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Item 9A. Controls and Procedures

2023-04-17 compared with 2022-03-31 · 1154 added, 745 removed, 433 unchanged (81% of the section changed)

3 unchanged sentences

Disclosure Controls and Procedures

In accordance with Rules 13a-15(b)

and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we, under the supervision and with

the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of the design

and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act) as of the

end of the period covered by this Annual Report on Form 10-K.

Based on the foregoing, our Chief Executive Officer and Chief Financial

Officer concluded that our disclosure controls and procedures were (a) designed to ensure that the information we are required to disclose

in our reports under the Exchange Act is recorded, processed, and reported in an accurate manner and on a timely basis and the information

that we are required to disclose in our Exchange Act reports is accumulated and communicated to management to permit timely decisions

with respect to required disclosure and (b) operating in an effective manner.

Change in Internal Control Over Financial Reporting

No change occurred in our internal

control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the year ended December 31, 2021

In accordance with Rules

13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we, under the supervision

and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness

of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange

Act) as of the end of the period covered by this Annual Report on Form 10-K.

Based on the foregoing, our Chief Executive Officer and

Chief Financial Officer concluded that our disclosure controls and procedures were (a) designed to ensure that the information we are

required to disclose in our reports under the Exchange Act is recorded, processed, and reported in an accurate manner and on a timely

basis and the information that we are required to disclose in our Exchange Act reports is accumulated and communicated to management

to permit timely decisions with respect to required disclosure and (b) operating in an effective manner.

Change in Internal Control Over Financial

No change occurred in our

internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the year ended December

31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Other Information.

In February 2023, the Company

formed a wholly-owned subsidiary, Pearsanta, Inc.

in order to accelerate the growth of the Company’s AditxtScore program through

future strategic revenue and growth oriented transactions.

In connection with the formation of Pearsanta and Corinne Pankovcin’s

anticipated role in driving such strategic revenue and growth oriented transactions, Ms.

Pankovcin’ s title was changed from President

to Chief Commercialization Officer, effective April 12, 2023.

Disclosure Regarding Foreign Jurisdictions

3 unchanged sentences

The information required

by this Item is incorporated herein by reference to the information that will be contained in our definitive proxy statement related to

the 2022 Annual Meeting of Stockholders, or the Proxy Statement, which we intend to file with the SEC within 120 days of the end of our

fiscal year pursuant to General Instruction G(3) of Form 10-K.

by this Item is incorporated herein by reference to the information that will be contained in our definitive proxy statement related

to the 2023 Annual Meeting of Stockholders, or the Proxy Statement, which we intend to file with the SEC within 120 days of the end of

our fiscal year pursuant to General Instruction G(3) of Form 10-K.

Executive Compensation

The information required by

this Item is incorporated herein by reference to the information that will be contained in our Proxy Statement, which we intend to file

with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.

The information required

by this Item is incorporated herein by reference to the information that will be contained in our Proxy Statement, which we intend to

file with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.

Security Ownership of Certain

Beneficial Owners and Management and Related Stockholder Matters

The information required

by this Item is incorporated herein by reference to the information that will be contained in our Proxy Statement, which we intend to

file with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.

Certain Relationships and Related

Transactions, and Director Independence

The information required by

this Item is incorporated herein by reference to the information that will be contained in our Proxy Statement, which we intend to file

with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.

The information required

by this Item is incorporated herein by reference to the information that will be contained in our Proxy Statement, which we intend to

file with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.

Principal Accounting Fees and

The information required by

this Item is incorporated herein by reference to the information that will be contained in our Proxy Statement, which we intend to file

with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.

The information required

by this Item is incorporated herein by reference to the information that will be contained in our Proxy Statement, which we intend to

file with the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.

Exhibits, Financial Statement Schedules.

The following documents are filed as part of this report:

Financial Statements:

following documents are filed as part of this report:

(1) Financial

Report of Independent Registered Public Accounting Firm

1 unchanged sentence

Statements of Operations

Statements of Changes in Stockholders’ Equity (Deficit)

Statements of Changes in Stockholders’ Equity

Statements of Cash Flows

Notes to Financial Statements

Financial Statement Schedules:

(2) Financial

Statement Schedules:

All financial statement schedules

1 unchanged sentence

notes thereto.

(3) Exhibits.

EXHIBIT INDEX

At The Market Offering Agreement dated December 20, 2022 between Aditxt, Inc.

Wainwright & Co., LLC (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on December 20, 2022)

Share Exchange Agreement, dated as of December 28, 2021 by and between AiPharma Group Ltd.

1 unchanged sentence

(incorporated by reference to the Registrant’s Current Report on Form 8-K filed on December 28, 2021)

Amendment to Share Exchange Agreement by and between AiPharma Group Ltd.

and Aditxt, Inc.

(incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on May 16, 2022)

Second Amendment to Share Exchange Agreement by and between AiPharma Group Ltd.

and Aditxt, Inc.

(incorporated by reference to the Registrant’s Current Report on Form 8-K filed on June 16, 2022)

Amended and Restated Certificate of Incorporation (incorporated by reference to the Registrant’s Registration Statement on Form S-1/A (File No.

4 unchanged sentences

Certificate of Amendment, dated July 6, 2021 (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on July 8, 2021)

Amendment No.

1 to Amended and Restated Bylaws of Aditxt, Inc.

(incorporated by reference to the Registrant’s Current Report on Form 8-K filed on July 8, 2022)

Certificate of Designation of Series B Preferred Stock, dated July 19, 2022 (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on July 20, 2022)

Certificate of Amendment to Certificate of Incorporation of Aditxt, Inc.

(incorporated by reference to the Registrant’s Current Report on Form 8-K filed on September 14, 2022)

Description of Securities Registered Under Section 12 of the Exchange Act (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 25, 2021)

43 unchanged sentences

First Amendment to Secured Credit Agreement with AiPharma Global Holdings LLC dated October 18, 2021 (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on November 15, 2021)

Second Amendment to Secured Credit Agreement with AiPharma Global Holdings LLC dated October 27, 2021

Second Amendment to Secured Credit Agreement with AiPharma Global Holdings LLC dated October 27, 2021(incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Employment Agreement, dated as of November 14, 2021 between Aditxt, Inc.

8 unchanged sentences

and Rowena Albanna, Chief Operating Officer (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on November 15, 2021)

Form of Warrant Reduction and Release Agreement dated as of November 24, 2021

First Amendment to Transaction Agreement dated November 30, 2021, by and between the Company and AiPharma Global Holdings LLC

Third Amendment to Secured Credit Agreement dated November 30, 2021, by and among AiPharma, AiPharma Holdings Limited, AiPharma Asia Limited and the Company

Second Amendment to Transaction Agreement dated December 7, 2021, by and between the Company and AiPharma Global Holdings LLC

Secured Credit Agreement, dated as of December 8, 2021, by and among the Company and the Target Company

Third Amendment to Transaction Agreement dated December 17, 2021, by and between the Company and AiPharma Global Holdings LLC

Fifth Amendment to Secured Credit Agreement dated December 22, 2021, by and among AiPharma, AiPharma Holdings Limited, AiPharma Asia Limited and the Company

Sixth Amendment to Secured Credit Agreement dated December 28, 2021, by and among AiPharma, AiPharma Holdings Limited, AiPharma Asia Limited and the Company

Form of Warrant Reduction and Release Agreement dated as of November 24, 2021 (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

First Amendment to Transaction Agreement dated November 30, 2021, by and between the Company and AiPharma Global Holdings LLC (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Third Amendment to Secured Credit Agreement dated November 30, 2021, by and among AiPharma, AiPharma Holdings Limited, AiPharma Asia Limited and the Company (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Second Amendment to Transaction Agreement dated December 7, 2021, by and between the Company and AiPharma Global Holdings LLC (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Secured Credit Agreement, dated as of December 8, 2021, by and among the Company and the Target Company (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Third Amendment to Transaction Agreement dated December 17, 2021, by and between the Company and AiPharma Global Holdings LLC (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Fifth Amendment to Secured Credit Agreement dated December 22, 2021, by and among AiPharma, AiPharma Holdings Limited, AiPharma Asia Limited and the Company (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Sixth Amendment to Secured Credit Agreement dated December 28, 2021, by and among AiPharma, AiPharma Holdings Limited, AiPharma Asia Limited and the Company (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Employment Agreement between Aditxt, Inc.

Shatzkes, Chief Legal Officer and General Counsel

Fourth Amendment to Transaction Agreement dated December 22,2021, by and between the Company and AiPharma Global Holdings LLC

and Matthew Shatzkes, Chief Legal Officer and General Counsel (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Forbearance Agreement and Seventh Amendment to Secured Credit Agreement dated as of February 14, 2022 by and among the Company, Cellvera Global Holdings LLC, Cellvera Holdings Ltd., Cellvera Asia Limited (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Fourth Amendment to Transaction Agreement dated December 22,2021, by and between the Company and AiPharma Global Holdings LLC (incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 31, 2022)

Series C Warrant Agent Agreement (incorporated by reference to the Registrant’s Annual Report on Form 10-K/A filed on April 15, 2022)

Form of Placement Agent Warrant dated January 25, 2021 (incorporated by reference to the Registrant’s Annual Report on Form 10-K/A filed on April 15, 2022)

Forbearance Agreement and Eighth Amendment to Secured Credit Agreement dated as of March 31, 2022 (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on May 16, 2022)

Security Agreement between Cellvera Holdings and Aditxt, Inc.

dated as of March 31, 2022 (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on May 16, 2022)

Security Agreement between Cellvera Development LLC and Aditxt, Inc.

dated as of March 31, 2022 (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on May 16, 2022)

Security Agreement between Cellvera Global Holdings and Aditxt, Inc.

dated as of March 31, 2022 (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on May 16, 2022)

Amended and Restated Security Agreement between Cellvera Asia Limited and Aditxt, Inc.

dated as of March 31, 2022 (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on May 16, 2022)

Revenue Sharing Agreement by and among Aditxt, Inc., Cellvera Global Holdings LLC and Cellvera Asia Limited dated as of March 31, 2022 (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed on May 16, 2022)

Form of Agreement for the Purchase and Sale of Future Receipts (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on June 3, 2022)

Amendment No.

1 to Series C Warrant Agent Agreement dated June 15, 2022 (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on June 15, 2022)

Inducement Offer to Exercise Series C Common Stock Purchase Warrants (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on June 15, 2022)

Form of New Warrant (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on June 15, 2022)

Form of Placement Agent Warrant (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on June 15, 2022)

Subscription and Investment Representation Agreement, dated July 19, 2022 (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on July 20, 2022)

Unsecured Promissory Note dated July 21, 2022 (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on July 26, 2022)

Form of Securities Purchase Agreement (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 10, 2022)

Form of August 2022 Note (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 10, 2022)

Form of August 2022 Warrant (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 10, 2022)

Form of Registration Rights Agreement (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 10, 2022)

Form of Security Agreement (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 10, 2022)

Form of First Amendment and Waiver effective as of August 31, 2022 (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on September 7, 2022)

Form of Warrant (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on September 7, 2022)

Form of Securities Purchase Agreement (incorporated by reference to the Registrant’s Registration Statement on Form S-1 filed on September 15, 2022)

Form of Warrant (incorporated by reference to the Registrant’s Registration Statement on Form S-1 filed on September 15, 2022)

Form of Placement Agent’s Warrant (incorporated by reference to the Registrant’s Registration Statement on Form S-1 filed on September 15, 2022)

Form of Pre-Funded Warrant (incorporated by reference to the Registrant’s Registration Statement on Form S-1 filed on September 15, 2022)

Amendment No.

2 to Series C Warrant Agent Agreement (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on December 23, 2022)

Form of Amended and Restated Unit Purchase Option (incorporated by reference to the Registrant’s Current Report on Form 8-K filed on December 23, 2022)

Form of Consulting Agreement (incorporated by reference to the Registrant's Current Report on Form 8-K filed on March 21, 2023)

Form of Business Loan and Security Agreement dated April 4, 2023(incorporated by reference to the Registrant's Current Report on Form 8-K filed on April 7, 2023)

Consent of dbb mckennon , independent registered public accounting firm

Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification

of Principal Financial and Accounting Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange

Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of the Principal Executive, Financial, and Accounting Officers under Section 906 of the Sarbanes-Oxley Act of 2002

Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and

15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Principal Financial and Accounting Officer Pursuant

to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of

the Sarbanes-Oxley Act of 2002

Certification of the Principal Executive, Financial, and Accounting

Officers under Section 906 of the Sarbanes-Oxley Act of 2002

Inline XBRL Instance Document.

Inline XBRL Taxonomy Extension Schema Document.

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Inline XBRL Taxonomy Extension Definition Linkbase Document.

Inline XBRL Taxonomy Extension Calculation Linkbase

Inline XBRL Taxonomy Extension Definition Linkbase

Inline XBRL Taxonomy Extension Label Linkbase Document.

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

Inline XBRL Taxonomy Extension Presentation Linkbase

Cover Page Interactive Data File (formatted as Inline

XBRL and contained in Exhibit 101).

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 on this 31 st day of March 2022.

/s/ Amro Albanna

duly authorized on this 17 th day of April 2023.

Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL BY THESE PRESENTS,

that each person whose signature appears below constitutes and appoints Amro Albanna and Thomas J.

Farley, and each of them, as his or

her true and lawful attorneys-in-fact and agents, each with the full power of substitution, for him or her and in his or her name, place,

or stead, in any and all capacities, to sign any and all amendments to this Report, and to file the same, with exhibits thereto and other

documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and

each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about

the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that

said attorneys-in-fact and agents, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements

3 unchanged sentences

Chief Executive Officer

April 17, 2023

(Principal Executive Officer)

/s/ Corinne Pankovcin

Corinne Pankovcin

/s/ Thomas J.

Chief Financial Officer

April 17, 2023

(Principal Financial and Accounting Officer)

/s/ Brian Brady

April 17, 2023

/s/ Namvar Kiaie

April 17, 2023

/s/ Jeffrey W.

April 17, 2023

/s/ Shahrokh Shabahang

Chief Innovation Officer and Director

April 17, 2023

Shahrokh Shabahang

5 unchanged sentences

Statements of Operations F-4

Statements of Stockholders’ Equity (Deficit) F-5

Statements of Stockholders’ Equity F-5

Statements of Cash Flows F-7

6 unchanged sentences

(the “Company”) as of December 31, 2022 and 2021, the related statements of operations, stockholders’

equity (deficit), and cash flows, for the years ended December 31, 2021 and 2020, and the related notes (collectively referred to as 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, 2021 and 2020, 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.

equity, and cash flows, for the years ended December 31, 2022 and 2021, and the related notes (collectively referred to as 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, 2022 and 2021, 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.

Going Concern

The accompanying financial statements have been prepared assuming the

Company will continue as a going concern.

As discussed in Note 2 to the financial statements, the Company’s net losses, negative

cash flow from operations, and ability to access capital raise substantial doubt about its ability to continue as a going concern.

plans in regard to these matters are also described in Note 2.

The financial statements do not include any adjustments that might result

from the outcome of this uncertainty.

The accompanying financial

statements have been prepared assuming the Company will continue as a going concern.

As discussed in Note 2 to the financial statements,

the Company’s net losses, negative cash flow from operations, and ability to access capital raise substantial doubt about its ability

to continue as a going concern.

Management’s plans in regard to these matters are also described in Note 2.

The financial statements

do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

11 unchanged sentences

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.

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

12 unchanged sentences

We have served as the Company’s auditor

Newport Beach, California

March 31, 2022

PART I - FINANCIAL

San Diego, California

April 17, 2023

PART I - FINANCIAL INFORMATION

Financial Statements

BALANCE SHEETS

CURRENT ASSETS:

Accounts receivable

Accounts receivable, net

Prepaid expenses

ROU asset - short term

Note receivable

Note receivable, net

TOTAL CURRENT ASSETS

1 unchanged sentence

Intangible assets, net

ROU asset - long term

Right of use asset - long term

Deferred issuance costs

LIABILITIES AND STOCKHOLDERS’ EQUITY

18 unchanged sentences

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

See accompanying notes

to the financial statements.

See accompanying notes to the financial statements.

STATEMENTS OF OPERATIONS

1 unchanged sentence

OPERATING EXPENSES

General and administrative expenses, including $ 3,927,551 and $ 3,188,840 , in stock-based compensation, respectively

Research and development expenses, including $ 713,130 , and $ 0 in stock-based compensation, respectively

Sales and marketing expenses, including $ 0 , and $ 0 in stock-based compensation, respectively

Impairment on note receivable

General and administrative expenses, includes $ 1,516,805 and $ 3,927,551 in stock-based compensation, respectively

Research and development, includes $ 591,518 and $ 713,130 in stock-based compensation, respectively

Sales and marketing, includes $ 1,023,045 , and $ 0 in stock-based compensation, respectively

Impairment on notes receivable

Total operating expenses

2 unchanged sentences

( 41,934,928 )

OTHER INCOME (EXPENSE)

OTHER EXPENSE

Interest expense

Interest income

Gain on forgiveness of debt

Loss on extinguishment of debt

2 unchanged sentences

( 1,533,048 )

Total other income (expense)

( 1,845,358 )

Total other expense

( 2,169,778 )

( 4,436,436 )

Net loss before income taxes

4 unchanged sentences

$ ( 46,371,364 )

Implied Dividends

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

$ ( 27,612,199 )

$ ( 46,269,097 )

Net loss per share - basic and diluted

Weighted average number of shares outstanding during the period - basic and diluted

See accompanying notes

to the financial statements.

STATEMENTS OF STOCKHOLDERS’

EQUITY (DEFICIT)

YEARS ENDED DECEMBER

31, 2021 AND 2020

Weighted average number of shares outstanding during the year - basic and diluted

See accompanying notes to the financial statements.

STATEMENTS OF STOCKHOLDERS’ EQUITY

YEARS ENDED DECEMBER 31, 2022 AND 2021

Stockholders’

Equity (Deficit)

Balance December 31, 2021

2 unchanged sentences

Stock option and warrant compensation

Exercise of warrants

Restricted stock unit compensation

Issuance of restricted stock

units for compensation

Issuance of shares for services

Issuance of shares for employee compensation

Issuance of shares for vested restricted stock units

Issuance of shares for the conversion of debt

Fair value of warrants issued with convertible note payable

Issuance of shares and warrants for offering, net of issuance costs

Issuance of shares for offerings, net of issuance costs

Warrant consideration for convertible debt offering costs

Reduction in exercise price of warrants

Exercise of warrants, modification

of warrants, and issuance of warrants

Sale of Series B Preferred

shares to related party

Redemption of Series B Preferred

shares to related party

Shares issued as inducement

on loans, net of issuance costs

Warrants issued with loans

Reset provision on warrants and

modification of warrants

Issuance of shares for debt

issuance costs

Exercise of warrants

Issuance of shares and warrants

for offering, net of issuance costs

Issuance costs related to exercise

of warrants, modification of warrants, and issuance of warrants

Issuance of shares for settlement of AP

Rounding from reverse stock

( 27,649,876 )

3 unchanged sentences

$ 100,443,967

$ ( 95,040,362 )

See accompanying notes to the financial statements.

STATEMENTS OF STOCKHOLDERS’ EQUITY

YEARS ENDED DECEMBER 31, 2022 AND 2021

Stockholders’

Equity (Deficit)

Balance December 31, 2020

1 unchanged sentence

$ ( 20,879,178 )

$ ( 2,852,177 )

Treasury stock

Rounding adjustment from stock split

Exercise of warrants

Issuance of shares for intangible assets

Stock option and warrant compensation

Exercise of warrants

Restricted stock unit compensation

Issuance of shares for services

Issuance of shares for the settlement of accrued compensation and accounts payable

Issuance of shares and warrants for IPO, net of issuance costs

Issuance of shares for employee compensation

Issuance of shares for vested restricted stock units

Issuance of shares for the conversion of debt

Fair value of warrants issued with convertible note payable

Issuance of shares and warrants for offering, net of issuance costs

Issuance of shares for the settlement of debt

Exercise conversion of preferred shares

( 1,250,000 )

Issuance of shares for offerings, net of issuance costs

Warrant consideration for convertible debt offering costs

Reduction in exercise price of warrants

( 46,371,364 )

3 unchanged sentences

$ ( 67,352,809 )

See accompanying notes

to the financial statements.

STATEMENTS OF CASH

See accompanying notes to the financial statements.

STATEMENTS OF CASH FLOWS

CASH FLOWS FROM OPERATING ACTIVITIES:

7 unchanged sentences

Loss on extinguishment of debt

Impairment on note receivable

Impairment on notes receivable

Disposal of fixed assets

Changes in operating assets and liabilities:

Accounts receivable

Prepaid expenses

Accounts payable and accrued expenses

( 1,483,180 )

Accrued compensation to related parties

Accounts receivable

Net cash used in operating activities

4 unchanged sentences

( 1,015,752 )

TI allowance receivable

Tenant improvement allowance receivable

Notes receivable and accrued interest

3 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from convertible note payable

Discount on convertible note payable from offering costs

Proceeds from note payable - related party

Repayments of note payable - related party

Repayments of note payable

Proceeds from notes and convertible notes payable, net of offering costs

Repayments of notes and convertible notes payable

( 3,206,887 )

Sale of Series B Preferred shares to related party

Redemption of Series B Preferred shares to related party

Common stock and warrants issued for cash, net of issuance costs

Offering costs

Proceeds from exercise of warrants

Exercise of warrants, net of offering costs

Payments on financing on fixed asset

2 unchanged sentences

Net cash provided by financing activities

NET (DECREASE) INCREASE IN CASH

NET DECREASE IN CASH

( 5,103,421 )

CASH AT BEGINNING OF PERIOD

CASH AT END OF PERIOD

( 2,628,765 )

CASH AT BEGINNING OF YEAR

CASH AT END OF YEAR

Supplemental cash flow information:

2 unchanged sentences

NON-CASH INVESTING AND FINANCING ACTIVITIES:

Liabilities assumed for common stock

Issuance of shares for the conversion of notes payable

Issuance of shares for the settlement of notes payable

Lease liability recognized from right of use asset

Issuance of shares for the settlement of accounts payable

Original offering discount on note payable

Original offering discount on convertible note payable

Debt discount from warrants issued with convertible note payable

Debt discount from warrant consideration for convertible debt offering costs

Debt discount from shares issued as inducement for convertible note payable

Liability recognized for financed assets

Reduction in exercise price of warrants

Shares issued for intangible assets

Conversion of preferred shares

See accompanying notes

to the financial statements.

NOTES TO FINANCIAL

1 – ORGANIZATION AND NATURE OF BUSINESS

(“Aditxt” or the “Company”), formerly known as Aditx Therapeutics, Inc., was incorporated in the State of

Delaware on September 28, 2017 and the Company’s headquarters are located in Richmond, VA.

The Company is a biotech innovation company

with a mission of prolonging life and enhancing its quality by improving the health of the immune system.

is developing biotechnologies specifically focused on improving the health of the immune system through immune reprogramming and monitoring.

The Company’s immune reprogramming technologies are currently at the pre-clinical stage and are designed to retrain the immune system

to induce tolerance with an objective of addressing rejection of transplanted organs, autoimmune diseases, and allergies.

The Company’s

immune monitoring technologies are designed to provide a personalized comprehensive profile of the immune system and the Company plans

to utilize them in its upcoming reprogramming clinical trials to monitor subjects’ immune response before, during and after drug

administration.

2, 2020, the Company completed its initial public offering (“IPO”).

In connection therewith, the Company issued 1,226,668 Units

(the “IPO Units”), at an offering price of $ 9.00 per IPO Unit, resulting in gross proceeds of approximately $ 11.0 million.

The IPO Units issued in the IPO consisted of one share of common stock, one Series A warrant, and one Series B warrant.

The Series A warrants

originally had an exercise price of $ 9.00 and a term of 5 years.

In addition, the Company issued a Unit Purchase Option

at an exercise price of $ 11.25 per unit to the underwriters to purchase up to 67,466 units, with each unit consisting of

(i) one share of common stock and (ii) one Series A warrant.

On August 19, 2020, the Company modified the exercise price of the Series

A warrants from $ 9.00 per share to $4.50 per share.

The term of the Series A warrants was not modified.

The Series B warrants

have an exercise price of $ 11.25 per share, a term of 5 years and contain a cashless exercise option upon certain criteria

10, 2020, the Company completed a follow-on public offering (“September 2020 Offering”).

In connection therewith, the Company

issued 2,400,000 Units (the “Follow-On Units”), at an offering price of $ 4.00 per Follow-On Unit, resulting

in gross proceeds of approximately $ 9.6 million.

The Follow-On Units issued in the September 2020 Offering consisted of one share

of common stock (or Series A Preferred Stock for investors who would own more than 4.99 % of the Company if they invested in common

stock), one Series A-1 warrant, and one Series B-1 warrant.

The Series A-1 warrants have an exercise price of $ 3.19 per share and

a term of 5 years.

The Series B-1 warrants have an exercise price of $ 5.00 per share, a term of 5 years and contain

a cashless exercise option upon certain criteria being met.

In addition, the Company issued a warrant to the underwriters to purchase

up to 60,000 shares of common stock at an exercise price of $ 5.00 per share.

31, 2021, the Company completed a registered direct offering (“August 2021 Offering”).

In connection therewith, the Company

issued 4,583,334 shares of common stock, at a purchase price of $ 2.40 per share, resulting in gross proceeds of approximately

$ 11.0 million.

In a concurrent private placement, the Company issued warrants to purchase up to 4,583,334 shares.

have an exercise price of $ 2.53 per share and are exercisable for a five-year period commencing six months from the date

The warrants exercise price was subsequently repriced to $ 1.50 .

In addition, the Company issued a warrant to the placement

agent to purchase up to 229,166 shares of common stock at an exercise price of $ 3.00 per share.

18, 2021, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Revere Securities LLC, relating

to the public offering (the “October 2021 Offering”) of 2,833,333 shares of the Company’s common stock (the

“Shares”) by the Company.

The Shares were offered, issued, and sold at a price to the public of $ 1.50 per share under

a prospectus supplement and accompanying prospectus filed with the SEC pursuant to an effective shelf registration statement filed with

the SEC on Form S-3 (File No.

Shares issued for debt offering costs

Warrant modification

Deferred issuance costs

See accompanying notes to the financial statements.

NOTES TO FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

Company Background

We are a biotech innovation company with a mission

of prolonging life and enhancing its quality by improving the health of the immune system.

We are an innovation company developing and

commercializing technologies with a focus on monitoring and modulating the immune system.

Our immune reprogramming technologies are currently

at the pre-clinical stage and are designed to retrain the immune system to induce tolerance with an objective of addressing rejection

of transplanted organs, autoimmune diseases, and allergies.

Our immune monitoring technologies are designed to provide a personalized

comprehensive profile of the immune system and we plan to utilize them in our upcoming reprogramming clinical trials to monitor subjects’

immune response before, during and after drug administration.

Reverse Stock Split

On September 13, 2022, the Company effectuated

a 1 for 50 reverse stock split (the “Reverse Split”).

The Company’s stock began trading on a split-adjusted basis effective

on the Nasdaq Stock Market on September 14, 2022.

There was no change to the number of authorized shares of the Company’s common

All shares amounts referenced in this report are adjusted to reflect the Reverse Split.

On August 31, 2021, the Company completed a registered

direct offering (“August 2021 Offering”).

In connection therewith, the Company issued 91,667 shares of common stock,

at a purchase price of $ 120.00 per share, resulting in gross proceeds of approximately $ 11.0 million.

In a concurrent private

placement, the Company issued warrants to purchase up to 91,667 shares.

The warrants have an exercise price of $126.50 per

share and are exercisable for a five-year period commencing six months from the date of issuance.

The warrants exercise

price was subsequently repriced to $ 75.00 .

In addition, the Company issued a warrant to the placement agent to purchase up to 4,584 shares

of common stock at an exercise price of $ 150.00 per share.

On October 18, 2021, the Company entered into

an underwriting agreement with Revere Securities LLC, relating to the public offering (the “October 2021 Offering”) of 56,667 shares

of the Company’s common stock (the “Shares”) by the Company.

The Shares were offered, issued, and sold at a price to

the public of $ 75.00 per share under a prospectus supplement and accompanying prospectus filed with the SEC pursuant to an effective

shelf registration statement filed with the SEC on Form S-3 (File No.

333-257645), which was declared effective by the SEC on July 13,

The October Offering closed on October

20, 2021 for gross proceeds of $ 4.25 million.

The Company utilized a portion of the proceeds, net of underwriting discounts of approximately

$ 3.91 million from the October Offering to fund certain obligations under the Credit Agreement.

6, 2021, we completed an offering for net proceeds of $ 16.0 million.

As part of this offering, we issued 8,246,430 units consisting of

shares of the Company’s common stock and warrant to purchase shares of the Company’s common stock and 8,328,570 prefunded

The warrant issued as part of the units had an exercise price of $ 1.15 and the prefunded warrants had an exercise price of $ 0.001 .

and Uncertainties

has a limited operating history and is in the very early stages of generating revenue from intended operations.

The Company’s business

and operations are sensitive to general business and economic conditions in the U.S.

and worldwide along with local, state, and federal

governmental policy decisions.

The October 2021 Offering closed on October 20, 2021 for gross proceeds of $ 4.25 million.

The Company utilized a portion of

the proceeds, net of underwriting discounts of approximately $ 3.91 million from the October 2021 Offering to fund certain obligations

under the Credit Agreement.

On December 6, 2021, the Company completed a public

offering for net proceeds of $ 16.0 million (the “December 2021 Offering”).

As part of the December 2021 Offering, we

issued 164,929 units consisting of shares of the Company’s common stock and warrant to purchase shares of the Company’s

common stock and 166,572 prefunded warrants.

The warrant issued as part of the units had an exercise price of $ 57.50 and

the prefunded warrants had an exercise price of $ 0.001 .

On June 15, 2022, the Company entered an agreement with a holder of certain warrants

in the December 2021 Offering.

(See Note 11)

On September 20, 2022, the Company completed a

public offering for net proceeds of $ 17.2 million (the “September 2022 Offering”).

As part of the September 2022 Offering,

we issued 1,224,333 of shares of the Company’s common stock, pre-funded warrants to purchase 2,109,000 shares of common stock,

and warrants to purchase 3,333,333 shares of the Company’s common stock.

The warrants had an exercise price of $ 6.00 and the

pre-funded warrants had an exercise price of $ 0.001 .

Risks and Uncertainties

The Company has a limited operating history and

is in the very early stages of generating revenue from intended operations.

The Company’s business and operations are sensitive

to general business and economic conditions in the U.S.

and worldwide along with local, state, and federal governmental policy decisions.

A host of factors beyond the Company’s control could cause fluctuations in these conditions.

conditions may include:

changes in the biotechnology regulatory environment, technological advances that render our technologies obsolete,

availability of resources for clinical trials, acceptance of technologies into the medical community, and competition from larger, more

well-funded companies.

These adverse conditions could affect the Company’s financial condition and the results of its operations.

30, 2020, the World Health Organization declared the COVID-19 novel coronavirus outbreak a “Public Health Emergency of International

Concern” and on March 10, 2020, declared it to be a pandemic.

Actions taken around the world to help mitigate the spread of the

coronavirus include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and

The COVID-19 coronavirus and actions taken to mitigate it have had and are expected to continue to have an adverse impact

on the economies and financial markets of many countries, including the geographical area in which the Company operates.

While it is unknown

how long these conditions will last and what the financial impact will be to the Company, it is reasonably possible that future capital

raising efforts and additional development of our technologies may be negatively affected.

2 – GOING CONCERN ANALYSIS

was incorporated on September 28, 2017 and has not generated significant revenues to date.

During the year ended December 31, 2021, the

Company had a net loss of $ 46,371,364 and negative cash flow from operating activities of $ 22,278,144 .

During the year ended December

31, 2021, the Company raised approximately $ 35.0 million dollars through debt and equity transactions.

As of December 31, 2021 the Company’s

cash balance was $ 7,872,061 .

The Company has $ 67.3 remaining availability to raise future funds pursuant to an effective shelf registration

statement filed with the SEC on Form S-3 declared effective on July 13, 2021.

However, factors such as stock price, volatility, trading

volume, market conditions, demand and regulatory requirements may adversely affect the Company’s ability to raise capital in an

efficient manner.

of these factors, the Company believes that this creates substantial doubt with the Company’s ability to continue as a going concern.

The financial

statements included in this report do not include any adjustments to reflect the possible future effects on the recoverability and classification

of assets or the amounts and classification of liabilities that may result from the matters discussed herein.

The Company’s ability

to continue as a going concern is dependent upon the ability to complete clinical studies and implement the business plan, generate sufficient

revenues and to control operating expenses.

In addition, the Company is consistently focused on raising capital, strategic acquisitions

and alliances, and other initiatives to strengthen the Company.

3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of Presentation

The Company’s

financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”).

The preparation

of financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts

of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported

amounts of revenue and expense during the reporting period.

Adverse conditions may include:

in the biotechnology regulatory environment, technological advances that render our technologies obsolete, availability of resources for

clinical trials, acceptance of technologies into the medical community, and competition from larger, more well-funded companies.

adverse conditions could affect the Company’s financial condition and the results of its operations.

January 30, 2020, the World Health Organization declared the COVID-19 novel coronavirus outbreak a “Public Health Emergency of

International Concern” and on March 10, 2020, declared it to be a pandemic.

Actions taken around the world to help mitigate the

spread of the coronavirus included restrictions on travel, and quarantines in certain areas, and forced closures for certain types of

public places and businesses.

The COVID-19 coronavirus and actions taken to mitigate it have had an adverse impact on the economies and

financial markets of many countries, including the geographical area in which the Company operates.

While it is unknown how long these

conditions will last and what the financial impact will be to the Company, it is reasonably possible that future capital raising efforts

and additional development of our technologies may be negatively affected.

NOTE 2 – GOING CONCERN ANALYSIS

Management Plans

The Company was incorporated on September 28,

2017 and has not generated significant revenues to date.

During the year ended December 31, 2022, the Company had a net loss of $ 27,649,876 and

negative cash flow from operating activities of $ 22,049,040 .

As of December 31, 2022, the Company’s cash balance was $ 2,768,640 .

As of December 31, 2022, the Company had $ 51.5 million of remaining availability, subject to regulatory requirements, to raise

future funds pursuant to an effective shelf registration statement filed with the SEC on Form S-3 declared effective on July 13, 2021.

However, factors such as stock price, volatility, trading volume, market conditions, demand and regulatory requirements may adversely

affect the Company’s ability to raise capital in an efficient manner.

In addition to the shelf registration, the Company

has the ability to raise capital from equity of debt through private placements or public offerings pursuant to a registration statement

We may also secure loans from related parties.

Because of these factors, the Company believes

that this creates substantial doubt with the Company’s ability to continue as a going concern.

The financial statements included in this report

do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts

and classification of liabilities that may result from the matters discussed herein.

The Company’s ability to continue as a going

concern is dependent upon the ability to complete clinical studies and implement the business plan, generate sufficient revenues and to

control operating expenses.

In addition, the Company is consistently focused on raising capital, strategic acquisitions and alliances,

and other initiatives to strengthen the Company.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING

Basis of Presentation

The Company’s financial statements have

been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

the rules and regulations of the Securities and Exchange Commission (“SEC”).

Use of Estimates

The preparation of financial statements in conformity

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure

of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the

reporting period.

Actual results could differ from those estimates.

Significant estimates underlying

the financial statements include the fair value of stock options and warrants.

Value Measurements and Fair Value of Financial Instruments

adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820, Fair

Value Measurements.

ASC Topic 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes

a fair value hierarchy to classify the inputs used in measuring fair value as follows:

Significant estimates underlying the financial statements include

the collectability of notes receivable, collectability and reserve on accounts receivable, the reserve on insurance billing, and the fair

value of stock options and warrants.

Fair Value Measurements and Fair Value of

Financial Instruments

The Company adopted Financial Accounting Standards

Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements.

ASC Topic 820 clarifies

the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs

used in measuring fair value as follows:

Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

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Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

did not identify any assets or liabilities that are required to be presented on the balance sheets at fair value in accordance with ASC

short-term nature of all financial assets and liabilities, their carrying value approximates their fair value as of the balance sheet

Concentrations

of Credit Risk

maintains its cash accounts at financial institutions which are insured by the Federal Deposit Insurance Corporation.

At times, the Company

may have deposits in excess of federally insured limits.

and Cash Equivalents

cash equivalents include short-term, liquid investments.

consists of laboratory materials and supplies used in laboratory analysis.

The Company did not identify any assets or liabilities

that are required to be presented on the balance sheets at fair value in accordance with ASC Topic 820.

Due to the short-term nature of all financial

assets and liabilities, their carrying value approximates their fair value as of the balance sheet dates.

Concentrations of Credit Risk

Financial instruments that potentially subject

the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.

The Company maintains its cash accounts at financial

institutions which are insured by the Federal Deposit Insurance Corporation.

At times, the Company may have deposits in excess of federally

insured limits.

Substantially all the Company’s accounts

receivable are with companies in the healthcare industry, individuals, and the U.S.

However, concentration of credit risk

is mitigated due to the Company’s number of customers.

In addition, for receivables due from U.S government agencies, the Company

does not believe the receivables represent a credit risk as these are related to healthcare programs funded by the U.S.

government and

payment is primarily dependent upon submitting the appropriate documentation.

Cash and Cash Equivalents

Cash and cash equivalents include short-term,

liquid investments.

Inventory consists of laboratory materials and

supplies used in laboratory analysis.

We capitalize inventory when purchased.

Inventory is valued

at the lower of cost or net realizable value on a first-in, first-out basis.

We periodically perform obsolescence assessments and write

off any inventory that is no longer usable.

are stated at cost less accumulated depreciation.

Cost includes expenditures for furniture, office equipment, laboratory equipment, and

other assets.

Maintenance and repairs are charged to expense as incurred.

When assets are sold, retired, or otherwise disposed of, the

cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in operations.

fixed assets are depreciated using the straight-line method over the estimated useful lives or lease life of the related assets.

assets are stated at cost less accumulated amortization.

For intangible assets that have finite lives, the assets are amortized using

the straight-line method over the estimated useful lives of the related assets.

For intangible assets with indefinite lives, the assets

are tested periodically for impairment.

Inventory is valued at the lower of cost or net realizable

value on a first-in, first-out basis.

We periodically perform obsolescence assessments and write off any inventory that is no longer usable.

Fixed assets are stated at cost less accumulated

depreciation.

Cost includes expenditures for furniture, office equipment, laboratory equipment, and other assets.

Maintenance and repairs

are charged to expense as incurred.

When assets are sold, retired, or otherwise disposed of, the cost and accumulated depreciation are

removed from the accounts and any resulting gain or loss is reflected in operations.

The costs of fixed assets are depreciated using the

straight-line method over the estimated useful lives or lease life of the related assets.

Useful lives assigned to fixed assets are as follows:

Three years to five years

Lab Equipment

Seven to ten years

Office Furniture

Five to ten years

Other fixed assets

Five to ten years

Leasehold Improvements

Shorter of estimated useful life or remaining lease term

Intangible Assets

Intangible assets are stated at cost less accumulated

amortization.

For intangible assets that have finite lives, the assets are amortized using the straight-line method over the estimated

useful lives of the related assets.

For intangible assets with indefinite lives, the assets are tested periodically for impairment.

Accounts Receivable and Allowance for Doubtful

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determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management.

As of December 31, 2021 and 2020, there was no allowance for doubtful accounts deemed necessary.

As of December 31, 2022 and 2021, there was an allowance for doubtful accounts of $ 18,634 and zero , respectively.

Offering Costs

Offering costs incurred in connection with equity are recorded as a

reduction of equity and offering costs incurred in connection with debt are recorded as a reduction of debt as a debt discount.

Revenue Recognition

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Recognize revenue when or as the Company satisfies a performance obligation

Revenues reported from services provided by the

AditxtScore™ division are recognized when the AditxtScore™ report is delivered.

The services performed include the analysis

of specimens received in Aditxt’s CLIA laboratory and the generation of results which are then delivered upon completion.

Fees per test in the client payer channel are

determined based on contractual arrangements with our customers.

Generally, client revenues are recorded based on the number of AditxtScore™

reports delivered at the contractual rate per test

accounts for offering costs in accordance with ASC 340, Other Assets and Deferred Costs.

Prior to the completion of an offering, offering

costs were capitalized as deferred offering costs on the balance sheet.

The deferred offering costs are netted against the proceeds of

the offering in stockholders’ equity (deficit) or the related debt, as applicable.

Costs related to unsuccessful offerings are expensed.

842 (Leases), operating lease expense is generally recognized evenly over the term of the lease.

The Company has operating leases consisting

of office space, laboratory space, and lab equipment.

an initial term of twelve months or less are not recorded on the balance sheet.

We combine the lease and non-lease components in determining

the lease liabilities and right of use (“ROU”) assets.

accounts for stock-based compensation costs under the provisions of ASC 718, Compensation—Stock Compensation, which requires the

measurement and recognition of compensation expense related to the fair value of stock-based compensation awards that are ultimately expected

Stock-based compensation expense recognized includes the compensation cost for all stock-based payments granted to employees,

officers, and directors based on the grant date fair value estimated in accordance with the provisions of ASC 718.

ASC 718 is also applied

to awards modified, repurchased, or cancelled during the periods reported.

Stock-based compensation is recognized as expense over the

employee’s requisite vesting period and over the nonemployee’s period of providing goods or services.

incurs fees from patent licenses, which are expensed as incurred.

During the years ended December 31, 2021 and December 31, 2020, the

Company incurred patent licensing fees for the patents of $ 76,455 and $ 258,635 , respectively.

and Development

research and development costs during the process of researching and developing our technologies and future offerings.

We expense these

costs as incurred unless such costs qualify for capitalization under applicable guidance.

Revenues reported from services relating to the

AditxtScore™ are recognized when the AditxtScore TM report is delivered to the customer.

The services performed include

the analysis of specimens received in the Company’s CLIA laboratory and the generation of results which are then delivered upon

The Company recognizes revenue in the following

manner for the following types of customers:

Client Payers:

Client payers include physicians or other entities

for which services are billed based on negotiated fee schedules.

The Company principally estimates the allowance for credit losses for

client payers based on historical collection experience and the period of time the receivable has been outstanding.

Customers are billed based on established patient

fee schedules or fees negotiated with physicians on behalf of their patients.

Collection of billings is subject to credit risk and the

ability of the patients to pay.

Reimbursements from healthcare insurers are based

on fee for service schedules.

Net revenues recognized consist of amounts billed net of contractual allowances for differences between

amounts billed and the estimated consideration the Company expects to receive from such payers, collection experience, and the terms of

the Company’s contractual arrangements.

Under Topic 842 (Leases), operating lease expense

is generally recognized evenly over the term of the lease.

The Company has operating leases consisting of office space, laboratory space,

and lab equipment.

Leases with an initial term of twelve months or

less are not recorded on the balance sheet.

We combine the lease and non-lease components in determining the lease liabilities and right

of use (“ROU”) assets.

Stock-Based Compensation

The Company accounts for stock-based compensation

costs under the provisions of ASC 718, Compensation—Stock Compensation, which requires the measurement and recognition of compensation

expense related to the fair value of stock-based compensation awards that are ultimately expected to vest.

Stock-based compensation expense

recognized includes the compensation cost for all stock-based payments granted to employees, officers, and directors based on the grant

date fair value estimated in accordance with the provisions of ASC 718.

ASC 718 is also applied to awards modified, repurchased, or cancelled

during the periods reported.

Stock-based compensation is recognized as expense over the employee’s requisite vesting period and

over the nonemployee’s period of providing goods or services.

The Company incurs fees from patent licenses,

which is reflected in research and development expenses, and are expensed as incurred.

During the years ended December 31, 2022 and 2021,

December 31, 2020, the Company incurred research and development costs of $ 5,042,617 and $ 937,966 , respectively.

and Diluted Net Loss per Common Share

per common share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding for each period.

Diluted loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding plus

the dilutive effect of shares issuable through the common stock equivalents.

The weighted-average number of common shares outstanding

excludes common stock equivalents because their inclusion would be anti-dilutive.

As of December 31, 2021, 2,235,466 stock options, 778,250 restricted

the Company incurred patent licensing fees for the patents of $ 263,273 and $ 76,455 , respectively.

Research and Development

We incur research and development costs during

the process of researching and developing our technologies and future offerings.

We expense these costs as incurred unless such costs

qualify for capitalization under applicable guidance.

During the years ended December 31, 2022 and 2021, the Company incurred research

and development costs of $ 7,268,084 and $ 5,042,617 , respectively.

Basic and Diluted Net Loss per Common Share

Basic loss per common share is computed by dividing the net loss by

the weighted average number of shares of common stock outstanding for each period.

Diluted loss per share is computed by dividing the

net loss attributable of common stockholders by the weighted average number of shares of common stock outstanding plus the dilutive effect

of shares issuable through the common stock equivalents.

The weighted-average number of common shares outstanding excludes common stock

equivalents because their inclusion would be anti-dilutive.

As of December 31, 2022, 44,710 stock options, 7,197 unvested restricted

stock units, and 5,090,024 warrants were excluded from dilutive earnings per share as their effects were anti-dilutive.

of December 31, 2020, 2,143,000 stock options and 5,799,146 warrants were excluded from dilutive earnings per share

as their effects were anti-dilutive.

Accounting Pronouncements

issues ASUs to amend the authoritative literature in ASC.

There have been several ASUs to date, including those above, that amend the

original text of ASC.

Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections,

(iii) are not applicable to us or (iv) are not expected to have a significant impact on our financial statements.

4 – NOTE RECEIVABLE

Global Note Receivable

25, 2021, the Company entered into a letter of intent (“the LOI”) to acquire AiPharma Global Holdings LLC, a Delaware limited

liability company, which changed its name to Cellvera Global Holdings LLC (“Cellvera Global”) which is commercializing COVID-19

antiviral oral therapy.

December 31, 2021, 44,710 stock options, 15,565 unvested restricted stock units and 601,399 warrants were excluded

from dilutive earnings per share as their effects were anti-dilutive.

During the years ended December 31, 2022 and 2021,

the Company recognized an implied dividend from the modification of warrants of $ 37,667 and $ 102,267 , respectively.

Theses implied dividends

resulted in an increase in the net loss attributable to common stockholders.

Recent Accounting Pronouncements

The FASB issues ASUs to amend the authoritative

literature in ASC.

There have been several ASUs to date, including those above, that amend the original text of ASC.

Management believes

that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to us or

(iv) are not expected to have a significant impact on our financial statements.

NOTE 4 – NOTE RECEIVABLE

Cellvera Global Note Receivable

On August 25, 2021, the Company entered into a

letter of intent (“the LOI”) to acquire AiPharma Global Holdings LLC, a Delaware limited liability company, which subsequently

changed its name to Cellvera Global Holdings LLC (“Cellvera Global”) which is commercializing COVID-19 antiviral oral therapy.

Key terms of the proposed transaction as stated in the Letter of Intent included:

the completion of a proposed

$ 6.5 million secured loan from the Company to Cellvera Global by August 31, 2021, as well as the issuance of such number of shares

of the Company’s common stock that yields 50 % of the number of the Company’s outstanding shares post-closing of the transaction.

The acquisition is subject to the satisfaction of numerous conditions, including satisfactory due diligence, the negotiation and execution

of definitive agreements and other closing conditions, including board and shareholder approval and approval by Nasdaq of the listing

of shares proposed to be issued in the transaction.

The Company and Cellvera Global agreed to an exclusivity period until September

30, 2021 (the “Exclusivity Period”), with a view to settling the definitive agreement.

On September 30, 2021, the parties

entered into a letter agreement pursuant to which they agreed to extend the Exclusivity Period until October 4, 2021.

the completion of a proposed $ 6.5 million secured

loan from the Company to Cellvera Global by August 31, 2021, as well as the issuance of such number of shares of the Company’s common

stock that yields 50 % of the number of the Company’s outstanding shares post-closing of the transaction.

The acquisition is

subject to the satisfaction of numerous conditions, including satisfactory due diligence, the negotiation and execution of definitive

agreements and other closing conditions, including board and shareholder approval and approval by Nasdaq of the listing of shares proposed

to be issued in the transaction.

The Company and Cellvera Global agreed to an exclusivity period until September 30, 2021 (the “Exclusivity

Period”), with a view to settling the definitive agreement.

On September 30, 2021, the parties entered into a letter agreement pursuant

to which they agreed to extend the Exclusivity Period until October 4, 2021.

On December 28, 2021, we entered into a Share

Exchange Agreement with Cellvera Global f/k/a AiPharma Global, pursuant to which we (i) will acquire

9.5% of the issued and outstanding equity interests in Cellvera Global in exchange for the issuance of 4,816,193 shares of our common

stock of Aditxt and a cash payment of $250,000, at an initial closing upon the satisfaction or waiver of certain conditions to closing;

and (ii) acquire the remaining 90.5% of the issued and outstanding equity interests in Cellvera Global in exchange for the issuance of

39,927,974 shares of our common stock and a cash payment of $250,000 at a secondary closing upon the satisfaction or waiver of certain

conditions to closing.

Additionally, we may elect to raise additional capital due to market conditions or strategic considerations.

In connection with the contemplated

acquisition with Cellvera Global, the Company entered into a secured credit agreement dated August 27, 2021 (the “Credit

Agreement”) with Cellvera Global and certain affiliated entities, pursuant to which the Company made a secured loan to Cellvera

Global in the principal amount of $ 6.5 million (the “Loan”).

The Loan was funded on August 31, 2021, following the closing

of the Company’s August 2021 Offering.

The Loan bears interest at a rate of 8 % per annum and matured on November 30, 2021 or

upon such earlier date as the Letter of Intent or Exclusivity Period is terminated in accordance with the terms thereof.

The Loan is secured

by certain accounts receivable and other assets of Cellvera Global and certain of its affiliates.

The Credit Agreement also contains certain

covenants that prohibit Cellvera Global from incurring additional indebtedness, incurring liens or making any dispositions of its property.

18, 2021, the Company entered into the first amendment to the Credit Agreement with Cellvera Global and certain affiliated entities (the

“Credit Agreement Amendment”), pursuant to which the Company agreed to increase the amount which Cellvera Global was permitted

to borrow under the Credit Agreement by $8.5 million to an aggregate of $15.0 million, of which $6.5 million was outstanding prior to

entering the Credit Agreement Amendment.

The Company agreed to fund such additional borrowings, as requested by Cellvera Global, by advancing

70% of any amounts received by the Company from the exercise of existing warrants or any other capital raises, including the October Offering.

As of December 31, 2021 an additional $ 8.0 million was advanced under the Credit Agreement for a total of $ 14.5 million.

Agreement was amended on multiple occasions, for which the final amendment was signed on December 31, 2021, extending the Loan’s

maturity date to January 31, 2022.

Based on the facts and circumstances

described in Note 13, the Company determined that Cellvera Global may not have the ability to repay the note receivable.

the Company recognized a full impairment of $ 14.5 million as of December 31, 2021.

Company Note Receivable

Exchange Agreement with Cellvera Global f/k/a AiPharma Global, pursuant to which we (i) will acquire 9.5% of the issued and outstanding

equity interests in Cellvera Global in exchange for the issuance of 96,324 shares of our common stock of Aditxt and a cash payment of

$250,000, at an initial closing upon the satisfaction or waiver of certain conditions to closing;

and (ii) acquire the remaining 90.5%

of the issued and outstanding equity interests in Cellvera Global in exchange for the issuance of 798,560 shares of our common stock and

a cash payment of $250,000 at a secondary closing upon the satisfaction or waiver of certain conditions to closing.

Additionally,

we may elect to raise additional capital due to market conditions or strategic considerations.

In connection with the contemplated acquisition

with Cellvera Global, the Company entered into a secured credit agreement dated August 27, 2021 (the “Credit Agreement”)

with Cellvera Global and certain affiliated entities (collectively, the “Borrower”), pursuant to which the Company made a

secured loan to Cellvera Global in the principal amount of $ 6.5 million (the “Loan”).

The Loan was funded on August 31,

2021, following the closing of the Company’s August 2021 Offering.

The Loan bears interest at a rate of 8 % per annum and matured

on November 30, 2021.

The Loan is secured by certain accounts receivable and other assets of Cellvera Global and certain of its affiliates.

The Credit Agreement also contains certain covenants that prohibit Cellvera Global from incurring additional indebtedness, incurring liens

or making any dispositions of its property.

On October 18, 2021, the Company entered

into the first amendment to the Credit Agreement with Cellvera Global and certain affiliated entities (the “Credit Agreement Amendment”),

pursuant to which the Company agreed to increase the amount which Cellvera Global was permitted to borrow under the Credit Agreement by

$8.5 million to an aggregate of $15.0 million, of which $6.5 million was outstanding prior to entering the Credit Agreement Amendment.

The Company agreed to fund such additional borrowings, as requested by Cellvera Global, by advancing 70% of any amounts received by the

Company from the exercise of existing warrants or any other capital raises, including the October Offering.

As of December 31, 2021,

an additional $ 8.0 million was advanced under the Credit Agreement for a total of $ 14.5 million.

The Credit Agreement was amended on multiple occasions,

for which the final amendment was signed on December 31, 2021, extending the Loan’s maturity date to January 31, 2022.

The Company determined that Cellvera Global may

not have the ability to repay the note receivable.

Accordingly, the Company recognized a full impairment of $ 14.5 million as of December

Forbearance Agreement:

On January 31, 2022, the Company’s $ 14.5 million

loan to Cellvera Global became fully due and payable under the Credit Agreement.

On February 14, 2022, the Company entered into a Forbearance

Agreement and Seventh Amendment to Credit Agreement (the “Forbearance Agreement”) with Cellvera Global.

Pursuant to the Forbearance Agreement, the Company

agreed to forbear from exercising its rights and remedies against Cellvera Global and certain affiliated guarantor parties until the earlier

of (i) June 30, 2022 or (ii) the date of occurrence of any event of default under the Forbearance Agreement (the “Forbearance Period”).

Given that the parties continue to conduct due diligence in connection with the Share Exchange Agreement, the Company and Cellvera Global

also agreed that should the initial closing occur under the Share Exchange Agreement, the existing event of default will be waived.

the Forbearance Agreement, the Company and Cellvera Global also agreed to certain amendments to the Credit Agreement, including, but not

(i) the delivery by the Borrower of certain financial statements and forecasts, and (ii) certain regularly scheduled payments

to be made by Cellvera Global to the Company during the Forbearance Period.

As of the date of filing of this Quarterly Report, the regularly

scheduled payments under the Forbearance Agreement have not been made, and the note receivable remains fully impaired.

On April 4, 2022, the Company and Cellvera Global

entered into a Forbearance Agreement and Eighth Amendment to the Credit Agreement (the “April Forbearance Agreement”) pursuant

to which among other things (i) the Company agreed to extend the forbearance period until the earlier of March 31, 2023 or the date of

occurrence of any event of default under the April Forbearance Agreement, (ii) Cellvera Global shall be permitted to factor certain receivables,

and (iii) certain conforming changes were made relating to the Revenue Sharing Agreement (as defined below).

In connection with the Forbearance

Agreement, the Company entered into a series of security agreements with Cellvera Global (the “Security Agreements”) and certain

affiliated entities pursuant to which Cellvera Global enhanced the Company’s security interest in connection with the Credit Agreement.

In addition, and as a condition to entering into the April Forbearance Agreement, the Company required that Cellvera Global enter into

a Revenue Sharing Agreement (the “Revenue Sharing Agreement”), pursuant to which, among other things, Cellvera Global agreed

to pay the Company a certain portion of its revenues up to the aggregate amount of $ 30 million.

As of the date of filing of this

Annual Report, the Company has not received any payments from Cellvera Global pursuant to the Revenue Sharing Agreement.

Upon termination

of the April Forbearance agreement, the amounts under the Secured Credit agreement (as amended) shall become immediately due and payable.

Concurrently with the execution of the April Forbearance

Agreement and the Revenue Sharing Agreement, the Company and AiPharma Group, Ltd.

entered into an Amendment to the Share Exchange Agreement

(the “Share Exchange Amendment”) which amended the Share Exchange Agreement to, among other things:

(i) modify the financial

statements required to be delivered by AiPharma Group, Ltd.

at the initial closing to include the unaudited financial statements for the

three months ended March 31, 2022 and 2021, (ii) permit the Company to amend its Certificate of Incorporation without the consent of AiPharma

in order to effect a reverse stock split of the Company’s common stock, if necessary, in order to maintain its listing

on the Nasdaq Capital Market, and (iii) make certain other conforming changes related to the March Forbearance Agreement and Revenue Sharing

Target Company Note Receivable

On December 10, 2021, the Company entered into

a secured credit agreement dated December 10, 2021 (the “Target Company Credit Agreement”) and signed on December 10, 2021

with the Target Company, pursuant to which the Company made a secured loan to the Target Company in the principal amount of $ 500,000 (the

“Target Company Loan”) and agreed to make additional secured loans, as requested by the Target Company and approved by the

Company, in an amount not to exceed $ 4.5 million.

The Target Company Loan bears interest at a rate of 8 % per annum and mature on December

8, 2022, provided, that the Letter of Intent currently contemplates that the Target Company Loan will be forgivable upon the closing of

the acquisition contemplated by the letter of intent.

The Target Company Credit Agreement also contains certain covenants that prohibit

the Target Company from incurring additional indebtedness, entering into any fundamental transactions, issuing any equity interests subject

to certain limited exceptions, or making any dispositions of its property.

In connection with the Target Company Credit Agreement, the

Company entered into a Security Agreement with the Target Company, pursuant to which the Target Company granted the Company a security

interest in all of the Target Company’s assets as security for the Target Company Loan.

The Company determined that the Target Company

may not have the ability to repay the note receivable.

Accordingly, the Company recognized a full impairment of the principal and accrued

interest of $ 0.5 million as of December 31, 2022.

NOTE 5 – FIXED ASSETS

The Company’s fixed assets include the following

on December 31, 2022:

the Company entered into a secured credit agreement dated December 10, 2021 (the “Target Company Credit Agreement”) and signed

on December 10, 2021 with the Target Company, pursuant to which the Company made a secured loan to the Target Company in the principal

amount of $500,000 (the “Target Company Loan”) and agreed to make additional secured loans, as requested by the Target Company

and approved by the Company, in an amount not to exceed $4.5 million.

The Target Company Loan bears interest at a rate of 8% per annum

and mature on December 8, 2022, provided, that the Letter of Intent currently contemplates that the Target Company Loan will be forgivable

upon the closing of the acquisition contemplated by the letter of intent.

The Target Company Credit Agreement also contains certain covenants

that prohibit the Target Company from incurring additional indebtedness, entering into any fundamental transactions, issuing any equity

interests subject to certain limited exceptions, or making any dispositions of its property.

In connection with the Target Company Credit

Agreement, the Company entered into a Security Agreement with the Target Company, pursuant to which the Target Company granted the Company

a security interest in all of the Target Company’s assets as security for the Target Company Loan.

As of December 31, 2021, the outstanding principal of the Target Company

Loan is $ 500,000 and the accrued interest on the Loan is $ 2,521 .

5 – FIXED ASSETS

The Company’s

fixed assets include the following on December 31, 2021:

$ ( 197,907 )

Lab Equipment

1 unchanged sentence

Other Fixed Assets

Leasehold Improvements

Total Fixed Assets

$ ( 815,987 )

The Company’s

fixed assets include the following on December 31, 2020:

The Company’s fixed assets include the following

on December 31, 2021:

Lab Equipment

2 unchanged sentences

Total Fixed Assets

expense was $ 369,236 and $ 17,773 , for the years ended December 31, 2021 and 2020, respectively.

None of the Company’s fixed assets

serve as collateral against any loans as of December 31, 2021 and December 31, 2020, other than those subject to the financed asset liability.

6 – INTANGIBLE ASSETS

The Company’s

intangible assets include the following on December 31, 2021:

$ ( 387,010 )

Depreciation expense was $ 428,977 and $ 369,236 ,

for the years ended December 31, 2022 and 2021, respectively.

None of the Company’s fixed assets serve as collateral against any

loans as of December 31, 2022 and December 31, 2021, other than those subject to the financed asset liability.

As of December 31, 2022

and 2021, the fixed assets that serve as collateral subject to the financed asset liability have a carrying value of $ 1,359,091 and $ 1,690,420 ,

respectively.

Financed Assets:

In October 2020, the Company purchased two pieces

of lab equipment and financed them for a period of twenty-four months with a monthly payment of $ 19,487 , with an interest rate of 8 %.

In January of 2021, the Company purchased one

piece of lab equipment and financed it for a period of twenty-four months with a monthly payment of $ 9,733 , with an interest rate of 8 %.

In March of 2021, the Company purchased five pieces

of lab equipment and financed them for a period of twenty-four months with a monthly payment of $ 37,171 , with an interest rate of 8 %.

Maturities as follows:

Total Payments

NOTE 6 – INTANGIBLE ASSETS

The Company’s intangible assets include

the following on December 31, 2022:

Proprietary Technology

1 unchanged sentence

Total Intangible Assets

The Company’s

intangible assets include the following on December 31, 2020:

$ ( 214,000 )

The Company’s intangible assets include

the following on December 31, 2021:

Proprietary Technology

$ ( 107,000 )

Total Intangible Assets

expense was $ 107,000 and $ 0 for the years ended December 31, 2021 and 2020, respectively.

None of the Company’s intangible assets

serve as collateral against any loans as of December 31, 2021, and December 31, 2020.

7 – RELATED PARTY TRANSACTIONS

24, 2021, the Company granted 225,000 shares of restricted stock pursuant to the Company’s 2017 Equity Incentive Plan

to the Company’s Chief Executive Officer.

The Company recognized $ 747,000 in stock-based compensation for the issuance of these

shares during the year ended December 31, 2021.

24, 2021, the Company granted 110,000 shares of restricted stock pursuant to the Company’s 2017 Equity Incentive Plan

to the Company’s current President and former Chief Financial Officer.

The Company recognized $ 365,200 in stock-based compensation

for the issuance of these shares during the year ended December 31, 2021.

4, 2021, the Company granted 75,000 shares of restricted stock pursuant to the Company’s 2021 Equity Incentive Plan to

the Company’s Chief Executive Officer.

The Company recognized $ 191,250 in stock-based compensation for the issuance of these

shares during the year ended December 31, 2021.

4, 2021, the Company granted 55,000 shares of restricted stock pursuant to the Company’s 2021 Equity Incentive Plan to

the Company’s current President and former Chief Financial Officer.

The Company recognized $ 140,250 in stock-based compensation

for the issuance of these shares during the year ended December 31, 2021.

5, 2021, the Company granted 175,000 shares of Restricted Stock Units (“RSUs”) pursuant to the Company’s 2021

Equity Incentive Plan to officers and board members of the Company.

The Company recognized $ 122,270 in stock-based compensation for

the issuance of these vested and unvested RSUs during the year ended December 31, 2021.

On September 30, 2021, the Company granted

50,000 shares of RSUs pursuant to the Company’s 2021 Equity Incentive Plan to board

members of the Company.

The Company recognized $ 28,476 in stock-based compensation for the issuance of these vested and unvested RSUs

during the year ended December 31, 2021.

10, 2021, the Company granted 195,000 RSUs to officers pursuant to the Company’s 2021 Equity Incentive Plan.

The Company recognized

$ 28,178 in stock-based compensation for the issuance of these unvested RSUs during the year ended December 31, 2021.

8 – FINANCING AGREEMENT

2021, the Company entered into a 24-month financing agreement for lab equipment.

The aggregate cost of this financing agreement, net of

a $ 200,000 down payment is $ 892,095 , of which $ 821,862 represents principal and $ 70,233 represents interest.

The financing

agreement has an interest rate of 8 % per year.

9 – CONVERTIBLE NOTE PAYABLE

25, 2021, the Company entered into a Securities Purchase Agreement with an institutional accredited investor (the “Investor”)

for the offering, sale, and issuance of a $ 6,000,000 Senior Convertible Promissory Note (the “January 2021 Securities Purchase

Agreement, or the Convertible Note”).

The Convertible Note had a twenty-four-month term and was convertible at the option of the

Investor at any time prior to maturity in shares of common stock at an initial conversion price of $ 4.00 per share.

Pursuant to the

January 2021 Securities Purchase Agreement, the Company also issued a warrant to the Investor to purchase up to 800,000 shares

of the Company’s common stock.

The warrant is immediately exercisable for a period of three (3) years at an

exercise price of $ 4.00 per share, subject to adjustment.

An additional 75,000 warrants to purchase shares of the Company’s

common stock was also issued to the underwriters.

These underwriter warrants are immediately exercisable for a period of five (5) years at

an exercise price of $ 4.00 per share, subject to adjustment.

The Convertible Note had an original issuance discount of $ 1,000,000 .

The Company also recognized an additional discount of $ 526,460 from the issuance costs of the debt, $ 1,322,840 from the relative

fair value of the warrants issued to the Investor, and $ 231,316 from the fair value of warrants issued to the underwriters.

debt discount from these items was $ 3,080,616 which would have been amortized over the life of the Convertible Note.

the Convertible Note’s principal amount would occur in nineteen monthly cash or common stock payments beginning in July 2021.

Convertible Note could have been prepaid by the Company at any time without penalty at 105 % of the then outstanding principal amount

due under the Convertible Note.

25, 2021, commensurate with the August 2021 Offering of securities described in Note 1, the exercise price of the warrants was reset based

on the sale of securities at a lesser price than the original strike price of the warrants.

The reset provision was partially waived at

the time and formally waived based on the defeasance and waiver agreement on August 30, 2021, described below.

The reset provision resulted

in a warrant reset adjustment for $ 102,267 and recorded as an decrease to accumulated deficit and an increase to additional

paid-in-capital.

30, 2021, the Company entered into a defeasance and waiver agreement with the holder (the “Noteholder”) of the Convertible

Note pursuant to which the Noteholder has agreed in exchange for (a) a cash payment by the Company to the Convertible Noteholder of $ 1.2 million,

(b) a waiver, in part, of the conversion price adjustment provision such that the January 2021 Note shall be convertible into 4,802,497 shares

of common stock (without giving effect to the conversion notices received by the Company from the Noteholder prior to the date hereof

totaling 1,005,748 shares) and (c) a voluntary and permanent reduction by the Company of the exercise price of the warrant to

purchase 800,000 shares of common stock of the Company to $ 2.53 per share.

As a result of the modification of the debt

terms, the Company determined that an extinguishment of the debt occurred and recorded a loss on extinguishment of the debt in the amount

of $ 2,500,970 for the year ended December 31, 2021.

$ ( 107,000 )

Amortization expense was $ 107,000 and $ 107,000 for

the years ended December 31, 2022 and 2021, respectively.

None of the Company’s intangible assets serve as collateral against any

loans as of December 31, 2022 and 2021.

The Company’s proprietary technology is being amortized over its estimated useful life of

three years .

NOTE 7 – RELATED PARTY TRANSACTIONS

On January 28, 2022, the Company granted 9,600 restricted

stock units to an officer of the Company pursuant to the Company’s 2021 Equity Incentive Plan.

The Company recognized $ 146,613 in

stock-based compensation for the issuance of these vested and unvested restricted stock units during the year ended December 31, 2022.

On July 19, 2022, the Company entered into a Subscription

and Investment Representation Agreement with its Chief Executive Officer (the “Purchaser”), pursuant to which the Company

agreed to issue and sell one (1) share of the Company’s Series B Preferred Stock (the “Preferred Stock”), par value

$ 0.001 per share, to the Purchaser for $ 20,000 in cash.

On July 19, 2022, the Company filed a certificate

of designation (the “Certificate of Designation”) with the Secretary of State of Delaware, effective as of the time of filing,

designating the rights, preferences, privileges and restrictions of the share of Preferred Stock.

The Certificate of Designation provides

that the share of Preferred Stock will have 250,000,000 votes and will vote together with the outstanding shares of the Company’s

common stock as a single class exclusively with respect to any proposal to amend the Company’s Restated Certificate of Incorporation

to effect a reverse stock split of the Company’s common stock.

The Preferred Stock will be voted, without action by the holder,

on any such proposal in the same proportion as shares of common stock are voted.

The Preferred Stock otherwise has no voting rights except

as otherwise required by the General Corporation Law of the State of Delaware.

The Preferred Stock is not convertible into, or

exchangeable for, shares of any other class or series of stock or other securities of the Company.

The Preferred Stock has no rights with

respect to any distribution of assets of the Company, including upon a liquidation, bankruptcy, reorganization, merger, acquisition, sale,

dissolution or winding up of the Company, whether voluntarily or involuntarily.

The holder of the Preferred Stock will not be entitled

to receive dividends of any kind.

The outstanding share of Preferred Stock shall

be redeemed in whole, but not in part, at any time (i) if such redemption is ordered by the Board of Directors in its sole discretion

or (ii) automatically upon the effectiveness of the amendment to the Certificate of Incorporation implementing a reverse stock split.

Upon such redemption, the holder of the Preferred Stock will receive consideration of $ 20,000 in cash.

On September 13, 2022, the

share was redeemed.

On July 21, 2022, the Chief Executive Officer

loaned $ 80,000 to the Company.

The loan was evidenced by an unsecured promissory note (the “Promissory Note”).

to the terms of the Promissory Note, it will accrue interest at a rate of four and three-quarters percent ( 4.75 %) per annum, the Prime

rate on the date of signing, and is due on the earlier of January 22, 2023, or an event of default.

On October 7, 2022, the Company fully

repaid the $ 80,000 Promissory Note and $ 812 of accrued interest to its Chief Executive Officer.

The Chief Executive Officer and the Company

entered the Promissory Note on July 21, 2022.

NOTE 8 – NOTES PAYABLE

On May 27, 2022, the Company entered into an agreement

for the purchase and sale of future receipts (the “Future Receipts Agreement”) with a commercial funding source pursuant to

which the Company agreed to sell to the funder certain future trade receipts in the aggregate amount of $ 792,000 (the “Future

Receipts Purchased Amount” for gross proceeds to the Company of $ 550,000 , less origination fees of $ 16,500 and professional

service fees of $ 13,500 .

Pursuant to the Future Receipts Agreement, the Company granted the funder a security interest in all of the Company’s

present and future accounts receivable in an amount not to exceed the Future Receipts Purchased Amount.

The Purchased Amount shall be

repaid by the Company in 28 weekly installments of approximately $ 28,000 with the final payment due on December 7, 2022.

On September 30, 2022, the principal balance and

accrued interest was paid off in full.

On August 31, 2022, the Company entered into an

Agreement for the Purchase and Sale of Future Receipts (the “Agreement”) with a commercial funding source pursuant to which

the Company agreed to sell to the funder certain future trade receipts in the aggregate amount $ 288,000 (the “Purchased Amount”)

for gross proceeds to the Company of $ 200,000 , less origination fees of $ 20,000 .

Pursuant to the Agreement, the Company granted the funder

a security interest in all of the Company’s present and future accounts receivable in an amount not to exceed the Purchased Amount.

The Purchased Amount shall be repaid by the Company in 20 weekly installments of approximately $ 14,400 with the final payment due on January

In connection with the Agreement, the Company also issued a warrant to purchase 26,667 shares of the Company’s common

stock with an exercise price of $ 7.50 and an expiration of five years from the issuance date.

On September 30, 2022, the principal balance and

accrued interest was paid off in full.

Convertible Note Financing:

On August 4, 2022, the Company entered into a

Securities Purchase Agreement (the “SPA”) with certain accredited investors to purchase $ 1,277,778 in principal amount 10 %

Senior Secured Promissory Notes (the “August 2022 Notes”), resulting in gross proceeds to the Company of $ 1,150,000 , exclusive

of placement agent commission and fees and other offering expenses.

In connection therewith, the Company issued, 25,556 shares

of common stock as commitment fees and warrants (the “August 2022 Warrants”) to purchase up to 108,517 shares of

the Company’s common stock.

On August 11, 2022, the Company entered into a

SPA with certain accredited investors to purchase $ 555,556 in principal amount of August 2022 Notes, resulting in gross proceeds to the

Company of $ 500,000 .

In connection therewith, the Company issued 11,112 shares of common stock as commitment fees and August 2022 Warrants

to purchase up to 47,182 shares of the Company’s common stock.

The August 2022 Notes have a maturity date of

twelve (12) months from the date of issuance and are convertible at the option of the Investor at any time prior to maturity in shares

of Common Stock (the “Conversion Shares”) at an initial conversion price of $ 11.78 per share, subject to adjustments.

The August 2022 Warrants are exercisable for a period of five (5) years

from the period commencing on the commencement date (as defined in the August 2022 Warrant) and ending on 5:00 p.m.

eastern standard time

on the date that is five (5) years after the date of issuance, at an initial exercise price of $11.78, subject to adjustment provided

therein (including cashless exercise).

These warrants were valued using a Black-Scholes Model and the resulting relative fair value was

recorded as a debt discount.

On August 25, 2022, the Company entered into a

First Amendment and Waiver with the holders of the August 2022 Warrants, pursuant to which the exercise price of the August 2022 Warrants

was reduced to $ 7.50 per share and the August 2022 Warrants were modified such that they are not exercisable unless and until the Company

obtains stockholder approval of the issuance of any shares of common stock upon exercise of the August 2022 Warrants.

On September 16,

2022, the exercise price of the August 2022 Warrants was further adjusted to $ 6.00 per share.

These warrants were valued using a Black-Scholes

Model and the resulting valuation was recorded as an implied dividend.

Convertible Note Financing Follow On:

On September 12, 2022, the Company entered into

a SPA with a certain accredited investor to purchase $ 555,555 in principal amount of August 2022 Notes, resulting in gross proceeds to

the Company of $ 500,000 .

In connection therewith, the Company issued 11,112 shares of common stock as commitment fees and warrants (the

“August 2022 Follow On Warrants”) to purchase up to 74,074 shares of the Company’s common stock.

The August 2022 Follow On Warrants are exercisable for a period of

five (5) years from the period commencing on the commencement date (as defined in the August 2022 Follow On Warrant) and ending on 5:00

eastern standard time on the date that is five (5) years after the date of issuance, at an initial exercise price of $ 7.50 , subject

to adjustments.

These warrants were valued using a Black-Scholes Model and the resulting relative fair value was recorded as a debt discount.

On September 16, 2022, the exercise price of the

August 2022 Follow On Warrants was adjusted to $ 6.00 per share.

These warrants were valued using a Black-Scholes Model and the resulting

valuation was recorded as an implied dividend.

As of December 31, 2022, the principal balance

of $ 2,388,888 , a prepayment penalty of $ 238,889 and all accrued interest of $ 119,444 relating to the August 2022 Notes was paid off in

NOTE 9 – LEASES

agreements generally do not provide an implicit borrowing rate;

therefore, an internal incremental borrowing rate is determined based

on information available at lease commencement date for purposes of determining the present value of lease payments.

We used the incremental

borrowing rate on December 31, 2021 and December 31, 2020 for all leases that commenced prior to that date.

In determining this rate,

which is used to determine the present value of future lease payments, we estimate the rate of interest we would pay on a collateralized

basis, with similar payment terms as the lease and in a similar economic environment.

Our lease agreements generally do not provide

an implicit borrowing rate;

therefore, an internal incremental borrowing rate is determined based on information available at lease commencement

date for purposes of determining the present value of lease payments.

We used the incremental borrowing rate on December 31, 2022 and

December 31, 2021 for all leases that commenced prior to that date.

In determining this rate, which is used to determine the present value

of future lease payments, we estimate the rate of interest we would pay on a collateralized basis, with similar payment terms as the lease

and in a similar economic environment.

Our corporate headquarters is located in Richmond,

Virginia, where we lease approximately 25,000 square feet.

The lease expires in August 2026 , subject to extension.

We also lease approximately 5,810 square feet

of laboratory and office space in Mountain View, California.

The lease expires in August 2024 , subject to extension.

Additionally, we lease approximately 3,150 square

feet of office space in Melville, New York.

The lease expires in December 2024 , subject to extension.

Subsequent to December 31, 2022 the Company is

in arrears on certain lease payments.

Components of total lease costs:

1 unchanged sentence

Total lease costs

Positions as of December 31, 2021

assets and lease liabilities for our operating leases are recorded on the balance sheet as follows:

Right of use asset – short term

Lease Positions as of December 31, 2022 and

December 31, 2021

ROU lease assets and lease liabilities for our

operating leases are recorded on the balance sheet as follows:

Right of use asset – long term

3 unchanged sentences

Total lease liability

Terms and Discount Rate

Lease Terms and Discount Rate as of December

Weighted average remaining lease term (in years) – operating leases

Weighted average discount rate – operating leases

2021, the Company entered a triple net lease (the “Richmond Lease”) for approximately 25,000 square feet of laboratory

and office space in Richmond, Virginia.

The Richmond Lease has a term of sixty-three months.

The monthly base rent is approximately $ 53,000 ,

plus applicable pro-rata common area charges, taxes, and maintenance.

The Richmond Lease contains a base rent escalation clause of 3 %

per lease calendar year as well as a tenant improvement allowance of $ 375,000 in aggregate.

3, 2021, the Company entered a modified gross lease (the “Melville Lease”) for approximately 3,150 square feet of office space

in Melville, New York.

The Melville Lease has a term of thirty-six months.

The monthly base rent is approximately $ 7,240 , plus applicable

pro-rata common area charges.

The Melville Lease contains a base rent escalation clause of 3.00 % per lease calendar year.

moved into the space in November of 2021.

11 – STOCKHOLDERS’ EQUITY

2021, the Company increased the number of authorized shares of the Company’s common stock, par value $ 0.001 per share, from 27,000,000 to 100,000,000 (the

Maturities of leases are as follows:

Year Ended December 31, 2022

Total lease payments

Less imputed interest

Less current portion

( 1,086,657 )

Total maturities, due beyond one year

NOTE 10 – COMMITMENTS & CONTIGENCIES

License Agreement with Loma Linda University

On March 15, 2018, as amended

on July 1, 2020, we entered into a LLU License Agreement directly with Loma Linda University.

Pursuant to the LLU License

Agreement, we obtained the exclusive royalty-bearing worldwide license in and to all intellectual property, including patents, technical

information, trade secrets, proprietary rights, technology, know-how, data, formulas, drawings, and specifications, owned or controlled

by LLU and/or any of its affiliates (the “LLU Patent and Technology Rights”) and related to therapy for immune-mediated inflammatory

diseases (the ADI™ technology).

In consideration for the LLU License Agreement, we issued 500 shares of common stock to LLU.

Pursuant to the LLU License

Agreement, we are required to pay an annual license fee to LLU.

Also, we paid LLU $ 455,000 in July 2020 for outstanding milestone payments

and license fees.

We are also required to pay to LLU milestone payments in connection with certain development milestones.

Specifically,

we are required to make the following milestone payments to LLU:

$ 175,000 on March 31, 2022;

$ 100,000 on March 31, 2024;

$ 500,000 on March

and $ 500,000 on March 31, 2027.

In lieu of the $ 175,000 milestone payment due on March 31, 2022, the Company paid LLU an extension

fee of $ 100,000 .

Upon payment of this extension fee, an additional year will be added for the March 31, 2022 milestone.

Additionally,

as consideration for prior expenses incurred by LLU to prosecute, maintain and defend the LLU Patent and Technology Rights, we made the

following payments to LLU:

$ 70,000 at the end of December 2018, and a final payment of $ 60,000 at the end of March 2019.

We are required

to defend the LLU Patent and Technology Rights during the term of the LLU License Agreement.

Additionally, we will owe royalty payments

of (i) 1.5 % of Net Product Sales (as such terms are defined under the LLU License Agreement) and Net Service Sales on any Licensed Products

(defined as any finished pharmaceutical products which utilizes the LLU Patent and Technology Rights in its development, manufacture or

supply), and (ii) 0.75 % of Net Product Sales and Net Service Sales for Licensed Products and Licensed Services (as such terms are defined

under the LLU License Agreement) not covered by a valid patent claim for technology rights and know-how for a three (3) year period beyond

the expiration of all valid patent claims.

We also are required to produce a written progress report to LLU, discussing our development

and commercialization efforts, within 45 days following the end of each year.

All intellectual property rights in and to LLU Patent and

Technology Rights shall remain with LLU (other than improvements developed by or on our behalf).

The LLU License Agreement

shall terminate on the last day that a patent granted to us by LLU is valid and enforceable or the day that the last patent application

licensed to us is abandoned.

The LLU License Agreement may be terminated by mutual agreement or by us upon 90 days written notice to LLU.

LLU may terminate the LLU License Agreement in the event of (i) non-payments or late payments of royalty, milestone and license maintenance

fees not cured within 90 days after delivery of written notice by LLU, (ii) a breach of any non-payment provision (including the provision

that requires us to meet certain deadlines for milestone events (each, a “Milestone Deadline”)) not cured within 90 days after

delivery of written notice by LLU and (iii) LLU delivers notice to us of three or more actual breaches of the LLU License Agreement by

us in any 12-month period.

Additional Milestone Deadlines include:

(i) the requirement to have regulatory approval of an IND application

to initiate first-in-human clinical trials on or before March 31, 2022, which has been extended to March 31, 2023 due to payment of a

$ 100,000 extension fee paid in March 2022, (ii) the completion of first-in-human (phase I/II) clinical trials by March 31, 2024, (iii)

the completion of Phase III clinical trials by March 31, 2026 and (iv) biologic licensing approval by the FDA by March 31, 2027.

License Agreement with Leland Stanford Junior

On February 3, 2020, we entered

into an exclusive license agreement (the “February 2020 License Agreement”) with Stanford regarding a patent concerning a

method for detection and measurement of specific cellular responses.

Pursuant to the February 2020 License Agreement, we received an exclusive

worldwide license to Stanford’s patent regarding use, import, offer, and sale of Licensed Products (as defined in the agreement).

The license to the patented technology is exclusive, including the right to sublicense, beginning on the effective date of the agreement,

and ending when the patent expires.

Under the exclusivity agreement, we acknowledged that Stanford had already granted a non-exclusive

license in the Nonexclusive Field of Use, under the Licensed Patents in the Licensed Field of Use in the Licensed Territory (as those

terms are defined in the February 2020 License Agreement”).

However, Stanford agreed to not grant further licenses under the Licensed

Patents in the Licensed Field of Use in the Licensed Territory.

On December 29, 2021, we entered into an amendment to the February 2020

License Agreement which extended our exclusive right to license the technology deployed in AditxtScore TM and securing

worldwide exclusivity in all fields of use of the licensed technology.

We were obligated to pay and

paid a fee of $ 25,000 to Stanford within 60 days of February 3, 2020.

We also issued 375 shares of the Company’s common stock to

An annual licensing maintenance fee is payable by us on the first anniversary of the February 2020 License Agreement in the

amount of $ 40,000 for 2021 through 2024 and $ 60,000 starting in 2025 until the license expires upon the expiration of the patent.

Company is required to pay and has paid $ 25,000 for the issuances of certain patents.

The Company will pay milestone fees of $ 50,000 on

the first commercial sales of a licensed product and $ 25,000 at the beginning of any clinical study for regulatory clearance of an in

vitro diagnostic product developed and a potential licensed product.

The Company paid a milestone fee for a clinical study for regulatory

clearance of an in vitro diagnostic product developed and a potential licensed product of $ 25,000 in March of 2022.

We are also required

(i) provide a listing of the management team or a schedule for the recruitment of key management positions by March 31, 2020 (which

has been completed), (ii) provide a business plan covering projected product development, markets and sales forecasts, manufacturing and

operations, and financial forecasts until at least $ 10,000,000 in revenue by June 30, 2020 (which has been completed), (iii) conduct validation

studies by September 30, 2020 (which has been completed), (iv) hold a pre-submission meeting with the FDA by September 30, 2020 (which

has been completed), (iv) submit a 510(k) application to the FDA, Emergency Use Authorization (“EUA”), or a Laboratory Developed

Test (“LDT”) by March 31, 2021 (which has been completed), (vi) develop a prototype assay for human profiling by December

31, 2021 (which has been completed), (vii) execute at least one partnership for use of the technology for transplant, autoimmunity, or

infectious disease purposes by March 31, 2022 (which has been completed) and (viii) provided further development and commercialization

milestones for specific fields of use in writing prior to December 31, 2022.

In addition to the annual

license maintenance fees outlined above, we will pay Stanford royalties on Net Sales (as such term is defined in the February 2020 License

Agreement) during the of the term of the agreement as follows:

4% when Net Sales are below or equal to $5 million annually or 6% when

Net Sales are above $5 million annually.

The February 2020 License Agreement may be terminated upon our election on at least 30 days advance

notice to Stanford, or by Stanford if we:

(i) are delinquent on any report or payment;

(ii) are not diligently developing and commercializing

Licensed Product;

(iii) miss certain performance milestones;

(iv) are in breach of any provision of the February 2020 License Agreement;

or (v) provide any false report to Stanford.

Should any events in the preceding sentence occur, we have a thirty (30) day cure period

to remedy such violation.

NOTE 11 – STOCKHOLDERS’ EQUITY

On May 24, 2021, the Company increased the number

of authorized shares of the Company’s common stock, par value $ 0.001 per share, from 27,000,000 to 100,000,000 (the

“Authorized Shares Increase”) by filing a Certificate of Amendment (the “Certificate of Amendment”) to its Amended

3 unchanged sentences

Company at the Company’s Annual Meeting of Stockholders on May 19, 2021.

year ended December 31, 2021, the Company issued 101,534 shares of common stock and recognized expense of $ 254,242 in stock-based

compensation for consulting services.

The Company also issued 80,093 shares of common stock to Stanford University and two employees

and recognized expense of $ 64,875 relating to the agreement with Stanford University.

The Company also issued 9,492,126 shares

of common stock upon the exercise of warrants and received $ 3,727,285 in cash proceeds.

The Company granted 465,000 Restricted

Stock Awards, as a result the Company recognized expense of $ 1,443,700 in stock-based compensation.

The Company granted 25,000 Restricted

Stock Awards of which 25,000 vested, as a result, the Company recognized expense of $ 17,000 in stock-based compensation for consulting

The Company also granted 1,822,799 Restricted Stock Units, of which 825,949 vested and resulted in the issuance

of shares, as a result, the Company recognized expense of $ 1,843,902 in stock-based compensation.

On September 13, 2022, the Company effectuated a 1

for 50 reverse stock split (the “Reverse Split”).

The Company’s stock began trading at the Reverse Split price effective

on the Nasdaq Stock Market on September 14, 2022.

There was no change to the number of authorized shares of the Company’s common

During the year ended December 31, 2022, the Company

issued 148,227 shares of common stock and recognized expense of $ 507,558 in stock-based compensation for consulting services,

consisting of capital markets and investor relations.

The stock-based compensation for consulting services is calculated by the number

shares multiplied by the closing price on the effective date of the contract.

The Company also granted 11,644 Restricted Stock

Units and, 18,469 Restricted Stock Units vested which resulted in the issuance of shares.

As a result, the Company recognized

expense of $ 1,209,906 in stock-based compensation.

The stock-based compensation for shares issued or RSU’s granted during the

period were valued based on the fair market value on the date of grant.

The Company issued 58,256 shares in relation to the issuance of

notes (See Note 8).

The Company issued 1,224,333 shares of common stock as part of the September 2022 Offering (See Note 1).

also issued 1,766,917 shares of common stock as a result of the exercise of prefunded warrants from the September 2022 Offering (See Note

The Company issued 179,419 shares of common stock from the exercise of warrant, modification of warrant, and the issuance of warrant.

The Company issued 9,237 shares of common stock for the settlement of accounts payable.

During the year ended December 31, 2021, the Company

issued 2,031 shares of common stock and recognized expense of $ 254,242 in stock-based compensation for consulting services.

also issued 1,602 shares of common stock to Stanford University and two employees and recognized expense of $ 64,875 relating to the agreement

with Stanford University.

The Company also issued 189,843 shares of common stock upon the exercise of warrants and received $ 3,727,285

in cash proceeds.

The Company granted 9,300 Restricted Stock Awards, as a result the Company recognized expense of $ 1,443,700 in stock-based

compensation.

The Company granted 500 Restricted Stock Awards of which 500 vested, as a result, the Company recognized expense of $ 17,000

in stock-based compensation for consulting services.

The Company also granted 36,456 Restricted Stock Units, of which 16,519 vested and

resulted in the issuance of shares, as a result, the Company recognized expense of $ 1,843,902 in stock-based compensation.

The Company issued 96,050 shares of common stock for the conversion of a convertible note.

(See Note 9) The Company issued 91,667 shares

of common stock for the conversion of a convertible note.

(See Note 9) The Company issued 4,583,334 shares of common stock as

part of the August 2021 Offering.

of common stock as part of the August 2021 Offering.

The Company issued 56,667 shares of common stock as part of the October 2021 Offering.

issued 8,246,430 shares of common stock as part of the December 2021 Offering.

The stock-based compensation for shares issued or

RSU’s granted during the period, were valued based on the fair market value on the date of grant.

year ended December 31, 2020, the Company issued 874,916 shares of common stock and recognized expense of $ 2,477,434 in stock compensation

for consulting services.

The Company issued 150,000 shares of common stock for intangible assets valued at $ 320,850 .

The Company also

issued 4,297,703 shares of common stock for the exercise of warrants and received $ 210,544 for the exercise of the warrants.

issued 1,250,000 shares of common stock for the exercise of 1,250,000 shares of Series A Preferred Stock.

The Company issued 146,818 shares

of common stock for the settlement of accounts payable and issued 62,500 shares of common stock for the settlement of debt.

issued 1,226,668 shares of common stock related to the IPO and issued 1,150,000 shares of common stock related to the September 2020 Offering.

The stock compensation for the period was valued based on prior private placements or based on management’s estimates of value immediately

prior to the IPO and the value of the shares based on public information post IPO.

is authorized to issue 3,000,000 shares of preferred stock, par value $ 0.001 per share.

There were no shares of preferred

stock outstanding as of December 31, 2021 and December 31, 2020, respectively.

2017, our Board of Directors adopted the Aditx Therapeutics, Inc.

The Company issued 164,929 shares of common stock as part of the December 2021 Offering.

The stock-based compensation for shares issued

or RSU’s granted during the period, were valued based on the fair market value on the date of grant.

Preferred Stock

The Company is authorized to issue 3,000,000 shares

of preferred stock, par value $ 0.001 per share.

There were no shares of preferred stock outstanding as of December 31, 2022 and December

31, 2021, respectively.

Issuance of Series B Preferred Stock:

On July 19, 2022, the Company entered into a Subscription

and Investment Representation Agreement with its Chief Executive Officer (the “Purchaser”), pursuant to which the Company

agreed to issue and sell one (1) share of the Company’s Series B Preferred Stock (the “Preferred Stock”), par value

$ 0.001 per share, to the Purchaser for $ 20,000 in cash.

On July 19, 2022, the Company filed a certificate

of designation (the “Certificate of Designation”) with the Secretary of State of Delaware, effective as of the time of filing,

designating the rights, preferences, privileges and restrictions of the share of Preferred Stock.

The Certificate of Designation provides

that the share of Preferred Stock will have 250,000,000 votes and will vote together with the outstanding shares of the Company’s

common stock as a single class exclusively with respect to any proposal to amend the Company’s Restated Certificate of Incorporation

to effect a reverse stock split of the Company’s common stock.

The Preferred Stock will be voted, without action by the holder,

on any such proposal in the same proportion as shares of common stock are voted.

The Preferred Stock otherwise has no voting rights except

as otherwise required by the General Corporation Law of the State of Delaware.

The Preferred Stock is not convertible into, or

exchangeable for, shares of any other class or series of stock or other securities of the Company.

The Preferred Stock has no rights with

respect to any distribution of assets of the Company, including upon a liquidation, bankruptcy, reorganization, merger, acquisition, sale,

dissolution or winding up of the Company, whether voluntarily or involuntarily.

The holder of the Preferred Stock will not be entitled

to receive dividends of any kind.

The outstanding share of Preferred Stock shall

be redeemed in whole, but not in part, at any time (i) if such redemption is ordered by the Board of Directors in its sole discretion

or (ii) automatically upon the effectiveness of the amendment to the Certificate of Incorporation implementing a reverse stock split.

Upon such redemption, the holder of the Preferred Stock will receive consideration of $ 20,000 in cash.

On September 13, 2022, the

share was redeemed.

Redemption of Series B Preferred Stock

On October 7, 2022, the Company paid $ 20,000 in

consideration for the one share of Preferred Stock which was redeemed on September 13, 2022.

Stock-Based Compensation

In October 2017, our Board of Directors adopted

the Aditx Therapeutics, Inc.

2017 Equity Incentive Plan (the “2017 Plan”).

Plan provides for the grant of equity awards to directors, employees, and consultants.

The Company is authorized to issue up to 2,500,000 shares

of our common stock pursuant to awards granted under the 2017 Plan.

The 2017 Plan is administered by our Board of Directors, and expires

ten years after adoption, unless terminated earlier by the Board of Directors.

24, 2021, our Board of Directors adopted the Aditx Therapeutics, Inc.

The 2017 Plan provides for the grant of equity

awards to directors, employees, and consultants.

The Company is authorized to issue up to 2,500,000 shares of our common

stock pursuant to awards granted under the 2017 Plan.

The 2017 Plan is administered by our Board of Directors, and expires ten years after

adoption, unless terminated earlier by the Board of Directors.

All shares of our common stock pursuant to awards under the 2017 Plan

have been awarded.

On February 24, 2021, our Board of Directors adopted

the Aditx Therapeutics, Inc.

2021 Omnibus Equity Incentive Plan (the “2021 Plan”).

The 2021 Plan provides for grants of nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock

and restricted stock units, and other stock-based awards (collectively, the “Awards”).

Eligible recipients of Awards include

employees, directors or independent contractors of the Company or any affiliate of the Company.

The Compensation Committee of the Board

of Directors (the “Committee”) will administer the 2021 Plan.

A total of 3,000,000 shares of common stock, par value

$ 0.001 per share, of the Company may be issued pursuant to Awards granted under the 2021 Plan.

The exercise price per share for the

shares to be issued pursuant to an exercise of a stock option will be no less than one hundred percent ( 100 %) of the Fair Market Value

(as defined in the 2021 Plan) of a share of Common Stock on the date of grant.

The 2021 Plan was submitted and approved by the Company’s

stockholders at the 2021 annual meeting of stockholders, held on May 19, 2021.

year ended December 31, 2021, the Company granted 92,466 stock options with an exercise price of $ 0.68 or $ 11.25 per share, some of which

vested immediately.

The total grant date fair value was determined to be $ 16,660 .

year ended December 31, 2020, the Company granted 880,500 stock options with an exercise price of $ 1.94 , $ 1.92 or $ 11.00 per share, some

of which vested immediately, and some of which vest between one and three years.

The total grant date fair value was determined to be

$ 1,668,997 .

years ended December 31, 2021 and December 31, 2020, the fair value of each option granted was estimated using the assumption ranges and/or

factors in the Black-Scholes Model as follows:

Exercise price

$ 0.68 - 9.00

Expected dividend yield

Risk free interest rate

0.28 %- 1.41 %

Expected life in years

Expected volatility

term of employee stock options is calculated using the simplified method which takes into consideration the contractual life and vesting

terms of the options.

The simplified method was used by the Company due to insufficient historical data.

The risk-free interest rate assumption for options

granted is based upon observed interest rates on the United States Government Bond Equivalent Yield appropriate for the expected term

determined the expected volatility assumption for warrants granted using the historical volatility of comparable public companies’

common stock.

The Company will continue to monitor peer companies and other relevant factors used to measure expected volatility for future

warrant grants, until such time that the Company’s common stock has enough market history to use historical volatility.

yield assumption for warrants granted is based on the Company’s history and expectation of dividend payouts.

The Company has never

declared nor paid any cash dividends on its common stock, and the Company does not anticipate paying any cash dividends in the foreseeable

recognizes forfeitures as they occur as there is insufficient historical data to accurately determine future forfeitures rates.

The following

is an analysis of the stock option grant activity under the Plan:

The 2021 Plan provides for grants of nonqualified

stock options, incentive stock options, stock appreciation rights, restricted stock and restricted stock units, and other stock-based

awards (collectively, the “Awards”).

Eligible recipients of Awards include employees, directors or independent contractors

of the Company or any affiliate of the Company.

The Compensation Committee of the Board of Directors (the “Committee”) will

administer the 2021 Plan.

A total of 60,000 shares of common stock, par value $ 0.001 per share, of the Company may be issued

pursuant to Awards granted under the 2021 Plan.

The exercise price per share for the shares to be issued pursuant to an exercise of a

stock option will be no less than one hundred percent ( 100 %) of the Fair Market Value (as defined in the 2021 Plan) of a share of Common

Stock on the date of grant.

The 2021 Plan was submitted and approved by the Company’s stockholders at the 2021 annual meeting of

stockholders, held on May 19, 2021.

During the year ended December 31, 2022, the Company

granted no new options.

During the year ended December 31, 2021, the Company

granted 1,850 stock option grants, with a weighted average grant date fair value $ 8.39 .

The fair value of each option granted was estimated

using the assumption and/or factors in the Black-Scholes Model.

The following is an analysis of the stock option

grant activity under the Plan:

Vested and Nonvested Stock Options

5 unchanged sentences

Nonvested on December 31, 2022

recognized stock-based compensation expense related to options issued and vesting of $ 827,065 during the year ended December 31,

2021, of which $ 587,209 is included in general and administrative expenses and $ 239,586 is included in research and development

expenses in the accompanying statements of operations.

The remaining value to be expensed is $ 971,080 with a weighted average vesting

term of 0.87 years as of December 31, 2021.

The Company recognized compensation expense related to options issued and vesting

of $ 406,880 during the year ended December 31, 2020, which is included in general and administrative expenses in the accompanying statements

of operations.

years ended December 31, 2021 and December 31, 2020, the fair value of each warrant granted was estimated using the assumption ranges

and/or factors in the Black-Scholes Model as follows:

As of December 31, 2022 there were 42,685 exercisable

options, these options had a weighted average exercise price $ 173.50 .

The Company recognized stock-based compensation

expense related to options granted and vesting expense of $ 791,187 during the year ended December 31, 2022, of which $ 555,772 is

included in general and administrative expenses and $ 235,415 is included in research and development expenses in the accompanying

statements of operations.

The remaining value to be expensed is $ 179,892 with a weighted average vesting term of 0.75 years

as of December 31, 2022.

The Company recognized stock-based compensation expense related to options issued and vesting of $ 826,795 during

the year ended December 31, 2021, of which $ 587,209 is included in general and administrative expenses and $ 239,586 is included in research

and development expenses in the accompanying statements of operations.

The Company recognizes warrant forfeitures

as they occur as there is insufficient historical data to accurately determine future forfeitures rates.

During the year ended December 31, 2022, the Company

issued 6,497,530 warrants.

During the year ended December 31, 2021, the Company issued 678,242 warrants.

For the year ended December 31, 2022, the fair

value of each warrant granted was estimated using the assumption and/or factors in the Black-Scholes Model as follows:

Exercise price

5 unchanged sentences

Expected volatility

The risk-free

interest rate assumption for warrants granted is based upon observed interest rates on the United States Government Bond Equivalent Yield

appropriate for the expected term of warrants.

determined the expected volatility assumption for warrants granted using the historical volatility of comparable public companies’

common stock.

The Company will continue to monitor peer companies and other relevant factors used to measure expected volatility for future

warrant grants, until such time that the Company’s common stock has enough market history to use historical volatility.

yield assumption for warrants granted is based on the Company’s history and expectation of dividend payouts.

The Company has never

declared nor paid any cash dividends on its common stock, and the Company does not anticipate paying any cash dividends in the foreseeable

recognizes warrant forfeitures as they occur as there is insufficient historical data to accurately determine future forfeitures rates.

of warrant issuances are as follows:

For the year ended December 31, 2021, the fair

value of each warrant issued was estimated using the assumption ranges and/or factors in the Black-Scholes Model as follows:

Exercise price

Expected dividend yield

Risk free interest rate

0.17 %- 0.42 %

Expected life in years

Expected volatility

The risk-free interest rate assumption for warrants

granted is based upon observed interest rates on the United States Government Bond Equivalent Yield appropriate for the expected term

The Company determined the expected volatility

assumption for warrants granted using the historical volatility of comparable public companies’ common stock.

The Company will continue

to monitor peer companies and other relevant factors used to measure expected volatility for future warrant grants, until such time that

the Company’s common stock has enough market history to use historical volatility.

The dividend yield assumption for warrants granted

is based on the Company’s history and expectation of dividend payouts.

The Company has never declared nor paid any cash dividends

on its common stock, and the Company does not anticipate paying any cash dividends in the foreseeable future.

The Company recognizes warrant forfeitures as

they occur as there is insufficient historical data to accurately determine future forfeitures rates.

A summary of warrant issuances are as follows:

Vested and Nonvested Warrants

2 unchanged sentences

Expired or forfeited

Rounding for Reverse Split

Outstanding December 31, 2022

3 unchanged sentences

Nonvested on December 31, 2022

recognized stock-based compensation expense related to warrants issued and vesting of $ 189,899 and $ 304,526 during the years

ended December 31, 2021 and December 31, 2020, respectively, which is included in general and administrative in the accompanying Statements

of Operations.

The remaining value to be expensed is $ 113,803 with a weighted average vesting term of 1.00 years as of

December 31, 2021.

year ended December 31, 2021, 9,492,126 warrants were exercised for 9,492,126 shares of common stock.

recognized proceeds of $ 3,727,285 related to the exercises.

25, 2021, pursuant to the January 2021 Securities Purchase Agreement the Company issued the January 2021 Warrant to the Investor to purchase

up to 800,000 shares of the Company’s common stock.

The January 2021 Warrant is immediately exercisable for a period of three

years at an exercise price of $ 4.00 per share.

The warrant was subsequently adjusted to $ 2.53 as disclosed in Note 9.

addition, the Company issued 75,000 warrants to the placement agent related to the January 2021 Securities Purchase Agreement.

These warrants have an exercise price of $ 4.00 and a term of five years.

All the 75,000 warrants are exercisable on issuance.

In connection

with the August 2021 Offering, the Company issued warrants to purchase up to 4,583,334 shares at an exercise price of $ 2.53 .

The warrant was subsequently adjusted to $ 1.50 (See Note 9).

In addition, the Company issued a warrant to the placement agent to purchase

up to 229,166 shares of common stock at an exercise price of $ 3.00 per share (See Note 1).

In connection

with the December 2021 Offering, the Company issued 8,246,430 warrants to purchase shares of the Company’s common stock and

8,328,570 prefunded warrants.

The warrant issued as part of the units had an exercise price of $1.15 and the prefunded warrants had an

exercise price of $0.001.

In addition, the Company issued a warrant to the underwriters to purchase up to 828,750 shares of

common stock at an exercise price of $0.98 per share.

of Restricted Stock Units (“RSUs”) issuances are as follows:

The Company recognized stock-based compensation

expense related to warrants granted and vesting expense of $ 609,748 during the year ended December 31, 2022, of which $ 105,049 is

included in general and administrative and $ 504,699 is included in sales and marketing in the accompanying Statements of Operations.

Company recognized stock-based compensation expense related to warrants granted and vesting expense of $ 189,899 during the year ended

December 31, 2021, which is included in general and administrative in the accompanying Statements of Operations.

The remaining value to

be expensed is zero as of December 31, 2022.

The weighted average vesting term is 0.22 years as of December 31, 2022.

On June 15, 2022, the Company entered an agreement

with a holder of certain of the Series C Warrants (the “Holder”).

Pursuant to the agreement, the Holder has agreed to

exercise in cash 179,419 of its Series C Warrants at a reduced exercise price of $ 7.50 per Share (reduced from $ 57.50 per share), for

gross proceeds to the Company of approximately $ 1.35 million.

As an inducement to such exercise, the Company has agreed to reduce the

exercise price of the Holder’s remaining Series C Warrants to purchase up to 49,153 Shares from $ 57.50 to $ 12.395 per share, which

will be non-exercisable for a period of six months following the closing date.

The modification of this exercise price resulted in an

increase of $ 344,158 to the fair value of the Series C Warrants.

This modification was an inducement on the transaction and as such was

recorded to equity resulting in no net change to additional paid in capital.

In addition, the Company issued to the Holder a new warrant

to purchase up to 407,991 shares of the Company’s common stock at an exercise price of $ 12.395 per share, which will be non-exercisable

for a period of six months following issuance date and have a term of five and one-half years.

This inducement resulted in a total

increase of $ 3,759,044 to the fair value of the warrants.

On December 20, 2022, the Company and the Warrant

Agent entered into Amendment No.

2 to the Series C Warrant Agent Agreement, pursuant to which the exercise price of the Series C Warrants

was reduced from $ 57.50 per share to $ 12.395 per share.

In addition, on December 21, 2022, the Company issued an Amended and Restated

Unit Purchase Option to the agent in the Offering reflecting a reduced exercise price of $ 12.395 per Unit.

This modification of these

warrants resulted in a $ 29,058 increase to the fair value of the warrants (See Note 1).

Restricted Stock Units

A summary of Restricted Stock Units (“RSUs”)

issuances are as follows:

Nonvested RSUs

1 unchanged sentence

Nonvested December 31, 2022

recognized stock-based compensation expense related to RSUs issued and straight-line vesting expense of $ 1,843,902 and zero during

the years ended December 31, 2021 and December 31, 2020, respectively, of which, $ 1,237,182 is included in general and administrative

and $ 606,720 is included in research and development in the accompanying Statements of Operations.

The remaining value to be expensed

is $ 1,391,343 as of December 31, 2021.

the year ended December 31, 2021, the Company granted a total of 1,822,799 RSUs.

As of December 31, 2021, 825,949 of

these RSUs have vested and 218,600 were forfeited.

The Company issued 825,949 shares of common stock for

the 825,949 vested RSUs.

12 – INCOME TAXES

The Company recognized stock-based compensation

expense related to RSUs granted and vesting expense of $ 1,222,875 and $ 1,843,902 during the years ended December 31, 2022 and

December 31, 2021, respectively, of which, $ 848,597 is included in general and administrative, $ 356,105 is included in research

and development, and $ 18,346 is included in sales and marketing in the accompanying Statements of Operations.

The remaining value to be

expensed is $ 321,603 with a weighted average vesting term of 0.40 years as of December 31, 2022.

During the year ended December 31, 2022, the Company

granted a total of 11,644 RSUs.

As of December 31, 2022, 18,506 RSUs vested and the Company issued 18,469 shares

of common stock for the 18,469 vested RSUs.

NOTE 12 – INCOME TAXES

For the years ended December 31, 2022 and

1 unchanged sentence

The Company’s losses before income taxes consist solely of losses from domestic operations.

On March 27, 2020, the United States enacted the

Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”).

The Cares Act includes provisions relating to refundable

payroll tax credits, deferment of the employer portion of certain payroll taxes, net operating loss carryback periods, alternative minimum

tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for

qualified improvement property.

The CARES Act also established a Paycheck Protection Program whereby certain small businesses are eligible

for a loan to fund payroll expenses, rent, and related costs.

The Company considered the provisions under the

CARES Act and elected not to take advantage of the provisions of CARES Act as the effect of such provisions was not expected to have a

material impact on the Company’s results of operations, cash flows and financial statements.

A reconciliation of income tax expense (benefit)

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Lease liability

Section 174 Capitalization

Loss on impairment of debt

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The Company’s valuation allowance increased during 2022 by approximately $ 3.5 million primarily

due to the generation of net operating loss and tax credit carryforwards, impairment of note receivable, and stock-based compensation.

due to the generation of net operating loss and tax credit carryforwards and the capitalization of research and experimental expenditures.

As of December 31, 2022 and 2021, the Company

federal net operating loss carryforwards of $ 38.0 million and $ 12.6 million, respectively, which may be available to offset

future income tax liabilities.

The 2017 Tax Cuts and Jobs Act (” TCJA”) will generally allow losses incurred after 2017 to

be carried over indefinitely, but will generally limit the net operating loss deduction to the lesser of the net operating loss carryover

or 80 % of a corporation’s taxable income (subject to Section 382 of the Internal Revenue Code of 1986, as amended).

will be no carryback for losses incurred after 2017.

Losses incurred prior to 2018 will generally be deductible to the extent of the lesser

of a corporation’s net operating loss carryover or 100 % of a corporation’s taxable income and be available for twenty years

from the period the loss was generated.

The Company has federal net operating losses generated following 2017 of $ 37.9 million, which

do not expire.

The federal net operating losses generated prior to 2018 of $ 0.1 million will expire at various dates through 2037.

CARES Act temporarily allows the Company to carryback net operating losses arising in 2018, 2019 and 2020 to the five prior tax years.

In addition, net operating losses generated in these years could fully offset prior year taxable income without the 80 % of the taxable

income limitation under the TCJA which was enacted on December 22, 2017.

The Company has been generating losses since its inception, as

such the net operating loss carryback provision under the CARES Act is not applicable to the Company.

federal net operating loss carryforwards of $ 56.6 million and $ 38.0 million, respectively, which may be available to

offset future income tax liabilities.

The 2017 Tax Cuts and Jobs Act (” TCJA”) will generally allow losses incurred after

2017 to be carried over indefinitely, but will generally limit the net operating loss deduction to the lesser of the net operating loss

carryover or 80 % of a corporation’s taxable income (subject to Section 382 of the Internal Revenue Code of 1986, as amended).

Also, there will be no carryback for losses incurred after 2017.

Losses incurred prior to 2018 will generally be deductible to the extent

of the lesser of a corporation’s net operating loss carryover or 100 % of a corporation’s taxable income and be available

for twenty years from the period the loss was generated.

The Company has federal net operating losses generated following 2017

of $ 56.5 million, which do not expire.

The federal net operating losses generated prior to 2018 of $ 0.1 million will expire

at various dates through 2037.

The CARES Act temporarily allows the Company to carryback net operating losses arising in 2018, 2019

and 2020 to the five prior tax years.

In addition, net operating losses generated in these years could fully offset prior year taxable

income without the 80 % of the taxable income limitation under the TCJA which was enacted on December 22, 2017.

The Company has been

generating losses since its inception, as such the net operating loss carryback provision under the CARES Act is not applicable to the

As of December 31, 2022 and 2021, the Company

also had U.S.

state net operating loss carryforwards of $ 44.8 million and $ 15.2 million, respectively, which may be available to

offset future income tax liabilities and expire at various dates through 2041.

state net operating loss carryforwards (post-apportioned) of $ 26.2 million and $ 44.8 million, respectively, which

may be available to offset future income tax liabilities and expire at various dates through 2042.

As of December 31, 2022, the Company had

no federal tax credit carryforwards available to reduce future tax liabilities.

As of December 31, 2020, the Company had federal

tax credit carryforwards of approximately $ 0.1 million, available to reduce future tax liabilities which expire at various dates through

As of December 31, 2021 and 2020, the Company had state research and development tax credit carryforwards of approximately

$ 0.2 million and $ 0.1 million, respectively, which may be available to reduce future tax liabilities and can be carried over indefinitely.

$ 0.1 million federal tax credit carryforwards available to reduce future tax liabilities which expire at various dates through 2042.

of December 31, 2021, the Company had no federal tax credit carryforwards.

As of December 31, 2022 and 2021, the Company had

state research and development tax credit carryforwards of approximately $ 0.4 million and $ 0.2 million, respectively, which

may be available to reduce future tax liabilities and can be carried over indefinitely.

Utilization of the U.S.

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The Company will recognize interest and penalties related to uncertain tax positions in income tax expense.

13 – SUBSEQUENT EVENTS

Nasdaq Stock Market, LLC Notification:

On January 18, 2022, the Company was notified

(the “Notification Letter”) by The Nasdaq Stock Market, LLC (“Nasdaq”) that it is not in compliance with the minimum

bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market.

Nasdaq Listing

Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of $ 1.00 per share, and Nasdaq Listing Rule 5810(c)(3)(A) provides

that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of 30 consecutive business days.

Based on the closing bid price of the Company’s common stock between December 1, 2021 and January 14, 2022, the Company no longer

met the minimum bid price requirement.

The Notification Letter had no immediate effect on the listing or trading of the Company’s

common stock on The Nasdaq Capital Market and, at the time, the common stock continued to trade on The Nasdaq Capital Market under the

symbol “ADTX.”

The Notification Letter provided the Company has

180 calendar days, or until July 18, 2022, to regain compliance with Nasdaq Listing Rule 5550(a)(2).

To regain compliance, the bid price

of the Company’s common stock must have a closing bid price of at least $ 1.00 per share for a minimum of 10 consecutive business days.

If the Company does not regain compliance by July 18, 2022, an additional 180 days may be granted to regain compliance, so long as the

Company meets The Nasdaq Capital Market continued listing requirements (except for the bid price requirement) and notifies Nasdaq in writing

of its intention to cure the deficiency during the second compliance period.

If the Company does not qualify for the second compliance

period or fails to regain compliance during the second 180-day period, then Nasdaq will notify the Company of its determination to delist

the Company’s common stock, at which point the Company will have an opportunity to appeal the delisting determination to a Hearings Panel.

The Company intends to monitor the closing bid

price of its common stock and will consider implementing available options to regain compliance with the minimum bid price requirement

under the Nasdaq Listing Rules.

On January 28, 2022, the Compensation Committee

approved the grant of 482,700 RSUs to employees pursuant to the Company’s 2021 Equity Incentive Plan.

Included in this grant were

480,000 RSUs granted to officers of the Company.

Forbearance Agreement:

On January 31, 2022, the Company’s $ 14.5

million loan to Cellvera Global became fully due and payable under the Credit Agreement.

NOTE 13 – SUBSEQUENT EVENTS

On December 20, 2022, the Company entered into

an At The Market Offering Agreement (the “ATM”) with H.C.

Wainwright & Co., LLC as agent (the “Agent”), pursuant

to which the Company may offer and sell, from time to time through the Agent, shares of the Company’s common stock having an aggregate

offering price of up to $ 50,000,000 (the “Shares”).

The offer and sale of

the Shares was made pursuant to a shelf registration statement on Form S-3 and the related prospectus (File No.

333-257645) filed by the

Company with the SEC on July 2, 2021, amended on July 6, 2021 and declared effective by the SEC on July 13, 2021, under the Securities

Act of 1933, as amended.

No sales of Shares were

made during the year ended December 31, 2022 under the ATM.

For the period beginning

January 1, 2023 through the date of this report, the Company sold 338,513 Shares at an average price of $ 1.55 per share under the ATM.

The sale of Shares generated net proceeds of approximately $ 507,000 after paying commissions and related fees.

On January 1, 2023, the Company formed Adimune,

a Delaware, wholly owned subsidiary.

On January 1, 2023, the Company formed Pearsanta,

a Delaware, wholly owned subsidiary.

On February 21, 2023, the Company entered into

a Forbearance Agreement and Seventh Amendment to Credit Agreement (the “Forbearance Agreement”) with Cellvera Global.

Pursuant to the Forbearance Agreement, the Company

agreed to forbear from exercising its rights and remedies against the Cellvera Global (the “Borrower”) and certain affiliated

guarantor parties until the earlier of (i) June 30, 2022 or (ii) the date of occurrence of any event of default under the Forbearance

Agreement (the “Forbearance Period”).

Given that the parties continue to conduct due diligence in connection with that certain

Share Exchange Agreement dated as of December 28, 2021 by and between the Company and Cellvera Global (the “Share Exchange Agreement”),

the Company and the Borrower also agreed that should the initial closing occur under the Share Exchange Agreement, the existing event

of default will be waived.

Under the Forbearance Agreement, the Company and the Borrower also agreed to certain amendments to the Credit

Agreement, including, but not limited to:

(i) the delivery by the Borrower of certain financial statements and forecasts, and (ii) certain

regularly scheduled payments to be made by Borrower to the Company during the Forbearance Period.

As of the date these financial statements

were available to be issued;

the regularly scheduled payments under the Forbearance Agreement were not made.

an agreement for the purchase and sale of future receipts (the “Future Receipts Agreement”) with a commercial funding source

pursuant to which the Company agreed to sell to the funder certain future trade receipts in the aggregate amount of $ 2,160,000 (the

“Future Receipts Purchased Amount” for gross proceeds to the Company of $ 1,500,000 , less origination fees of $ 75,000 .

to the Future Receipts Agreement, the Company granted the funder a security interest in all of the Company’s present and future

accounts receivable in an amount not to exceed the Future Receipts Purchased Amount.

The Purchased Amount shall be repaid by the Company

in 28 weekly installments of approximately $ 77,000 with the final payment due on September 5, 2023.

On March 17, 2023, the Company entered into a consulting

agreement (the "Independent Consulting Agreement") with an independent consultant for a term of thirty days.

Pursuant to the

Independent Consulting Agreement, the independent consultant agreed to provide the Company with business advisory services, guidance on

growth strategies and networking with its clients on a non-exclusive basis for general business purposes (the "Independent Consulting

In consideration for the Independent Consulting Services, the Company issued to the independent consultant 187,000 shares

of the Company's common stock (the "Independent Consulting Shares").

The issuance of the Independent Consulting Shares will

not be registered under the Securities Act.

On April 4, 2023, the Company entered into a Business

Loan and Security Agreement (the "April Loan Agreement") with a commercial funding source (the "April Lender"), pursuant

to which the Company obtained a loan from the April Lender in the principal amount of $ 1,060,000 , which includes origination fees of $ 60,000

(the "April Loan").

Pursuant to the April Loan Agreement, the Company granted the April Lender a continuing secondary security

interest in certain collateral (as defined in the April Loan Agreement).

The total amount of interest and fees payable by the Company

to the April Lender under the April Loan (the "April Repayment Amount") will be (i) $ 1,000,000 if paid prior to April 6, 2023,

(ii) $ 1,219,000 if paid prior to April 10, 2023, or (iii) $ 1,590,000 if paid after April 10, 2023 and will be repaid in 20 weekly installments

of $ 79,500 commencing on April 10, 2023 and ending on August 21, 2023.

On April 13, 2023, the Company formed Adivir, Inc.

a Delaware, wholly owned subsidiary.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures