Co-Diagnostics, Inc. 10-Q

Item 1. Legal Proceedings Stadium Capital Securities Class Action (Southern District of New York) On July 28, 2026, the parties entered into a binding term sheet setting forth the material terms of a proposed settlement of the Stadium Capital securities class action. Under the term sheet, the defendants will pay, or cause to be paid, an aggregate of $6.5 million into a settlement fund in exchange for the settlement and release of claims asserted by or on behalf of the proposed settlement class. The proposed settlement contains no admission of wrongdoing or liability by the Company or the other defendants. The parties are negotiating definitive settlement documentation, and the proposed settlement remains subject to preliminary and final court approval, notice to the proposed settlement class, satisfaction of applicable termination conditions, and entry of a final judgment dismissing the action with prejudice. There can be no assurance that the proposed settlement will be approved or become effective . Co-Diagnostics, Inc. v. Hukui Technology, Inc., et al. Third Judicial District Court, Salt Lake County, Utah As previously disclosed, on March 25, 2026, the trial court issued Findings of Fact, Conclusions of Law, and a ruling in favor of the Company on its declaratory judgment claim and on all remaining counterclaims asserted by Hukui Technology, Inc., Hukui Tech, Inc. and Hukui Bio Co., Ltd. The court concluded, among other things, that the Company did not breach any agreement with the defendants and that the defendants were not entitled to damages. Final judgment was entered on April 10, 2026 and was amended on April 27, 2026 to include costs. On May 11, 2026, the defendants filed a notice of appeal seeking review of the final judgment in its entirety. On June 2, 2026, the Utah Supreme Court transferred the appeal to the Utah Court of Appeals for disposition pursuant to Rule 42(a) of the Utah Rules of Appellate Procedure. The appeal remains pending. The Company believes the trial court’s judgment was correct and intends to defend the judgment vigorously, but there can be no assurance as to the outcome of the appeal. Robert Salna v. Co-Diagnostics, Inc., et al. Third Judicial District Court, Salt Lake County, Utah As previously disclosed, in February 2024, Robert Salna filed an action against the Company and certain current or former officers arising from a 2018 loan transaction and the alleged failure to issue warrants or other equity-based compensation in connection with that transaction. The original complaint asserted claims including breach of contract, breach of fiduciary duty, fraud, negligent misrepresentation, and violations of federal and Utah securities laws. The plaintiff seeks compensatory and other damages. On May 26, 2026, the court granted the Company’s motion to dismiss. The court dismissed with prejudice the breach-of-contract claim against the individual defendants. The court dismissed without prejudice the breach-of-contract claim against the Company and the claims for breach of fiduciary duty, fraud, negligent misrepresentation, and violations of the Utah Securities Act. The court also determined that it lacked subject-matter jurisdiction over the plaintiff’s claim under the Securities Act of 1933 and dismissed that claim without prejudice. The court permitted the plaintiff to seek leave to amend the complaint. On July 9, 2026, the plaintiff filed a motion for leave to file a proposed first amended complaint. The proposed amended complaint would remove two individual defendants and the federal securities claim and would assert claims against the Company, Dwight H. Egan, and Reed L. Benson for breach of contract, fraud or intentional misrepresentation, negligent misrepresentation, breach of fiduciary duty or an alleged transaction-specific duty, violation of the Utah Uniform Securities Act, and declaratory relief. The proposed amended complaint continues to allege that the plaintiff was promised warrants in connection with the $2.0 million loan transaction and seeks damages and other relief based on the alleged failure to issue those warrants. The defendants have opposed the motion for leave to amend, arguing that the proposed amendment is unjustifiably delayed and that the proposed claims remain legally deficient and would be futile. The motion remains pending. The Company believes the plaintiff’s claims are without merit and intends to continue defending the action vigorously, but there can be no assurance as to the outcome. Item 1A. Risk Factors. Not required under Regulation S-K for “smaller reporting companies.”