What changed in this filing

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Item 9A. Controls and Procedures

2021-01-07 compared with 2020-01-09 · 1427 added, 842 removed, 352 unchanged (87% of the section changed)

Controls and Procedures.

Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act.

Under the supervision and with the participation of our management, including our President and Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15 and 15d-15 of the Exchange Act.

Based upon that evaluation, our President and Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of fiscal year 2019.

Managements Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act.

Our management, including the principal executive officer and principal financial officer, does not expect that our internal controls over financial reporting will prevent all errors and all fraud.

A control system, no matter how well designed and operated, cannot provide full assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles.

Under the supervision and with the participation of our management, including the principal executive officer and principal financial officer, we conducted an evaluation as to the effectiveness of our internal control over financial reporting as of October 31, 2019.

In making this assessment, our management used the criteria for effective internal control set forth by the Committee of Sponsoring Organizations of the Treadway Commission in the 2013 Internal Control Integrated Framework .

Based on this assessment, our management concluded that our internal control over financial reporting was effective as of October 31, 2019.

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting.

Managements report was not subject to attestation by the Companys independent registered public accounting firm pursuant to a permanent exemption of the Commission that permits the Company to provide only managements report in this Annual Report on Form 10-K.

Accordingly, our managements assessment of the effectiveness of our internal control over financial reporting as of October 31, 2019 has not been audited by our auditors, Haskell & White LLP.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the fourth quarter of fiscal year 2019 that has materially affected, or is reasonably likely to materially affect, the Companys internal control over financial reporting.

Controls and Procedures

maintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act.

Under the supervision and with the participation of our management, including our President and Chief Executive Officer and our

Chief Operating Officer and Chief Financial Officer, we evaluated the effectiveness of the design and operation of our disclosure

controls and procedures pursuant to Rule 13a-15 and 15d-15 of the Exchange Act.

Based upon that evaluation, our President and

Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer concluded that our disclosure controls and

procedures were effective as of the end of fiscal year 2020.

Management’s

Report on Internal Control Over Financial Reporting

management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is

defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act.

Our management, including the principal executive officer and principal

financial officer, does not expect that our internal controls over financial reporting will prevent all errors and all fraud.

A control system, no matter how well designed and operated, cannot provide full assurance that the objectives of the control system

are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any,

within a company have been detected.

Our internal control over financial reporting is designed to provide reasonable assurance

regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes

in accordance with generally accepted accounting principles.

the supervision and with the participation of our management, including the principal executive officer and principal financial

officer, we conducted an evaluation as to the effectiveness of our internal control over financial reporting as of October 31,

In making this assessment, our management used the criteria for effective internal control set forth by the Committee of

Sponsoring Organizations of the Treadway Commission in the 2013 Internal Control –

Integrated Framework .

this assessment, our management concluded that our internal control over financial reporting was effective as of October 31, 2020.

Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm regarding

internal control over financial reporting.

Management’s report was not subject to attestation by the Company’s independent

registered public accounting firm pursuant to a permanent exemption of the Commission that permits the Company to provide only

management’s report in this Annual Report on Form 10-K.

Accordingly, our management’s assessment of the effectiveness

of our internal control over financial reporting as of October 31, 2020 has not been audited by our auditors, Haskell & White

in Internal Control Over Financial Reporting

were no changes in our internal control over financial reporting during the fourth quarter of fiscal year 2020 that has materially

affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Other Information.

At the Annual Meeting of Shareholders of the Company held on October 23, 2019, the Companys shareholders voted on, among other matters, an advisory vote regarding the frequency of future advisory votes on named executive officer compensation.

The Companys shareholders voted for an advisory vote on named executive officer compensation to be held every year, consistent with the recommendation of the Companys Board of Directors.

In response to the voting results and other factors, the Companys Board of Directors determined at a meeting held on December 12, 2019, that the Company will hold an advisory vote on named executive officer compensation every year.

The Company will continue to hold advisory votes on named executive officer compensation every year until the Companys Board of Directors decides to hold the next shareholder advisory vote on the frequency of advisory votes, which shall be no later than the Companys Annual Meeting of Shareholders in 2025.

On January 6, 2020, the Board of Directors of the Company confirmed its intention to hold the Company's 2020 Annual Meeting of Shareholders (the 2020 Annual Meeting) on Wednesday, July 15, 2020.

The time and location of the 2020 Annual Meeting, and the matters to be considered, will be as set forth in the Company's definitive proxy statement for the 2020 Annual Meeting to be filed in due course with the SEC.

Since the date of the 2020 Annual Meeting has been changed by more than 30 days from the anniversary date of the Companys last annual meeting of shareholders, the Company is informing shareholders of this change and the updated deadline for shareholders to submit nominations for director or proposals for consideration at the 2020 Annual Meeting in accordance with the rules and regulations of the SEC and the Companys By-laws (as amended on January 6, 2020).

Accordingly, shareholders wishing to nominate a candidate for director or to propose other business at the 2020 Annual Meeting must ensure proper notice is received by the Company at its offices no later than May 11, 2020.

The notice must include all of the information required by the Companys By-laws.

On January 6, 2020, the Board of Directors of the Company approved an amendment to the Companys By-laws to provide that if during the prior year the Company did not hold an annual meeting or if the date of the annual meeting was changed more than thirty (30) days from the anniversary of the prior years meeting, notice of a proposal to be included at an annual meeting must be delivered to or mailed and received at the principal executive offices of the Company a reasonable time before the Company begins to print and send its proxy materials to be timely.

No other changes were made to the Companys By-laws.

Directors, Executive Officers and Corporate Governance .

Our Directors and Executive Officers

The following table sets forth certain information with respect to all of our directors and executive officers:

Position with the Company and

Principal Occupation

Director and/or Executive Officer Since

Chairman of the Board, President and Chief Executive Officer

January 7, 2021, the Board of Directors of the Company confirmed its intention to hold the Company’s 2021 Annual

Meeting of Shareholders (the “2021 Annual Meeting”) on Friday, May 21, 2021.

The time and location of the 2021 Annual

Meeting, and the matters to be considered, will be as set forth in the Company’s definitive proxy statement for the 2021

Annual Meeting to be filed in due course with the SEC.

the date of the 2021 Annual Meeting has been changed by more than 30 days from the anniversary date of the Company’s last

annual meeting of shareholders, the Company is informing shareholders of this change and the updated deadline for shareholders

to submit nominations for director or proposals for consideration at the 2021 Annual Meeting in accordance with the rules and

regulations of the SEC and the Company’s By-laws.

Accordingly, shareholders wishing to nominate a candidate for director

or to propose other business at the 2021 Annual Meeting must ensure proper notice is received by the Company at its offices no

later than March 17, 2021.

The notice must include all of the information required by the Company’s By-laws.

Executive Officers and Corporate Governance.

Directors and Executive Officers

following table sets forth certain information with respect to all of our directors and executive officers:

with the Company and Principal Occupation

and/or Executive Officer Since

of the Board, President and Chief Executive Officer

Titterton, Jr.

Lead Independent Director

Independent Director

Arnold Baskies

David Cavalier

Emily Gottschalk

Chief Operating Officer and Chief Financial Officer

We believe that our Board represents a desirable mix of backgrounds, skills, and experiences.

The principal occupation and business experience during the last five years for our executive officers and directors and some of the specific experiences, qualifications, attributes or skills that led to the conclusion that each person should serve as one of our directors in light of our business and structure is as follows:

Amit Kumar, 55, Chairman of the Board, President and Chief Executive Officer.

Kumar has served as our President and Chief Executive Officer since July 2017, as a director of the Company since November 2012 and as Chairman of the Board since August 2016.

Operating Officer and Chief Financial Officer

believe that our Board represents a desirable mix of backgrounds, skills, and experiences.

The principal occupation and business

experience during the last five years for our executive officers and directors and some of the specific experiences, qualifications,

attributes or skills that led to the conclusion that each person should serve as one of our directors in light of our business

and structure is as follows:

Kumar, Ph.D., 56, Chairman of the Board, President and Chief Executive Officer.

Kumar has served as our President

and Chief Executive Officer since July 2017, as a director of the Company since November 2012 and as Chairman of the Board since

From June 2015 until August 2016, he served as Vice Chairman of the Board.

Kumar served as a strategic advisor to the Company from September 2012 until July 2017.

He has been Executive Chairman of the board of directors of Anixa Diagnostics Corporation, a wholly-owned subsidiary of the Company since June 2015.

Upon his appointment as Executive Chairman of Anixa Diagnostics, Dr.

Kumar served as a strategic advisor

to the Company from September 2012 until July 2017.

He has been Executive Chairman of the board of directors of Anixa Diagnostics

Corporation, a wholly-owned subsidiary of the Company since June 2015.

Upon his appointment as Executive Chairman of Anixa Diagnostics,

Kumar resigned from his position as the CEO of Geo Fossil Fuels LLC, an energy company, which he had held since December 2010.

From September 2001 to June 2010, he was President and CEO of CombiMatrix Corporation, a NASDAQ listed biotechnology company and also served as director from September 2000 to June 2012.

He was Vice President of Life Sciences of Acacia Research Corporation, a publicly traded investment company, from July 2000 to August 2007 and also served as a director from January 2003 to August 2007.

Kumar has served as Chairman of the board of directors of Ascent Solar Technologies, Inc., a publicly-held solar energy company, since June 2007.

He served as a director of Aeolus Pharmaceuticals, Inc., a publicly traded biotechnology company, from June 2004 to June 2018.

From September 2001 to June 2010, he was President and CEO of CombiMatrix Corporation, a NASDAQ listed biotechnology company and

also served as director from September 2000 to June 2012.

He was Vice President of Life Sciences of Acacia Research Corporation,

a publicly traded investment company, from July 2000 to August 2007 and also served as a director from January 2003 to August

Kumar has served as Chairman of the board of directors of Ascent Solar Technologies, Inc., a publicly-held solar energy

company, since June 2007.

He served as a director of Aeolus Pharmaceuticals, Inc., a publicly traded biotechnology company, from

June 2004 to June 2018.

Kumar is Chairman of Actym Therapeutics, a private biotechnology company.

Kumar has served on the board of the American Cancer Society since 2016.

Kumar has served on

the board of the American Cancer Society since 2016.

Kumar holds an A.B.

in Chemistry from Occidental College.

After graduate studies at Stanford University and Caltech, he received his Ph.D.

from Caltech and completed his post-doctoral training at Harvard University.

He has experience in technology driven startups, both at the board of directors and operating levels, in a broad variety of areas including finance, acquisitions, research and development, and marketing, and, as described above, has served as a director and/or officer of various publicly traded companies.

After graduate

studies at Stanford University and Caltech, he received his Ph.D.

from Caltech and completed his post-doctoral training at Harvard

He has experience in technology driven startups, both at the board of directors and operating levels, in a broad variety

of areas including finance, acquisitions, research and development, and marketing, and, as described above, has served as a director

and/or officer of various publicly traded companies.

Titterton, Jr., 76, Director.

Titterton has served as a director since July 2017, and as Lead Independent Director since July 2018.

He previously served as a director of the Company from August 2010 through August 2016, as the Chairman of the Board from July 2012 through August 2016, and interim Chief Executive Officer from August 2012 until September 2012.

He served on the board of directors of ParkerVision, Inc., a publicly traded wireless technology company, from September 2018 to April 2019.

His background is in high technology with an emphasis on health care and he was the Chairman of the Board of Directors of NYMED, Inc., a diversified health services company, from 1989 until October 2018.

Titterton has served as a director since July 2017, and as Lead Independent Director

since July 2018.

He previously served as a director of the Company from August 2010 through August 2016, as the Chairman of the

Board from July 2012 through August 2016, and interim Chief Executive Officer from August 2012 until September 2012.

on the board of directors of ParkerVision, Inc., a publicly traded wireless technology company, from September 2018 to April 2019.

His background is in high technology with an emphasis on health care and he was the Chairman of the Board of Directors of NYMED,

Inc., a diversified health services company, from 1989 until October 2018.

Titterton founded MedE America, Inc.

in 1986 and was Chief Executive Officer of Management and Planning Services, Inc.

was Chief Executive Officer of Management and Planning Services, Inc.

from 1978 to 1986.

Titterton also served as one of our Directors from July 1999 to January 2003.

Titterton also served as one of our

Directors from July 1999 to January 2003.

He holds an MBA from the State University of New York at Albany, and a B.A.

degree from Cornell University.

Cornell University.

Titterton has been involved with our Company as a director or investor for over twenty years.

Titterton also has substantial experience with advising on the strategic development of technology companies and over forty years of experience in various aspects of the technology industry.

Arnold Baskies, MD, FACS, 70, Director.

also has substantial experience with advising on the strategic development of technology companies and over forty years of experience

in various aspects of the technology industry.

Baskies, MD, FACS, 71, Director.

Baskies has served on our Board since September 2018.

He previously served as a director of the Company from August 2016 until September 2017.

Baskies is a surgical oncologist at Virtua Health Systems in southern New Jersey, where he specializes in surgical oncology and general surgery.

He trained at Boston University Medical Center and the Surgery Branch of the National Cancer Institute where his early research involved immunotherapy.

He has extensive experience in all facets of general surgical problems, with special interests in the treatment of breast cancer, gastrointestinal cancers, thyroid cancer, melanoma, and parathyroid disease, and is a co-investigator in several national studies dealing with breast cancer prevention.

He served as chairman of the New Jersey Governors Task Force on Early Detection, Prevention and Treatment of Cancer, having created and chaired the cancer control plan for the state from 2000-2016, and is a member of numerous societies, including the Society of Surgical Oncology, the American Society of Breast Surgeons, and the American College of Surgeons.

Baskies has been involved with the American Cancer Society for 40 years.

He was awarded the Societys Silver Chalice Award in 1998 and the Societys St.

George National Award in 2009.

He has held leadership positions at many levels of the organization, including service as the first board scientific officer for the American Cancer Society Board of Directors in 2015, and was the chief medical officer and Chairman of the Board of Directors of the former Eastern Division of the American Cancer Society.

In 2017, he served as the Chairman of the Board of the American Cancer Society.

He presently serves as immediate past chair of the American Cancer Society Board of Directors, having served as a member of the Board of Directors since 2013.

He currently chairs the Global Cancer Control Advisory Council for the society.

He received a medical degree from Boston University School of Medicine in 1975 and a bachelor of arts degree from Boston University College of Liberal Arts in 1971.

David Cavalier, 50, Director .

He previously served as a director

of the Company from August 2016 until September 2017.

Baskies is a surgical oncologist affiliated with Virtua Health Systems

in southern New Jersey, where he specializes in surgical oncology and general surgery, and is Clinical Professor of Surgery at

Rowan School of Medicine.

He trained at Boston University Medical Center and the Surgery Branch of the National Cancer Institute

where his early research involved immunotherapy.

He has extensive experience in all facets of general surgical and surgical oncologic

problems, with special interests in the treatment of breast cancer, gastrointestinal cancers, thyroid cancer, melanoma, and parathyroid

disease, and is a co-investigator in several national studies dealing with breast cancer prevention.

Baskies has served as

a director of Baudax Bio, Inc., a publicly-held biotechnology company, since August 2020.

He served as chairman of the New Jersey

Governor’s Task Force on Early Detection, Prevention and Treatment of Cancer, having created and chaired the cancer control

plan for the state from 2000-2016, and is a member of numerous societies, including the Society of Surgical Oncology, the American

Society of Breast Surgeons, and the American College of Surgeons.

Baskies has been involved with the American Cancer Society

for 40 years.

He was awarded the Society’s Silver Chalice Award in 1998 and the Society’s St.

George National Award

He has held leadership positions at many levels of the organization, including service as the first board scientific

officer for the American Cancer Society Board of Directors in 2015, and was the chief medical officer and Chairman of the Board

of Directors of the former Eastern Division of the American Cancer Society.

In 2017, he served as the Chairman of the National

Board of Directors of the American Cancer Society.

He helped develop the current guidelines for breast cancer screening and colon

cancer screening which are used on a daily basis in the United States and internationally.

He chairs the Global Cancer Control

Advisory Council for the society and the St.

Baldrick’s Foundation/ACS Alliance.

He has helped set the standards for cancer

care accreditation through his involvement with the Commission on Cancer.

He received a medical degree from Boston University

School of Medicine in 1975 and a bachelor of arts degree from Boston University College of Liberal Arts in 1971.

Cavalier, 51, Director .

Cavalier has served on our Board since September 2018.

He is a seasoned executive and investor with over 20 years of experience in the biotechnology sector.

He is currently the Chief Operating Officer of Mab & Stoke, Inc., a direct-to-consumer health and wellness company.

He was the Chairman, from 2004 to 2018, and Chief Financial Officer, from 2013 to 2018, of Aeolus Pharmaceuticals, Inc., a biotechnology company where in 2011 he was instrumental in winning and managing a $118 million advanced research and development contract from the U.S.

He is a seasoned executive and investor

with over 20 years of experience in the biotechnology sector.

He is currently the Chief Operating Officer of Mab & Stoke,

Inc., a direct-to-consumer health and wellness company.

He was the Chairman, from 2004 to 2018, and Chief Financial Officer, from

2013 to 2018, of Aeolus Pharmaceuticals, Inc., a biotechnology company where in 2011 he was instrumental in winning and managing

a $118 million advanced research and development contract from the U.S.

Prior to Aeolus, Mr.

Cavalier was the founder, portfolio manager and Chief Operating Officer of Xmark Opportunity Partners, a biotechnology investment firm.

Xmark was an activist fund, focused on creating positive change at the board and management level for portfolio companies.

He began his biotech investment career at Brown Simpson Asset Management, where he co-managed the life sciences investment group.

Cavalier previously worked for Tiger Real Estate, a private investment fund sponsored by Tiger Management Corporation.

He began his career in the Investment Banking Division of Goldman, Sachs & Co.

Cavalier was the founder,

portfolio manager and Chief Operating Officer of Xmark Opportunity Partners, a biotechnology investment firm.

Xmark was an activist

fund, focused on creating positive change at the board and management level for portfolio companies.

He began his biotech investment

career at Brown Simpson Asset Management, where he co-managed the life sciences investment group.

Cavalier previously worked

for Tiger Real Estate, a private investment fund sponsored by Tiger Management Corporation.

He began his career in the Investment

Banking Division of Goldman, Sachs & Co.

working on debt and equity offerings for public and private real estate companies.

Cavalier currently serves as the Chairman of the New York Advisory Board for Enterprise Community Partners, a non-profit focused on policy, program and capital solutions for affordable housing.

Cavalier currently serves as the Chairman of the New York Advisory Board for Enterprise Community Partners, a non-profit focused

on policy, program and capital solutions for affordable housing.

He received his B.A.

from Yale University and his M.Phil.

from Oxford University.

Emily Gottschalk, 59, Director.

Oxford University.

Gottschalk, 60, Director.

Gottschalk has served on our Board since October 2019.

She is an experienced marketer with over 30 years of developing products for the consumer marketplace.

She is an experienced marketer with

over 30 years of developing products for the consumer marketplace.

She has been the CEO of The Garr Group, Inc.

since 1997, a diverse entertainment and new product development company that she founded that sells entertainment and general merchandise to the mass, specialty and on-line market.

Gottschalk co-founded IdeationUSA, LLC in 2017, a product development company focused on bringing innovative electronics to the consumer market.

IdeationUSA identifies white space opportunities in the marketplace and defines and develops products that uniquely touch consumers lives.

Ideation is equally focused on brick and mortar, on-line and emerging distribution channels.

Previously, she was Marketing Director of Zany Brainy, a childrens educational toy store that she launched.

since 1997, a

diverse entertainment and new product development company that she founded that sells entertainment and general merchandise to

the mass, specialty and on-line market.

Gottschalk co-founded IdeationUSA, LLC in 2017, a product development company focused

on bringing innovative electronics to the consumer market.

IdeationUSA identifies “white space”

opportunities in the

marketplace and defines and develops products that uniquely touch consumers lives.

Ideation is equally focused on brick and mortar,

on-line and emerging distribution channels.

Previously, she was Marketing Director of Zany Brainy, a children’s educational

toy store that she launched.

Since 1997, Ms.

Gottschalks companies have produced over 150 million CDs/DVDs to the US retail market, developed a proprietary Android tablet called RealPad, by AARP with Intel and has created private label brands across the home and craft market.

She is a graduate of Cornell Universitys School of Hotel Administration and serves on the board of several philanthropic organizations.

John Monahan, 73, Director.

Gottschalk’s companies have produced over 150 million CD’s/DVD’s

to the US retail market, developed a proprietary Android tablet called “RealPad, by AARP”

with Intel and has created

private label brands across the home and craft market.

She is a graduate of Cornell University’s School of Hotel Administration

and serves on the board of several philanthropic organizations.

Monahan, Ph.D., 74, Director.

Monahan has served on our Board since August 2016.

He is an experienced executive and has served on a number of biotechnology company boards over the years.

He is currently a Scientific Advisory Consultant for Synthetic Biologics, Inc., a publicly traded biotechnology company, and from 2010 through 2015 he was the Senior Executive Vice President of Research & Development at Synthetic Biologics, Inc.

He is also a director of Heat Biologics, Inc., a publicly traded biotechnology company, a position that he has held since 2011, and was a director of Tacere Therapeutics, Inc., a privately held biotechnology company, from 2006 to 2012.

In addition to his work with public companies, Dr.

Monahan is also currently a member of the Scientific Advisory Board of Agilis Biotherapeutics, Inc., a position that he has held since 2014, and is a board member of several other biotechnology companies.

In 1992 he founded Avigen, Inc., a biotechnology company that pioneered the development of gene medicines based on adeno-associated virus vectors, now an industry standard.

Over a 12-year period as its Chief Executive Officer, Dr.

Monahan took Avigen public through an initial public offering raising over $235 million and led the company through several IND applications.

He is an experienced executive and

has served on a number of biotechnology company boards over the years.

He is currently a director of Synthetic Biologics, Inc.,

a publicly traded biotechnology company, and from 2010 through 2015 he was the Senior Executive Vice President of Research &

Development at Synthetic Biologics, Inc.

He is also a director of Heat Biologics, Inc., a publicly traded biotechnology company,

a position that he has held since 2011.

In 1992 he founded Avigen, Inc., a biotechnology company that pioneered the development

of gene medicines based on adeno-associated virus vectors, now an industry standard.

Over a 12-year period as its Chief Executive

Monahan took Avigen public through an initial public offering raising over $235 million and led the company through

several IND applications.

Prior to Avigen, Dr.

Monahan served as Vice President - Research and Development at Somatix B.V., and Director of Molecular & Cell Biology at Triton Biosciences, Inc.

He was also previously Research Group Chief, Department of Molecular Genetics at Hoffmann-LaRoche Inc., and Adjunct Assistant Professor, Department of Cell Biology at New York University.

Monahan served as Vice President - Research and Development at Somatix Therapy

Corp., and Director of Molecular & Cell Biology at Triton Biosciences, Inc.

He was also previously Research Group Chief, Department

of Molecular Genetics at Hoffmann-LaRoche Inc., and Adjunct Assistant Professor, Department of Cell Biology at New York University.

Monahan earned a Ph.D.

in Biochemistry from McMaster University, Hamilton, Canada, and a B.S.

in Science from University College, Dublin, Ireland.

Monahan has over 50 publications in scientific literature and has made hundreds of presentations and public TV appearances, to scientific groups, investors and the general public over the years.

in Science from University College,

Dublin, Ireland.

Monahan has over 50 publications in scientific literature and has made hundreds of presentations and public

TV appearances, to scientific groups, investors and the general public over the years.

Catelani, 54, Chief Operating Officer and Chief Financial Officer.

Catelani has served as our Chief Operating Officer since July 2017 and as Chief Financial Officer since November 2016.

Catelani is a seasoned executive with over 30 years of experience in finance and operations.

From October 2012 to July 2017, he served as a contract Chief Financial Officer to a number of established privately held businesses in the biotechnology field.

In July 2006, he co-founded Tacere Therapeutics, Inc., a privately held biotechnology company, and served as its Chairman, President and Chief Financial Officer until its sale in October 2012.

Catelani has served as our Chief Operating Officer

since July 2017 and as Chief Financial Officer since November 2016.

Catelani is a seasoned executive with over 30 years of

experience in finance and operations.

From October 2012 to July 2017, he served as a contract Chief Financial Officer to a number

of established privately held businesses in the biotechnology field.

In July 2006, he co-founded Tacere Therapeutics, Inc., a

privately held biotechnology company, and served as its Chairman, President and Chief Financial Officer until its sale in October

While at Tacere, Mr.

Catelani was instrumental in establishing and managing a $150 million drug development collaboration with Pfizer, Inc.

Prior to Tacere, he served on the Board of Directors and was the Chief Financial Officer of Benitec Biopharma Limited, an Australian Stock Exchange-listed biotechnology company.

Catelani was instrumental in establishing and managing a $150 million drug development collaboration

with Pfizer, Inc.

Prior to Tacere, he served on the Board of Directors and was the Chief Financial Officer of Benitec Biopharma

Limited, an Australian Stock Exchange-listed biotechnology company.

Prior to Benitec, Mr.

Catelani served as Vice President and Chief Financial Officer at Axon Instruments, Inc., a U.S.

corporation publicly traded on the Australian Stock Exchange that was a leading designer and manufacturer of instrumentation and software systems for biotechnology and diagnostics research.

Previously, he served as the Vice President of Finance for Media Arts Group, Inc., an NYSE-listed company.

Catelani has also worked with several early stage start-up companies in a variety of industries, including biotechnology, cleantech and retail, in both advisory and management roles.

Catelani served as Vice President and

Chief Financial Officer at Axon Instruments, Inc., a U.S.

corporation publicly traded on the Australian Stock Exchange that was

a leading designer and manufacturer of instrumentation and software systems for biotechnology and diagnostics research.

he served as the Vice President of Finance for Media Arts Group, Inc., an NYSE-listed company.

Catelani has also worked with

several early stage start-up companies in a variety of industries, including biotechnology, cleantech and retail, in both advisory

and management roles.

Catelani began his professional career at Ernst & Young and is a CPA (Inactive).

He holds a B.S.

degree in business administration, with a concentration in accountancy, from Sacramento State University and an MBA from the University of California, Davis.

Of our current directors and executive officers, Drs.

Kumar and Monahan and Messrs.

Titterton and Cavalier have served as a director of another public company within the past five years.

Our Significant Employees

We have no significant employees other than our executive management team.

Family Relationships

There are no family relationships between or among the directors, executive officers or persons nominated or chosen by the Company to become directors or executive officers.

Involvement of Certain Legal Proceedings

To the best of our knowledge, during the past ten years, none of the following occurred with respect to a present or former director or executive officer of the Company:

(1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

(2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

(3) being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his or her involvement in any type of business, securities or banking activities;

(4) being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated;

(5) being subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree or finding relating to an alleged violation of the federal or state securities, commodities, banking or insurance laws or regulations or any settlement thereof or involvement in mail or wire fraud in connection with any business entity not subsequently reversed, suspended or vacated and (6) being subject of, or a party to, any disciplinary sanctions or orders imposed by a stock, commodities or derivatives exchange or other self-regulatory organization.

On November 5, 2018, a putative shareholder derivative complaint was filed in the Court of Chancery of the State of Delaware, captioned Howland v.

Kumar et al., C.A.

2018-0804-KSJM (the Derivative Action), that alleged claims for breach of fiduciary duty and unjust enrichment.

The Derivative Action named as defendants certain of the Companys current and former officers and directors (the Individual Defendants), and the Company was named solely as a nominal defendant.

On August 21, 2019, the Company entered into a settlement pursuant to which the Company agreed to certain changes in its corporate governance policies and to reprice certain stock options that were repriced on September 6, 2017 to $0.67 to the option price immediately prior to that repricing.

The Company also agreed to pay certain legal fees, with such fees to be paid from the Companys D&O insurance.

As a result of this settlement, all of the claims asserted in the Derivative Action have been dismissed.

The Individual Defendants have denied, and continue to deny, any and all allegations of wrongdoing or liability asserted in the Derivative Action.

The Individual Defendants have further asserted, and continue to assert, that at all relevant times, they acted in good faith and in a manner that they reasonably believed to be in the best interests of the Company and its stockholders.

The Individual Defendants entered into the settlement solely to eliminate the uncertainty, distraction, disruption, burden, risk, and expense of further litigation.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors, executive officers and ten percent stockholders to file initial reports of ownership and reports of changes in ownership of our common stock with the Commission.

Directors, executive officers and ten percent stockholders are also required to furnish us with copies of all Section 16(a) forms that they file.

Based upon a review of these filings, we believe that all required Section 16(a) reports were made on a timely basis during fiscal year 2019.

Code of Ethics

We have adopted a formal code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions.

We will provide a copy of our code of ethics to any person without charge, upon request.

For a copy of our code of ethics write to Secretary, Anixa Biosciences, Inc., 3150 Almaden Expressway, Suite 250, San Jose, California 95118.

degree in Business Administration, with a concentration in Accountancy, from Sacramento State University and an MBA from the University

of California, Davis.

our current directors and executive officers, Drs.

Kumar, Baskies and Monahan and Messrs.

Titterton and Cavalier have served as

a director of another public company within the past five years.

Significant Employees

have no significant employees other than our executive management team.

Relationships

are no family relationships between or among the directors, executive officers or persons nominated or chosen by the Company to

become directors or executive officers.

of Certain Legal Proceedings

the best of our knowledge, during the past ten years, none of the following occurred with respect to a present or former director

or executive officer of the Company:

(1) any bankruptcy petition filed by or against any business of which such person was a general

partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

(2) any conviction in

a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

(3) being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent

jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his or her involvement in any type

of business, securities or banking activities;

(4) being found by a court of competent jurisdiction (in a civil action), the Commission

or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment

has not been reversed, suspended or vacated;

(5) being subject of, or a party to, any Federal or State judicial or administrative

order, judgment, decree or finding relating to an alleged violation of the federal or state securities, commodities, banking or

insurance laws or regulations or any settlement thereof or involvement in mail or wire fraud in connection with any business entity

not subsequently reversed, suspended or vacated and (6) being subject of, or a party to, any disciplinary sanctions or orders

imposed by a stock, commodities or derivatives exchange or other self-regulatory organization.

16(a) Beneficial Ownership Reporting Compliance

16(a) of the Exchange Act requires our directors, executive officers and ten percent stockholders to file initial reports of ownership

and reports of changes in ownership of our common stock with the Commission.

Directors, executive officers and ten percent stockholders

are also required to furnish us with copies of all Section 16(a) forms that they file.

Based upon a review of these filings, we

believe that all required Section 16(a) reports were made on a timely basis during fiscal year 2020.

have adopted a formal code of ethics that applies to our principal executive officer, principal financial officer, principal accounting

officer or controller or persons performing similar functions.

We will provide a copy of our code of ethics to any person without

charge, upon request.

For a copy of our code of ethics write to Secretary, Anixa Biosciences, Inc., 3150 Almaden Expressway, Suite

250, San Jose, California 95118.

A current copy of our code of ethics is also available on our website at http://ir.anixa.com/governance-docs.

Nomination Procedures

On July 9, 2015, the Board established a nominating and corporate governance committee (the Nominating Committee).

The Nominating Committee has a charter which will be reviewed on an annual basis by members of the committee and will be at all times composed of exclusively independent directors.

The principal duties and responsibilities of the Nominating Committee are to identify qualified individuals to become board members, recommend to the Board individuals to be designated as nominees for election as directors at the annual meetings of stockholders, and develop and recommend to the Board the Companys corporate governance guidelines.

In selecting directors, the Nominating Committee will consider candidates that possess qualifications and expertise that will enhance the composition of the Board, including the considerations set forth below.

The considerations set forth below are not meant as minimum qualifications, but rather as guidelines in weighing all of a candidates qualifications and expertise.

· Candidates should be individuals of personal integrity and ethical character.

· Candidates should have background, achievements, and experience that will enhance our Board.

This may come from experience in areas important to our business,substantial accomplishments or prior or current associations with institutions noted for their excellence.

· Candidates should have demonstrated leadership ability, the intelligence and ability to make independent analytical inquiries and the ability to exercise sound business judgment.

· Candidates should be free from conflicts that would impair their ability to discharge the fiduciary duties owed as a director to Anixa and its stockholders, and we will consider directors independence from our management and stockholders.

· Candidates should have, and be prepared to devote, adequate time and energy to the Board and its committees to ensure the diligent performance of their duties, including by attending meetings of the Board and its committees.

· Due consideration will be given to the Boards overall balance of diversity of perspectives, backgrounds and experiences, as well as age, gender and ethnicity.

· Consideration will also be given to relevant legal and regulatory requirements.

We are of the view that the continuing service of qualified incumbents promotes stability and continuity in the board room, contributing to the Boards ability to work as a collective body, while giving us the benefit of the familiarity and insight into our affairs that our directors accumulate during their tenure.

Accordingly, the process of the Nominating Committee for identifying nominees for directors will reflect our practice of generally re-nominating incumbent directors who continue to satisfy the Boards criteria for membership on the Board, whom the Nominating Committee believes continue to make important contributions and who consent to continue their service on the Board.

If the Nominating Committee determines that an incumbent director consenting to re-nomination continues to be qualified and has satisfactorily performed his or her duties as director during the preceding term, and that there exist no reasons, including considerations relating to the composition and functional needs of the Board as a whole, why in the Nominating Committees view the incumbent should not be re-nominated, the Nominating Committee will, absent special circumstances, generally propose the incumbent director for re-election.

Although we do not have a formal policy regarding the consideration of diversity in identifying and evaluating potential director candidates, the Nominating Committee will take into account the personal characteristics (gender, ethnicity and age), skills and experience, qualifications and background of current and prospective directors diversity as one factor in identifying and evaluating potential director candidates, so that the Board, as a whole, will possess what the nominating and corporate governance committee believes are appropriate skills, talent, expertise and backgrounds necessary to oversee our Companys business.

If the incumbent directors are not nominated for re-election or if there is otherwise a vacancy on the Board, the Nominating Committee may solicit recommendations for nominees from persons that the Nominating Committee believes are likely to be familiar with qualified candidates, including from members of the Board and management.

While the Nominating Committee may also engage a professional search firm to assist in identifying qualified candidates, the Nominating Committee did not engage any third party to identify or evaluate or assist in identifying or evaluating the Director Nominees.

We do not have a policy with regard to the consideration of director candidates recommended by stockholders.

Due to the size of our Company and Board, the Nominating Committee does not believe that such a policy is necessary.

Depending on its level of familiarity with the candidates, the Nominating Committee may choose to interview certain candidates that it believes may possess qualifications and expertise required for membership on the Board.

It may also gather such other information it deems appropriate to develop a well-rounded view of the candidate.

Based on reports from those interviews or from Board members with personal knowledge and experience with a candidate, and on all other available information and relevant considerations, the Nominating Committee will select and nominate candidates who, in its view, are most suited for membership on the Board.

The members of the nominating committee are Dr.

July 9, 2015, the Board established a nominating and corporate governance committee (the “Nominating Committee”).

The Nominating Committee has a charter which will be reviewed on an annual basis by members of the committee and will be at all

times composed of exclusively independent directors.

The principal duties and responsibilities of the Nominating Committee are

to identify qualified individuals to become board members, recommend to the Board individuals to be designated as nominees for

election as directors at the annual meetings of stockholders, and develop and recommend to the Board the Company’s corporate

governance guidelines.

In selecting directors, the Nominating Committee will consider candidates that possess qualifications and

expertise that will enhance the composition of the Board, including the considerations set forth below.

The considerations set

forth below are not meant as minimum qualifications, but rather as guidelines in weighing all of a candidate’s qualifications

and expertise.

should be individuals of personal integrity and ethical character.

should have background, achievements, and experience that will enhance our Board.

This may come from experience in areas important

to our business, substantial accomplishments or prior or current associations with institutions noted for their excellence.

should have demonstrated leadership ability, the intelligence and ability to make independent analytical inquiries and the

ability to exercise sound business judgment.

should be free from conflicts that would impair their ability to discharge the fiduciary duties owed as a director to Anixa

and its stockholders, and we will consider directors’

independence from our management and stockholders.

should have, and be prepared to devote, adequate time and energy to the Board and its committees to ensure the diligent performance

of their duties, including by attending meetings of the Board and its committees.

consideration will be given to the Board’s overall balance of diversity of perspectives, backgrounds and experiences,

as well as age, gender and ethnicity.

Consideration

will also be given to relevant legal and regulatory requirements.

are of the view that the continuing service of qualified incumbents promotes stability and continuity in the board room, contributing

to the Board’s ability to work as a collective body, while giving us the benefit of the familiarity and insight into our

affairs that our directors accumulate during their tenure.

Accordingly, the process of the Nominating Committee for identifying

nominees for directors will reflect our practice of generally re-nominating incumbent directors who continue to satisfy the Board’s

criteria for membership on the Board, whom the Nominating Committee believes continue to make important contributions and who

consent to continue their service on the Board.

If the Nominating Committee determines that an incumbent director consenting to

re-nomination continues to be qualified and has satisfactorily performed his or her duties as director during the preceding term,

and that there exist no reasons, including considerations relating to the composition and functional needs of the Board as a whole,

why in the Nominating Committee’s view the incumbent should not be re-nominated, the Nominating Committee will, absent special

circumstances, generally propose the incumbent director for re-election.

Although we do not have a formal policy regarding the

consideration of diversity in identifying and evaluating potential director candidates, the Nominating Committee will take into

account the personal characteristics (gender, ethnicity and age), skills and experience, qualifications and background of current

and prospective directors’

diversity as one factor in identifying and evaluating potential director candidates, so that

the Board, as a whole, will possess what the nominating and corporate governance committee believes are appropriate skills, talent,

expertise and backgrounds necessary to oversee our Company’s business.

the incumbent directors are not nominated for re-election or if there is otherwise a vacancy on the Board, the Nominating Committee

may solicit recommendations for nominees from persons that the Nominating Committee believes are likely to be familiar with qualified

candidates, including from members of the Board and management.

While the Nominating Committee may also engage a professional

search firm to assist in identifying qualified candidates, the Nominating Committee did not engage any third party to identify

or evaluate or assist in identifying or evaluating the Director Nominees.

We do not have a policy with regard to the consideration

of director candidates recommended by stockholders.

Due to the size of our Company and Board, the Nominating Committee does not

believe that such a policy is necessary.

on its level of familiarity with the candidates, the Nominating Committee may choose to interview certain candidates that it believes

may possess qualifications and expertise required for membership on the Board.

It may also gather such other information it deems

appropriate to develop a well-rounded view of the candidate.

Based on reports from those interviews or from Board members with

personal knowledge and experience with a candidate, and on all other available information and relevant considerations, the Nominating

Committee will select and nominate candidates who, in its view, are most suited for membership on the Board.

members of the nominating committee are Dr.

Arnold Baskies (Chairman), Dr.

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Titterton, Jr.

Audit Committee and Audit Committee Financial Expert

On July 9, 2015, the Board established a separately-designated standing audit committee (the Audit Committee) established in accordance with Section 3(a)(58)(A) of the Exchange Act, and Nasdaq Listing Rules.

The Audit Committee has a charter which will be reviewed on an annual basis by members of the committee and will be at all times composed of exclusively independent directors who are financially literate, meaning they are able to read and understand fundamental financial statements, including the Companys balance sheet, income statement and cash flow statement.

In addition, the committee will have at least one member who qualifies as an audit committee financial expert as defined in rules and regulations of the SEC.

The principal duties and responsibilities of the Companys Audit Committee are to appoint the Companys independent auditors, oversee the quality and integrity of the Companys financial reporting and the audit of the Companys financial statements by its independent auditors and in fulfilling its obligations, the Companys Audit Committee will review with the Companys management and independent auditors the scope and result of the annual audit, the auditors independence and the Companys accounting policies.

The Audit Committee will be required to report regularly to the Board to discuss any issues that arise with respect to the quality or integrity of the Companys financial statements, its compliance with legal or regulatory requirements and the performance and independence of the Companys independent auditors.

The members of the Audit Committee are David Cavalier (Chairman), Lewis H.

Committee and Audit Committee Financial Expert

July 9, 2015, the Board established a separately-designated standing audit committee (the “Audit Committee”) established

in accordance with Section 3(a)(58)(A) of the Exchange Act, and Nasdaq Listing Rules.

The Audit Committee has a charter which

will be reviewed on an annual basis by members of the committee and will be at all times composed of exclusively independent directors

who are “financially literate,”

meaning they are able to read and understand fundamental financial statements, including

the Company’s balance sheet, income statement and cash flow statement.

In addition, the committee will have at least one

member who qualifies as an “audit committee financial expert”

as defined in rules and regulations of the SEC.

principal duties and responsibilities of the Company’s Audit Committee are to appoint the Company’s independent auditors,

oversee the quality and integrity of the Company’s financial reporting and the audit of the Company’s financial statements

by its independent auditors and in fulfilling its obligations, the Company’s Audit Committee will review with the Company’s

management and independent auditors the scope and result of the annual audit, the auditors’

independence and the Company’s

accounting policies.

Audit Committee will be required to report regularly to the Board to discuss any issues that arise with respect to the quality

or integrity of the Company’s financial statements, its compliance with legal or regulatory requirements and the performance

and independence of the Company’s independent auditors.

members of the Audit Committee are David Cavalier (Chairman), Lewis H.

Titterton, Jr.

John Monahan.

Our Board has determined that Mr.

Cavalier qualifies as an Audit Committee financial expert as defined by SEC rules, based on his education, experience and background.

Our Board has determined

Cavalier qualifies as an Audit Committee financial expert as defined by SEC rules, based on his education, experience

and background.

Please see Mr.

Cavaliers biographical information above for a description of his relevant experience.

Executive Compensation.

The following table sets forth certain information for the fiscal years ended October 31, 2019 and 2018, with respect to compensation awarded to, earned by or paid to our Chairman of the Board, President and Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer (the Named Executive Officers).

No other executive officer received total compensation in excess of $100,000 during fiscal year 2019.

Cavalier’s biographical information above for a description of his relevant experience.

Compensation.

following table sets forth certain information for the fiscal years ended October 31, 2020 and 2019, with respect to compensation

awarded to, earned by or paid to our Chairman of the Board, President and Chief Executive Officer and our Chief Operating Officer

and Chief Financial Officer (the “Named Executive Officers”).

No other executive officer received total compensation

in excess of $100,000 during fiscal year 2020.

SUMMARY COMPENSATION TABLE

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Option Awards

Chairman of the Board, President and Chief Executive Officer

All Other Compensation

Total Compensation

Chairman of the Board,

President and Chief Executive Officer

Chief Operating Officer and Chief Financial Officer

(1) These amounts have been calculated in accordance with Accounting Standards Codification (ASC) 718.

A discussion of assumptions used in valuation of option awards may be found in Note 2 to our Consolidated Financial Statements for fiscal year ended October 31, 2019, included elsewhere in this Annual Report on Form 10-K.

These amounts reflect our accounting expense for these stock options and restricted stock awards and do not correspond to the actual value that may be recognized by our Named Executive Officers.

(2) These amounts reflect the sum of the incremental cost to us of all perquisites and personal benefits, which consisted of compensation for use of a home office and reimbursement of medical insurance benefits for Dr.

Employment Agreements

Consulting Agreement with Dr.

On September 19, 2012, the Company entered into a Consulting Agreement with Dr.

Amit Kumar (the Kumar Agreement) pursuant to which Dr.

amounts have been calculated in accordance with Accounting Standards Codification (“ASC”) 718.

A discussion of

assumptions used in valuation of option awards may be found in Note 2 to our Consolidated Financial Statements for fiscal

year ended October 31, 2020, included elsewhere in this Annual Report on Form 10-K.

These amounts reflect our accounting expense

for these stock options and restricted stock awards and do not correspond to the actual value that may be recognized by our

Named Executive Officers.

amounts reflect the sum of the incremental cost to us of all perquisites and personal benefits, which consisted of compensation

for use of a home office and reimbursement of medical insurance benefits for Dr.

Agreement with Dr.

September 19, 2012, the Company entered into a Consulting Agreement with Dr.

Amit Kumar (the “Kumar Agreement”) pursuant

Kumar agreed to provide business consulting services for an initial annual consulting fee of $120,000.

On June 15, 2015, Dr.

Kumar was appointed Vice Chairman of the Company and Executive Chairman of Anixa Diagnostics.

As a result of this appointment, Dr.

Kumars annual cash compensation was increased to $300,000 by the Board.

As a result of this appointment,

Kumar’s annual cash compensation was increased to $300,000 by the Board.

On August 23, 2016, Dr.

Kumar was appointed Executive Chairman of the Company, and on July 6, 2017, Dr.

Kumar was appointed

Executive Chairman of the Company, and on July 6, 2017, Dr.

Kumar was appointed President and Chief Executive Officer of the Company.

On January 1, 2018 and 2019, Dr.

Kumars annual salary was increased to $450,000 and $481,500, respectively.

Kumars services are terminated by the Company or he terminates his services for any reason or no reason, the Company shall be obligated to pay to Dr.

Kumar only any earned compensation and/or bonus due under the Kumar Agreement and any unpaid reasonable and necessary expenses, due to him through the date of termination.

All such payments shall be made in a lump sum immediately following termination.

Stock Options

Outstanding Stock Option Awards

The following table sets forth certain information with respect to unexercised stock options held by the Named Executive Officers outstanding on October 31, 2019:

As of the beginning of each subsequent calendar year, Dr.

Kumar’s salary has been reviewed and adjusted by the Board’s

Compensation Committee.

On January 1, 2021, Dr.

Kumar’s annual salary was $582,085.

Kumar’s services are terminated by the Company or he terminates his services for any reason or no reason, the Company

shall be obligated to pay to Dr.

Kumar only any earned compensation and/or bonus due under the Kumar Agreement and any earned

and unused paid time off and any unpaid reasonable and necessary expenses, due to him through the date of termination.

payments shall be made in a lump sum immediately following termination.

Stock Option Awards

following table sets forth certain information with respect to unexercised stock options held by the Named Executive Officers

outstanding on October 31, 2020:

OUTSTANDING OPTION AWARDS

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1,000,000 (4)

(1) As a result of a settlement agreement related to the Derivative Action, the option was repriced to the option price immediately prior to the repricing effected on September 6, 2017.

(2) Options vest and become exercisable in 36 consecutive monthly installments, beginning May 31, 2018 and continuing through April 30, 2021.

(3) Options vest and become exercisable in one installment of 50,000 on July 6, 2018 and the remainder in twelve consecutive quarterly installments, beginning October 31, 2018 and continuing through July 31, 2021.

(4) Options shall vest as follows:

(i) 500,000 shares vest if during any 20 trading day period on or before May 31, 2021, the average closing stock price of the Companys Common Stock is at least $5.00, (ii) 500,000 shares vest if during any 20 trading day period on or before May 31, 2021, the average closing stock price of the Companys Common Stock is at least $7.00, and (iii) 500,000 shares vest if during any 20 trading day period on or before May 31, 2021, the average closing stock price of the Companys Common Stock is at least $8.00.

Stock Option Grants

No stock options were granted to the Named Executive Officers during the year ended October 31, 2019.

Stock Option Exercises

During the year ended October 31, 2019, no stock options were exercised by Named Executive Officers.

On May 8, 2018, a restricted stock award of 1,500,000 shares of common stock was granted under our 2018 Share Incentive Plan to Dr.

The restricted stock award vests in its entirety if during any 20 trading day period on or before May 31, 2021, the average closing stock price of the Companys Common Stock is at least $11.00.

The grant date fair value of this restricted stock award was $4,814,265.

Potential Payments upon Termination or Change in Control

The time-based and performance-based options granted Dr.

Kumar on May 8, 2018 provide for the vesting of the unvested portion of his options to be accelerated and such accelerated options to become immediately exercisable upon a change in control as defined below.

The intrinsic value of options granted on May 8, 2018 would be $221,000, which was calculated by multiplying (a) 1,300,000 options (being the number of options granted to him on May 8, 2018 that would be accelerated) by (b) an amount equal to the excess of (x) our closing share price on October 31, 2019 of $3.87 and (y) the options exercise price of $3.70 per share.

Options granted Mr.

Catelani on May 8, 2018 provide for the vesting of the unvested portion of his options to be accelerated and such accelerated options to become immediately exercisable upon a change in control as defined below.

The intrinsic value of options granted on May 8, 2018 would be $42,500, which was calculated by multiplying (a) 250,000 options (being the number of options granted to him on May 8, 2018 that would be accelerated) by (b) an amount equal to the excess of (x) our closing share price on October 31, 2019 of $3.87 and (y) the options exercise price of $3.70 per share.

Options granted Mr.

Catelani on July 6, 2017 provide for the vesting of the unvested portion of his options to be accelerated and such accelerated options to become immediately exercisable if Mr.

Catelani is terminated without cause or upon a change in control as defined below.

The intrinsic value of options granted on July 6, 2017 would be $254,625, which was calculated by multiplying (a) 87,500 options (being the number of options granted to him on July 6, 2017 that would be accelerated) by (b) an amount equal to the excess of (x) our closing share price on October 31, 2019 of $3.87 and (y) the options exercise price of $0.96 per share.

Change in Control

Under our 2010 Share Incentive Plan and our 2018 Share Incentive Plan, change in control means:

· Change in Ownership:

A change in ownership of the Company occurs on the date that any one person, or more than one person acting as a group, acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company, excluding the acquisition of additional stock by a person or more than one person acting as a group who is considered to own more than 50% of the total fair market value or total voting power of the stock of the Company.

· Change in Effective Control:

vest and become exercisable in 36 consecutive monthly installments, beginning May 31, 2018 and continuing through April 30,

vest and become exercisable in 36 consecutive monthly installments, beginning December 31, 2019 and continuing through November

vest and become exercisable in one installment of 50,000 on July 6, 2018 and the remainder in twelve consecutive quarterly

installments, beginning October 31, 2018 and continuing through July 31, 2021.

shall vest as follows:

(i) 500,000 shares vest if during any 20 trading day period on or before May 31, 2021, the average

closing stock price of the Company’s Common Stock is at least $5.00, (ii) 500,000 shares vest if during any 20 trading

day period on or before May 31, 2021, the average closing stock price of the Company’s Common Stock is at least $7.00,

and (iii) 500,000 shares vest if during any 20 trading day period on or before May 31, 2021, the average closing stock price

of the Company’s Common Stock is at least $8.00.

Option Grants

following table summarizes stock option grants during fiscal year 2020.

GRANTS OF OPTION AWARDS

Number of Securities Underlying Options

Exercise Price of Option Awards

Grant Date Fair Value

amounts have been calculated in accordance with ASC 718.

A discussion of assumptions used in valuation of option awards may

be found in Note 2 to our Consolidated Financial Statements for fiscal year ended October 31, 2020, included elsewhere in

this Annual Report on Form 10-K.

These amounts reflect our accounting expense for these stock options and restricted stock

awards and do not correspond to the actual value that may be recognized by our Named Executive Officers.

Option Exercises

the year ended October 31, 2020, no stock options were exercised by Named Executive Officers.

May 8, 2018, a restricted stock award of 1,500,000 shares of common stock was granted under our 2018 Share Incentive Plan to Dr.

The restricted stock award vests in its entirety if during any 20 trading day period on or before May 31, 2021, the average

closing stock price of the Company’s Common Stock is at least $11.00.

The grant date fair value of this restricted stock

award was $4,814,265.

Payments upon Termination or Change in Control

time-based and performance-based options granted Dr.

Kumar on May 8, 2018 provide for the vesting of the unvested portion of his

options to be accelerated and such accelerated options to become immediately exercisable upon a change in control as defined below.

The intrinsic value of options granted on May 8, 2018 would be $-0-, which was calculated by multiplying (a) 1,100,000 options

(being the number of options granted to him on May 8, 2018 that would be accelerated) by (b) an amount equal to the excess of

(x) our closing share price on October 31, 2020 of $2.06 and (y) the options’

exercise price of $3.70 per share.

Kumar on December 12, 2019 provide for the vesting of the unvested portion of his options to be accelerated and such

accelerated options to become immediately exercisable upon a change in control as defined below.

The intrinsic value of options

granted on December 12, 2019 would be $-0-, which was calculated by multiplying (a) 361,111 options (being the number of options

granted to him on December 12, 2019 that would be accelerated) by (b) an amount equal to the excess of (x) our closing share price

on October 31, 2020 of $2.06 and (y) the options’

exercise price of $3.84 per share.

Catelani on July 6, 2017 provide for the vesting of the unvested portion of his options to be accelerated and such

accelerated options to become immediately exercisable if Mr.

Catelani is terminated without cause or upon a change in control

as defined below.

The intrinsic value of options granted on July 6, 2017 would be $41,250, which was calculated by multiplying

(a) 37,500 options (being the number of options granted to him on July 6, 2017 that would be accelerated) by (b) an amount equal

to the excess of (x) our closing share price on October 31, 2019 of $2.06 and (y) the options’

exercise price of $0.96 per

Catelani on May 8, 2018 provide for the vesting of the unvested portion of his options to be accelerated and such

accelerated options to become immediately exercisable upon a change in control as defined below.

The intrinsic value of options

granted on May 8, 2018 would be $-0-, which was calculated by multiplying (a) 83,333 options (being the number of options granted

to him on May 8, 2018 that would be accelerated) by (b) an amount equal to the excess of (x) our closing share price on October

31, 2020 of $2.06 and (y) the options’

exercise price of $3.70 per share.

Catelani on December 12, 2019 provide for the vesting of the unvested portion of his options to be accelerated and

such accelerated options to become immediately exercisable upon a change in control as defined below.

The intrinsic value of options

granted on December 12, 2019 would be $-0-, which was calculated by multiplying (a) 69,411 options (being the number of options

granted to him on December 12, 2019 that would be accelerated) by (b) an amount equal to the excess of (x) our closing share price

on October 31, 2020 of $2.06 and (y) the options’

exercise price of $3.84 per share.

our 2010 Share Incentive Plan and our 2018 Share Incentive Plan, “change in control”

in Ownership:

A change in ownership of the Company occurs on the date that any one person, or more than one person acting

as a group, acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes

more than 50% of the total fair market value or total voting power of the stock of the Company, excluding the acquisition

of additional stock by a person or more than one person acting as a group who is considered to own more than 50% of the total

fair market value or total voting power of the stock of the Company.

in Effective Control:

A change in effective control of the Company occurs on the date that either:

o any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company possessing 30% or more of the total voting power of the stock of the Company;

o a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election;

provided, that this paragraph will apply only to the Company if no other corporation is a majority shareholder.

· Change in Ownership of Substantial Assets:

A change in the ownership of a substantial portion of the Companys assets occurs on the date that any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of the assets of the Company immediately before such acquisition or acquisitions.

For this purpose, gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

It is the intent that this definition be construed consistent with the definition of Change of Control as defined under Code Section 409A and the applicable treasury regulations, as amended from time to time.

Director Compensation

There is no present arrangement for cash compensation of directors for services in that capacity.

Consistent with the non-employee director compensation approved on March 28, 2013 for calendar year 2013, on November 8, 2013, the Board approved an amendment to the 2010 Share Incentive Plan to provide that on January 1 st of each year commencing on January 1, 2014, each non-employee director (a Director Participant) of the Company at that time shall automatically be granted a 10 year nonqualified stock option to purchase 12,000 shares of common stock (or 16,000 in the case of the Chairman of the Board to the extent he qualifies as a Director Participant), with an exercise price equal to the closing price on the date of grant, that will vest in four equal quarterly installments in the year of grant (the Annual Grant).

In addition, each person who is a Director Participant and joins the Board after January 1 of any year, shall be granted on the date such person joins the Board, a nonqualified stock option to purchase 12,000 shares of common stock (or 16,000 in the case of the Chairman of the Board) pro-rated based upon the number of calendar quarters remaining in the calendar year in which such person joins the Board (rounded up for partial quarters) (the New Director Grant).

Effective January 1, 2018 through the expiration of the 2010 Share Incentive Plan, each Director Participant has waived their right to receive the Annual Grant.

On October 23, 2019, each of our non-employee directors were granted a 10 year nonqualified stock option to purchase 45,000 shares of common stock exercisable at $3.87, such option vesting monthly over a one year period.

one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the

date of the most recent acquisition by such person or persons) ownership of stock of the Company possessing 30% or more of

the total voting power of the stock of the Company;

majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is

not endorsed by a majority of the members of the Board before the date of the appointment or election;

provided, that this

paragraph will apply only to the Company if no other corporation is a majority shareholder.

in Ownership of Substantial Assets:

A change in the ownership of a substantial portion of the Company’s assets occurs

on the date that any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month

period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total

gross fair market value equal to or more than 40% of the total gross fair market value of the assets of the Company immediately

before such acquisition or acquisitions.

For this purpose, “gross fair market value”

means the value of the assets

of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with

is the intent that this definition be construed consistent with the definition of “Change of Control”

as defined under

Code Section 409A and the applicable treasury regulations, as amended from time to time.

August 13, 2020, after a review of non-employee director compensation at comparable companies, the Board approved cash and equity

compensation of directors.

Each non-employee director shall receive cash compensation of $50,000 paid in four quarterly installments,

and the grant of a 10 year nonqualified stock option to purchase 30,000 shares of common stock exercisable at $2.68, such option

vesting monthly over a one year period.

Our employee director, Dr.

Amit Kumar, did not receive any additional compensation for services provided as a director during fiscal year 2019.

The following table sets forth compensation of Lewis H.

Amit Kumar, did not receive any additional compensation for

services provided as a director during fiscal year 2020.

2010 Share Incentive Plan provides that on January 1 st of each year, each non-employee director (a “Director

Participant”) of the Company at that time shall automatically be granted a 10 year nonqualified stock option to purchase

12,000 shares of common stock (or 16,000 in the case of the Chairman of the Board to the extent he qualifies as a Director Participant),

with an exercise price equal to the closing price on the date of grant, that will vest in four equal quarterly installments in

the year of grant (the “Annual Grant”).

Effective January 1, 2018 through the expiration of the 2010 Share Incentive

Plan, each Director Participant waived their right to receive the Annual Grant.

following table sets forth compensation of Lewis H.

Titterton, Jr., Dr.

1 unchanged sentence

John Monahan, our non-employee directors, for fiscal year 2020:

DIRECTORS COMPENSATION

DIRECTORS’

Option Awards

3 unchanged sentences

Emily Gottschalk

(1) These amounts have been calculated in accordance with ASC 718.

These amounts reflect our accounting expense for these stock options and do not correspond to the actual value that may be recognized by our directors.

(2) At October 31, 2019, Mr.

amounts have been calculated in accordance with ASC 718.

A discussion of assumptions used in valuation of option awards may

be found in Note 2 to our Consolidated Financial Statements for fiscal year ended October 31, 2020, included elsewhere in

this Annual Report on Form 10-K.

These amounts reflect our accounting expense for these stock options and do not correspond

to the actual value that may be recognized by our directors.

October 31, 2020, Mr.

Titterton, Dr.

1 unchanged sentence

Gosttschalk and Dr.

Monahan held unexercised stock options to purchase 655,000, 128,000, 90,000, 45,000 and 158,000 shares respectively, of our common stock.

Gottshchalk became a director on October 23, 2019.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table sets forth certain information with respect to our common s tock beneficially owned as of January 8, 2020 (or exercisable within 60 days of such date) by (a) each person who is known by our management to be the beneficial owner of more than 5% of our outstanding common stock, (b) each of our directors and executive officers, and (c) all directors and executive officers as a group:

Monahan held unexercised stock options

to purchase 685,000, 158,000, 120,000, 75,000 and 188,000 shares respectively, of our common stock.

Security Ownership of Certain Beneficial Owners

and Management and Related Stockholder Matters.

following table sets forth certain information with respect to our common stock beneficially owned as of January 7, 2021

(or exercisable within 60 days of such date) by (a) each person who is known by our management to be the beneficial owner of more

than 5% of our outstanding common stock, (b) each of our directors and executive officers, and (c) all directors and executive

officers as a group:

Name and Address of Beneficial Owner

Amount and Nature of Beneficial Ownership

(1)(2)(3)(4)(5)

Percent of Class

20 unchanged sentences

Less than 1%.

(1) A beneficial owner of a security includes any person who directly or indirectly has or shares voting power and/or investment power with respect to such security or has the right to obtain such voting power and/or investment power within sixty (60) days.

Except as otherwise noted, each designated beneficial owner in this Annual Report on Form 10-K has sole voting power and investment power with respect to the shares of common stock beneficially owned by such person.

(2) Includes 240,000 shares, 374,000 shares, 175,000 shares, 113,000 shares, 83,000 shares, 45,000 shares and 1,030,000 shares which Dr.

beneficial owner of a security includes any person who directly or indirectly has or shares voting power and/or investment

power with respect to such security or has the right to obtain such voting power and/or investment power within sixty (60)

Except as otherwise noted, each designated beneficial owner in this Annual Report on Form 10-K has sole voting power

and investment power with respect to the shares of common stock beneficially owned by such person.

240,000 shares, 474,000 shares, 225,000 shares, 113,000 shares, 83,000 shares, 45,000 shares and 1,180,000 shares which Dr.

Amit Kumar, Lewis H.

2 unchanged sentences

John Monahan, Dr.

Arnold Baskies, David Cavalier and all directors and executive officers as a group, respectively, have the right to acquire within 60 days upon exercise of options granted pursuant to the 2010 Share Incentive Plan.

(3) Includes 910,000 shares, 15,000 shares, 313,889 shares, 15,000 shares, 15,000 shares, 15,000 shares, 15,000 shares and 1,298,889 shares which Dr.

Arnold Baskies, David Cavalier and all directors

and executive officers as a group, respectively, have the right to acquire within 60 days upon exercise of options granted

pursuant to the 2010 Share Incentive Plan.

1,366,667 shares, 62,500 shares, 522,222 shares, 62,500 shares, 62,500 shares, 62,500 shares, 62,500 shares and 2,201,389

shares which Dr.

Amit Kumar, Lewis H.

2 unchanged sentences

John Monahan, Dr.

Arnold Baskies, David Cavalier, Emily Gottschalk and all directors and executive officers as a group, respectively, have the right to acquire within 60 days upon exercise of options granted pursuant to the 2018 Share Incentive Plan.

(4) Includes 640,000 shares, 86,000 shares and 726,000 shares which Dr.

Arnold Baskies, David Cavalier,

Emily Gottschalk and all directors and executive officers as a group, respectively, have the right to acquire within 60 days

upon exercise of options granted pursuant to the 2018 Share Incentive Plan.

640,000 shares, 86,000 shares and 726,000 shares which Dr.

Amit Kumar, Lewis H.

Titterton, Jr.

and all directors and executive officers as a group, respectively, have the right to acquire within 60 days pursuant to option agreements with the Company.

(5) Includes 1,500,000 restricted shares of common stock awarded to Dr.

Amit Kumar pursuant to the 2018 Share Incentive Plan for which Dr.

Kumar has voting rights but that vest only if during any twenty (20) trading day period on or before May 31, 2021 in which Dr.

Kumar is employed by Anixa, the average closing stock price of the Companys common stock is at least $11.00.

(6) Based on 20,821,204 shares of common stock outstanding as of January 8, 2020.

Change in Control

We are not aware of any arrangement that might result in a change in control of the Company in the future.

Equity Compensation Plan Information

The following is information as of October 31, 2019 about shares of our common stock that may be issued upon the exercise of options, warrants and rights under all equity compensation plans in effect as of that date, including our 2003 Share Incentive Plan, our 2010 Share Incentive Plan and our 2018 Share Incentive Plan.

and all directors and executive

officers as a group, respectively, have the right to acquire within 60 days pursuant to option agreements with the Company.

1,500,000 restricted shares of common stock awarded to Dr.

Amit Kumar pursuant to the 2018 Share Incentive Plan for which

Kumar has voting rights but that vest only if during any twenty (20) trading day period on or before May 31, 2021 in which

Kumar is employed by Anixa, the average closing stock price of the Company’s common stock is at least $11.00.

on 26,076,819 shares of common stock outstanding as of January 7, 2020.

are not aware of any arrangement that might result in a change in control of the Company in the future.

Compensation Plan Information

following is information as of October 31, 2020 about shares of our common stock that may be issued upon the exercise of options,

warrants and rights under all equity compensation plans in effect as of that date, including our our 2010 Share Incentive Plan

and our 2018 Share Incentive Plan.

See Note 4 to our Consolidated Financial Statements for more information on these plans.

5 unchanged sentences

Equity compensation plans approved by security holders (2)

(1) On April 23, 2003 the Board adopted the 2003 Share Incentive Plan.

Officers, key employees and non-employee directors of, and consultants to, the Company or any of its subsidiaries and affiliates were eligible to participate in the 2003 Share Incentive Plan.

The 2003 Share Incentive Plan provided for the grant of stock options, stock appreciation rights, stock awards, performance awards and stock units (the 2003 Benefits).

The maximum number of shares of common stock available for issuance under the 2003 Share Incentive Plan was 2,800,000.

The 2003 Share Incentive Plan was administered by the Stock Option Committee through June 2004, from June 2004 through July 2010, by the Board of Directors, from July 2010 through August 2012, by the Stock Option Committee, from August 2012 through November 2012, by the Executive Committee of the Board of Directors, from November 2012 to July 2015, by the Board of Directors and since July 2015 by the Compensation Committee, which determined the option price, term and provisions of the 2003 Benefits.

The 2003 Share Incentive Plan contains provisions for equitable adjustment of the 2003 Benefits in the event of a merger, consolidation, reorganization, recapitalization, stock dividend, stock split, reverse stock split, spinoff, combination of shares, exchange of shares, dividends in kind or other like change in capital structure or distribution (other than normal cash dividends) to stockholders of the Company.

The 2003 Share Incentive Plan terminated with respect to additional grants on April 21, 2013.

(2) On July 14, 2010 the Board adopted the 2010 Share Incentive Plan.

Officers, key employees and non-employee directors of, and consultants to, the Company or any of its subsidiaries and affiliates are eligible to participate in the 2010 Share Incentive Plan.

The 2010 Share Incentive Plan provides for the grant of stock options, stock appreciation rights, stock awards, and performance awards and stock units (the 2010 Benefits).

The maximum number of shares of common stock available for issuance under the 2010 Share Incentive Plan was initially 600,000 shares.

On July 6, 2011 and August 29, 2012, the 2010 Share Incentive Plan was amended by our Board to increase the maximum number of shares of common stock that may be granted to 1,080,000 and 1,200,000 shares, respectively.

On November 8, 2013, the Board approved an amendment to provide that effective and following November 8, 2013, the maximum aggregate number of shares available for issuance will be 800,000 shares.

Additionally, commencing on the first business day in 2014 and on the first business day of each calendar year thereafter, the maximum aggregate number of shares available for issuance shall be replenished such that, as of such first business day, the maximum aggregate number of shares available for issuance shall be 800,000 shares.

Current and future non-employee directors are automatically granted a 10 year nonqualified stock option to purchase 12,000 shares of Common Stock (or 16,000 in the case of the Chairman of the Board) on January 1st of each year that will vest in four equal quarterly installments.

The 2010 Share Incentive Plan was administered by the Stock Option Committee through August 2012, from August 2012 through November 2012, by the Executive Committee of the Board of Directors, from November 2012 through July 2015, by the Board of Directors and since July 2015, by the Compensation Committee, which determines the option price, term and provisions of the 2010 Benefits.

The 2010 Share Incentive Plan terminates with respect to additional grants on July 14, 2020.

The Board may amend, suspend or terminate the 2010 Share Incentive Plan at any time.

(3) The 2018 Share Incentive Plan was adopted by the Board on January 25, 2018 and approved by our shareholders on March 29, 2018.

Officers, key employees and non-employee directors of, and consultants to, the Company or any of its subsidiaries and affiliates are eligible to participate in the 2018 Share Incentive Plan.

The 2018 Share Incentive Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, stock awards, performance awards and stock units (the 2018 Benefits).

The maximum number of shares of common stock available for issuance under the 2018 Share Incentive Plan was initially 5,000,000 shares.

Additionally, commencing on the first business day in January 2019 and on the first business day of each calendar year thereafter, the maximum aggregate number of shares available for issuance shall be replenished such that, as of such first business day, the maximum aggregate number of shares available for issuance shall be 2,000,000 shares.

The 2018 Share Incentive Plan is administered by the Compensation Committee, which determines the option price, term and provisions of the 2018 Benefits.

July 14, 2010 the Board adopted the 2010 Share Incentive Plan.

Officers, key employees and non-employee directors of, and

consultants to, the Company or any of its subsidiaries and affiliates are eligible to participate in the 2010 Share Incentive

The 2010 Share Incentive Plan provides for the grant of stock options, stock appreciation rights, stock awards, and

performance awards and stock units (the “2010 Benefits”).

The maximum number of shares of common stock available

for issuance under the 2010 Share Incentive Plan was initially 600,000 shares.

On July 6, 2011 and August 29, 2012, the 2010

Share Incentive Plan was amended by our Board to increase the maximum number of shares of common stock that may be granted

to 1,080,000 and 1,200,000 shares, respectively.

On November 8, 2013, the Board approved an amendment to provide that effective

and following November 8, 2013, the maximum aggregate number of shares available for issuance will be 800,000 shares.

Additionally,

commencing on the first business day in 2014 and on the first business day of each calendar year thereafter, the maximum aggregate

number of shares available for issuance shall be replenished such that, as of such first business day, the maximum aggregate

number of shares available for issuance shall be 800,000 shares.

Current and future non-employee directors are automatically

granted a 10 year nonqualified stock option to purchase 12,000 shares of Common Stock (or 16,000 in the case of the Chairman

of the Board) on January 1st of each year that will vest in four equal quarterly installments.

The 2010 Share Incentive Plan

was administered by the Stock Option Committee through August 2012, from August 2012 through November 2012, by the Executive

Committee of the Board of Directors, from November 2012 through July 2015, by the Board of Directors and since July 2015,

by the Compensation Committee, which determines the option price, term and provisions of the 2010 Benefits.

The 2010 Share

Incentive Plan terminated with respect to additional grants on July 14, 2020.

2018 Share Incentive Plan was adopted by the Board on January 25, 2018 and approved by our shareholders on March 29, 2018.

Officers, key employees and non-employee directors of, and consultants to, the Company or any of its subsidiaries and affiliates

are eligible to participate in the 2018 Share Incentive Plan.

The 2018 Share Incentive Plan provides for the grant of incentive

stock options, nonqualified stock options, stock appreciation rights, stock awards, performance awards and stock units (the

“2018 Benefits”).

The maximum number of shares of common stock available for issuance under the 2018 Share Incentive

Plan was initially 5,000,000 shares.

Additionally, commencing on the first business day in January 2019 and on the first business

day of each calendar year thereafter, the maximum aggregate number of shares available for issuance shall be replenished such

that, as of such first business day, the maximum aggregate number of shares available for issuance shall be 2,000,000 shares.

The 2018 Share Incentive Plan is administered by the Compensation Committee, which determines the option price, term and provisions

of the 2018 Benefits.

The 2018 Share Incentive Plan terminates with respect to additional grants on March 28, 2028.

The Board may amend, suspend or terminate the 2018 Share Incentive Plan at any time, subject in certain respects to obtaining shareholder approval.

Certain Relationships and Related Transactions, and Director Independence .

Transactions with Related Persons

Aside from compensation arrangements with executive officers described above, there are no other transactions entered into by the Company with related persons.

Related Person Transaction Approval Policy

While we have no written policy regarding approval of transactions between us and a related person, our Board, as matter of appropriate corporate governance, reviews and approves all such transactions, to the extent required by applicable rules and regulations.

Generally, management would present to the Board for approval at the next regularly scheduled Board meeting any related person transactions proposed to be entered into by us.

The Board may approve the transaction if it is deemed to be in the best interests of our stockholders and the Company.

Director Independence

Our Board oversees the activities of our management in the handling of the business and affairs of our company.

Our common stock trades on the NASDAQ Capital Market and we are subject to listing requirements which include the requirement that our Board be comprised of a majority of independent directors.

may amend, suspend or terminate the 2018 Share Incentive Plan at any time, subject in certain respects to obtaining shareholder

Certain Relationships and Related Transactions,

and Director Independence.

with Related Persons

from compensation arrangements with executive officers described above, there are no other transactions entered into by the Company

with related persons.

Person Transaction Approval Policy

we have no written policy regarding approval of transactions between us and a related person, our Board, as matter of appropriate

corporate governance, reviews and approves all such transactions, to the extent required by applicable rules and regulations.

Generally, management would present to the Board for approval at the next regularly scheduled Board meeting any related person

transactions proposed to be entered into by us.

The Board may approve the transaction if it is deemed to be in the best interests

of our stockholders and the Company.

Board oversees the activities of our management in the handling of the business and affairs of our company.

Our common stock trades

on the NASDAQ Capital Market and we are subject to listing requirements which include the requirement that our Board be comprised

of a majority of “independent”

Titterton, Jr., Dr.

Arnold Baskies, David Cavalier, Emily Gottschalk and Dr.

John Monahan currently meet the definition of independent as defined by the SEC.

Amit Kumar is an employee of the Company and as such does not qualify as an independent director.

The Board of Directors has separately designated audit, nominating and compensation committees.

Principal Accounting Fees and Services .

The following table describes fees for professional audit services rendered and billed by Haskell & White LLP, our present independent registered public accounting firm and principal accountant, for the audit of our consolidated financial statements and for other services during fiscal years 2018 and 2017.

Arnold Baskies, David Cavalier, Emily Gottschalk

John Monahan currently meet the definition of “independent”

as defined by the SEC.

Amit Kumar is an employee

of the Company and as such does not qualify as an “independent”

The Board of Directors has separately designated

audit, nominating and compensation committees.

Accounting Fees and Services.

following table describes fees for professional audit services rendered and billed by Haskell & White LLP, our present independent

registered public accounting firm and principal accountant, for the audit of our consolidated financial statements and for other

services during fiscal years 2020 and 2019.

Audit Fees (1)

1 unchanged sentence

All Other Fees (4)

(1) Audit fees for fiscal years 2019 and 2018 represent fees billed for services rendered by Haskell & White LLP for the audit of our consolidated financial statements and review of our quarterly reports on Form 10-Q.

(2) Audit related fees for fiscal years 2019 and 2018 represent fees billed for services rendered by Haskell & White LLP in connection with our Registration Statements filed during fiscal years 2019 and 2018.

(3) Tax Fees for fiscal years 2019 and 2018 represent fees billed for services rendered by Haskell & White LLP for the preparation of Federal and State income tax returns.

(4) All other fees for fiscal years 2019 and 2018 represent fees billed for services rendered by Haskell & White LLP in connection with the preparation of comfort letters and research of various tax subjects.

Procedures For Board of Directors Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditor

Our Board is ultimately responsible for reviewing and approving, in advance, any audit and any permissible non-audit engagement or relationship between us and our independent registered public accounting firm.

On July 9, 2015, the Board established an Audit Committee which was authorized to assume these responsibilities.

Haskell & White LLPs engagement to conduct our fiscal year 2019 audit was approved by our Board on August 8, 2019.

fees for fiscal years 2020 and 2019 represent fees billed for services rendered by Haskell & White LLP for the audit of

our consolidated financial statements and review of our quarterly reports on Form 10-Q.

related fees for fiscal years 2020 and 2019 represent fees billed for services rendered by Haskell & White LLP in connection

with our Registration Statements filed during fiscal years 2020 and 2019.

Fees for fiscal years 2020 and 2019 represent fees billed for services rendered by Haskell & White LLP for the preparation

of Federal and State income tax returns.

other fees for fiscal years 2020 and 2019 represent fees billed for services rendered by Haskell & White LLP in connection

with the preparation of comfort letters and research of various tax subjects.

For Board of Directors Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditor

Board is ultimately responsible for reviewing and approving, in advance, any audit and any permissible non-audit engagement or

relationship between us and our independent registered public accounting firm.

On July 9, 2015, the Board established an Audit

Committee which was authorized to assume these responsibilities.

Haskell & White LLP’s engagement to conduct all

audit and permissible non-audit related activities incurred during fiscal years 2020 and 2019 were approved by our audit committee

in accordance with these procedures.

Exhibits, Financial Statement Schedules.

(a)(1)(2) Financial Statement Schedules

See accompanying Index to Consolidated Financial Statements.

Financial Statement Schedules

accompanying “Index to Consolidated Financial Statements.”

Certificate of Incorporation, as amended.

12 unchanged sentences

(Incorporated by reference to Exhibit 3.1 to our Form 8-K, dated October 1, 2018.)

Certificate of Amendment to the Certificate of Incorporation.

(Incorporated by reference to Exhibit 3.1 to our Form 8-K, dated August 13, 2020.)

Amended and Restated By-laws.

(Filed herewith.)

(Incorporated by reference to Exhibit 3.8 to our Form 10-K for the fiscal year ended October 31, 2019.)

Form of Warrant issued to Adaptive Capital LLC.

(Incorporated by reference to Exhibit 4.2 to our Form 10-K, dated December 7, 2016.).

2003 Share Incentive Plan.

(Incorporated by reference to Exhibit 4 to our Form S-8 dated May 5, 2003.)

Amendment No.

1 to the 2003 Share Incentive Plan.

(Incorporated by reference to Exhibit 4(e) to our Form S-8 dated November 9, 2004.)

Amendment No.

2 to the 2003 Share Incentive Plan.

(Incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2006.)

Amendment No.

3 to the 2003 Share Incentive Plan.

(Incorporated by reference to Exhibit 10.2 to our Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2006.)

Amendment No.

4 to the 2003 Share Incentive Plan.

(Incorporated by reference to Exhibit 4(g) to our Form S-8 dated September 21, 2007.)

Amendment No.

5 to the 2003 Share Incentive Plan.

(Incorporated by reference to Exhibit 4(g) to our Form S-8 dated January 21, 2009.)

Amendment No.

6 to the 2003 Share Incentive Plan.

(Incorporated by reference to Exhibit 10.5 to our Form 8-K, dated July 20, 2010.)

Form of Warrant issued to Acorn Management Partners LLC.

(Filed herewith.).

2010 Share Incentive Plan.

14 unchanged sentences

The redacted portions have been separately filed with the Securities and Exchange Commission.)

Letter Agreement, dated October 17, 2016, between the Company and Mike Catelani.

(Incorporated by reference to Exhibit 10.21 to our Form 10-K, dated December 7, 2016.)

License Agreement, dated November 13, 2017, between Certainty Therapeutics, Inc.

9 unchanged sentences

(Incorporated by reference to Exhibit 10.2 to our Form 10-Q for the fiscal quarter ended July 31, 2019.)

Amendment 2 to the Collaboration Agreement between Certainty Therapeutics, Inc.

Lee Moffitt Cancer Center and Research Institute, Inc.

(Filed herewith.) (Certain information has been redacted in the marked portions of the exhibit.)

Exclusive License Agreement, dated July 8, 2019, between the Company and The Cleveland Clinic Foundation.

(Incorporated by reference to Exhibit 10.1 to our Form 10-Q for the fiscal quarter ended July 31, 2019.) (Certain information has been redacted in the marked portions of the exhibit.)

Collaboration Agreement, dated April 14, 2020, between the Company and OntoChem GmbH.

(Incorporated by reference to Exhibit 10.1 to our Form 10-Q for the fiscal quarter ended April 30, 2020.) (Certain information has been redacted in the marked portions of the exhibit.)

Amendement to Collaboration Agreement between the Company and OntoChem GmbH.

(Filed herewith.)

Exclusive License Agreement, dated October 20, 2020, between the Company and The Cleveland Clinic Foundation.

(Filed herewith.) (Certain information has been redacted in the marked portions of the exhibit.)

At Market Issuance Sales Agreement, dated June 21, 2019, between the Company and B.

1 unchanged sentence

(Incorporated by reference to Exhibit 10.1 to our Registration Statement of Form S-3 filed June 11, 2019.)

Code of Conduct (Filed herewith.)

Subsidiaries of Anixa Biosciences, Inc.

2 unchanged sentences

(Filed herewith.)

Certification of Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 9, 2020.

(Filed herewith.)

Certification of Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 9, 2020.

(Filed herewith.)

Statement of Chief Executive Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 9, 2020.

Certification

of Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 7, 2021.

Certification

of Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 7, 2021.

of Chief Executive Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 7, 2021.

(Filed herewith.)

Statement of Chief Financial Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 9, 2020.

of Chief Financial Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 7, 2021.

(Filed herewith.)

Pursuant to the requirements of Section 13 or 15(d) 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.

Anixa Biosciences, Inc.

/s/ Amit Kumar

Chairman of the Board, President and

January 9, 2020

Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.

Form 10-K Summary.

The Company has elected

not to include a summary pursuant to this Item 16.

to the requirements of Section 13 or 15(d) 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.

Biosciences, Inc.

of the Board, President and

Executive Officer

to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf

of the registrant and in the capacities and on the date indicated.

/s/ Amit Kumar

Chairman of the Board, President and

Chief Executive Officer

of the Board, President and

Executive Officer

January 7, 2021

(Principal Executive Officer)

/s/ Michael J.

Chief Operating Officer and

Chief Financial Officer

(Principal Financial

January 9, 2020

and Accounting Officer)

Operating Officer and

Financial Officer

Financial and Accounting Officer)

Titterton, Jr.

January 9, 2020

/s/ Arnold Baskies

Arnold Baskies

January 9, 2020

/s/ David Cavalier

Arnold Baskies

David Cavalier

January 9, 2020

/s/ Emily Gottschalk

Emily Gottschalk

January 9, 2020

/s/ John Monahan

January 9, 2020

ANIXA BIOSCIENCES, INC.

BIOSCIENCES, INC.

AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

OCTOBER 31, 2020

5 unchanged sentences

Notes to Consolidated Financial Statements

Additional information required by schedules called for under Regulation S-X is either not applicable or is included in the consolidated financial statements or notes thereto.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders

Anixa Biosciences, Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Anixa Biosciences, Inc.

(the Company) as of October 31, 2019 and 2018, and the related consolidated statements of operations, equity, and cash flows for each of the two years in the period ended October 31, 2019, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of October 31, 2019 and 2018, and the consolidated results of its operations and its cash flows for each of the two years in the period ended October 31, 2019, in conformity with accounting principles generally accepted in the United States.

Basis for Opinion

The consolidated financial statements are the responsibility of the Companys management.

Our responsibility is to express an opinion on the Companys consolidated financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated 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.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control over financial reporting.

information required by schedules called for under Regulation S-X is either not applicable or is included in the consolidated

financial statements or notes thereto.

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

the Board of Directors and Shareholders

Biosciences, Inc.

on the Consolidated Financial Statements

have audited the accompanying consolidated balance sheets of Anixa Biosciences, Inc.

(the “Company”)

as of October 31, 2020 and 2019, and the related consolidated statements of operations, shareholders’

cash flows for each of the two years in the period ended October 31, 2020, and the related notes (collectively, the “consolidated

financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects,

the consolidated financial position of the Company as of October 31, 2020 and 2019, and the consolidated results of its operations

and its cash flows for each of the two years in the period ended October 31, 2020, in conformity with accounting principles generally

accepted in the United States.

consolidated financial statements are the responsibility of

the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements

based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States)

(“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities

laws and the applicable rules and regulations of the Securities Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits

to obtain reasonable assurance about whether the consolidated 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.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting

but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether

due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis,

evidence supporting the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating

the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of

the consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

/s/ Haskell & White LLP

Haskell & White LLP

We have served as the Companys auditor since 2013.

Irvine, California

have served as the Company’s auditor since 2013.

January 7, 2021

ANIXA BIOSCIENCES, INC.

BIOSCIENCES, INC.

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

BALANCE SHEETS

and cash equivalents

Short–term

investments in certificates of deposit

expenses and other current assets

current assets

Cash and cash equivalents

Shortterm investments in certificates of deposit

Prepaid expenses and other current assets

Total current assets

Patents, net of impairment of $1,001,729 and $582,979, respectively, and

accumulated amortization of $2,034,381 and $1,615,632, respectively

Property and equipment, net of accumulated depreciation of $95,015 and $53,799,

LIABILITIES AND EQUITY

and equipment, net of accumulated depreciation of $-0- and $95,015, respectively

lease right-of-use asset

lease liability

current liabilities

Accounts payable

Accrued expenses

Total current liabilities

Commitments and contingencies (Note 5)

Shareholders equity:

Preferred stock, par value $100 per share;

and contingencies (Note 6)

Shareholders’

stock, par value $100 per share;

19,860 shares authorized;

issued or outstanding

Series A convertible preferred stock, par value $100 per share;

no shares issued or outstanding

Common stock, par value $.01 per share;

48,000,000 shares

20,331,754 and 18,908,632 shares issued and

outstanding, respectively

Additional paid-in capital

Accumulated deficit

A convertible preferred stock, par value $100 per share;

140 shares authorized;

no shares issued or outstanding

stock, par value $.01 per share;

100,000,000 and 48,000,000

shares authorized, respectively;

24,248,695 and 20,331,754

shares issued and outstanding, respectively

paid-in capital

(191,835,618 )

(181,817,263 )

Total shareholders equity

Noncontrolling interest (Note 2)

Total liabilities and equity

The accompanying notes are an integral part of these statements.

ANIXA BIOSCIENCES, INC.

shareholders’

Noncontrolling

interest (Note 2)

liabilities and equity

accompanying notes are an integral part of these statements.

BIOSCIENCES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

For the years ended October 31,

Operating costs and expenses:

Inventor royalties, contingent legal fees, litigation and licensing expenses

Amortization of patents

Research and development expenses (including non-cash share based

compensation expenses of $2,825,630 and $4,596,866, respectively)

General and administrative expenses (including non-cash share based

STATEMENTS OF OPERATIONS

the years ended October 31,

costs and expenses:

royalties, contingent legal fees, litigation and licensing expenses

and development expenses (including non-cash share based

compensation expenses of $1,484,545 and $2,825,630, respectively)

Impairment in carrying amount of patent assets (Note 2)

Total operating costs and expenses

Loss from operations

Interest income

Loss before income taxes

Provision for income taxes (Note 6)

and administrative expenses (including non-cash share based

compensation expenses of $2,652,915 and $2,888,115,

respectively)

in carrying amount of patent assets (Note 2)

operating costs and expenses

from operations

(11,890,005 )

on disposal of property and equipment

(10,092,363 )

(11,818,652 )

Net loss attributable to noncontrolling interest

Net loss attributable to common stockholders

Net loss per share:

Basic and diluted

Weighted average common shares outstanding:

Basic and diluted

The accompanying notes are an integral part of these statements.

ANIXA BIOSCIENCES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY

FOR THE YEARS ENDED OCTOBER 31, 2019 and 2018

BALANCE, October 31, 2017

loss attributable to common stockholders

$ (10,018,355 )

Stock option compensation to employees and directors

Stock options and warrants issued to consultants

Common stock issued upon exercise of stock options

Restricted stock award compensation to employee

pursuant to stock incentive plan

Common stock issued to consultants

Common stock issued in at-the-market offering

Issuance of noncontrolling interest in Certainty

Therapeutics, Inc.

BALANCE, October 31, 2018

$ (11,647,054 )

Stock option compensation to employees and

Stock options and warrants issued to consultants

Common stock issued upon exercise of stock options

ANIXA BIOSCIENCES, INC.

loss per share:

average common shares outstanding:

accompanying notes are an integral part of these statements.

BIOSCIENCES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY

FOR THE YEARS ENDED OCTOBER 31, 2019 and 2018

Restricted stock award compensation to

employee pursuant to stock incentive plan

Common stock issued pursuant to employee

stock purchase plan

Common stock issued in at-the-market offering

Shareholder derivative complaint settlement

BALANCE, October 31, 2019

STATEMENTS OF EQUITY

THE YEARS ENDED OCTOBER 31, 2020 and 2019

October 31, 2018

$ 175,415,931

The accompanying notes are an integral part of this statement.

ANIXA BIOSCIENCES, INC.

$ (170,170,209 )

option compensation to employees and directors

options and warrants issued to consultants

stock issued upon exercise of stock options

stock award compensation to employee pursuant to stock incentive plan

stock issued pursuant to employee stock purchase plan

stock issued in at-the-market offering

derivative complaint settlement

(11,647,054 )

October 31, 2019

$ 186,849,299

$ (181,817,263 )

option compensation to employees and directors

options issued to consultants

stock issued upon exercise of stock options

stock issued pursuant to employee stock purchase plan

stock issued in at-the-market offering

(10,018,355 )

October 31, 2020

$ 200,354,488

$ (191,835,618 )

accompanying notes are an integral part of these statements.

BIOSCIENCES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

STATEMENTS OF CASH FLOWS

For the years ended October 31,

1 unchanged sentence

Reconciliation of net loss to net cash used in operating activities:

$ (10,092,363 )

$ (11,818,652 )

Stock option compensation to employees and directors

1 unchanged sentence

Restricted stock award compensation to employee pursuant to stock incentive plan

Common stock issued to consultants

Amortization of patents

Depreciation of property and equipment

Loss on disposal of property and equipment

Amortization of operating lease right-of-use asset

Impairment in carrying amount of patent assets

Issuance of noncontrolling interest in Certainty Therapeutics, Inc.

expensed as a

Change in operating assets and liabilities:

2 unchanged sentences

Accrued expenses

Operating lease liability

Net cash used in operating activities

3 unchanged sentences

Purchase of property and equipment

Net cash (used in) provided by investing activities

Net cash used in investing activities

Cash flows from financing activities:

4 unchanged sentences

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of year

6 unchanged sentences

Note receivable issued for settlement of shareholder derivative complaint

The accompanying notes are an integral part of these statements.

ANIXA BIOSCIENCES, INC.

accompanying notes are an integral part of these statements.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

BUSINESS AND FUNDING

Description of Business

As used herein, we, us, our, the Company or Anixa means Anixa Biosciences, Inc.

used herein, “we,”

“us,”

“our,”

the “Company”

or “Anixa”

Biosciences, Inc.

and its consolidated subsidiaries.

Our primary operations involve research and development of cancer therapeutics and diagnostics.

Our cancer therapeutics programs consist of development of a vaccine against triple negative breast cancer (TNBC) and development of chimeric endocrine receptor T-cell (CER-T) technology, a novel form of CAR-T technology, initially focused on treating ovarian cancer.

Our cancer diagnostics program consists of development of the artificial intelligence (AI) driven Cchek liquid biopsy platform for early cancer detection.

We hold an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by The Cleveland Clinic Foundation (Cleveland Clinic) related to certain breast cancer vaccine technology developed at Cleveland Clinic.

We are working in collaboration with Cleveland Clinic to develop a method to vaccinate women against contracting breast cancer, focused specifically on TNBC, the most lethal form of the disease.

A specific protein, alpha-lactalbumin, has been identified that is only present during lactation in healthy women, but reappears in many forms of breast cancer, especially TNBC.

Studies have shown that vaccinating against this protein prevents breast cancer in mice.

We are working with researchers at Cleveland Clinic to advance this vaccine toward human clinical testing, and are completing the activities necessary to submit an Investigational New Drug (IND) application with the U.S.

Food and Drug Administration (FDA).

Our subsidiary, Certainty Therapeutics, Inc.

(Certainty), is developing immuno-therapy drugs against cancer.

Certainty holds an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by The Wistar Institute (Wistar) relating to Wistars CER-T technology.

We have initially focused on the development of a treatment for ovarian cancer, but we may also pursue applications of the technology for the development of treatments for additional solid tumors.

Our primary operations involve developing therapies and vaccines that are

focused on critical unmet needs in oncology and infectious disease.

Our therapeutics programs include the development of a chimeric

endocrine receptor T-cell technology, a novel form of CAR-T technology, initially focused on treating ovarian cancer, and the

discovery and ultimately development of anti-viral drug candidates for the treatment of COVID-19 focused on inhibiting certain

viral protein functions of the virus.

Our vaccine programs include the development of a vaccine against triple negative breast

cancer (“TNBC”), the most lethal form of breast cancer, and a vaccine against ovarian cancer.

subsidiary, Certainty Therapeutics, Inc.

(“Certainty”), is developing immuno-therapy drugs against cancer.

holds an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by The Wistar Institute

(“Wistar”) relating to Wistar’s CAR-T technology.

We have initially focused on the development of a treatment

for ovarian cancer, but we may also pursue applications of the technology for the development of treatments for additional solid

The license agreement requires Certainty to make certain cash and equity payments to Wistar.

With respect to Certaintys equity obligations to Wistar, Certainty issued to Wistar shares of its common stock equal to five percent (5%) of the common stock of Certainty.

With respect to Certainty’s

equity obligations to Wistar, Certainty issued to Wistar shares of its common stock equal to five percent (5%) of the common stock

of Certainty.

Certainty, in collaboration with the H.

Lee Moffitt Cancer Center and Research Institute, Inc.

(Moffitt), is advancing toward human clinical testing its CER-T technology for treating ovarian cancer.

Certainty is working with researchers at Moffitt to complete studies necessary to submit an IND application with the FDA.

Our subsidiary, Anixa Diagnostics Corporation (Anixa Diagnostics), is developing Cchek, an AI driven platform of non-invasive blood tests for the early detection of cancer which is based on the bodys immune response to the presence of a malignancy.

We have demonstrated the efficacy of Cchek with 20 different types of cancer:

breast, lung, colon, melanoma, ovarian, liver, thyroid, pancreatic, appendiceal, uterine, osteosarcoma, leiomyosarcoma, liposarcoma, vulvar, prostate, bladder, cervical, head and neck, gastric and testicular cancers.

Breast, lung, colon and prostate cancers represent the four largest categories of cancer worldwide.

ANIXA BIOSCIENCES, INC.

(“Moffitt”),

is advancing toward human clinical testing its CAR-T technology for treating ovarian cancer.

April 2020, in collaboration with OntoChem GmbH (“OntoChem”), we commenced a project to discover and ultimately develop

anti-viral drug candidates against COVID-19.

Through this collaboration, we utilized advanced computational methods, machine learning,

and molecular modeling techniques to perform in silico screening of over 1.2 billion compounds in chemical libraries (including

publicly available compounds and OntoChem’s proprietary libraries) to evaluate if any of these compounds could disrupt one

of two key enzymes of SARS-CoV-2, the virus that causes the disease COVID-19.

We are working with researchers at OntoChem and

other collaboration partners to advance the compounds discovered through this screening process toward human clinical testing.

hold an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by The Cleveland

Clinic Foundation (“Cleveland Clinic”) relating to certain breast cancer vaccine technology developed at Cleveland

We are working in collaboration with Cleveland Clinic to develop a method to vaccinate women against contracting breast

cancer, focused specifically on TNBC.

A specific protein, alpha-lactalbumin, has been identified that is only present during lactation

in healthy women, but reappears in many forms of breast cancer, especially TNBC.

Studies have shown that vaccinating against this

protein prevents breast cancer in mice.

We are working with researchers and clinicians at Cleveland Clinic to prepare for treatment

of patients in a Phase 1a clinical trial.

November 2020, we executed a license agreement with Cleveland Clinic pursuant to which the Company was granted an exclusive worldwide,

royalty-bearing license to use certain intellectual property owned or controlled by Cleveland Clinic relating to certain ovarian

cancer vaccine technology.

This technology pertains to the use of vaccines for the treatment or prevention of ovarian cancers

which express the extracellular domain of anti-Mullerian hormone receptor II (“AMHR2-ED”).

In healthy tissue, this

protein regulates growth and development of egg-containing follicles in the ovary.

While expression of AMHR2-ED naturally and

markedly declines after menopause, AMHR2-ED is expressed at high levels in the ovaries of postmenopausal women with ovarian cancer.

Researchers at Cleveland Clinic believe that a vaccination targeting AMHR2-ED could prevent the occurrence of ovarian cancer.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Based on a number of factors, including key scientific, clinical, and commercial considerations, for the past year the primary commercial focus for Cchek has been on developing a prostate cancer confirmatory test.

In February 2019 we formed a strategic alliance with ResearchDx, a CLIA certified, CAP Accredited laboratory, to prepare the Cchek Prostate Cancer Confirmation (Cchek PCC) test for launch as a laboratory developed test.

In December 2019, upon completion of independent validation by ResearchDx, we announced the commercial launch of Cchek PCC.

We are currently conducting a number of activities to support the marketing of Cchek PCC, including the development of marketing materials, education of key opinion leaders in urology and development of a reimbursement path for the test.

We expect Cchek PCC to be broadly available throughout the U.S.

by April 2020.

Over the next several quarters, we expect the development of our breast cancer vaccine, Certaintys CER-T technology and Anixa Diagnostics Cchek to be the primary focus of the Company.

As part of our legacy operations, the Company remains engaged in limited patent licensing activities in the area of encrypted audio/video conference calling.

We do not expect these activities to be a significant part of the Companys ongoing operations nor do we expect these activities to require material financial resources or attention of senior management.

Over the past several years, our revenue was derived from technology licensing and the sale of patented technologies, including revenue from the settlement of litigation.

We have not generated any revenue to date from our cancer therapeutics and diagnostics programs.

In addition, while we pursue our cancer therapeutics and diagnostics programs, we may also make investments in and form new companies to develop additional emerging technologies.

Based on currently available information as of January 9, 2020, we believe that our existing cash, cash equivalents, short-term investments and expected cash flows will be sufficient to fund our activities for the next twelve months.

We have implemented a business model that conserves funds by collaborating with third parties to develop our technologies.

However, our projections of future cash needs and cash flows may differ from actual results.

If current cash on hand, cash equivalents, short term investments and cash that may be generated from our business operations are insufficient to continue to operate our business, or if we elect to invest in or acquire a company or companies or new technology or technologies that are synergistic with or complementary to our technologies, we may be required to obtain more working capital.

During fiscal year 2019, we raised approximately $5,527,000 through an at-the-market equity offering of 1,363,872 shares of common stock (as of October 31, 2019 an additional 112,238 shares were available for sale under our 2018 at-the-market equity program, which shares were sold in November 2019).

Further, we have an additional at-the-market equity offering under which we may issue up to $50 million of common stock, which has been effective since June 2019 and under which we commenced selling shares in November 2019, and which may remain available to us in the future.

We may seek to obtain working capital during our fiscal year 2020 or thereafter through sales of our equity securities or through bank credit facilities or public or private debt from various financial institutions where possible.

We cannot be certain that additional funding will be available on acceptable terms, or at all.

If we do identify sources for additional funding, the sale of additional equity securities or convertible debt could result in dilution to our stockholders.

We can give no assurance that we will generate sufficient cash flows in the future to satisfy our liquidity requirements or sustain future operations, or that other sources of funding, such as sales of equity or debt, would be available or would be approved by our security holders, if needed, on favorable terms or at all.

If we fail to obtain additional working capital as and when needed, such failure could have a material adverse impact on our business, results of operations and financial condition.

Furthermore, such lack of funds may inhibit our ability to respond to competitive pressures or unanticipated capital needs, or may force us to reduce operating expenses, which would significantly harm the business and development of operations.

ANIXA BIOSCIENCES, INC.

TO CONSOLIDATED FINANCIAL STATEMENTS

July 2, 2020, we implemented a strategic realignment of our business and redirected resources to exclusively focus on the development

of therapeutics and vaccines.

Accordingly, we suspended operations of our subsidiary, Anixa Diagnostics Corporation, and the development

of the Cchek™

artificial intelligence driven platform of non-invasive blood tests for the early detection of cancer.

the next several quarters, we expect the development of our breast and ovarian cancer vaccines, our COVID-19 therapeutic discovery

program and Certainty’s CAR-T technology to be the primary focus of the Company.

As part of our legacy operations, the Company

remains engaged in limited patent licensing activities regarding the Cchek™

liquid biopsy platform, as well as in the area

of encrypted audio/video conference calling.

We do not expect these activities to be a significant part of the Company’s

ongoing operations nor do we expect these activities to require material financial resources or attention of senior management.

the past several years, our revenue was derived from technology licensing and the sale of patented technologies, including revenue

from the settlement of litigation.

We have not generated any revenue to date from our therapeutics or vaccine programs.

while we pursue our therapeutics and vaccine programs, we may also make investments in and form new companies to develop additional

emerging technologies.

We do not expect to begin generating revenue with respect to any of our current therapy or vaccine programs

in the near term.

We hope to achieve a profitable outcome by eventually licensing our technologies to large pharmaceutical companies

that have the resources and infrastructure in place to manufacture, market and sell our technologies as therapeutics or vaccines.

The eventual licensing of any of our technologies may take several years, and may depend on positive results from human clinical

on currently available information as of January 7, 2021, we believe that our existing cash, cash equivalents, short-term

investments and expected cash flows will be sufficient to fund our activities for the next twelve months.

We have implemented

a business model that conserves funds by collaborating with third parties to develop our technologies.

However, our projections

of future cash needs and cash flows may differ from actual results.

If current cash on hand, cash equivalents, short term investments

and cash that may be generated from our business operations are insufficient to continue to operate our business, or if we elect

to invest in or acquire a company or companies or new technology or technologies that are synergistic with or complementary to

our technologies, we may be required to obtain more working capital.

During fiscal year 2020, we raised approximately $9,266,000,

net of expenses, through at-the-market equity offerings of 3,854,305 shares of common stock.

This included approximately $427,000,

net of expenses, through the sale of 112,238 shares of common stock in an at-the market equity offering which expired in November

2019 and approximately $8,839,000, net of expenses, through the sale of 3,742,067 shares of common stock in an at-the-market equity

offering under which we may issue up to $50 million of common stock.

Under our current at-the-market equity program which is currently

effective and may remain available for us to use in the future, we may sell an additional approximately $40,811,000 of common

We may seek to obtain working capital during our fiscal year 2021 or thereafter through sales of our equity securities

or through bank credit facilities or public or private debt from various financial institutions where possible.

We cannot be certain

that additional funding will be available on acceptable terms, or at all.

If we do identify sources for additional funding, the

sale of additional equity securities or convertible debt could result in dilution to our stockholders.

We can give no assurance

that we will generate sufficient cash flows in the future to satisfy our liquidity requirements or sustain future operations,

or that other sources of funding, such as sales of equity or debt, would be available or would be approved by our security holders,

if needed, on favorable terms or at all.

If we fail to obtain additional working capital as and when needed, such failure could

have a material adverse impact on our business, results of operations and financial condition.

Furthermore, such lack of funds

may inhibit our ability to respond to competitive pressures or unanticipated capital needs, or may force us to reduce operating

expenses, which would significantly harm the business and development of operations.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements include the accounts of Anixa Biosciences, Inc.

of Presentation

consolidated financial statements include the accounts of Anixa Biosciences, Inc.

and its wholly and majority owned subsidiaries.

All intercompany transactions have been eliminated.

Noncontrolling Interest

Noncontrolling interest represents Wistars equity ownership in Certainty and is presented as a component of equity.

The following table sets forth the changes in noncontrolling interest for the two years ended October 31, 2019:

Noncontrolling

interest represents Wistar’s equity ownership in Certainty and is presented as a component of equity.

The following table

sets forth the changes in noncontrolling interest for the two years ended October 31, 2020:

Balance October 31, 2018

Issuance of noncontrolling interest in Certainty

Net loss attributable to noncontrolling interest

2 unchanged sentences

Balance October 31, 2020

Revenue Recognition

Since fiscal 2016 our revenue has been derived solely from technology licensing and the sale of patented technologies.

Revenue is recognized upon transfer of control of intellectual property rights and satisfaction of other contractual performance obligations to licensees in an amount that reflects the consideration we expect to receive.

On November 1, 2018 we adopted Accounting Standards Update 2014-09 (ASU 2014-09), Revenue from Contracts with Customers using the modified retrospective method.

Upon adoption of ASU 2014-09 we are required to make certain judgments and estimates in connection with the accounting for revenue.

Such areas may include determining the existence of a contract and identifying each partys rights and obligations to transfer goods and services, identifying the performance obligations in the contract, determining the transaction price and allocating the transaction price to separate performance obligations, estimating the timing of satisfaction of performance obligations, determining whether a promise to grant a license is distinct from other promised goods or services and evaluating whether a license transfers to a customer at a point in time or over time.

Our revenue arrangements provide for the payment of contractually determined, one-time, paid-up license fees in settlement of litigation and in consideration for the grant of certain intellectual property rights for patented technologies owned or controlled by the Company.

fiscal 2016 our revenue has been derived solely from technology licensing and the sale of patented technologies.

Revenue is recognized

upon transfer of control of intellectual property rights and satisfaction of other contractual performance obligations to licensees

in an amount that reflects the consideration we expect to receive.

November 1, 2018 we adopted Accounting Standards Update 2014-09 (“ASU 2014-09”), “Revenue from Contracts with

Customers”

using the modified retrospective method.

Upon adoption of ASU 2014-09 we are required to make certain judgments

and estimates in connection with the accounting for revenue.

Such areas may include determining the existence of a contract and

identifying each party’s rights and obligations to transfer goods and services, identifying the performance obligations

in the contract, determining the transaction price and allocating the transaction price to separate performance obligations, estimating

the timing of satisfaction of performance obligations, determining whether a promise to grant a license is distinct from other

promised goods or services and evaluating whether a license transfers to a customer at a point in time or over time.

revenue arrangements provide for the payment of contractually determined, one-time, paid-up license fees in settlement of litigation

and in consideration for the grant of certain intellectual property rights for patented technologies owned or controlled by the

These arrangements typically include some combination of the following:

(i) the grant of a non-exclusive, retroactive and future license to manufacture and/or sell products covered by patented technologies owned or controlled by the Company, (ii) a covenant-not-to-sue, (iii) the release of the licensee from certain claims, and (iv) the dismissal of any pending litigation.

In such instances, the intellectual property rights granted have been perpetual in nature, extending until the expiration of the related patents.

Pursuant to the terms of these agreements, we have no further obligations with respect to the granted intellectual property rights, including no obligation to maintain or upgrade the technology, or provide future support or services.

Licensees obtained control of the intellectual property rights they have acquired upon execution of the agreement.

Accordingly, the performance obligations from these agreements were satisfied and 100% of the revenue was recognized upon the execution of the agreements.

The adoption of ASU 2014-09 had no impact on revenue recognized.

ANIXA BIOSCIENCES, INC.

(i) the grant of a non-exclusive, retroactive

and future license to manufacture and/or sell products covered by patented technologies owned or controlled by the Company, (ii)

a covenant-not-to-sue, (iii) the release of the licensee from certain claims, and (iv) the dismissal of any pending litigation.

In such instances, the intellectual property rights granted have been perpetual in nature, extending until the expiration of the

related patents.

Pursuant to the terms of these agreements, we have no further obligations with respect to the granted intellectual

property rights, including no obligation to maintain or upgrade the technology, or provide future support or services.

obtained control of the intellectual property rights they have acquired upon execution of the agreement.

Accordingly, the performance

obligations from these agreements were satisfied and 100% of the revenue was recognized upon the execution of the agreements.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Cost of Revenues

Cost of revenues include the costs and expenses incurred in connection with our patent licensing and enforcement activities, including inventor royalties paid to original patent owners, contingent legal fees paid to external counsel, other patent-related legal expenses paid to external counsel, licensing and enforcement related research, consulting and other expenses paid to third-parties and the amortization of patent-related investment costs.

These costs are included under the caption Operating costs and expenses in the accompanying consolidated statements of operations.

Research and Development Expenses

Research and development expenses, consisting primarily of employee compensation, payments to third parties for research and development activities and other direct costs associated with developing a platform for non-invasive blood tests for early detection of cancer, developing immuno-therapy drugs against cancer and development of our breast cancer vaccine, are expensed in the consolidated financial statements in the year incurred.

Fair Value Measurements

Accounting Standards Codification (ASC) 820 Fair Value Measurements and Disclosures (ASC 820) defines fair value, establishes a framework for measuring fair value under GAAP, and expands disclosures about fair value measurements.

In accordance with ASC 820, we have categorized our financial assets and liabilities, based on the priority of the inputs to the valuation technique, into a three-level fair value hierarchy as set forth below.

If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

Financial assets and liabilities recorded in the accompanying consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:

Level 1 Financial instruments whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market which we have the ability to access at the measurement date.

Level 2 Financial instruments whose values are based on quoted market prices in markets where trading occurs infrequently or whose values are based on quoted prices of instruments with similar attributes in active markets.

ANIXA BIOSCIENCES, INC.

TO CONSOLIDATED FINANCIAL STATEMENTS

of revenues include the costs and expenses incurred in connection with our patent licensing and enforcement activities, including

inventor royalties paid to original patent owners, contingent legal fees paid to external counsel, other patent-related legal

expenses paid to external counsel, licensing and enforcement related research, consulting and other expenses paid to third-parties

and the amortization of patent-related investment costs.

These costs are included under the caption “Operating costs and

expenses”

in the accompanying consolidated statements of operations.

and Development Expenses

and development expenses, consisting primarily of employee compensation, payments to third parties for research and development

activities and other direct costs associated with developing a platform for non-invasive blood tests for early detection of cancer,

developing immuno-therapy drugs against cancer, development of our breast cancer vaccine, development of our ovarian cancer vaccine

and development of anti-viral drug candidates for COVID-19, are expensed in the consolidated financial statements in the year

Value Measurements

Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures”

(“ASC 820”) defines

fair value, establishes a framework for measuring fair value under U.S.

generally accepted accounting principles (GAAP), and expands

disclosures about fair value measurements.

In accordance with ASC 820, we have categorized our financial assets and liabilities,

based on the priority of the inputs to the valuation technique, into a three-level fair value hierarchy as set forth below.

the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based

on the lowest level input that is significant to the fair value measurement of the instrument.

assets and liabilities recorded in the accompanying consolidated balance sheets are categorized based on the inputs to the valuation

techniques as follows:

Financial instruments whose values are based on unadjusted quoted prices for identical assets or liabilities in an active

market which we have the ability to access at the measurement date.

Financial instruments whose values are based on quoted market prices in markets where trading occurs infrequently or

whose values are based on quoted prices of instruments with similar attributes in active markets.

Financial instruments whose values are based on prices or valuation techniques that require inputs that are both unobservable

and significant to the overall fair value measurement.

These inputs reflect management’s own assumptions about the assumptions

a market participant would use in pricing the instrument.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Level 3 Financial instruments whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.

These inputs reflect managements own assumptions about the assumptions a market participant would use in pricing the instrument.

The following table presents the hierarchy for our financial assets measured at fair value on a recurring basis as of October 31, 2019:

TO CONSOLIDATED FINANCIAL STATEMENTS

following table presents the hierarchy for our financial assets measured at fair value on a recurring basis as of October 31,

Money market funds:

4 unchanged sentences

Total financial assets

The following table presents the hierarchy for our financial assets measured at fair value on a recurring basis as of October 31, 2018:

following table presents the hierarchy for our financial assets measured at fair value on a recurring basis as of October 31,

Money market funds:

4 unchanged sentences

Total financial assets

Our non-financial assets that are measured on a non-recurring basis include our patents and property and equipment which are measured using fair value techniques whenever events or changes in circumstances indicate a condition of impairment exists.

The estimated fair value of prepaid expenses, accounts payable and accrued expenses approximates their individual carrying amounts due to the short-term nature of these measurements.

Cash and Cash Equivalents

Cash equivalents consists of highly liquid, short-term investments with original maturities of three months or less when purchased.

Short-term Investments

At October 31, 2019 and 2018, we had certificates of deposit with maturities greater than 90 days and less than 12 months when acquired of $2,350,000 and $2,000,000, respectively, that were classified as short-term investments and reported at fair value.

ANIXA BIOSCIENCES, INC.

non-financial assets that are measured on a non-recurring basis include our property and equipment which are measured using fair

value techniques whenever events or changes in circumstances indicate a condition of impairment exists.

The estimated fair value

of accounts receivable, prepaid expenses, accounts payable and accrued expenses approximates their individual carrying amounts

due to the short-term nature of these measurements.

Cash and cash equivalents are stated at carrying value which approximates

and Cash Equivalents

equivalents consists of highly liquid, short-term investments with original maturities of three months or less when purchased.

October 31, 2020 and 2019, we had certificates of deposit with maturities greater than 90 days and less than 12 months when acquired

of $2,640,000 and $2,350,000, respectively, that were classified as short-term investments and reported at fair value.

only identifiable intangible assets are patents and patent rights.

We capitalize patent and patent rights acquisition costs and

amortize the cost over the estimated economic useful life.

No patent acquisition costs were capitalized during the years ended

October 31, 2020 and 2019.

We recorded patent amortization expense of $-0- and approximately $419,000, respectively, during the

years ended October 31, 2020 and 2019.

evaluating the carrying amount of capitalized patents at January 31, 2019, we determined that a write-down of the carrying amount

of approximately $419,000, to a carrying value of approximately $168,000, should be recorded as of January 31, 2019.

The write-down

was based on estimated undiscounted future cash flows of the capitalized patents compared to the carrying value.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Our only identifiable intangible assets are patents and patent rights.

We capitalize patent and patent rights acquisition costs and amortize the cost over the estimated economic useful life.

No patent acquisition costs were capitalized during the years ended October 31, 2019 and 2018.

We recorded patent amortization expense of approximately $419,000 and $325,000, respectively, during the years ended October 31, 2019 and 2018.

In evaluating the carrying amount of capitalized patents at October 31, 2018, we determined that a write-down of the carrying amount of approximately $583,000, to a carrying value of approximately $838,000, should be recorded as of October 31, 2018.

In evaluating the carrying amount of capitalized patents at January 31, 2019, we determined that a write-down of the carrying amount of approximately $419,000, to a carrying value of approximately $168,000, should be recorded as of January 31, 2019.

The write-downs were based on estimated undiscounted future cash flows of the capitalized patents compared to the carrying value.

Our estimates of future cash flows were based on our most recent assessment of the market for potential licensees, as well as the status of ongoing negotiations with potential licensees.

While we may be able to generate future cash flows from this patent portfolio, as of October 31, 2019, we cannot reasonably determine an estimate of any such future cash flows.

The carrying value of capitalized patents has been amortized to $-0- as of October 31, 2019.

Property and equipment

We capitalize computers and test equipment used in our cancer diagnostics and therapeutics programs and charge depreciation on a straight-line basis over 60 months.

Equipment purchases during the years ended October 31, 2019 and 2018 were approximately $175,000 and $38,000, respectively.

We recorded depreciation expense of approximately $48,000 and 18,000, respectively, during the years ended October 31, 2019 and 2018.

We recognize deferred tax assets and liabilities for the estimated future tax effects of events that have been recognized in our financial statements or tax returns.

Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse.

A valuation allowance is established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

Stock-Based Compensation

We maintain stock equity incentive plans under which we may grant non-qualified stock options, incentive stock options, stock appreciation rights, stock awards, performance and performance-based awards, or stock units to employees, non-employee directors and consultants.

Stock Option Compensation Expense

We account for stock options granted to employees and directors using the accounting guidance in ASC 718 Stock Compensation (ASC 718).

In accordance with ASC 718, we estimate the fair value of service-based options on the date of grant, using the Black-Scholes pricing model.

We recognize compensation expense for stock option awards over the requisite or implied service period of the grant.

We recorded stock-based compensation expense, related to service-based stock options granted to employees and directors, of approximately $3,185,000 and $1,959,000, during the years ended October 31, 2019 and 2018, respectively.

ANIXA BIOSCIENCES, INC.

TO CONSOLIDATED FINANCIAL STATEMENTS

estimates of future cash flows was based on our most recent assessment of the market for potential licensees, as well as the status

of ongoing negotiations with potential licensees.

While we may be able to generate future cash flows from this patent portfolio,

as of October 31, 2020 and 2019, we could not reasonably determine an estimate of any such future cash flows.

The carrying value

of capitalized patents is $-0- as of October 31, 2020 and 2019.

and equipment

capitalized computers and test equipment used in our cancer diagnostics and therapeutics programs and charged depreciation on

a straight-line basis over 60 months.

Equipment purchases during the years ended October 31, 2020 and 2019 were approximately

$16,000 and $175,000, respectively.

We recorded depreciation expense of approximately $38,000 and 48,000, respectively, during

the years ended October 31, 2020 and 2019.

As a result of the suspension of operations of our subsidiary, Anixa Diagnostics Corporation,

as discussed in Note 1, we recorded a loss on disposal of property and equipment of approximately $148,000 during the year ended

October 31, 2020.

recognize deferred tax assets and liabilities for the estimated future tax effects of events that have been recognized in our

financial statements or tax returns.

Under this method, deferred tax assets and liabilities are determined based on the difference

between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect in the years in which

the differences are expected to reverse.

A valuation allowance is established, when necessary, to reduce deferred tax assets to

the amount expected to be realized.

maintain stock equity incentive plans under which we may grant non-qualified stock options, incentive stock options, stock appreciation

rights, stock awards, performance awards and stock units to employees, non-employee directors and consultants.

Option Compensation Expense

account for stock options granted to employees and directors using the accounting guidance in ASC 718 “Stock Compensation”

(“ASC 718”).

In accordance with ASC 718, we estimate the fair value of service-based options on the date of grant,

using the Black-Scholes pricing model.

We recognize compensation expense for stock option awards over the requisite or implied

service period of the grant.

We recorded stock-based compensation expense, related to service-based stock options granted to employees

and directors, of approximately $3,923,000 and $3,185,000, during the years ended October 31, 2020 and 2019, respectively.

in stock-based compensation cost for service-based options granted to employees and directors during the years ended October 31,

2020 and 2019 was approximately $3,011,000 and $3,166,000, respectively, related to the amortization of compensation cost for

stock options granted in prior periods but not yet vested.

As of October 31, 2020, there was unrecognized compensation cost related

to non-vested service-based stock options granted to employees and directors of approximately $2,605,000, which will be recognized

over a weighted-average period of 1.5 years.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Included in stock-based compensation cost for service-based options granted to employees and directors during the years ended October 31, 2019 and 2018 was approximately $3,166,000 and $785,000, respectively, related to the amortization of compensation cost for stock options granted in prior periods but not yet vested.

As of October 31, 2019, there was unrecognized compensation cost related to non-vested service-based stock options granted to employees and directors of approximately $5,122,000, which will be recognized over a weighted-average period of 1.6 years.

For stock options granted to employees that vest based on market conditions, such as the trading price of the Companys common stock exceeding certain price targets, we use a Monte Carlo Simulation in estimating the fair value at grant date and recognize compensation cost over the implied service period (median time to vest).

On May 8, 2018, we issued market condition options to purchase 1,500,000 shares of common stock, to our Chairman, President and Chief Executive Officer, vesting at target trading prices of $5.00 to $8.00 per share before May 31, 2021, with implied service periods of three to seven months.

The assumptions used in the Monte Carlo Simulation were stock price on date of grant and exercise price of $3.70, contract term of 10 years, expected volatility of 119.6% and risk-free interest rate of 2.97%.

We recorded stock-based compensation expense related to market condition stock options granted to employees of approximately $376,000 and $3,759,000 during the years ended October 31, 2019 and 2018, respectively.

Included in stock-based compensation cost related to market condition stock options granted to employees during the years ended October 31, 2019 and 2018 was approximately $376,000 and $-0-, respectively, related to the amortization of compensation cost for stock options granted in prior periods but not yet vested.

As of October 31, 2019, there was no unrecognized compensation cost related to market condition stock options.

On November 1, 2018 we adopted Accounting Standards Update 2018-07 (ASU 2018-07) for stock options granted to consultants.

Upon adoption of ASU 2018-07 we estimated the fair value of unvested service-based and performance-based stock options at the date of adoption, using the Black-Scholes pricing model.

Subsequent to adoption of ASU 2018-07, future grants to consultants are measured at the grant date, based on the fair value of the award using the Black-Scholes pricing model, consistent with our policy for grants to employees and directors.

In prior periods, in accordance with US GAAP, we estimated the fair value of service-based and performance-based stock options granted to consultants at each reporting period using the Black-Scholes pricing model.

We recognize the fair value of stock options granted to consultants as consulting expense over the requisite or implied service period of the grant.

We recorded consulting expense, related to service based and performance-based stock options granted to consultants, during the years ended October 31, 2019 and 2018 of approximately $113,000 and $261,000, respectively.

Included in stock-based consulting expense for the years ended October 31, 2019 and 2018 was approximately $99,000 and $47,000, respectively, related to compensation cost for stock options granted in prior periods but not yet vested.

As of October 31, 2019, there was unrecognized consulting expense related to non-vested stock options granted to consultants, related to service-based options of approximately $274,000, which will be recognized over a weighted-average period of 2.1 years.

ANIXA BIOSCIENCES, INC.

TO CONSOLIDATED FINANCIAL STATEMENTS

stock options granted to employees that vest based on market conditions, such as the trading price of the Company’s common

stock exceeding certain price targets, we use a Monte Carlo Simulation in estimating the fair value at grant date and recognize

compensation cost over the implied service period (median time to vest).

On May 8, 2018, we issued market condition options to

purchase 1,500,000 shares of common stock, to our Chairman, President and Chief Executive Officer, vesting at target trading prices

of $5.00 to $8.00 per share before May 31, 2021, with implied service periods of three to seven months.

The assumptions used in

the Monte Carlo Simulation were stock price on date of grant and exercise price of $3.70, contract term of 10 years, expected

volatility of 119.6% and risk-free interest rate of 2.97%.

We recorded stock-based compensation expense related to market condition

stock options granted to employees of $-0- and approximately $376,000 during the years ended October 31, 2020 and 2019, respectively,

which included $-0- and approximately $376,000, respectively, of expense related to the amortization of compensation cost for

stock options granted in prior periods but not yet vested.

As of October 31, 2020, there was no unrecognized compensation cost

related to market condition stock options.

November 1, 2018 we adopted Accounting Standards Update 2018-07 (“ASU 2018-07”) for stock options granted to consultants.

Upon adoption of ASU 2018-07 we estimated the fair value of unvested service-based and performance-based stock options at the

date of adoption, using the Black-Scholes pricing model.

Subsequent to adoption of ASU 2018-07, future grants to consultants are

measured at the grant date, based on the fair value of the award using the Black-Scholes pricing model, consistent with our policy

for grants to employees and directors.

In prior periods, in accordance with U.S.

GAAP, we estimated the fair value of service-based

and performance-based stock options granted to consultants at each reporting period using the Black-Scholes pricing model.

recognize the fair value of stock options granted to consultants as consulting expense over the requisite or implied service period

of the grant.

recorded consulting expense, related to service based and performance-based stock options granted to consultants, during the years

ended October 31, 2020 and 2019 of approximately $215,000 and $113,000, respectively.

Included in stock-based consulting expense

for the years ended October 31, 2020 and 2019 was approximately $123,000 and $99,000, respectively, related to compensation cost

for stock options granted in prior periods but not yet vested.

As of October 31, 2020, there was unrecognized consulting expense

related to non-vested stock options granted to consultants, related to service-based options of approximately $340,000, which

will be recognized over a weighted-average period of --1.9 years.

Value Determination

use the Black-Scholes pricing model in estimating the fair value of stock options granted to employees, directors and consultants

which vest over a specific period of time.

The stock options we granted during each of the years ended October 31, 2020 and 2019

consisted of awards with 5-year and 10-year terms that vest over 12 to 36 months.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Fair Value Determination

We use the Black-Scholes pricing model in estimating the fair value of stock options granted to employees, directors and consultants which vest over a specific period of time.

The stock options we granted during the year ended October 31, 2019 consisted of awards with 5-year and 10-year terms that vest over 12 to 36 months.

The stock options we granted during the year ended October 31, 2018 consisted of awards with 10-year terms that vest over 12 to 36 months

The following weighted average assumptions were used in estimating the fair value of stock options granted during the years ended October 31, 2019 and 2018:

TO CONSOLIDATED FINANCIAL STATEMENTS

following weighted average assumptions were used in estimating the fair value of stock options granted during the years ended

October 31, 2020 and 2019:

Ended October 31,

5 unchanged sentences

Expected dividend yield

The expected term of stock options represents the weighted average period the stock options are expected to remain outstanding.

For employees and directors, we use the simplified method, which is a weighted average of the vesting term and contractual term, to determine expected term.

The simplified method was adopted since we do not believe that historical experience is representative of future performance because of the impact of the changes in our operations and the change in terms from historical options which vested immediately to terms including vesting periods of up to three years.

For consultants we use the contract term for expected term.

Under the Black-Scholes pricing model, we estimated the expected volatility of our shares of common stock based upon the historical volatility of our share price over a period of time equal to the expected term of the options.

We estimated the risk-free interest rate based on the implied yield available on the applicable grant date of a U.S.

Treasury note with a term equal to the expected term of the underlying grants.

We made the dividend yield assumption based on our history of not paying dividends and our expectation not to pay dividends in the future.

Under ASC 718, the amount of stock-based compensation expense recognized is based on the portion of the awards that are ultimately expected to vest.

Accordingly, if deemed necessary, we reduce the fair value of the stock option awards for expected forfeitures, which are forfeitures of the unvested portion of surrendered options.

Based on our historical experience and future expectations, we have not reduced the amount of stock-based compensation expenses for anticipated forfeitures.

We will reconsider use of the Black-Scholes pricing model if additional information becomes available in the future that indicates another model would be more appropriate.

If factors change and we employ different assumptions in the application of ASC 718 in future periods, the compensation expense that we record under ASC 718 may differ significantly from what we have recorded in the current period.

ANIXA BIOSCIENCES, INC.

expected term of stock options represents the weighted average period the stock options are expected to remain outstanding.

employees and directors, we use the simplified method, which is a weighted average of the vesting term and contractual term, to

determine expected term.

The simplified method was adopted since we do not believe that historical experience is representative

of future performance because of the impact of the changes in our operations and the change in terms from historical options which

vested immediately to terms including vesting periods of up to three years.

For consultants we use the contract term for expected

Under the Black-Scholes pricing model, we estimated the expected volatility of our shares of common stock based upon the

historical volatility of our share price over a period of time equal to the expected term of the options.

We estimated the risk-free

interest rate based on the implied yield available on the applicable grant date of a U.S.

Treasury note with a term equal to the

expected term of the underlying grants.

We made the dividend yield assumption based on our history of not paying dividends and

our expectation not to pay dividends in the future.

ASC 718, the amount of stock-based compensation expense recognized is based on the portion of the awards that are ultimately expected

Accordingly, if deemed necessary, we reduce the fair value of the stock option awards for expected forfeitures, which

are forfeitures of the unvested portion of surrendered options.

Based on our historical experience and future expectations, we

have not reduced the amount of stock-based compensation expenses for anticipated forfeitures.

will reconsider use of the Black-Scholes pricing model if additional information becomes available in the future that indicates

another model would be more appropriate.

If factors change and we employ different assumptions in the application of ASC 718 in

future periods, the compensation expense that we record under ASC 718 may differ significantly from what we have recorded in the

current period.

Award Compensation Expense

account for stock awards granted to employees and directors in accordance with ASC 718.

On May 8, 2018, a restricted stock award

of 1,500,000 shares of common stock was granted to our Chairman, President and Chief Executive Officer.

The restricted stock award

vests in its entirety upon achievement of a target trading price of $11.00 per share of the Company’s common stock before

May 31, 2021.

For restricted stock awards vesting upon achievement of a price target of our common stock we use a Monte Carlo

Simulation in estimating the fair value at grant date and recognize compensation cost over the implied service period (median

time to vest).

The assumptions used in the Monte Carlo Simulation were stock price on date of grant of $3.70, contract term of

3.06 years, expected volatility of 128.8% and risk-free interest rate of 2.66%.

During the years ended October 31, 2020 and 2019

we recorded compensation expense related to the restricted stock award of $-0- and approximately $1,954,000, respectively.

did not issue any stock awards during the years ended October 31, 2020 and 2019.

As of October 31, 2020, there was no unrecognized

compensation cost related to the restricted stock awards.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock Award Compensation Expense

We account for stock awards granted to employees and directors in accordance with ASC 718.

On May 8, 2018, a restricted stock award of 1,500,000 shares of common stock was granted to our Chairman, President and Chief Executive Officer.

The restricted stock award vests in its entirety upon achievement of a target trading price of $11.00 per share of the Companys common stock before May 31, 2021.

For restricted stock awards vesting upon achievement of a price target of our common stock we use a Monte Carlo Simulation in estimating the fair value at grant date and recognize compensation cost over the implied service period (median time to vest).

The assumptions used in the Monte Carlo Simulation were stock price on date of grant of $3.70, contract term of 3.06 years, expected volatility of 128.8% and risk-free interest rate of 2.66%.

During the years ended October 31, 2019 and 2018 we recorded compensation expense related to the restricted stock award of approximately $1,954,000 and $2,860,000.

We did not issue any restricted stock awards during fiscal year 2019.

As of October 31, 2019, there was no unrecognized compensation cost related to the restricted stock awards.

During the year ended October 31, 2018, we issued 5,347 shares of common stock vested at date of grant to consultants for services rendered.

We accounted for the stock awards in accordance with ASC 505-50 and recognized expense based on the grant date market price of the underlying common stock.

We recorded consulting expense for the year ended October 31, 2018 of approximately $15,000 for the shares of common stock issued to consultants.

We did not issue any stock awards to consultants during fiscal year 2019.

For warrants granted to consultants for services rendered we estimate the fair value using the Black-Scholes pricing model on the date of grant.

During the years ended October 31, 2019 and 2018 we recorded consulting expense, based on the fair value, of approximately $85,000 and $57,000, respectively, for warrants granted to consultants.

Net Loss Per Share of Common Stock

In accordance with ASC 260, Earnings Per Share, basic net loss per common share (Basic EPS) is computed by dividing net loss by the weighted average number of common shares outstanding.

Diluted net loss per common share (Diluted EPS) is computed by dividing net loss by the weighted average number of common shares and dilutive common share equivalents and convertible securities then outstanding.

Diluted EPS for all years presented is the same as Basic EPS, as the inclusion of the effect of common share equivalents then outstanding would be anti-dilutive.

For this reason, excluded from the calculation of Diluted EPS for the years ended October 31, 2019 and 2018, were options to purchase 7,632,068 and 7,405,868 shares, respectively, and warrants to purchase 525,000 shares and 829,400 shares, respectively.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 revenues and expenses during the reporting period.

Estimates and assumptions are used for, but not limited to, determining stock-based compensation, asset impairment evaluations, tax assets and liabilities, license fee revenue, the allowance for doubtful accounts, depreciation lives and other contingencies.

TO CONSOLIDATED FINANCIAL STATEMENTS

warrants granted to consultants for services rendered we estimate the fair value using the Black-Scholes pricing model on the

date of grant.

During the years ended October 31, 2020 and 2019 we recorded consulting expense, based on the fair value, of $-0-

and approximately $85,000, respectively, for warrants granted to consultants.

Loss Per Share of Common Stock

accordance with ASC 260, “Earnings Per Share”, basic net loss per common share (“Basic EPS”) is computed

by dividing net loss by the weighted average number of common shares outstanding.

Diluted net loss per common share (“Diluted

EPS”) is computed by dividing net loss by the weighted average number of common shares and dilutive common share equivalents

and convertible securities then outstanding.

Diluted EPS for all years presented is the same as Basic EPS, as the inclusion of

the effect of common share equivalents then outstanding would be anti-dilutive.

For this reason, excluded from the calculation

of Diluted EPS for the years ended October 31, 2020 and 2019 were options to purchase 7,952,195 and 7,632,068 shares, respectively,

and warrants to purchase 560,000 shares and 525,000 shares, respectively.

preparation of financial statements in conformity with accounting principles generally accepted in the United States of America

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 revenues and expenses

during the reporting period.

Estimates and assumptions are used for, but not limited to, determining stock-based compensation,

asset impairment evaluations, tax assets and liabilities, license fee revenue, the allowance for doubtful accounts, depreciation

lives and other contingencies.

Actual results could differ from those estimates.

ANIXA BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Subsequent Events

We evaluated all events and transactions that occurred after the balance sheet date through the date of this filing.

During this period, the Company did not have any material subsequent events that impacted its financial statements other than the discharge of a disputed trade payable.

The Company discharged the approximately $337,000 disputed liability upon the expiration of the vendor's statutory right to pursue collection of the disputed liability.

Effect of Recently Issued Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update 2014-09 (ASU 2014-09), Revenue from Contracts with Customers.

This amendment updates addressing revenue from contracts with customers, which clarifies existing accounting literature relating to how and when a company recognizes revenue.

Under the standard, a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services.

This standard update was effective for interim and annual reporting periods beginning after December 15, 2016, and was to be applied retrospectively or the cumulative effect as of the date of adoption, with early application not permitted.

In July 2015, a one-year deferral of the effective date of the new guidance was approved.

The Company adopted ASU 2014-09 on November 1, 2018.

The adoption of ASU 2014-09 did not have a material impact on our consolidated financial statements, other than required additional disclosure of accounting policies See disclosure above of our revenue recognition policy .

In February 2016, the FASB issued Accounting Standards Update 2016-02 (ASU 2016-02) which requires lessees to recognize most leases on the balance sheet.

This is expected to increase both reported assets and liabilities.

of Recently Issued Pronouncements

February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2016-02 (“ASU 2016-02”)

Accounting Standards Codification Topic 842, Leases (“ASC 842”), which supersedes Topic 840, Leases, and which requires

lessees to recognize most leases on the balance sheet.

The new lease standard does not substantially change lessor accounting.

For public companies, the standard will be effective for the first interim reporting period within annual periods beginning after December 15, 2018, although early adoption is permitted.

Lessees and lessors will be required to apply the new standard at the beginning of the earliest period presented in the financial statements in which they first apply the new guidance, using a modified retrospective transition method.

The requirements of this standard include a significant increase in required disclosures.

The disclosure requirements of ASU 2016-02 will be effective for the Company on November 1, 2019.

The adoption of this guidance will not have a material impact on our consolidated financial statements, other than additional disclosures.

Concentration of Credit Risks

Financial instruments that potentially subject us to concentrations of credit risk are cash equivalents, short-term investments and accounts receivable.

For public companies, the standard was effective for the first interim reporting period within annual periods beginning after

December 15, 2018, although early adoption was permitted.

Lessees and lessors were required to apply the new standard at the beginning

of the earliest period presented in the financial statements in which they first apply the new guidance.

In July 2018, FASB issued

ASU 2018-11, Leases, which provides an additional transition option for an entity to apply the provisions of ASC 842 by recognizing

a cumulative effect adjustment at the effective date of adoption without adjusting the prior comparative periods presented.

requirements of this standard include a significant increase in required disclosures.

The Company adopted ASU 2016-02 on November

The adoption of this standard did not have a material impact on our consolidated financial statements.

See Note 5 regarding

the accounting and disclosures related to our office lease.

Concentration

of Credit Risks

instruments that potentially subject us to concentrations of credit risk are cash equivalents, short-term investments and accounts

Cash equivalents are primarily highly rated money market funds.

Short-term investments are certificates of deposit within federally insured limits.

Where applicable, management reviews our accounts receivable and other receivables for potential doubtful accounts and maintains an allowance for estimated uncollectible amounts.

Our policy is to write-off uncollectable amounts at the time it is determined that collection will not occur.

One licensee accounted for 100% of revenues from patent licensing activities during fiscal year 2019.

Two licensees accounted for 67% and 33%, respectively, of revenues from patent licensing during fiscal year 2018.

ANIXA BIOSCIENCES, INC.

Short-term investments are certificates of deposit

within federally insured limits.

Where applicable, management reviews our accounts receivable and other receivables for potential

doubtful accounts and maintains an allowance for estimated uncollectible amounts.

Our policy is to write-off uncollectable amounts

at the time it is determined that collection will not occur.

One licensee accounted for 100% of revenues from patent licensing

activities during fiscal year 2019.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

ACCRUED EXPENSES

Accrued liabilities consist of the following as of:

liabilities consist of the following as of:

Payroll and related expenses

2 unchanged sentences

Accrued other

SHAREHOLDERS EQUITY

Stock Option Plans

As of October 31, 2019, we have three stock option plans:

SHAREHOLDERS’

the year ended October 31, 2020, we had three stock option plans:

the Anixa Biosciences, Inc.

2003 Share Incentive Plan (the 2003 Share Plan), the Anixa Biosciences, Inc.

2010 Share Incentive Plan (the 2010 Share Plan) and the Anixa Biosciences, Inc.

2018 Share Incentive Plan (the 2018 Share Plan) which were adopted by our Board of Directors on April 21, 2003, July 14, 2010 and January 25, 2018, respectively.

2003 Share Incentive Plan (the “2003

Share Plan”), the Anixa Biosciences, Inc.

2010 Share Incentive Plan (the “2010 Share Plan”) and the Anixa Biosciences,

2018 Share Incentive Plan (the “2018 Share Plan”) which were adopted by our Board of Directors on April 21, 2003,

July 14, 2010 and January 25, 2018, respectively.

The 2018 Share Plan was approved by our shareholders on March 29, 2018

During the years ended October 31, 2019 and 2018, stock options to purchase 47,600 and 76,178 shares of common stock, respectively, were exercised with aggregate proceeds of approximately $122,000 and $58,000, respectively.

Under certain circumstances, stock options may be exercised on a cashless basis.

During the year ended October 31, 2018, 9,459 shares of common stock were withheld in connection with cashless exercises of stock options.

During the year ended October 31, 2019 no shares of common stock were withheld in connection with cashless exercises of stock options.

The 2003 Share Plan provided for the grant of nonqualified stock options, stock appreciation rights, stock awards, performance awards and stock units to employees, directors and consultants.

The exercise price with respect to all of the options granted under the 2003 Share Plan since its inception was equal to the fair market value of the underlying common stock at the grant date.

In accordance with the provisions of the 2003 Share Plan, the plan terminated with respect to the grant of future options on April 21, 2013.

the years ended October 31, 2020 and 2019, stock options to purchase 51,100 and 47,600 shares of common stock, respectively, were

exercised with aggregate proceeds of approximately $122,000 and $122,000, respectively.

2003 Share Plan provided for the grant of nonqualified stock options, stock appreciation rights, stock awards, performance awards

and stock units to employees, directors and consultants.

The exercise price with respect to all of the options granted under the

2003 Share Plan since its inception was equal to the fair market value of the underlying common stock at the grant date.

In accordance

with the provisions of the 2003 Share Plan, the plan terminated with respect to the grant of future options on April 21, 2013.

Information regarding the 2003 Share Plan for the two years ended October 31, 2020 is as follows:

ANIXA BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Average Exercise

Price Per Share

Intrinsic Value

Options Outstanding at October 31, 2018

Options Outstanding at October 31, 2019

Forfeited/Expired

Options Outstanding and Exercisable at October 31, 2020

The following table summarizes information about stock options outstanding and exercisable under the 2003 Share Plan as of October 31, 2019:

Weighted Average

Contractual Life

Exercise Price

Exercise Prices

The 2010 Share Plan provides for the grant of nonqualified stock options, stock appreciation rights, stock awards, performance awards and stock units to employees, directors and consultants.

On the first business day of each calendar year the maximum aggregate number of shares available for future issuance is replenished such that 800,000 shares are available.

The exercise price with respect to all of the options granted under the 2010 Share Plan was equal to the fair market value of the underlying common stock at the grant date.

As of October 31, 2019, the 2010 Share Plan had 901,200 shares available for future grants.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

2010 Share Plan provides for the grant of nonqualified stock options, stock appreciation rights, stock awards, performance awards

and stock units to employees, directors and consultants.

On the first business day of each calendar year the maximum aggregate

number of shares available for future issuance is replenished such that 800,000 shares are available.

The exercise price with

respect to all of the options granted under the 2010 Share Plan was equal to the fair market value of the underlying common stock

at the grant date.

In accordance with the provisions of the 2010 Share Plan, the plan terminated with respect to the grant of

future options on July 14, 2020.

Information regarding the 2010 Share Plan for the two years ended October 31, 2020 is as follows:

1 unchanged sentence

Price Per Share

Aggregate Intrinsic

Options Outstanding at October 31, 2018

Options Outstanding at October 31, 2019

Forfeited/Expired

Options Outstanding at October 31, 2020

Options Exercisable at October 31, 2020

ANIXA BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes information about stock options outstanding under the 2010 Share Plan as of October 31, 2019:

following table summarizes information about stock options outstanding under the 2010 Share Plan as of October 31, 2020:

Options Outstanding

Options Exercisable

Contractual Life

Exercise Prices

Contractual Life

Exercise Price

Contractual Life

Exercise Price

Exercise Prices

$0.67 - $2.30

$2.58 - $3.13

$3.46 - $5.75

The 2018 Share Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, stock awards, performance awards and stock units to employees, directors and consultants.

On the first business day of each calendar year the maximum aggregate number of shares available for future issuance is replenished such that 2,000,000 shares are available.

The exercise price with respect to all of the options granted under the 2018 Share Plan was equal to the fair market value of the underlying common stock at the grant date.

As of October 31, 2018, the 2018 Share Plan had 1,543,000 shares available for future grants.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

2018 Share Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, stock

awards, performance awards and stock units to employees, directors and consultants.

On the first business day of each calendar

year the maximum aggregate number of shares available for future issuance is replenished such that 2,000,000 shares are available.

The exercise price with respect to all of the options granted under the 2018 Share Plan was equal to the fair market value of

the underlying common stock at the grant date.

As of October 31, 2020, the 2018 Share Plan had 2,388,339 shares available for

future grants.

Information regarding the 2018 Share Plan for the two years ended October 31, 2020 is as follows:

1 unchanged sentence

Price Per Share

Aggregate Intrinsic Value

Options Outstanding at October 31, 2018

Forfeited/Expired

Options Outstanding at October 31, 2019

Forfeited/Expired

Options Outstanding at October 31, 2020

Options Exercisable at October 31, 2020

The following table summarizes information about stock options outstanding under the 2018 Share Plan as of October 31, 2019:

ANIXA BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

following table summarizes information about stock options outstanding under the 2018 Share Plan as of October 31, 2020:

Options Outstanding

1 unchanged sentence

Contractual Life

Exercise Price

Contractual Life

Exercise Price

Exercise Prices

$ 3.84 - $4.61

Outside of Plans

In addition to options granted under the 2003 Share Plan, the 2010 Share Plan and the 2018 Share Plan, during the years ended October 31, 2012 and 2013, the Board of Directors approved the grant of stock options to certain employees and directors.

Information regarding stock options that were not granted under the 2003 Share Plan, the 2010 Share Plan or the 2018 Share Plan for the two years ended October 31, 2019 is as follows:

addition to options granted under the 2003 Share Plan, the 2010 Share Plan and the 2018 Share Plan, during the years ended October

31, 2012 and 2013, the Board of Directors approved the grant of stock options to certain employees and directors (the “Non-Plan

Options”).

regarding the Non-Plan Options for the two years ended October 31, 2020 is as follows:

Average Exercise

1 unchanged sentence

Options Outstanding at October 31, 2018

Options Outstanding and exercisable at

October 31, 2019

The following table summarizes information about stock options outstanding and exercisable that were not granted under the 2003 Share Plan, the 2010 Share Plan or the 2018 Share Plan as of October 31, 2019:

Options Outstanding and Exercisable at October 31, 2019 and 2020

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

following table summarizes information about outstanding and exercisable Non-Plan Options as of October 31, 2020:

Exercise Prices

Weighted Average

Contractual Life

Exercise Price

Exercise Prices

Re-Priced Stock Options

On August 21, 2019, the Company entered into a settlement agreement in connection with a putative shareholder derivative complaint filed in the Court of Chancery of the State of Delaware on November 5, 2018.

Pursuant to the settlement agreement the Company agreed, among other things, to reprice certain stock options that were repriced on September 6, 2017 to $0.67 to the option price immediately prior to that repricing.

Accordingly, 4,000 stock options in the 2003 Share Plan with exercise prices of $2.58, 878,400 stock options in the 2010 Share Plan with exercise prices ranging from $0.96 to $5.30 and 1,046,000 stock options that were not granted under the 2003 Share Plan, the 2010 Share Plan or the 2018 Share Plan with exercise prices of $2.58, were re-priced to the option price immediately prior to the September 6, 2017 repricing.

In addition, certain individual defendants in the derivative complaint who had exercised stock options that were re-priced in the 2017 re-pricing and sold the underlying shares paid approximately $45,000 to the Company representing a portion of the amount received for those shares.

ANIXA BIOSCIENCES, INC.

Stock Options

August 21, 2019, the Company entered into a settlement agreement in connection with a putative shareholder derivative complaint

filed in the Court of Chancery of the State of Delaware on November 5, 2018.

Pursuant to the settlement agreement the Company

agreed, among other things, to reprice certain stock options that were repriced on September 6, 2017 to $0.67 to the option price

immediately prior to that repricing.

Accordingly, 4,000 stock options in the 2003 Share Plan with exercise prices of $2.58, 878,400

stock options in the 2010 Share Plan with exercise prices ranging from $0.96 to $5.30 and 1,046,000 Non-Plan Options with exercise

prices of $2.58, were re-priced to the option price immediately prior to the September 6, 2017 repricing.

In addition, certain

individual defendants in the derivative complaint who had exercised stock options that were re-priced in the 2017 re-pricing and

sold the underlying shares paid approximately $45,000 to the Company representing a portion of the amount received for those shares.

Stock Purchase Plan

Company maintains the Anixa Biosciences, Inc.

Employee Stock Purchase Plan which permits eligible employees to purchase shares

at not less than 85% of the market value of the Company’s common stock on the offering date or the purchase date of the

applicable offering period, whichever is lower.

The plan was adopted by our Board of Directors on August 13, 2018 and approved

by our shareholders on September 27, 2018.

During the years ended October 31, 2020 and 2019, employees purchased 11,536 and 11,650

shares, respectively, with aggregate proceeds of approximately $18,000 and $39,000, respectively.

Stock Purchase Warrants

the year ended October 31, 2019 we issued a warrant, expiring on November 1, 2023, to purchase 25,000 shares of common stock at

$4.04 per share, vesting over 12 months, to a consultant for investor relations services.

On November 1, 2019 the warrant was

exchanged for a stock option with the same terms as the warrant.

We recorded consulting expense of approximately $85,000 during

the year ended October 31, 2019, based on the fair value of the warrant recognized on a straight-line basis over the vesting period.

October 30, 2020 we issued a warrant, expiring on October 30, 2025, to purchase 60,000 shares of common stock at $2.06 per share,

vesting over five months, to a consultant for investor relations services.

regarding the Company’s warrants for the two years ended October 31, 2020 is as follows:

Average Exercise

Warrants Outstanding at October 31, 2018

Warrants Outstanding at October 31, 2019

Warrants Outstanding at October 31, 2020

Warrants Exercisable at October 31, 2020

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Employee Stock Purchase Plan

The Company maintains the Anixa Biosciences, Inc.

Employee Stock Purchase Plan which permits eligible employees to purchase shares at not less than 85% of the market value of the Companys common stock on the offering date or the purchase date of the applicable offering period, whichever is lower.

The plan was adopted by our Board of Directors on August 13, 2018 and approved by our shareholders on September 27, 2018.

During the year ended October 31, 2019, employees purchased 11,650 shares with aggregate proceeds of approximately $39,000.

Common Stock Purchase Warrants

During the year ended October 31, 2019 we issued a warrant, expiring on November 1, 2023, to purchase 25,000 shares of common stock at $4.04 per share, vesting over 12 months, to a consultant for investor relations services.

We recorded consulting expense of approximately $85,000 during the year ended October 31, 2019, based on the fair value of the warrant recognized on a straight-line basis over the vesting period.

In July 2018 we issued a warrant exercisable at $3.65 per share vested upon grant to purchase 25,000 shares of common stock to a consultant for investor relations services.

We recorded consulting expense of approximately $57,000 during the year ended October 31, 2018, based on the fair value of the warrant.

This warrant was exercised in October 2018.

As of October 31, 2019, we also had warrants outstanding to purchase 500,000 shares of common stock at $5.03 per share expiring on November 30, 2021.

COMMITMENTS AND CONTINGENCIES

We lease approximately 2,000 square feet of office space at 3150 Almaden Expressway, San Jose, California (our principal executive offices) from an unrelated party pursuant to a lease that expires September 30, 2021.

Our base rent is approximately $5,000 per month and the lease provides for annual increases of approximately 3% and an escalation clause for increases in certain operating costs.

Under a lease that expired on May 31, 2019 we also leased approximately 3,000 square feet of office space at 12100 Wilshire Boulevard, Los Angeles, California (our former executive offices) from an unrelated party.

As of August 1, 2018, we had subleased these facilities.

As of October 31, 2019, our non-cancelable operating lease commitments for the San Jose lease for the years ending October 31, 2020 and 2021, was approximately $63,000 and $59,000, respectively.

Rent expense for the years ended October 31, 2019 and 2018, was approximately $60,000 and $114,000, respectively.

Litigation Matters

Other than lawsuits we bring to enforce our patent rights we are not a party to any material pending legal proceedings other than that which arise in the ordinary course of business.

We believe that any liability that may ultimately result from the resolution of these matters will not, individually or in the aggregate, have a material adverse effect on our financial position or results of operations.

ANIXA BIOSCIENCES, INC.

TO CONSOLIDATED FINANCIAL STATEMENTS

lease approximately 2,000 square feet of office space at 3150 Almaden Expressway, San Jose, California (our principal executive

offices) from an unrelated party pursuant to an operating lease that expires September 30, 2021.

Our base rent is approximately

$5,000 per month and the lease provides for annual increases of approximately 3% and an escalation clause for increases in certain

operating costs.

Under an operating lease that expired on May 31, 2019 we also leased approximately 3,000 square feet of office

space at 12100 Wilshire Boulevard, Los Angeles, California (our former executive offices) from an unrelated party.

1, 2018, we had subleased these facilities.

Rent expense was approximately $64,000 and $60,000, respectively, for the years ended

October 31, 2020 and 2019.

November 1, 2019, the Company adopted ASC 842, which increases transparency and comparability by recognizing a lessee’s

rights and obligations resulting from leases by recording them on the balance sheet as lease assets and lease liabilities.

new guidance requires the recognition of the right-of-use (“ROU”) assets and related operating lease liabilities on

the balance sheet.

The Company adopted the new guidance using the modified retrospective approach on November 1, 2019.

the consolidated balance sheet as of October 31, 2019 was not restated and is not comparative.

adoption of ASC 842 resulted in the recognition of ROU assets of $106,221, and lease liabilities for operating leases of $106,299

on the Company’s consolidated balance sheet as of November 1, 2019.

The difference between the ROU assets and the operating

lease liability represents the difference between the lease cost and the amount of rent paid in October 2019.

Company elected the package of practical expedients permitted within the standard, which allow an entity to forgo reassessing

(i) whether a contract contains a lease, (ii) classification of leases, and (iii) whether capitalized costs associated with a

lease meet the definition of initial direct costs.

Also, the Company elected the expedient allowing an entity to use hindsight

to determine the lease term and impairment of ROU assets and the expedient to allow the Company to not have to separate lease

and non-lease components.

The Company has also elected the short-term lease accounting policy under which Anixa would not recognize

a lease liability or ROU asset for any lease that at the commencement date has a lease term of twelve months or less and does

not include a purchase option that Anixa is more than reasonably certain to exercise.

operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments.

The remaining 11-month lease term as of October 31, 2020 for the Company’s lease includes the noncancelable period of the

The lease does not contain a Company option to extend the lease or an option to extend the lease controlled by the lessor.

All ROU assets are reviewed for impairment.

sheet information related to the Company’s lease is presented below:

Balance Sheet

Operating Lease:

Right-of-use asset

lease right- of-use asset

Right-of-use liability,

Operating lease liability

Right-of-use liability,

Not presented

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Collaborative Research and License Commitments

As of October 31, 2019, our commitments under the collaborative agreement with Moffitt and the license agreement with Cleveland Clinic for the year ending October 31, 2020 were approximately $401,000.

Income tax provision (benefit) consists of the following:

TO CONSOLIDATED FINANCIAL STATEMENTS

of October 31, 2020, the annual minimum lease payments of our operating lease liability were as follows:

Operating Leases

Fiscal year 2021 future minimum payments, undiscounted

Imputed interest

Present value of future minimum lease payments

COMMITMENTS AND CONTINGENCIES

than lawsuits we bring to enforce our patent rights, we are not involved in any litigation or other legal proceedings and management

is not aware of any pending litigation or legal proceeding against us that would have a material adverse effect upon our results

of operations or financial condition.

Collaborative

Research and License Commitments

of October 31, 2020, our commitments under the collaborative and license agreements with Moffitt, Wistar, Cleveland Clinic and

OntoChem for the year ending October 31, 2021 were approximately $188,000.

tax provision (benefit) consists of the following:

Year Ended October 31,

Adjustment to valuation allowance related

to net deferred tax assets

The tax effects of temporary differences that give rise to significant portions of the deferred tax asset, net, at October 31, 2019 and 2018, are as follows:

Adjustment to valuation allowance related to net deferred tax assets

tax effects of temporary differences that give rise to significant portions of the deferred tax asset, net, at October 31, 2020

and 2019, are as follows:

Long-term deferred tax assets:

2 unchanged sentences

valuation allowance

(28,756,000 )

(28,360,000 )

Deferred tax asset, net

As of October 31, 2019, we had tax net operating loss and tax credit carryforwards of approximately $81,242,000 and $1,519,000, respectively, available within statutory limits (expiring at various dates between 2020 and 2039), to offset any future regular Federal corporate taxable income and taxes payable.

If the tax benefits relating to deductions of option holders income are ultimately realized, those benefits will be credited directly to additional paid-in capital.

Certain changes in stock ownership can result in a limitation on the amount of net operating loss and tax credit carryovers that can be utilized each year.

As of October 31, 2019, management has not determined the extent of any such limitations, if any.

We had New York and California tax net operating loss carryforwards of approximately $63,485,000 and $20,441,000, respectively, as of October 31, 2019, available within statutory limits (expiring at various dates between 2020 and 2039), to offset future corporate taxable income and taxes payable, if any, under certain computations of such taxes.

ANIXA BIOSCIENCES, INC.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

We have provided a valuation allowance against our deferred tax asset due to our current and historical pre-tax losses and the uncertainty regarding their realizability.

The primary differences from the Federal statutory rate of 21% and the effective rate of 0% is attributable to certain permanent differences and a change in the valuation allowance.

The following is a reconciliation of income taxes at the Federal statutory tax rate to income tax expense (benefit):

TO CONSOLIDATED FINANCIAL STATEMENTS

of October 31, 2020, we had tax net operating loss and tax credit carryforwards of approximately $81,316,000 and $1,545,000, respectively,

available within statutory limits (expiring at various dates between 2021 and 2040), to offset any future regular Federal corporate

taxable income and taxes payable.

If the tax benefits relating to deductions of option holders’

income are ultimately realized,

those benefits will be credited directly to additional paid-in capital.

Certain changes in stock ownership can result in a limitation

on the amount of net operating loss and tax credit carryovers that can be utilized each year.

As of October 31, 2020, management

has not determined the extent of any such limitations, if any.

had California tax net operating loss carryforwards of approximately $26,671,000 as of October 31, 2020, available within statutory

limits (expiring at various dates between 2021 and 2040), to offset future corporate taxable income and taxes payable, if any,

under certain computations of such taxes.

have provided a valuation allowance against our deferred tax asset due to our current and historical pre-tax losses and the uncertainty

regarding their realizability.

The primary differences from the Federal statutory rate of 21% and the effective rate of 0% is

attributable to expiring net operating losses and a change in the valuation allowance.

The following is a reconciliation of income

taxes at the Federal statutory tax rate to income tax expense (benefit):

Year Ended October 31,

Income tax benefit at U.S.

Federal statutory income

Federal statutory income tax rate

$ (2,119,000 )

$ (2,482,000 )

State income taxes

Permanent differences

Expiring net operating

losses, credits and other

Change in valuation

Expiring net operating losses, credits and other

Change in valuation allowance

Income tax provision

During the two fiscal years ended October 31, 2019, we incurred no Federal and no State income taxes.

We have no unrecognized tax benefits as of October 31, 2019 and 2018 and we account for interest and penalties related to income tax matters in general and administrative expenses.

Tax years to which our net operating losses relate remain open to examination by Federal authorities and other jurisdictions to the extent which the net operating losses have yet to be utilized.

the two fiscal years ended October 31, 2020, we incurred no Federal and no State income taxes.

We have no unrecognized tax benefits

as of October 31, 2020 and 2019 and we account for interest and penalties related to income tax matters in general and administrative

Tax years to which our net operating losses relate remain open to examination by Federal and California authorities

to the extent which the net operating losses have yet to be utilized.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

SEGMENT INFORMATION

We follow the accounting guidance of ASC 280 Segment Reporting (ASC 280).

Reportable operating segments are determined based on the management approach.

The management approach, as defined by ASC 280, is based on the way that the chief operating decision-maker organizes the segments within an enterprise for making operating decisions and assessing performance.

While our results of operations are primarily reviewed on a consolidated basis, the chief operating decision-maker manages the enterprise in three reportable segments, each with different operating and potential revenue generating characteristics:

(i) cancer diagnostics, (ii) cancer therapeutics and (iii) our legacy patent licensing activities.

follow the accounting guidance of ASC 280 “Segment Reporting”

(“ASC 280”).

Reportable operating segments

are determined based on the management approach.

The management approach, as defined by ASC 280, is based on the way that the

chief operating decision-maker organizes the segments within an enterprise for making operating decisions and assessing performance.

While our results of operations are primarily reviewed on a consolidated basis, the chief operating decision-maker manages the

enterprise in five reportable segments, each with different operating and potential revenue generating characteristics:

Therapeutics, (ii) Cancer Vaccines, (iii) Anti-Viral Therapeutics, (iv) Cancer Diagnostics and (v) our legacy Patent Licensing

The following represents selected financial information for our segments for the years ended October 31, 2020 and

ANIXA BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Year Ended October 31,

CAR-T Therapeutics

$ (2,241,443 )

$ (5,074,868 )

Cancer Vaccines

Anti-Viral Therapeutics

Cancer Diagnostics

Cancer therapeutics

Patent Licensing

$ (10,092,363 )

$ (11,818,652 )

Total operating costs and expenses

Less non-cash share-based compensation

Operating costs and expenses excluding non-cash

share-based compensation

Operating costs and expenses excluding non-cash

share based compensation expense:

Operating costs and expenses excluding non-cash share-based compensation

Operating costs and expenses excluding non-cash share based compensation:

CAR-T Therapeutics

Cancer Vaccines

Anti-Viral Therapeutics

Cancer Diagnostics

Cancer therapeutics

Patent Licensing

Total assets:

CAR-T Therapeutics

Cancer Vaccines

Anti-Viral Therapeutics

Cancer Diagnostics

Cancer therapeutics

Patent Licensing

Operating costs and expenses excluding non-cash share-based compensation is the measurement the chief operating decision-maker uses in managing the enterprise.

The Companys consolidated revenue of $250,000 and impairment in carrying amount of patent assets of $418,750 for the year ended October 31, 2019 were solely related to our patent licensing segment.

The Companys consolidated revenue of $1,112,500 and impairment in carrying amount of patent assets of $582,979 for the year ended October 31, 2018 were solely related to our patent licensing segment.

All our revenue is generated domestically (United States) based on the country in which the licensee is located.

costs and expenses excluding non-cash share-based compensation is the measurement the chief operating decision-maker uses in managing

the enterprise.

Company’s consolidated revenue of $250,000, inventor royalties, contingent legal fees, litigation and licensing expense

of $166,250, amortization of patents of $418,750 and impairment in carrying amount of patent assets of $418,750 for the year ended

October 31, 2019 were solely related to our patent licensing segment.

All our revenue is generated domestically (United States)

based on the country in which the licensee is located.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

IMPACT OF CORONAVIRUS PANDEMIC

March 10, 2020, the World Health Organization declared the COVID-19 outbreak a pandemic.

The virus and actions taken to mitigate

its spread have had and are expected to continue to have a broad adverse impact on the economies and financial markets of many

countries, including the geographical areas in which the Company operates and conducts its business and which the Company’s

partners operate and conduct their business.

We are currently following the recommendations of local health authorities to minimize

exposure risk for our team members and visitors.

However, the scale and scope of this pandemic is unknown and the duration of

the business disruption and related financial impact cannot be reasonably estimated at this time.

While we have implemented specific

business continuity plans to reduce the potential impact of COVID-19, there is no guarantee that our continuity plans will be

have already experienced certain disruptions to our business such as temporary closure of our offices and similar disruptions

have occurred for our partners.

Specifically, the outbreak has caused shutdowns of the laboratories and other service providers

that we rely on to develop our programs, and those laboratories and service providers that have been operating or that have begun

operating recently have been doing so with more limited capacity due to social distancing requirements.

As a result, our progress

has been slowed and there is no assurance that we will be able to meet our previously announced timelines regarding the advancement

of our programs.

extent to which COVID-19 or any other health epidemic may impact our results will depend on future developments, which are highly

uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions

to contain COVID-19 or treat its impact, among others.

Accordingly, COVID-19 could have a material adverse effect on our business,

results of operations, financial condition and prospects.

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