UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31,June 30, 2011

OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________to _________

Commission file number: 0-21419

CardoTiger X Medical, Inc.
(Exact name of Registrant as Specified in its Charter)

 

Delaware	23-2753988
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)

7625 Hayvenhurst Avenue, Suite #49
Van Nuys, CA    91406
(Address of Principal Executive Offices including Zip Code)

(818) 780-6677
(Registrant's Telephone Number, Including Area Code)

          N/ACardo Medical. Inc.          
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file reports), and (2) has been subject to such filing requirements for the past 90 days.
YES   x        NO   ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     YES  ¨x     NO  ¨

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YES   ¨        NO   x

As of MayAugust 10, 2011, 230,293,141 shares of the issuer's common stock, par value of $0.001 per share, were outstanding.

CARDOTIGER X MEDICAL, INC.

PART I — FINANCIAL INFORMATION

ITEM 1 — CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CARDOTIGER X MEDICAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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CARDOTIGER X MEDICAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share amounts)
(Unaudited)

The accompanying notes are an integral part of these condensed consolidated financial statements.

2

CARDOTIGER X MEDICAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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CARDOTIGER X MEDICAL, INC.
Notes to Condensed Consolidated Financial Statements
March 31,June 30, 2011
(Unaudited)

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CardoTiger X Medical, Inc. ("Cardo"Tiger X" or the "Company") has, formerly known as Cardo Medical, Inc., previously operated as an orthopedic medical device company specializing in designing, developing and marketing high performance reconstructive joint devices and spinal surgical devices.

As discussed below in the discontinued operations section, we sold our Reconstructive joint devices are usedand Spine Divisions during the quarter ended June 30, 2011. Our future operations will include the collection and management of our royalty income earned in connection with the Asset Purchase Agreement with Arthrex. The Company will also be evaluating future investment opportunities and uses for its cash.

On June 10, 2011, the Company filed an amendment to replace knee, hip and other joints that have deteriorated through disease or injury. Spinal surgical devices involve productsits Certificate of Incorporation with the Secretary of State of Delaware for the purpose of changing its name to stabilize the spine for fusion and reconstructive procedures. Within these areas, we have been focused on developing surgical devices, instrumentation and techniques that will enable surgeons to move what are typically inpatient surgical procedures to the outpatient world. We have commercialized our reconstructive joint devices through our reconstructive division and our spine devices through our spine division.Tiger X Medical, Inc. The amendment was effective as of June 10, 2011.

Basis of Presentation

The accompanying condensed consolidated balance sheet as of December 31, 2010, which has been derived from Cardo'sthe Company's audited financial statements as of that date, and the unaudited condensed consolidated financial information of Cardothe Company as of March 31,June 30, 2011 and for the three and six months ended March 31,June 30, 2011 and 2010, has been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 8-03 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of the Company's financial position at such date and the operating results and cash flows for such periods. Operating results for the interim period ended March 31,June 30, 2011 are not necessarily indicative of the results that may be expected for the entire year.

Certain information and footnote disclosure normally included in financial statements in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the United States Securities and Exchange Commission ("SEC"). These unaudited financial statements should be read in conjunction with our audited financial statements and accompanying notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2010 filed on March 31, 2011, as amended by the Company's Annual Report on Form 10-K/A filed on May 2, 2011 and May 6, 2011.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Cardo,Tiger X, Accelerated Innovation, Inc. ("Accelerated"), Uni-Knee LLC ("Uni") and Cervical Xpand LLC ("Cervical"). All significant intercompany transactions have been eliminated in consolidation.

Management's Plan

As reflected in the accompanying financial statements, the Company has losses from operations, negative cash flows from operations, an accumulated deficit and limited cash to fund future operations. As discussed below in the Discontinued Operations section, the Company was unable to obtain financing through debt or equity instruments in order to fund its future operations. As a result, on

On October 7, 2010, the Company's management and Board of Directors announced the decisiondecided to put substantially all of its assets up for sale. These factors raise substantial doubt aboutThe assets determined to be held for sale were inventories, intellectual properties, and property and equipment of its reconstructive products line (the "Reconstructive Division") and spine products line (the "Spine Division"). The Company decided to put the Company's abilityassets of its Reconstructive and Spine Divisions up for sale primarily because it did not have sufficient working capital, and was not able to continue asprocure such financial resources through equity or debt financing, in order to fully execute a going concern.profitable sales strategy.

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Accordingly, management took the following measures during the fourth quarter of 2010:

• terminated over half of the Company's employees;
• had the Company's Chief Executive Officer and President forego their salaries for a period of time from October 1, 2010 through April 1, 2011;
• reduced office space by not renewing the corporate headquarters facility lease;
• scaled back research and development activities;
• deferred manufacturing of inventories required to build additional base-level implant banks; and
• engaged an investment adviser to assist it in seeking alternative sources of capital; including selling of some or all of the Company's assets and other strategic alternatives.

On January 24, 2011, the Company entered into an Asset Purchase Agreement with Arthrex, Inc. ("Arthrex"), pursuant to which the Company has agreed to sell the assets of the Reconstructive Division to Arthrex in exchange for cash consideration of approximately $9.9$9.96 million, plus the valuecost of the Company's inventory and property and equipment relating to the Reconstructive Division calculated as of the closing date.date (the "Arthrex Asset Purchase Agreement"). The Arthrex Asset Purchase Agreement also callsprovides for the Company to receive royalty payments equal to 5% of net sales of the Company's products made by Arthrex on a quarterly basis for a term up to and including the 20th anniversary of the closing date. Following the execution of the Arthrex Asset Purchase Agreement, Arthrex delivered to the Company a $250,000 deposit to be credited against the cash consideration due at closing.closing (the "Arthrex Deposit"). From the cash consideration paid at closing, $900,000 will be$1,159,000, was deposited with an escrow agent for a period of twelve months from the closing date to be used for any adjustments to the value of the Company's inventory and property, plant and equipment relating to the Reconstructive Division and for post closing indemnification claims which may be asserted by Arthrex with respect to unassumed liabilities. Cardo estimates that the value of their inventory and property, plant and equipment relating to the Reconstructive Division as of the closing date will be approximately $4.7 million. The Asset Purchase Agreement calls for the transaction to be completed by April 24, 2011 (the "End Date"). If the transaction is not completed by the End Date, Arthrex, under certain circumstances, can terminate the Asset Purchase Agreement

On March 18, 2011, the Company entered into the First Amendment to the Asset Purchase Agreement, dated as of January 24, 2011, with Arthrex. The first amendment modifies the definition of "End Date" so that it means May 24, 2011; provided that in certain circumstances if the closing has not occurred by May 24, 2011, the "End Date" shall be June 24, 2011. Pursuant to the terms of the Asset Purchase Agreement, Arthrex can terminate the Asset Purchase Agreement if certain conditions have not been fulfilled or waived by the End Date. The Company expectscompleted the sale of the Reconstructive Division will occur during the second quarter ofon June 10 2011.

An investment banking firm also assisted The total cash consideration received by the Company in connectionfrom Arthrex amounted to $14,586,000, which is comprised of $9,960,000 plus inventory with sellinga preliminary value of $2,908,000 and property and equipment with a preliminary value of $1,718,000. From this amount, the assets of$250,000 Arthrex Deposit was repaid and $1,159,000 was deposited with an escrow agent to be held for twelve months for any potential adjustments to the Spine Division, which was completed in April 2011 forpurchase price as discussed above. The total proceeds of $3 million (see Note 5).

In view of the matters described above, recoverability of the recorded asset amounts shown in the accompanying consolidated balance sheets are dependent upon the successful closing of the Asset Purchase Agreement with Arthrex forgain on the sale of the Reconstructive Division assets. However, there is no guarantee that this transaction will close as expected. The financial statements do not include any adjustments relatingassets amounted to $10,527,000, which represents the recoverability and classificationexcess of recorded asset amounts or amounts and classificationsthe cash consideration over the carrying amount of liabilities that might be necessary should the Company be unable to continue its existence.

5

Discontinued Operationsassets sold of $4,059,000.

On October 7, 2010, the Company's management and Board of Directors decided to put substantially all of its assets up for sale. The assets determined to be held for sale were inventories, intellectual properties, and property and equipment of its reconstructive products (the "Reconstructive Division") and spine products (the "Spine Division"). The Company decided to put up for sale the assets of its Reconstructive and Spine Divisions primarily because it did not have sufficient working capital, and was not able to procure such financial resources through equity or debt financing, in order to fully execute a profitable sales strategy. We expect the sale of the Reconstructive Division will occur during the second quarter of 2011. In April 4, 2011, the Company entered into and closed an Asset Purchase agreementAgreement with Altus Partners, LLC, a Delaware limited liability company ("Altus"), pursuant to sellwhich the Company sold substantially all of the assets of the Spine Division (see Note 5)in exchange for cash consideration of $3,000,000 (the "Altus Asset Purchase Agreement").

As a result Pursuant to the terms of the factors discussed above,Altus Asset Purchase Agreement, $2,700,000 of the purchase price was paid at the closing and $300,000 was deposited into escrow with an escrow agent for a period of 90 days from the closing date (assuming there are no disputes) to be used for any adjustments to the closing value of the Company's two business segments have been discontinued. Pursuantinventory and property and equipment. The Company is awaiting finalization of the closing value, and expects any adjustments to occur during the quarter ended September 30, 2011.

Of the proceeds received from Altus pursuant to the Asset Purchase Agreement, entered intothe Company repaid $974,000 of the outstanding amounts under the Arthrex Note (as defined in January 2011 relatingNote 2), along with $3,000 in accrued interest. The total gain on the sale of the Spine Division assets amounted to $2,286,000.

Pursuant to the Reconstructive Division which is expected to close duringsales transactions with Arthrex and Altus, the quarter endingtotal aggregate amounts placed in escrow accounts were $1,459,000. These amounts are reflected as restricted cash on the accompanying condensed consolidated balance sheet as of June 30, 2011.

Total sales associated with the discontinued divisions reported as discontinued operations for the three months ended June 30, 2011 the Company is to receive a royalty payment equal to 5% of future net sales made solely by Arthrex of the Reconstructive Division products for a term up to and including the 20th anniversary of the closing date (see management's plan section of Note 2). In addition, there will be no significant continuing involvement by the Company in the Reconstructive2010, were $214,000 and Spine Divisions.

$1,077,000, respectively. Total sales associated with the discontinued Reconstructive and Spine Divisions reported as discontinued operations for the threesix months ended March 31,June 30, 2011 and 2010, were $547,000$761,000 and $902,000,$1,979,000, respectively. The total pretax loss associated with the discontinued Reconstructive and Spine Divisions, including the discontinued corporate support for those activities, reported as discontinued operations for the three months ended March 31,June 30, 2011 and 2010, were $196,000$1,170,000 and $1,271,000,$1,346,000, respectively. The total pretax loss associated with the discontinued Reconstructive and Spine Divisions, including the discontinued corporate support for those activities, reported as discontinued operations for the six months ended June 30, 2011 and 2010, were $1,366,000 and $2,617,000, respectively. The only continuing operations reflected are expenses associated with business insurance, legal and accounting fees that the Company will continue to incur. The prior year financial statements for March 31,June 30, 2010 have been reclassified to present the operations of the Reconstructive and Spine Divisions as discontinued operations.

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The assets of the discontinued operations are presented separately under the caption "Assets held for Sale" in the accompanying condensed consolidated balance sheet at March 31, 2011 and December 31, 2010 and consisted of the following.following:

There was no gain or loss associated with the recording of the assets held for sale, which are recorded at the lower of their carrying amounts or fair values less cost to sell.

Use of Estimates

Financial statements prepared in accordance with U.S. GAAP require management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Among other things, management makes estimates relating to allowances for doubtful accounts, net realizable value of assets, share-based payment and deferred income tax assets. Given the short operating history of Cardo,Tiger X, actual results could differ from those estimates.

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Net Loss Per Share

Basic net (loss) income per share is computed by using the weighted-average number of common shares outstanding during the period. Diluted net (loss) income per share is computed by giving effect to all dilutive potential common shares that were outstanding during the period. Dilutive potential common shares consist of incremental common shares issuable upon exercise of stock options or warrants. No dilutive potential common shares are included in the computation of any diluted per share amount when a loss from continuing operations is reported by the Company because they are anti- dilutive.anti-dilutive.

Concentrations

As of March 31,June 30, 2011, the Company had three hospital customers that accounted for 33.6%33.8%, 20.1%32.9% and 16.6%21.3% of its net accounts receivable.

As of December 31, 2010, the Company had three hospital customers that accounted for 28.7%, 12.7 %,% and 11.7% of its net accounts receivable.

Reclassifications

Certain amounts from prior periods have been reclassified to conform to the current period presentation due to the treatment of discontinued operations.

Recent Accounting Pronouncements and Updates

There are no recently issued accounting pronouncements or standards updates that the Company has yet to adopt that are expected to have a material effect on its financial position, results of operations, or cash flows.

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NOTE 2 — PROMISSORY NOTES PAYABLE

In November 2010, the Company entered into two secured promissory notes (collectively, the "Notes") with two individuals (collectively, the "Lenders"). The aggregate proceeds from the Notes were $500,000. One of the Lenders, Jon Brooks, is the brother of the Company's Chief Executive Officer. The Notes had maturity dates of March 2, 2011 and March 4, 2011, respectively, but were extended under a provision that allowed for an extension of up to 60 days by the Company, provided the Company givesgave the Lenders notice of such extension period at least two business days prior to the maturity date, and bear simple interest at 12% per annum.

In connection with the Notes, the Company entered into a security agreement with each lender, in which the Company granted a security interest, up to the amount of the principal and interest, in all of the Company's right, title and interest in all of the Company's assets, other than its accounts receivable.

On March 18, 2011, the Company and Arthrex executed a Secured Promissory Note in favor of Arthrex (the "Arthrex Note"). Under the terms of the Arthrex Note, the $250,000 deposit made by Arthex on January 24, 2011 pursuant to the terms of the Asset Purchase Agreement constitutesconstituted an initial loan. Under the terms of theAdditionally, Arthrex Note, Arthrex willagreed to (a) make a second loan to the Company of such amount to repay the indebtedness owed to the Lenders above, and (b) make additional advances within two business days of the written request of the Company; provided that in no event shallwould the aggregate principal amount loaned under the Arthrex Note at any time exceed $1,250,000. Pursuant to the Arthrex Note, the Company promisespromised to repay to Arthrex the principal amount outstanding from time to time on the Arthrex Note together with all accrued and unpaid interest on the maturity date. The maturity date shall meanwas the earlier of: (i) the closing of the transactions contemplated by the Asset Purchase Agreement, (ii) the fifth day following the termination of the Asset Purchase Agreement pursuant to its terms, and (iii) the End Date (as defined in the Asset Purchase Agreement). Interest on the unpaid principal amount due under the Arthrex Note accruesaccrued at an interest rate of 6% per annum; provided that if an event of default occurs,had occurred, interest on the unpaid principal amount due under the Arthrex Note shall increasewould have increased to an interest rate of 12% per annum.

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The proceeds obtained by the Company under the Arthrex Note were used to pay off the Lenders and the security agreements relating to such indebtedness totaling $522,000, including $22,000 of accrued interest, on March 18, 2011. The outstanding borrowing from Jon Brooks was reflected as "note payable - related party" on the accompanying consolidated condensed balance sheet as of December 31, 2010. Proceeds obtained from additional drawdowns on the Arthrex Note can bewere used for ordinary course working capital needs of the Company's Reconstructive Division. In March 2011, the Company had additional drawdowns of $450,000 under the Arthrex Note. Collectively, the total amounts outstanding under the Arthrex Note as of March 31, 2011 amounted to $1,224,000. Of this outstanding amount, $974,000 was repaid in April 2011 using the proceeds received from the sale of the Spine Division and the remaining balance of $250,000 reverted back to a deposit (see Note 5).was repaid from the proceeds received from the Reconstructive Division sale on June 10, 2011.

Pursuant to the Arthrex Note, the Company granted, pledged and assigned to Arthrex a security interest in all assets (including the to be acquired assets as defined in the Arthrex Asset Purchase Agreement), goods, inventories, properties and business of the Company, either tangible, intangible, real, personal, mixed, together with all proceeds or products thereof including, without limitation, all leasehold interests, all payments under insurance, or any indemnity, warranty or guaranty, which security interest shall rank senior to and have priority over those held by all other creditors of the Company. Such interest is no longer in force as the Arthrex Note was repaid in full on June 10, 2011.

As of June 30, 2011, the Company has no remaining outstanding notes payable.

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NOTE 3 — SHARE BASED PAYMENT

On August 29, 2008, the Company issued options to certain employees and Board members to purchase membership units in Cardo.Tiger X. The options give the grantees the right to purchase up to 2,398,400 shares of the Company's common stock at an exercise price of $0.23 per share. The options vest 20% each year over a five-year period and expire after ten years. The weighted average grant date fair value of options granted was $0.13 per option, for a total fair value of $300,000, which will be reflected as an operating expense over the vesting period of the options. Stock option compensation recognized for the three months ended March 31,June 30, 2011 and 2010 in the accompanying condensed consolidated statements of operations amounted to $11,000 and $18,000,$17,000, respectively. Stock option compensation recognized for the six months ended June 30, 2011 and 2010 in the accompanying condensed consolidated statements of operations amounted to $22,000 and $35,000, respectively.

The fair value of each option award was estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table. Because the Black-Scholes option valuation model incorporate ranges of assumptions for inputs, those ranges are disclosed. To estimate volatility of the options over their expected terms, the Company measured the historical volatility of the components of the small cap sector of the Dow Jones medical equipment index for a period equal to the expected life of the Cardo options. It also measured the volatility of other public companies with similar size and industry characteristics to Cardo for the same period. These measurements were averaged and the result was used as expected volatility. As there was no history of option lives at Cardo, the expected term of options granted was the midpoint between the vesting periods and the contractual life of the options. The risk-free rate for periods within the contractual life of the option was based on the U.S. Treasury yield curve in effect at the time of grant. The forfeiture rate was based on an analysis of the nature of the recipients' jobs and relationships to the Company. As a result of the announced sale of substantially all of the Company's assets in October 2010April and June 2011 (see Note 1), other than the CEO, and COO, Cardo will no longer havehas any employees once the sale is completed.employees. As a result, the only options expected to vest are those held by the Company's Board of Directors CEO and COO,CEO, who are expected to remain with the continuing entity. As a result, the estimated forfeiture rate has been adjusted to 75.6%.

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A summary of stock option activity as of March 31,June 30, 2011, and changes during the period then ended is presented below.below:

NOTE 4 — STOCKHOLDERS' EQUITY

Our authorized capital consists of 750,000,000 shares of common stock and 50,000,000 shares of preferred stock. Our preferred stock may be designated into series pursuant to authority granted by our Certificate of Incorporation, and on approval from our Board of Directors. As of March 31,June 30, 2011 we did not have any preferred stock issued.

NOTE 5 — SUBSEQUENT EVENTS8

On April 4, 2011, the Company entered into an Asset Purchase Agreement with Altus Partners, LLC, a Delaware limited liability company (the "Buyer"), pursuant to which the Company has agreed to sell substantially all of the assets of the Spine Division in exchange for cash consideration of $3,000,000 (the "Asset Purchase Agreement"). The Company and Buyer closed the asset purchase transaction simultaneously with signing the Asset Purchase Agreement on April 4, 2011. Pursuant to the terms of the Asset Purchase Agreement, $2,700,000 of the purchase price was paid at the closing and $300,000 was deposited into escrow with an escrow agent for a period of 90 days from the closing date (assuming there are no disputes) to be used for any adjustments to the closing value of the Company's inventory and property and equipment.

Of the proceeds received from the Buyer pursuant to the Asset Purchase Agreement, the Company repaid $974,000 of the outstanding amounts under the Arthrex Note in April 2011. The remaining outstanding balance of $250,000 under the Arthrex Note reverted back to a deposit.

The discussion and analysis of our financial condition and results of operations are based on our financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenues and expenses during the reporting periods. On an ongoing basis, we evaluate estimates and judgments, including those described in greater detail below. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and

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liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

As used in this "Management's Discussion and Analysis of Financial Condition and Results of Operation," except where the context otherwise requires, the term "we," "us," "our""our," "Tiger X," or "Cardo" refers to the business of CardoTiger X Medical, Inc.

The following discussion should be read together with the information contained in the unaudited condensed consolidated financial statements and related notes included in Item 1, "Financial Statements," in this Form 10-Q. All dollar amounts are in thousands unless otherwise specified.

Overview

Tiger X Medical, Inc. ("Tiger X" or the "Company"), formerly known as Cardo Medical, Inc. has formerly, previously operated as an orthopedic medical device company specializing in designing, developing and marketing high performance reconstructive joint devices and spinal surgical devices. Reconstructive joint devices are used to replace knee, hip and other joints that have deteriorated through disease or injury. Spinal surgical devices involve products to stabilize the spine for fusion and reconstructive procedures. Within these areas, we have been focused on developing surgical devices, instrumentation and techniques that will enable surgeons to move what are typically inpatient surgical procedures to the outpatient world. We have commercialized our reconstructive joint devices through our Reconstructive Division and our spine devices through our Spine Division. We launched and commenced sales of our first product in late 2006, which was a high performance unicompartmental knee replacement. We commenced sales of our other reconstructive products in 2007 and our spine products in 2008.

As discussed below, in January 2011 we entered into an asset purchase agreement to sell substantially all of our assets in the Reconstructive Division to Arthrex. We expect to completecompleted the sale of the Reconstructive Division assets during the second quarter of 2011. Additionally, we have completed the sale of substantially all of the assets in the Spine Division in April 2011. However, ifOur future operations will include the salecollection and management of our royalty income earned in connection with the Reconstructive Division assetsAsset Purchase Agreement with Arthrex. The Company will also be evaluating future investment opportunities and uses for its cash.

On June 10, 2011, the Company filed an amendment to its Certificate of Incorporation with the Secretary of State of Delaware for the purpose of changing its name to Tiger X Medical, Inc. The amendment is not consummated, our cash position would require that we immediately raise working capital or cease operations.effective as of June 10, 2011.

We are headquartered in Van Nuys, California. In connection with the consummation of the merger with CKST, CKST approved through its stockholders an amendment to its Amended and Restated Certificate of Incorporation to change its name from "clickNsettle.com, Inc." to "Cardo Medical, Inc." CKST's trading symbol was "CKST.OB," which has changed to "CDOM.OB" in connection with the name change. Cardo Medical'sOur common stock is quoted on the National Association of Securities Dealers, Inc.'s, Over-the-Counter Bulletin Board, or the OTC Bulletin Board.Board with a trading symbol of CDOM.OB.

Critical Accounting Policies

Use of Estimates

Financial statements prepared in accordance with United States generally accepted accounting principles ("U.S. GAAP") require management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Among other things, management makes estimates relating to allowances for doubtful accounts, net realizable value of assets, share-basedshare- based payment, and deferred income tax assets. Given the short operating history of Cardo, actualActual results could differ from those estimates.

Management's Plan9

As reflected in the accompanying financial statements, the Company has losses from operations, negative cash flows from operations, an accumulated deficit and limited cash to fund future operations. As previously discussed, the Company was unable to obtain financing through debt or equity instruments in order to fund its future operations. As a result, on

Discontinued Operations

On October 7, 2010, the Company's management and Board of Directors announced the decisiondecided to put

10

substantially all of its assets up for sale. These factors raise substantial doubt aboutThe assets determined to be held for sale were inventories, intellectual properties, and property and equipment of its reconstructive products line (the "Reconstructive Division") and spine products line (the "Spine Division"). The Company decided to put the Company's abilityassets of its Reconstructive and Spine Divisions up for sale primarily because it did not have sufficient working capital, and was not able to continue asprocure such financial resources through equity or debt financing, in order to fully execute a going concern.profitable sales strategy.

Accordingly, management took the following measures during the fourth quarter of 2010:

• terminated over half of the Company's employees;
• had the Company's Chief Executive Officer and President forego their salaries for a period of time from October 1, 2010 through April 1, 2011;
• reduced office space by not renewing the corporate headquarters facility lease;
• scaled back research and development activities;
• deferred manufacturing of inventories required to build additional base-level implant banks; and
• engaged an investment adviser to assist it in seeking alternative sources of capital; including selling of some or all of the Company's assets and other strategic alternatives.

On January 24, 2011, the Company entered into an Asset Purchase Agreement with Arthrex, Inc. ("Arthrex"), pursuant to which the Company has agreed to sell the assets of the Reconstructive Division to Arthrex in exchange for cash consideration of approximately $9.9$9.96 million, plus the valuecost of the Company's inventory and property and equipment relating to the Reconstructive Division calculated as of the closing date.date (the "Arthrex Asset Purchase Agreement"). The Arthrex Asset Purchase Agreement also callsprovides for the Company to receive royalty payments equal to 5% of net sales of the Company's products made by Arthrex on a quarterly basis for a term up to and including the 20th anniversary of the closing date. Following the execution of the Arthrex Asset Purchase Agreement, Arthrex delivered to the Company a $250,000 deposit to be credited against the cash consideration due at closing.closing (the "Arthrex Deposit"). From the cash consideration paid at closing, $900,000 will be$1,159,000, was deposited with an escrow agent for a period of twelve months from the closing date to be used for any adjustments to the value of the Company's inventory and property, plant and equipment relating to the Reconstructive Division and for post closing indemnification claims which may be asserted by Arthrex with respect to unassumed liabilities. Cardo estimates that the value of their inventory and property, plant and equipment relating to the Reconstructive Division as of the closing date will be approximately $4.7 million. The Asset Purchase Agreement calls for the transaction to be completed by April 24, 2011 (the "End Date"). If the transaction is not completed by the End Date, Arthrex, under certain circumstances, can terminate the Asset Purchase Agreement

On March 18, 2011, the Company entered into the First Amendment to the Asset Purchase Agreement, dated as of January 24, 2011, with Arthrex. The first amendment modifies the definition of "End Date" so that it means May 24, 2011; provided that in certain circumstances if the closing has not occurred by May 24, 2011, the "End Date" shall be June 24, 2011. Pursuant to the terms of the Asset Purchase Agreement, Arthrex can terminate the Asset Purchase Agreement if certain conditions have not been fulfilled or waived by the End Date. The Company expectscompleted the sale of the Reconstructive Division will occur during the second quarter ofon June 10 2011.

An investment banking firm also assisted The total cash consideration received by the Company in connectionfrom Arthrex amounted to $14,586,000, which is comprised of $9,960,000 plus inventory with sellinga preliminary value of $2,908,000 and property and equipment with a preliminary value of $1,718,000. From this amount, the assets of$250,000 Arthrex Deposit was repaid and $1,159,000 was deposited with an escrow agent to be held for twelve months for any potential adjustments to the Spine Division, which was completed in April 2011 forpurchase price as discussed above. The total proceeds of $3 million.

In view of the matters described above, recoverability of the recorded asset amounts shown in the accompanying consolidated balance sheets are dependent upon the successful closing of the Asset Purchase Agreement with Arthrex forgain on the sale of the Reconstructive Division assets. However, there is no guarantee that this transaction will close as expected. The financial statements do not include any adjustments relatingassets amounted to $10,527,000, which represents the recoverability and classificationexcess of recorded asset amounts or amounts and classificationsthe cash consideration over the carrying amount of liabilities that might be necessary should the Company be unable to continue its existence.

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Discontinued Operationsassets sold of $4,059,000.

On October 7, 2010, the Company's management and Board of Directors decided to put substantially all of its assets up for sale. The assets determined to be held for sale were inventories, intellectual properties, and property and equipment of its reconstructive products (the "Reconstructive Division") and spine products (the "Spine Division"). The Company decided to put up for sale the assets of its Reconstructive and Spine Divisions primarily because it did not have sufficient working capital, and was not able to procure such financial resources through equity or debt financing, in order to fully execute a profitable sales strategy. We expect the sale of the Reconstructive Division will occur during the second quarter of 2011. In April 4, 2011, the Company entered into and closed an Asset Purchase agreementAgreement with Altus Partners, LLC, a Delaware limited liability company ("Altus"), pursuant to sellwhich the Company sold substantially all of the assets of the Spine Division (see Note 5)in exchange for cash consideration of $3,000,000 (the "Altus Asset Purchase Agreement").

As a result Pursuant to the terms of the factors discussed above,Altus Asset Purchase Agreement, $2,700,000 of the purchase price was paid at the closing and $300,000 was deposited into escrow with an escrow agent for a period of 90 days from the closing date (assuming there are no disputes) to be used for any adjustments to the closing value of the Company's two business segments have been discontinued. Pursuantinventory and property and equipment. The Company is awaiting finalization of the closing value, and expects any adjustments to occur during the quarter ended September 30, 2011.

Of the proceeds received from Altus pursuant to the Asset Purchase Agreement, entered intothe Company repaid $974,000 of the outstanding amounts under the Arthrex Note (as defined in January 2011 relatingNote 2), along with $3,000 in accrued interest. The total gain on the sale of the Spine Division assets amounted to $2,286,000.

Pursuant to the Reconstructive Division which we expect to close duringsales transactions with Arthrex and Altus, the quarter endingtotal aggregate amounts placed in escrow accounts were $1,459,000. These amounts are reflected as restricted cash on the accompanying condensed consolidated balance sheet as of June 30, 2011.

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Total sales associated with the discontinued divisions reported as discontinued operations for the three months ended June 30, 2011 the Company is to receive a royalty payment equal to 5% of future net sales made solely by Arthrex of the Reconstructive Division products for a term up to and including the 20th anniversary of the closing date (see management's plan section of Note 2). In addition, there will be no significant continuing involvement by the Company in the Reconstructive2010, were $214,000 and Spine Divisions.

$1,077,000, respectively. Total sales associated with the discontinued Reconstructive and Spine Divisions reported as discontinued operations for the threesix months ended March 31,June 30, 2011 and 2010, were $547,000$761,000 and $902,000,$1,979,000, respectively. The total pretax loss associated with the discontinued Reconstructive and Spine Divisions, including the discontinued corporate support for those activities, reported as discontinued operations for the three months ended March 31,June 30, 2011 and 2010, were $196,000$1,170,000 and $1,271,000,$1,346,000, respectively. The total pretax loss associated with the discontinued Reconstructive and Spine Divisions, including the discontinued corporate support for those activities, reported as discontinued operations for the six months ended June 30, 2011 and 2010, were $1,366,000 and $2,617,000, respectively. The only continuing operations reflected are expenses associated with business insurance, legal and accounting fees that the Company will continue to incur. The prior year financial statements for March 31,June 30, 2010 have been reclassified to present the operations of the Reconstructive and Spine Divisions as discontinued operations.

The assets of the discontinued operations are presented separately under the caption "Assets held for Sale" in the accompanying condensed consolidated balance sheet at March 31, 2011 and December 31, 2010 and consisted of the following.following:

There was no gain or loss associated with the recording of the assets held for sale, which are recorded at the lower of their carrying amounts or fair values less cost to sell.

Revenue Recognition

We recognize revenue when it is realizable and earned. Management considers revenue to be realizable and earned when the following criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the seller's price to the buyer is fixed or determinable, and collectability is reasonably assured.

Persuasive evidence of the arrangements occurs when we receive a signed contract from the hospital in which the surgery will be performed. Within that contract is the price at which the hospital will buy the device. Delivery occurs on the day of surgery when the device is implanted by the surgeon. Collectability is reasonably assured as we have continuing relationships with the hospitals and can pursue collections if necessary. As we do not accept returns and do not have any post-sale obligations, the date of revenue recognition is on the date of surgery.

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Income Taxes

Our deferred tax assets and liabilities are recognized to reflect the estimated future tax effects, calculated at currently effective tax rates, of future deductible or taxable amounts attributable to events that have been recognized on a cumulative basis in the financial statements. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion of the deferred tax asset will not be realized. The estimated value of the deferred tax assets are subject to significant change based on the company's future profitability. Deferred tax assets and liabilities are adjusted for the effects of the changes in tax laws and rates of the date of enactment.

In June 2008, the Financial Accounting Standards Board ("FASB") sought to reduce the diversity in practice associated with certain aspects of measurement and recognition in accounting for income taxes. FASB prescribed a recognition threshold and measurement requirement for the financial statement recognition of a tax position that has been taken or is expected to be taken on a tax return and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. As such, we may only recognize or continue to recognize tax positions that meet a "more likely than not" threshold. Based on this analysis, our tax position is unlikely to change.

Recent Accounting Pronouncements and Standards Updates

There are no recently issued accounting pronouncements or standards updates that we have yet to adopt that are expected to have a material effect on our financial position, results of operations, or cash flows.

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Results of Operations for the Three Months Ended March 31,June 30, 2011 as Compared to the Three Months Ended March 31,June 30, 2010.

The following is a comparison of theour consolidated results of operations for Cardo for the three months ended March 31,June 30, 2011 and 2010. As discussed above, our Reconstructive Division and Spine Division were discontinued during 2010.

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General and Administrative Expenses

General and administrative expenses for the quarterthree months ended March 31,June 30, 2011 decreasedincreased by $90,000$110,000 as compared to 2010. General and administrative expenses represent our continuing operating expenses associated with remaining a public company, including business insurance expense and professional fees such as legal, accounting and audit services. The primary reason for the decreaseincrease in 2011 relates to an increase in insurance expense of approximately $84,000 due to increased product liability insurance limits required in conjunction with the sale of the Reconstructive and Spine assets, as well as higher outside accounting fees of $69,000 relating to the closing of the Arthrex and Altus sales transactions. These increases were offset by a decrease in legal expensesfees of $43,000 in 2011 as compared to 2010. Our legal expenses were higher in 2010 due to increased corporate activity and administrative legal matters, as we had not discontinued our operations. In the future, we expect our legal and other professional fees to remainbe at a reduced level.

Interest Income/(Expense)

During the quarterthree months ended March 31,June 30, 2011 and 2010, we had no outstanding debt. As a result, we incurred no interest expense during those periods. Interest income earned is consistent between the two periods. In the future, we expect our interest income to increase as a result of the increased amount of cash being held by the Company.

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Results of Operations for the Six Months Ended June 30, 2011 as Compared to the Six Months Ended June 30, 2010.

The following is a comparison of our consolidated results of operations for the six months ended June 30, 2011 and 2010. As discussed above, our Reconstructive Division and Spine Division were discontinued during 2010.

General and Administrative Expenses

General and administrative expenses for the six months ended June 30, 2011 increased by $20,000 as compared to 2010. General and administrative expenses represent our continuing operating expenses associated with remaining a public company, including business insurance expense and professional fees such as legal, accounting and audit services. The primary reason for the increase in 2011 relates to an increase in insurance expense of approximately $121,000 due to increased product liability insurance limits required in conjunction with the sale of the Reconstructive and Spine assets, as well as increased outside accounting fees of $44,000 relating to the closing of the Arthrex and Altus sales transactions. These increases were offset by a decrease in legal fees of $146,000 in 2011 as compared to 2010. Our legal expenses were higher in 2010 due to increased corporate activity and administrative legal matters, as we had not discontinued our operations. In the future, we expect our legal and other professional fees to be at a reduced level.

Interest Income/(Expense)

During the six months ended June 30, 2011, we had net interest expense of $24,000,$22,000, which was primarily the result of $500,000 of notes payable outstanding as of December 31, 2010, which werewas repaid in March 2011, as well as borrowings under the Arthrex Note.Note which were repaid in April 2011. During the quartersix months ended March 31,June 30, 2010, we had interest income of $7,000.$10,000. We had no interest expense in 2010, as there was no debt outstanding during this timeframe.

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Liquidity and Capital Resources

As discussed above, during the quarter ended June 30, 2011, we sold substantially all of our assets relating to the Spine and Reconstructive Divisions, which were discontinued during the fourth quarter of 2010. This resulted in net cash provided by investing activities for the six months ended June 30, 2011 of $15,990,00, which included gross proceeds from the sale of the assets of $17,586,000, less $1,459,000 of the funds placed in restricted cash escrow accounts, less purchases of equipment of $137,000. During 2010, we had net cash used in investing activities of $715,000 for the purchase of property and equipment.

Net cash used in operating activities was $558,000$2,925,000 for the threesix months ended March 31,June 30, 2011 compared to $935,000$2,593,000 for the same period in 2010. Our overall operating costs were lower in 2011 due to the announced discontinued operations during the fourth quarter of 2010. As a result, during 2010, we had higher payroll and other administrative costs as we had additional employees. Also, in 2010 we continued the build-up of our inventory, which increased $414,000by $1,134,000 during the period. During 2011, we did not make any significant inventory purchases due to the decision to sell our Reconstructive and Spine Divisions. However our net cash used in operating activities increased due to our paying $1,386,000 of outstanding accounts payable and accrued expenses with the funds received from the Spine and Reconstructive sale transactions.

Net cash used in investing activities was $52,000 for the three months ended March 31, 2011 compared to $350,000 for the same period in 2010. The cash used for investment activities during the three months ended March 31, 2010 was attributed to the purchase of equipment to accommodate our operational and corporate growth as well as additional instrumentation required in order to support our anticipated future sales levels. During 2011, we only purchased $52,000 worth of property and equipment, primarily representing additional instrumentation for our Reconstructive Division.

Net cash provided by financing activities was $724,000 for the three months ended March 31,$500,000 in 2011. This consisted of $1,224,000 in borrowings under the Arthrex Note, offset by the repayment of the Arthrex Note balances, as well as $500,000 in previously outstanding notes payable. There was no cash raised by or used in financing activities during the three monthssame period in 2010.

We had received a "going concern" opinion from our independent auditors for the years ended MarchDecember 31, 2010. Subsequent2010 and 2009. Pursuant to March 31,the sales of the Reconstructive and Spine Divisions during the quarter ended June 30, 2011, we had cash of $12,692,000 as of June 30, 2011. As a result, we have repaid $974,000adequate cash on hand to fund our operations and other activities for the next twelve months and beyond. Therefore, the factors which raised substantial doubt about our ability to continue as a going concern have been alleviated. Our future operations will include the collection and management of our royalty income earned in connection with the amounts outstanding under the Arthrex Note. The remaining $250,000 outstanding under the Arthrex Note reverted back to deposit in April 2011 upon the sale of Spine Division .Asset Purchase Agreement with Arthrex. We will also be evaluating future investment opportunities and uses for our cash.

Forward-Looking Statements

Some of the statements in this Quarterly Report on Form 10-Q are "forward-looking statements," as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "may," "will," "should," "anticipate," "estimate," "expect," "plan," "believe," "predict," "potential," "project," "target," "forecast," "intend," "assume," "guide," "seek" and similar expressions. Forward-looking statements do not relate strictly to historical or current matters. Rather, forward-looking statements are predictive in nature and may depend upon or refer to future events, activities or conditions. Although we believe that these statements are based upon reasonable assumptions, we cannot provide any assurances regarding future results. We undertake no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

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Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties. Many factors could cause our actual activities or results to differ materially from the activities and results anticipated in forward-looking statements. Information regarding our risk factors appears in Part I, Item 1A, "Risk Factors," in our Annual Report on Form 10-K for the year ended December 31, 2010 filed on March 31, 2011, as amended by the Company's Annual Report on Form 10-K/A filed on May 2, 2011 and May 6, 2011.

ITEM 3 —- QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable for smaller reporting companies.

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ITEM 4 —- CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, that are designed to ensure that information required to be disclosed in our reports under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and our interim principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

We carried out an evaluation under the supervision and with the participation of our management, including our principal executive officer and interim principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this quarterly report. Based on this evaluation, our Chief Executive Officer and interim Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31,June 30, 2011.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended March 31,June 30, 2011 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Subsequent to June 30, 2011, in July 2011, our then-Chief Financial Officer, Derrick Romine, left the Company. Given the Company's diminished activity following the sale of substantially all of its assets during the 2011 second quarter, the Company has not appointed a replacement as the Chief Financial Officer. The Company is currently assessing the impact of the departure of the then-Chief Financial Officer on its internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1 —- LEGAL PROCEEDINGS

We know of no material, existing or pending legal proceeding against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 2 —- UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3 —- DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4 —- (REMOVED AND RESERVED)

ITEM 5 —- OTHER INFORMATION

None

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ITEM 6 —- EXHIBITS

The following exhibits are filed as part of, or incorporated by reference into this Report:

__________

⁽¹⁾    Previously filed as an exhibit to the Current Report on Form 8-K filed by us on January 27, 2011.
⁽²⁾    Previously filed as an exhibit to the Current Report on Form 8-K filed by us on March 24, 2011.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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INDEX TO EXHIBITS

__________

⁽¹⁾    Previously filed as an exhibit to the Current Report on Form 8-K filed by us on January 27, 2011.
⁽²⁾    Previously filed as an exhibit to the Current Report on Form 8-K filed by us on March 24, 2011.

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