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Item 1. Financial Statements

2024-12-11 compared with 2024-09-11 · 212 added, 82 removed, 629 unchanged (32% of the section changed)

2 unchanged sentences

Condensed Balance Sheets

October 31, 2024

April 30, 2024

CURRENT ASSETS

2 unchanged sentences

Property, plant and equipment, net

LIABILITIES AND STOCKHOLDERS’ DEFICIT

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

CURRENT LIABILITIES

2 unchanged sentences

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS’ DEFICIT

STOCKHOLDERS’ EQUITY (DEFICIT)

Series A Convertible Preferred Stock, $ 0.0001

1 unchanged sentence

shares designated;

and nil 0 issued and outstanding as of July 31, 2024 and April 30, 2024, respectively

and nil 0 issued and outstanding as of October 31, 2024 and April 30, 2024, respectively

Series B Convertible Preferred Stock, $ 0.0001 stated value per share, 6,000 designated;

2,100 issued and outstanding as of July

31, 2024 and April 30, 2024

2,100 issued and outstanding as of

October 31, 2024 and April 30, 2024

Common stock, $ 0.0001 par value:

300,000,000 shares authorized;

861,332 and 687,999 issued and outstanding as of July 31, 2024

and April 30, 2024, respectively

5,231,254 and 687,999 issued and outstanding as of October 31, 2024 and April 30, 2024, respectively

Additional paid-in capital

2 unchanged sentences

( 54,020,408 )

TOTAL STOCKHOLDERS’ DEFICIT

( 1,212,319 )

TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)

( 2,594,185 )

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

The accompanying notes are an integral part of

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Condensed Statements of Operations

For the Three Months Ended July 31,

For the Three Months Ended

For the Six Months Ended

OPERATING EXPENSES

4 unchanged sentences

( 1,358,068 )

( 2,901,722 )

( 2,320,473 )

( 6,427,652 )

OTHER EXPENSE, NET

3 unchanged sentences

( 2,906,033 )

( 2,335,974 )

( 6,433,799 )

Dividends on preferred shares

NET LOSS AVAILABLE TO COMMON SHARES

$ ( 1,415,214 )

$ ( 2,906,033 )

$ ( 2,389,625 )

$ ( 6,433,799 )

Basic and diluted net loss per common share

4 unchanged sentences

Condensed Statements of Stockholders’

For the Three Months Ended July 31, 2024

Equity (Deficit)

For the Three Months Ended October 31, 2024

Series A Convertible

2 unchanged sentences

Preferred Stock

BALANCES, April 30, 2024

BALANCES, July 31, 2024

$ 53,782,414 -

1 unchanged sentence

$ ( 1,212,319 )

Issuance of preferred stock for cash

Conversion of note payable and interest to preferred stock

Issuance of common stock for cash, net of issuance costs

Issuance of common stock for restricted stock awards

Issuance of preferred stock for cash, net of issuance costs

Conversion of preferred stock to common stock

Stock-based compensation to employees and consultants

( 1,415,214 )

BALANCES, October 31, 2024

$ 60,162,478 -

$ ( 56,410,033 )

The accompanying notes are an integral part of

these unaudited condensed financial statements.

Alzamend Neuro, Inc.

Condensed Statements of Stockholders’

For the Three Months Ended October 31, 2023

Series B Convertible

Note Receivable for

Preferred Stock

Common Stock -

Related Party

BALANCES, July 31, 2023

2 unchanged sentences

$ ( 112,883 )

Issuance of common stock for cash, net of issuance costs

Issuance of common stock for restricted stock awards

Subscription receivable payment received

Stock-based compensation to employees and consultants

( 2,906,033 )

BALANCES, October 31, 2023

$ ( 14,876,293 )

$ ( 50,506,461 )

$ ( 2,682,493 )

The accompanying notes are an integral part of

3 unchanged sentences

Equity (Deficit)

For the Three Months Ended July 31, 2023

For the Six Months Ended October 31, 2024

Series A Convertible

Series B Convertible

Preferred Stock

BALANCES, April 30, 2024

$ ( 54,020,408 )

$ ( 2,594,185 )

Issuance of common stock for cash, net of issuance costs

Issuance of common stock for restricted stock awards

Issuance of preferred stock for cash, net of issuance costs

Conversion of preferred stock to common stock

Conversion of note payable and interest to preferred stock

Stock-based compensation to employees and consultants

( 2,389,625 )

BALANCES, October 31, 2024

$ ( 56,410,033 )

The accompanying notes are an integral part of

these unaudited condensed financial statements.

Alzamend Neuro, Inc.

Condensed Statements of Stockholders’

Equity (Deficit)

For the Six Months Ended October 31, 2023

Series B Convertible

Note Receivable for

5 unchanged sentences

$ ( 44,072,662 )

Issuance of common stock for cash, net of issuance costs

Issuance of common stock for restricted stock awards

Subscription receivable payment received

Stock-based compensation to employees and consultants

1 unchanged sentence

( 6,433,799 )

BALANCES, July 31, 2023

BALANCES, October 31, 2023

$ ( 14,876,293 )

5 unchanged sentences

Condensed Statements of Cash Flows

For the Three Months Ended July 31,

For the Six Months Ended

Cash flows from operating activities:

9 unchanged sentences

Accounts payable and accrued liabilities

( 1,668,953 )

Net cash used in operating activities

5 unchanged sentences

Cash flows from financing activities:

Net proceeds from the issuance of common stock

Net proceeds from the issuance of preferred stock

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financial statements have been prepared on the basis that the Company will continue as a going concern.

As of July 31, 2024, the Company

had cash of $ 1.2 million, a working capital deficiency of $ 1.5 million, an accumulated deficit of $ 55.0 million and a stockholders’

deficit of $ 1.2 million.

For the three months ended July 31, 2024, the Company had a net loss of $ 1.0 million.

For the three months ended

July 31, 2024, cash used in operating activities was $ 1.1 million.

Historically, the Company has financed its operations principally through

issuances of equity and debt instruments.

As of October 31, 2024, the Company

had cash of $ 4.1 million, working capital of $ 3.5 million, an accumulated deficit of $ 56.4 million and stockholders’ equity of $ 3.8

For the three and six months ended October 31, 2024, the Company had net losses of $ 1.4 million and $ 2.4 million, respectively.

For the six months ended October 31, 2024, cash used in operating activities was $ 4.5 million.

Historically, the Company has financed

its operations principally through issuances of equity and debt instruments.

believes its current cash on hand is not sufficient to fund its planned operations through one year after the date the condensed financial

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However, based on the Company’s current business plan, management believes

that the Company’s cash and cash equivalents at July 31, 2024, together with the anticipated receipt of funds from the sale of its

Series A and Series B Convertible Preferred Stock pursuant to the securities purchase agreements related thereto, will be sufficient to

meet the Company’s anticipated cash requirements during the twelve-month period subsequent to the issuance of the financial statements

included in this Quarterly Report.

that the Company’s cash and cash equivalents at October 31, 2024, together with the anticipated receipt of funds from its “at-the-market”

offering and from the sale of its Series A and Series B Convertible Preferred Stock pursuant to the securities purchase agreements related

thereto, will be sufficient to meet the Company’s anticipated cash requirements during the twelve-month period subsequent to the

issuance of the financial statements included in this Quarterly Report.

SIGNIFICANT ACCOUNTING POLICIES

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highly liquid investments with a remaining maturity of three months or less when purchased to be cash equivalents.

As of July 31, 2024

As of October 31, 2024

and April 30, 2024, the Company had no cash equivalents.

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Schedule of antidilutive securities excluded from computation of earnings per share

For the Three Months Ended July 31,

For the Six Months Ended October 31,

Stock options (1)

Restricted stock units

(1) The Company has excluded 10,000 stock options for the three months ended July 31, 2024 and 2023, with

(1) The Company has excluded 10,000 stock options for the six months ended October 31, 2024 and 2023, with

an exercise price of $0.06, from its anti-dilutive securities as these shares have been included in our determination of basic loss per

14 unchanged sentences

Schedule of prepaid expenses and other current assets

July 31, 2024

October 31, 2024

April 30, 2024

Prepaid clinical trial expenses

Prepaid insurance

1 unchanged sentence

Total prepaid expenses and other current assets

On October 22, 2024, the Company

entered into a Study Start-up Agreement with Massachusetts General Hospital (“Mass General Agreement”) in preparation for

five clinical research trials for its AL001 product candidate.

The Mass General Agreement required a prepayment of $ 514,000 .

Prepaid clinical

trial expenses at October 31, 2024 represented the unamortized portion of clinical trial expense and will be amortized as used.

On June 14, 2024, the Company

purchased directors’ and officers’ insurance for 12 months in the amount of $ 227,000 .

Prepaid insurance at July 31, 2024 represented

the unamortized portion of directors’ and officers’ insurance.

Prepaid insurance at October 31, 2024

represented the unamortized portion of directors’ and officers’ insurance.

STOCK-BASED COMPENSATION

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Treasury issues with an equivalent term approximating the expected life of the options as calculated using the simplified method.

The expected life of the options used was based on the contractual life of the option granted.

Stock-based compensation is a non-cash

expense because the Company settles these obligations by issuing shares of Common Stock from its authorized shares instead of settling

such obligations with cash payments.

The expected life of the options used was based on the contractual life calculated using the simplified method.

Stock-based compensation

is a non-cash expense because the Company settles these obligations by issuing shares of Common Stock from its authorized shares instead

of settling such obligations with cash payments.

A summary of stock option

activity for the three months ended July 31, 2024 is presented below:

activity for the six months ended October 31, 2024 is presented below:

Schedule of share-based payment arrangement, option, activity

5 unchanged sentences

Options expired

Balance at July 31, 2024

Options vested and expected to vest at July 31, 2024

Options exercisable at July 31, 2024

Balance at October 31, 2024

Options vested and expected to vest at October 31, 2024

Options exercisable at October 31, 2024

The aggregate intrinsic value

3 unchanged sentences

Restricted stock unit activity

for the three months ended July 31, 2024 is presented below:

for the six months ended October 31, 2024 is presented below:

Schedule of nonvested restricted stock units activity

2 unchanged sentences

Unvested at April 30, 2024

Unvested at July 31, 2024

Unvested at October 31, 2024

Performance Contingent

18 unchanged sentences

Due to the significant risks and uncertainties

associated with achieving the market-contingent awards, as of July 31, 2024, the Company believes that the achievement of the requisite

associated with achieving the market-contingent awards, as of October 31, 2024, management believes that the achievement of the requisite

performance conditions is not probable and, as a result, no compensation cost has been recognized for these awards.

7 unchanged sentences

Phase II clinical trial of AL001 would be achieved and had recognized the related stock-based compensation.

As of July 31, 2024, management

As of October 31, 2024, management

believed that the achievement of the second performance condition was not probable and, as a result, no compensation cost has been recognized

35 unchanged sentences

related to the vesting.

As of July 31, 2024, management believed that the achievement of the remaining requisite performance condition

As of October 31, 2024, management believed that the achievement of the remaining requisite performance condition

was not probable and, as a result, no compensation cost has been recognized for these awards related to ALZN002 – Alzheimer’s.

1 unchanged sentence

The Company’s results

of operations included expenses relating to stock-based compensation for three months ended July 31, 2024 and 2023, were comprised as

of operations included expenses relating to stock-based compensation for three and six months ended October 31, 2024 and 2023, were comprised

Schedule of stock-based compensation

For the Three Months Ended July 31,

For the Three Months Ended October 31,

For the Six Months Ended October 31,

Research and development

General and administrative

As of July 31, 2024, total

As of October 31, 2024, total

unamortized stock-based compensation expense related to unvested employee and non-employee awards that are expected to vest was $ 284,000 .

1 unchanged sentence

During the three months ended

July 31, 2024, the Company issued warrants to purchase an aggregate of 200,000 shares of common stock at an exercise price of $ 12.50 per

(i) On May 10, 2024, the Company issued a warrant to purchase 80,000 shares of Common Stock at an exercise

October 31, 2024, the Company issued warrants to purchase an aggregate of 440,000 shares of common stock at an exercise price of $ 12.50

(i) On August 19, 2024, the Company issued a warrant to purchase 160,000 shares of Common Stock at an exercise

price of $ 12.50 in connection with the sale of convertible preferred stock to Orchid Finance, LLC (“Orchid”) for $ 2,000,000 .

1 unchanged sentence

is indexed to the common stock, requires settlement in shares and would be classified as equity under ASC 815.

(ii) On June 25, 2024, the Company issued a warrant to purchase 120,000 shares of Common Stock at an exercise

The fair value of the warrant

on the date issued was $ 571,000 .

(ii) On August 21, 2024, the Company issued a warrant to purchase 200,000 shares of Common Stock at an exercise

price of $ 12.50 in connection with the sale of convertible preferred stock to Orchid for $ 2,500,000 .

2 unchanged sentences

settlement in shares and would be classified as equity under ASC 815.

Warrant activity for the three

months ended July 31, 2024 is presented below:

The fair value of the warrant on the date issued was $ 486,000 .

(iii) On September 11, 2024, the Company issued a warrant to purchase 80,000 shares of Common Stock at an exercise

price of $ 12.50 in connection with the sale of convertible preferred stock to Orchid for $ 1,000,000 .

Based on the terms of the Company’s

warrant agreement, the Company accounted for the warrant as an equity instrument as the warrant is indexed to the common stock, requires

settlement in shares and would be classified as equity under ASC 815.

The fair value of the warrant on the date issued was $ 69,000 .

Warrant activity for the six

months ended October 31, 2024 is presented below:

Schedule of warrant activity

3 unchanged sentences

Cancelled/Expired

Outstanding at July 31, 2024

Outstanding at October 31, 2024

The following table summarizes

information about Common Stock warrants outstanding and exercisable at July 31, 2024:

information about Common Stock warrants outstanding and exercisable at October 31, 2024:

Schedule of common stock warrants outstanding

117 unchanged sentences

The purchase price was paid in cash.

On August 19, 2024, the Company

sold 200 shares of Series A Convertible Preferred Stock and warrants to purchase 160,000 shares of Common Stock with an exercise price

of $ 12.50 to Orchid, for a total purchase price of $ 2.0 million.

The purchase price was paid in

On August 21, 2024, the Company

sold 250 shares of Series A Convertible Preferred Stock and warrants to purchase 200,000 shares of Common Stock with an exercise price

of $ 12.50 to Orchid, for a total purchase price of $ 2.5 million less $100,000 discount.

price was paid in cash.

On September 11, 2024, the

Company sold 100 shares of Series A Convertible Preferred Stock and warrants to purchase 80,000 shares of Common Stock with an exercise

price of $ 12.50 to Orchid, for a total purchase price of $ 1.0 million.

The purchase price was paid

Series A Convertible Preferred Stock has a stated value of $1,000 per share and holders of

the Series A Convertible Preferred Stock are entitled to cumulative cash dividends at an annual rate of 15%, or $1,500.00 per share (“Dividend

Amount”), based on the stated value per share.

Notwithstanding the foregoing, for as long as any share(s) of Series A Preferred

Stock shall remain outstanding, the Dividend Amount shall be paid either in shares of Series A Preferred Stock or cash, at Orchid’s

discretion, in each case equal to the Dividend Amount.

Each share of Series A Convertible Preferred Stock is convertible into shares

of Common Stock cased on the conversion price (“Series A Conversion Price”), which is defined as (a) the state value of the

Series A Preferred Stock being converted pus all accrued but unpaid dividends, divided by (b) the greater of (i) $2.50 per share (“Floor

Price”), and (ii) the lesser of (A) $15.00 and (B) 80% of the lowest closing price of the Common Stock during the three trading

days immediately prior to the date of the conversion.

The Conversion Price is subject to adjustment in the event of an issuance of Common

Stock at a price per share lower than the Conversion Price then in effect, but not below the Floor Price.

The Floor Price shall, however,

be adjusted for stock splits, stock dividends, combinations or similar transactions.

The holders of the Series A Convertible Preferred

Stock are entitled to vote with the Common Stock as a single class on an as-converted basis, subject to applicable law provisions of the

Delaware General Corporation Law and Nasdaq, provided, however, that for purposes of complying with Nasdaq regulations, the conversion

price, for purposes of determining the number of votes the holder of Series A Convertible Preferred Stock is entitled to cast, shall not

be lower than $5.63 (the “Voting Floor Price”), which represents the closing sale price of the Common Stock on the trading

day immediately prior to the execution date of the Orchid SPA.

The Voting Floor Price shall be adjusted for stock dividends, stock splits,

stock combinations and other similar transactions.

Upon a liquidation event, the holders of Series A Convertible Preferred Stock receive

a liquidation preference ahead of holders of Common Stock.

Series B Convertible

Preferred Stock

On January 31, 2024, the

Company and Ault Lending, LLC (“Ault Lending”) entered into a securities purchase agreement (the “AL SPA”)

for the purchase of up to 6,000 shares of Series B Convertible Preferred Stock and warrants to purchase shares up to 600,000

shares of the Company’s Common Stock.

The AL SPA provides that Ault Lending may purchase up to $6 million of Series B

Convertible Preferred Stock in one or more closings.

Lending has the right to purchase up to $2 million of Series B Convertible Preferred Stock, on or before March 31, 2024, and the

right to purchase up to $4 million of Series B Convertible Preferred Stock after March 31, 2024, but on or before March 31, 2025

On January 31, 2024, the Company

and Ault Lending, LLC (“Ault Lending”) entered into a securities purchase agreement (the “AL SPA”) for the purchase

of up to 6,000 shares of Series B Convertible Preferred Stock and warrants to purchase shares up to 600,000 shares of the Company’s

Common Stock.

The AL SPA provides that Ault Lending may purchase up to $6 million of Series B Convertible Preferred Stock in one or more

Ault Lending has the right to purchase up to $2 million of Series B Convertible Preferred Stock, on or before March 31, 2024,

and the right to purchase up to $4 million of Series B Convertible Preferred Stock after March 31, 2024, but on or before March 31, 2025

(the “Termination Date”).

The Agreement will automatically terminate if the final closing has not occurred prior

to the Termination Date.

The Agreement will automatically terminate if the final closing has not occurred prior to the Termination

On January 31, 2024, the Company

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Price then in effect, as well as upon customary stock splits, stock dividends, combinations or similar events.

At-the-Market Offering

On October 3, 2024, the Company

entered into an At-the-Market Issuance Sales Agreement with Ascendiant Capital Markets, LLC (the “ATM Offering”), as sales

agent to sell shares of its Common Stock, having an aggregate offering price of up to approximately $6.5 million from time to time, through

the ATM Offering.

On October 3, 2024, the Company filed a prospectus supplement with the SEC relating to the offer and sale of up to approximately

$6.5 million in shares of Common Stock in the ATM Offering.

The offer and sale of the

shares will be made pursuant to the Company’s effective “shelf” registration statement on Form S-3 and an accompanying

base prospectus contained therein (Registration Statement No.

333-273610) filed with the SEC on August 2, 2023 and declared effective

by the SEC on August 10, 2023.

During the six months ended

October 31, 2024, the Company sold an aggregate of 755,888 shares of Common Stock pursuant to the ATM Offering for gross and net proceeds

of $ 1.2 million.

During the three months ended

July 31, 2024, Orchid converted 62.477 shares of Series A Convertible Preferred Stock into 173,333 shares of Common Stock.

October 31, 2024, Orchid converted 649.5363 shares of Series A Convertible Preferred Stock into 3,613,951 shares of Common Stock.

the six months ended October 31, 2024, Orchid converted 712.0133 shares of Series A Convertible Preferred Stock into 3,787,284 shares

of Common Stock.

RELATED PARTY TRANSACTIONS

2 unchanged sentences

gross proceeds we receive from Orchid upon each purchase of Series A Convertible Preferred Stock.

During the three months ended July 31,

2024, origination fees due to Ault Lending were $ 125,000 .

During the three and six months ended

October 31, 2024, origination fees due to Ault Lending were $ 275,000 and $ 400,000 , respectively.

SUBSEQUENT EVENTS

On August 19, 2024, the Company

sold 200 shares of Series A Convertible Preferred Stock and warrants to purchase 160,000 shares of Common Stock with an exercise price

of $ 12.50 to Orchid, for a total purchase price of $ 2.0 million.

The purchase price was paid in

On August 21, 2024, the Company

sold 250 shares of Series A Convertible Preferred Stock and warrants to purchase 200,000 shares of Common Stock with an exercise price

of $ 12.50 to Orchid, for a total purchase price of $ 2.5 million less $ 100,000 discount.

price was paid in cash.

From August 1, 2024 to September 10, 2024, Orchid converted 632.4909

shares of Series A Convertible Preferred Stock into 3,196,825 shares of Common Stock.

From November 1, 2024 to December

10, 2024, the Company sold an aggregate of 201,543 shares of Common Stock pursuant to the ATM Offering for gross and net proceeds of $ 280,000 .

Management has evaluated events

through the date the financial statement were available to be issued and determined that there have been no other events that occurred

that would require adjustment to our disclosures in the condensed financial statements.

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-Q

Item 1. Financial Statements