36 Placement Agent Warrants with an exercise price of $ 3,684.00 per share. The Company’s warrants were accounted for as equity classified financial instruments as they meet the requirements for equity classification under ASC 815, Derivatives and Hedging . 6. STOCK COMPENSATION Stock Incentive Plans In 2018, the Company adopted the 2018 Stock Incentive Plan (the “2018 Plan”) for employees, consultants, and directors. The 2018 Plan, which is administered by the Company’s Board of Directors, permits the Company to grant incentive and nonqualified stock options for the purchase of common stock, and restricted stock awards. The maximum number of shares of common stock reserved for issuance under the 2018 Plan is 79 . At December 31, 2024 there were 35 shares of common stock available for grant under the 2018 Plan. On July 6, 2021, the Company’s Board of Directors and stockholders approved and adopted the Bluejay Diagnostics, Inc. 2021 Stock Plan (the “2021 Plan”). A total of 245 shares of common stock were approved to be initially reserved for issuance under the 2021 Stock Plan. At December 31, 2024 there were 101 shares of common stock available for grant under the 2021 Plan. F- 14 Stock Award Activity The following table summarizes the status of the Company’s non-vested restricted stock awards for years ended December 31, 2024: Non-vested Restricted Stock Awards Number of Shares Weighted Average Grant Date Fair Value Outstanding at December 31, 2023 20 $ 4,384 Granted - - Vested ( 18 ) 3,981 Cancelled / forfeited ( 1 ) 10,320 Outstanding at December, 2024 1 $ 10,320 In February 2023, the Company issued 47 fully vested restricted stock units to certain employees in lieu of cash to satisfy their 2022 accrued bonuses of $ 164,860 . Of the 47 restricted stock units issued, 16 shares were withheld for tax liabilities with a fair value of $ 57,625 . The number of restricted stock unit awards issued was determined based on the approved bonus amount divided by the market price of the Company’s common stock on the date of grant. Stock Option Plan Summary The following is a summary of stock option activity for the year ended December 31, 2024: Number of Stock Options Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life in Years Aggregate Intrinsic Value Outstanding at December 31, 2023 74 $ 14,604 6.7 $ - Granted - - - Exercised - - - Cancelled / forfeited ( 2 ) - - Outstanding at December 31, 2024 72 $ 14,966 5.8 $ - Exercisable at December 31, 2024 64 $ 14,966 5.6 $ - The weighted average grant date fair value of options granted during the year ended December 31, 2023 was $ 4,240.00 per share. The Company determined the grant-date fair value of stock option awards granted during the year ended December 31, 2023 using the Black-Scholes model with the following assumptions: 2023 Risk-free interest rate 3.63 % Expected dividend yield 0.00 % Volatility factor 108.78 % Expected life of option (in years) 6.00 F- 15 Stock-Based Compensation Expense For the years ended December 31, 2024 and 2023, the Company recorded stock-based compensation expense as follows: Year ended December 31, 2024 2023 Research and development $ 16,648 $ 62,955 General and administrative 3,446 133,840 Marketing and business development - ( 7,550 ) Total stock-based compensation $ 20,094 $ 189,245 At December 31, 2024, there was approximately $ 1,996 of unrecognized compensation expense related to non-vested stock option awards that are expected to be recognized over a weighted-average period of 0.83 years. At December 31, 2024, there was approximately $ 944 of unrecognized compensation expense related to non-vested restricted stock awards that are expected to be recognized over a weighted-average period of 0.44 years. 7. RELATED PARTY TRANSACTIONS NanoHybrids, Inc. In December 2021, the Company entered into an agreement with NanoHybrids, Inc. (“NanoHybrids”) to utilize the Company’s research and development staff and laboratory facility when available to perform work for NanoHybrids. Any hours worked by Company employees for NanoHybrids is billed to NanoHybrids at a bill rate of the respective employee’s fully burdened personnel cost plus 10 %. Additionally, the Company may purchase certain lab supplies for NanoHybrids and rebill these costs to NanoHybrids. The Company’s Chief Technology Officer is the majority shareholder of NanoHybrids. The table below summarizes the amounts earned for the years ended December 31, 2024 and 2023 and balances due from NanoHybrids as of December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Income from NanoHybrids included in Other Income $ 127,079 $ 178,042 Cash receipts from NanoHybrids $ 153,783 $ 156,504 As of December 31, 2024 2023 Amounts receivable from NanoHybrids included in Prepaids and Other Current Assets $ 14,564 $ 41,269 8. PROPERTY AND EQUIPMENT Property and equipment consisted of the following at December 31, 2024 and 2023: December 31, Depreciable lives 2024 2023 Construction in process $ 1,351,179 $ 1,052,822 Furniture, fixtures, and equipment 3 - 5 years 136,312 141,164 Software 3 years 4,457 4,457 Lab equipment 3 - 5 years 173,268 1,287,783 Leasehold improvements Life of lease 43,231 43,231 1,708,447 2,529,457 Less: accumulated depreciation ( 194,952 ) ( 1,243,716 ) Property and equipment, net $ 1,513,495 $ 1,285,741 The Company reviews long-lived assets for impairment when events, expectations, or changes in circumstances indicate that the asset’s carrying value may not be recoverable. As a result of this review in 2023, the Company revised the useful life of certain lab equipment in the first quarter of 2023 due to a change in expectations of the time the equipment will be used which resulted in approximately $ 382,795 of additional depreciation recorded in the year ended December 31, 2023. Construction in process consists of symphony cartridge manufacturing equipment. There are no commitments in place to complete construction in process as of December 31, 2024. F- 16 9. LEASES The Company primarily enters into lease arrangements for office, laboratory space, and copiers. A summary of supplemental lease information is as follows: December 31, 2024 2023 Weighted average remaining lease term - operating leases (in years) 2.1 2.9 Weighted average remaining lease term - finance leases (in years) 3.1 4.1 Weighted average discount rate – operating leases 7.0 % 7.0 % Weighted average discount rate – finance leases 7.0 % 7.0 % Operating cash flows from operating leases $ 177,081 $ 174,640 Operating cash flows from finance leases $ 1,053 $ 1,305 A summary of the Company’s lease assets and liabilities are as follows: December 31, 2024 2023 Operating lease right-of-use asset $ 209,788 $ 333,267 Finance leases in Property and Equipment 10,421 15,152 Total lease assets $ 220,209 $ 348,419 Current portion of operating lease liability $ 113,260 $ 162,990 Current portion of finance lease liability included in accrued expenses 4,807 4,807 Noncurrent operating lease liabilities 108,989 189,987 Noncurrent finance lease liabilities 8,567 12,321 Total lease liabilities $ 235,623 $ 370,105 The following table reconciles the undiscounted lease liabilities to the total lease liabilities recognized on the consolidated balance sheet as of December 31, 2024: Year Operating Lease Finance Lease 2025 $ 113,259 $ 4,807 2026 100,000 4,807 2027 25,000 4,807 2028 - 400 Thereafter - - Total future lease payments 238,259 14,821 Less: Imputed interest 16,010 1,447 Present value of lease liability $ 222,249 $ 13,374 10. COMMITMENTS AND CONTINGENCIES Minimum Royalties As required under the License Agreement (see Note 3), following the first sale of Cartridges, the Company will also make royalty payments to Toray equal to 7.5 % of the net sales of the Cartridges for a term of 10 years. A 50 % reduction in the royalty rate applies upon expiry of applicable Toray patents on a product-by-product and country-by-country basis. There were no sales of or revenues from the Cartridges through December 31, 2024. Indemnification The Company has certain agreements with service providers with which it does business that contain indemnification provisions pursuant to which the Company typically agrees to indemnify the party against certain types of third-party claims. The Company accrues for known indemnification issues when a loss is probable and can be reasonably estimated. The Company would also accrue for estimated incurred but unidentified indemnification issues based on historical activity. As the Company has not incurred any indemnification losses to date, there were no accruals for or expenses related to indemnification issues for any period presented. F- 17 11. SUPPLEMENTAL BALANCE SHEET INFORMATION Prepaid expenses and other current assets consist of the following: December 31, 2024 2023 Prepaid insurance $ 489,174 $ 136,342 Vendor prepayments 21,946 558,959 Prepaid other 85,818 51,962 Total prepaid expenses and other current assets $ 596,938 $ 747,263 Accrued expenses and other current liabilities consist of the following: December 31, 2024 2023 Accrued personnel costs $ 100,974 $ 566,087 Goods received but unpaid - 78,579 Accrued expenses for CFO separation agreement - 160,000 Accrued legal fees 48,860 157,670 Accrued clinical trial expenses 191,673 - Accrued board of director fees 95,000 95,000 Accrued other 115,479 59,575 Total accrued expenses and other current liabilities $ 551,986 $ 1,116,911 12. INCOME TAX No provision for federal income taxes has been recorded for the years ended December 31, 2024 and 2023 due to net losses and the valuation allowance established. Significant components of the Company’s deferred tax assets are as follows: As of December 31, 2024 2023 Deferred tax assets: Net operating losses $ 6,356,812 $ 4,553,431 Tax credits 812,541 546,325 Intangible assets 52,813 58,063 Capitalized R&D expenses 2,619,730 2,106,995 Fixed assets - 114,657 Other 193,197 314,958 Total deferred tax assets 10,035,093 7,694,429 Valuation allowance ( 10,035,093 ) ( 7,694,429 ) Deferred tax asset, net of allowance $ - $ - F- 18 A reconciliation of the statutory tax rates and the effective tax rates for the years ended December 2024 and 2023 is as follows: Year Ended December 31, 2024 2023 Federal statutory rate 21.00 % 21.00 % State income taxes, net of federal benefit and tax credits 7.31 % 7.43 % Change in valuation allowance ( 30.33 )% ( 30.80 )% Permanent differences and other 2.02 % 2.37 % Effective tax rate 0.00 % 0.00 % The Company regularly assesses the need for a valuation allowance against its deferred tax assets. In making that assessment, the Company considers both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more-likely-than-not that some or all of the deferred tax assets will not be realized. In assessing the realizability of deferred tax assets, the Company considers taxable income in prior carryback years, as permitted under the tax law, forecasted taxable earnings, tax planning strategies, and the expected timing of the reversal of temporary differences. This determination requires significant judgment, including assumptions about future taxable income that are based on historical and projected information and is performed on a jurisdiction-by-jurisdiction basis. The Company continues to maintain a full valuation allowance against its deferred tax assets. During the years ended December 31, 2024 and 2023, management assessed the positive and negative evidence in its operations, and concluded that it is more likely than not that its deferred tax assets as of December 31, 2024 and 2023 will not be realized given the Company’s history of operating losses. The valuation allowance against deferred tax assets increased by approximately $ 2.3 million and $ 3.1 million during 2024 and 2023, respectively, related to a full valuation allowance recorded against capitalized research expenditures, additional net operating losses and tax credits generated in the year. As of December 31, 2024, the Company had federal net operating losses of approximately $ 23.4 million. The Company’s federal net operating losses incurred prior to 2018 totaling $ 713,000 expire through 2037, while its federal net operating losses incurred in 2018 to 2024 totaling approximately $ 22.7 million can be carried forward indefinitely but are limited to 80 % utilization against future taxable income each year. As of December 31, 2023, the Company had federal net operating losses of $ 16,772,000 , which may be available to offset future federal income tax liabilities. As of December 31, 2024, the Company had post-apportioned state net operating losses of approximately $ 22.8 million that can generally be carried forward 20 years and will expire at various dates through 2044. As of December 31, 2023, the Company had post-apportioned Massachusetts net operating losses of approximately $ 16.3 million that can generally be carried forward 20 years and will expire at various dates through 2043. As of December 31, 2024, the Company had $ 569,000 and $ 307,000 of federal and state research and development credits, respectively, which will expire at various dates through 2044. As of December 31, 2023, the Company had $ 381,000 and $ 208,000 of federal and state research and development credits, respectively, which will expire at various dates through 2043. F- 19