Related Party Transactions	6 Months Ended
Jun. 30, 2023
Related Party Transactions
Related Party Transactions	11. Related Party Transactions The following is a summary of related party transactions that met our disclosure threshold: *Asset Purchase Agreement* Ainos KY and the Company entered into an Asset Purchase Agreement dated as of November 18, 2021 (the “Asset Purchase Agreement”), as modified by an Amended and Restated Asset Purchase Agreement dated as of January 29, 2022 (the “Amended Asset Purchase Agreement”). Pursuant to the Asset Purchase Agreement, the Company acquired certain intellectual property assets and certain manufacturing, testing, and office equipment for a total purchase price of $26,000,000 that included $24,886,023 for intangible intellectual property assets and $1,113,977 for equipment. As consideration the Company issued to Ainos KY a convertible promissory note in the principal amount of $26,000,000 upon closing on January 30, 2022 (the “APA Convertible Note”). Ainos KY converted all of the APA Convertible Note on or about August 8, 2022 upon the Company’s up-listing to the Nasdaq Capital Markets. *Working Capital Advances* Refer to Chen Note, KY Note and ASE Note in Note 5 which proceeds were used for working capital advances. The total interest expense incurred in related to the notes for the three and six months ended June 30, 2023 were $23,031 and $26,841, respectively, compared to $18,602 and $34,486, respectively, for the three and six months ended June 30, 2022. As of June 30, 2023 and December 31, 2022, unpaid accrued interest expenses were $46,712 and $35,282, respectively. *Purchase and Sales* *Ainos COVID-19 Test Kits Sales and Marketing Agreement with Ainos KY* On June 14, 2021, the Company entered into an exclusive agreement with Ainos KY to serve as the master sales and marketing agent for the Ainos COVID-19 Antigen Rapid Test Kit and COVID-19 Nucleic Acid Test Kit which were developed and will be manufactured by Taiwan Carbon Nano Technology Corporation (the “TCNT”), a controlling shareholder of Ainos KY (the “Sales and Marketing Agreement”). On June 7, 2021, the Taiwan Food and Drug Administration (the “TFDA”) approved emergency use authorization (the “EUA”) to TCNT for the Ainos COVID-19 Antigen Rapid Test Kit that will be sold and marketed under the “Ainos” brand in Taiwan. On June 21, 2022, the Company began marketing the Ainos SARS-CoV-2 Antigen Rapid Self-Test (together with Ainos COVID-19 Antigen Rapid Test Kit, the “COVID-19 Antigen Rapid Test Kits”) under a separate EUA issued by the TFDA to TCNT on June 13, 2022. The Company incurred costs associated with manufacturing COVID-19 Antigen Rapid Test Kits by TCNT pursuant to the Sales and Marketing Agreement, totaling nil and $46,635 for the three and six months ended June 30, 2023, respectively, compared with the amount for the three and six months ended June 30, 2022 of $483,992 and $870,404, respectively. As of June 30, 2023 and December 31, 2022, the accounts payable to TCNT were nil and $24,365, respectively; the prepayment to TCNT were $90,519 and nil, respectively. *COVID-19 Antigen Rapid Test Kits Sales* The Company sold COVID-19 Antigen Rapid Test Kits to affiliates of ASE Test Inc., totaling $12,541 and $12,541 for the three and six months ended June 30, 2023, respectively, compared with the amount for the three and six months ended June 30, 2022 of $401,259 and $482,359, respectively. As of June 30, 2023, and December 31, 2022, the accounts receivable to aforementioned related parties were nil and $177,595, respectively. *Product Co-development Agreement* Pursuant to a five-year Product Co-development Agreement effective on August 1, 2021 (the “Product Co-Development Agreement”) with TCNT, the development expenses incurred were $74,733 and $152,196 for the three and six months ended June 30, 2023, respectively, compared to $206,748 and $374,170 for the three and six months ended June 30, 2022, respectively. As of June 30, 2023 and December 31, 2022, the accounts payable were $25,089 and $70,113, respectively. Under the agreement, the Company made deposits of $31,071 and $31,490 to TCNT as of June 30, 2023 and December 31, 2022, respectively. Miscellaneous On April 26, 2023, the Company issued a total of 61,157 shares of common stock to Ting-Chuan Lee, a director of the Company, pursuant to a purchase and sale agreement relating to the Company’s acquisition of a vehicle. The purchase price was determined by the market price of the vehicle in the amount of $48,559. The Company engaged Ms. Chien-Hsuan Huang as a medical device development consultant in September 2022. Ms. Huang is the spouse of one of the board of directors of the Company. The R&D expense was $19,618 and $39,344 for the three and six months ended June 30, 2023, respectively.

Related Party Transactions

6 Months Ended

Jun. 30, 2023

11. Related Party Transactions

The following is a summary of related party transactions that met our disclosure threshold:

Asset Purchase Agreement

Ainos KY and the Company entered into an Asset Purchase Agreement dated as of November 18, 2021 (the “Asset Purchase Agreement”), as modified by an Amended and Restated Asset Purchase Agreement dated as of January 29, 2022 (the “Amended Asset Purchase Agreement”).

Pursuant to the Asset Purchase Agreement, the Company acquired certain intellectual property assets and certain manufacturing, testing, and office equipment for a total purchase price of $26,000,000 that included $24,886,023 for intangible intellectual property assets and $1,113,977 for equipment. As consideration the Company issued to Ainos KY a convertible promissory note in the principal amount of $26,000,000 upon closing on January 30, 2022 (the “APA Convertible Note”). Ainos KY converted all of the APA Convertible Note on or about August 8, 2022 upon the Company’s up-listing to the Nasdaq Capital Markets.

Working Capital Advances

Refer to Chen Note, KY Note and ASE Note in Note 5 which proceeds were used for working capital advances. The total interest expense incurred in related to the notes for the three and six months ended June 30, 2023 were $23,031 and $26,841, respectively, compared to $18,602 and $34,486, respectively, for the three and six months ended June 30, 2022. As of June 30, 2023 and December 31, 2022, unpaid accrued interest expenses were $46,712 and $35,282, respectively.

Purchase and Sales

Ainos COVID-19 Test Kits Sales and Marketing Agreement with Ainos KY

On June 14, 2021, the Company entered into an exclusive agreement with Ainos KY to serve as the master sales and marketing agent for the Ainos COVID-19 Antigen Rapid Test Kit and COVID-19 Nucleic Acid Test Kit which were developed and will be manufactured by Taiwan Carbon Nano Technology Corporation (the “TCNT”), a controlling shareholder of Ainos KY (the “Sales and Marketing Agreement”). On June 7, 2021, the Taiwan Food and Drug Administration (the “TFDA”) approved emergency use authorization (the “EUA”) to TCNT for the Ainos COVID-19 Antigen Rapid Test Kit that will be sold and marketed under the “Ainos” brand in Taiwan. On June 21, 2022, the Company began marketing the Ainos SARS-CoV-2 Antigen Rapid Self-Test (together with Ainos COVID-19 Antigen Rapid Test Kit, the “COVID-19 Antigen Rapid Test Kits”) under a separate EUA issued by the TFDA to TCNT on June 13, 2022.

The Company incurred costs associated with manufacturing COVID-19 Antigen Rapid Test Kits by TCNT pursuant to the Sales and Marketing Agreement, totaling nil and $46,635 for the three and six months ended June 30, 2023, respectively, compared with the amount for the three and six months ended June 30, 2022 of $483,992 and $870,404, respectively. As of June 30, 2023 and December 31, 2022, the accounts payable to TCNT were nil and $24,365, respectively; the prepayment to TCNT were $90,519 and nil, respectively.

COVID-19 Antigen Rapid Test Kits Sales

The Company sold COVID-19 Antigen Rapid Test Kits to affiliates of ASE Test Inc., totaling $12,541 and $12,541 for the three and six months ended June 30, 2023, respectively, compared with the amount for the three and six months ended June 30, 2022 of $401,259 and $482,359, respectively. As of June 30, 2023, and December 31, 2022, the accounts receivable to aforementioned related parties were nil and $177,595, respectively.

Product Co-development Agreement

Pursuant to a five-year Product Co-development Agreement effective on August 1, 2021 (the “Product Co-Development Agreement”) with TCNT, the development expenses incurred were $74,733 and $152,196 for the three and six months ended June 30, 2023, respectively, compared to $206,748 and $374,170 for the three and six months ended June 30, 2022, respectively. As of June 30, 2023 and December 31, 2022, the accounts payable were $25,089 and $70,113, respectively. Under the agreement, the Company made deposits of $31,071 and $31,490 to TCNT as of June 30, 2023 and December 31, 2022, respectively.

Miscellaneous

On April 26, 2023, the Company issued a total of 61,157 shares of common stock to Ting-Chuan Lee, a director of the Company, pursuant to a purchase and sale agreement relating to the Company’s acquisition of a vehicle. The purchase price was determined by the market price of the vehicle in the amount of $48,559.

The Company engaged Ms. Chien-Hsuan Huang as a medical device development consultant in September 2022. Ms. Huang is the spouse of one of the board of directors of the Company. The R&D expense was $19,618 and $39,344 for the three and six months ended June 30, 2023, respectively.