What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2022-01-04 compared with 2021-01-07 · 7 added, 219 removed, 6 unchanged (97% of the section changed)

Market for the Registrant’s Common Equity,

Related Stockholder Matters and Issuer Purchases of Equity Securities.

common stock trades on the NASDAQ Capital Market under the symbol “ANIX”.

of January 6, 2021, the approximate number of record holders of our common stock was 334 and the closing price of

our common stock was $3.36 per share.

Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity

common stock trades on the NASDAQ Capital Market under the symbol “ANIX”.

of January 3, 2022, the approximate number of record holders of our common stock was 322 and the closing price of our common

stock was $3.02 per share.

Authorized for Issuance Under Equity Compensation Plans

“Item 12.

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

cash dividends have been paid on our common stock since our inception.

We have no present intention to pay any cash dividends

in the foreseeable future.

We have no present intention to pay any cash dividends in the

foreseeable future.

Sales of Unregistered Securities

2 unchanged sentences

required for a smaller reporting company.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations.

reviewing Management’s Discussion and Analysis of Financial Condition and Results of Operations, you should refer to our

Consolidated Financial Statements and the notes related thereto.

of Operations

Year ended October 31, 2020 compared with Fiscal Year ended October 31, 2019

did not have any revenue in fiscal year 2020.

In fiscal year 2019, we recorded revenue of $250,000 from one license agreement.

The license agreement provided for a one-time, non-recurring, lump sum payment in exchange for a non-exclusive retroactive and

future license, and covenant not to sue.

Pursuant to the terms of the agreement, 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

Accordingly, the performance obligations from the license were satisfied and 100% of the revenue was recognized upon

execution of the license agreement.

As discussed in Note 1 to our Consolidated Financial Statements, as part of our legacy operations,

the Company remains engaged in limited patent licensing activities which we do not expect to be a significant part of our ongoing

operations or revenue.

Royalties, Contingent Legal Fees, Litigation and Licensing Expenses Related to Patent Assertion

did not have any inventor royalties, contingent legal fees, litigation and licensing expenses related to patent assertion activities

in fiscal year 2020.

In fiscal year 2019 inventor royalties, contingent legal fees, litigation and licensing expenses related

to patent assertion activities were approximately $166,000.

Inventor royalties and contingent legal fees are expensed in the period

that the related revenues are recognized.

Litigation and licensing expenses related to patent assertion, other than contingent

legal fees, are expensed in the period incurred.

of patents was $-0- in fiscal year 2020 compared to approximately $419,000 in fiscal year 2019.

We capitalize patent and patent

rights acquisition costs and amortize the cost over the estimated economic useful life.

The carrying value of capitalized patents

was reduced to $-0- as of October 31, 2019.

During fiscal year 2020, we did not capitalize any patents or patent rights.

and Development Expenses

and development expenses are related to the development of our cancer diagnostics and therapeutics programs and our anti-viral

drug program, and decreased by approximately $1,092,000 to approximately $4,381,000 in fiscal year 2020, from approximately $5,473,000

in fiscal year 2019.

The decrease in research and development expenses was primarily due to a decrease in employee stock award

compensation expense of approximately $1,251,000 and a decrease in Certainty’s outside research and development expenses

related to development of CAR-T therapeutics of approximately $547,000, offset by an increase in Anixa Diagnostics Corporation’s

outside research and development expense to develop the Cchek™

artificial intelligence driven platform of non-invasive blood

tests for the early detection of cancer of approximately $561,000 and an increase in outside research and development to develop

anti-viral drug candidates against COVID-19 of approximately $141,000.

and development expenses incurred in fiscal year 2020 associated with each of our development programs consisted of approximately

$2,455,000 for our suspended as of July 2020 cancer diagnostics program, approximately $1,048,000 for CAR-T therapeutics, approximately

$510,000 for anti-viral therapeutics, and approximately $368,000 for cancer vaccines.

and Administrative Expenses

and administrative expenses decreased by approximately $66,000 to approximately $5,597,000 in fiscal year 2020, from approximately

$5,663,000 in fiscal year 2019.

The decrease in general and administrative expenses was principally due to a decrease in employee

stock award compensation expense of approximately $704,000, a decrease in legal and accounting fees of approximately $423,000

in fiscal year 2020 primarily related to fees incurred in fiscal year 2019 in connection with a putative shareholder derivative

complaint which was settled in August 2019, a decrease in expense resulting from the discharge in January 2020 of a disputed liability

of approximately $337,000 upon the expiration of the vendor’s statutory right to pursue collection of the disputed liability,

a decrease in patent expense of approximately $144,000 primarily related to a patent expense reimbursement to Cleveland Clinic

in fiscal year 2019, a decrease in investor and public relations expense of approximately $107,000, offset by an increase in employee

compensation and related costs, other than equity-based compensation, of approximately $748,000, an increase in employee and director

stock option expense of approximately $460,000, an increase in corporate insurance expense of approximately $230,000 primarily

due to an increase in our directors and officers insurance premium, an increase in consultant expense related to our Cchek™

program of approximately $120,000 and an increase in consultant stock option expense of approximately $94,000.

in Carrying Amount of Patent Assets

impairment in carrying amount of patent assets related to our legacy patent licensing activities recorded in fiscal year 2020

was $-0- compared to approximately $419,000 in the fiscal year 2019.

The impairment recorded in fiscal year 2019 resulted from

the write down of the value of our patent assets to the estimated undiscounted future cash flows we anticipated receiving from

the patent assets.

The estimated undiscounted future cash flows was based on our assessment of the market for potential licensees,

as well as the status of ongoing negotiations with potential licensees.

on Disposal of Property and Equipment

expense was $148,000 in fiscal year 2020 compared to $-0- in fiscal year 2019.

The other expense recorded in fiscal year 2020

represents loss on disposal of property and equipment as a result of suspension of development of our Cchek™

income decreased to approximately $34,000 in fiscal year 2020 compared to approximately $71,000 in fiscal year 2019, due to a

decrease in interest rates.

Loss Attributable to Noncontrolling Interest

net loss attributable to noncontrolling interest, representing Wistar’s 5% ownership interest in Certainty’s net loss,

decreased by approximately $98,000 to approximately $74,000 in fiscal year 2020, from approximately $172,000 in fiscal year 2019,

as Certainty’s net loss decreased.

The decrease in Certainty’s net loss was primarily due to a decrease in employee

stock option and stock award compensation expense of approximately $1,315,000 and a decrease in research and development expense

of approximately $547,000.

and Capital Resources

primary sources of liquidity are cash, cash equivalents and short-term investments.

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, as of October 31, 2020, we may sell an additional approximately

$40,811,000 of common stock.

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.

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.

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.

the year ended October 31, 2020, cash used in operating activities was approximately $6,176,000.

Cash used in investing activities

was approximately $306,000, resulting from the purchases of certificates of deposit totaling $5,010,000 and the purchase of property

and equipment of approximately $16,000, which was offset by the proceeds on maturities of certificates of deposit totaling $4,720,000.

Cash provided by financing activities was approximately $9,407,000, resulting from the sale of 3,854,305 shares of common stock

in at-the-market equity offerings of approximately $9,266,000, the proceeds from exercise of stock options of approximately $122,000

and the proceeds from the sale of common stock pursuant to employee stock purchase plan of approximately $18,000.

our cash, cash equivalents, and short-term investments at October 31, 2020 increased approximately $3,215,000 to approximately

$9,057,000 from approximately $5,842,000 at the end of fiscal year 2019.

Sheet Arrangements

have no variable interest entities or other significant off-balance sheet obligation arrangements.

Accounting Policies

Company’s consolidated financial statements are prepared in conformity with accounting principles generally accepted in

the United States of America.

In preparing these financial statements, we make assumptions, judgments and estimates that can have

a significant impact on amounts reported in our consolidated financial statements.

We base our assumptions, judgments and estimates

on historical experience and various other factors that we believe to be reasonable under the circumstances.

Actual results could

differ materially from these estimates under different assumptions or conditions.

On a regular basis, we evaluate our assumptions,

judgments and estimates and make changes accordingly.

believe that, of the significant accounting policies discussed in Note 2 to our Consolidated Financial Statements, the following

accounting policies require our most difficult, subjective or complex judgments:

Compensation.

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.

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.

compensation cost for service-based stock options granted to employees and directors is measured at the grant date, based on the

fair value of the award using the Black-Scholes pricing model, and is expensed on a straight-line basis over the requisite service

period (the vesting period of the stock option).

For employee options vesting if the trading price of the Company’s common

stock exceeds 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.

stock awards granted to employees and directors that vest at date of grant we recognize expense based on the grant date market

price of the underlying common stock.

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).

November 1, 2018 we adopted Accounting Standards Update 2018-07 (“ASU 2018-027”) for stock-based compensation to non-employees.

Upon adoption of ASU 2018-07 we estimated the fair value of unvested awards at the date of adoption, using the Black-Scholes pricing

Future grants to consultants will be 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.

Black-Scholes pricing model and the Monte Carlo Simulation we use to estimate fair values requires valuation assumptions of expected

term, expected volatility, risk-free interest rates and expected dividend yield.

The expected term of stock options represents

the weighted average period the stock options are expected to remain outstanding.

For employees 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.

For consultants we use the contract term for expected term.

We estimate 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 grants.

We estimate 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

will reconsider use of the Black-Scholes pricing model and Monte Carlo Simulation if additional information becomes available

in the future that indicates other models would be more appropriate.

If factors change and we employ different assumptions in

future periods, the compensation expense that we record may differ significantly from what we have recorded in the current period.

See Note 2 to the Consolidated Financial Statements for additional information.

of Recent Accounting Pronouncements

discuss the effect of recently issued pronouncements in Note 2 to the Consolidated Financial Statements.

Quantitative and Qualitative Disclosures About

required for a smaller reporting company.

Financial Statements and Supplementary Data.

accompanying “Index to Consolidated Financial Statements.”

Changes in and Disagreements With Accountants

on Accounting and Financial Disclosure.

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 5. Market for Registrant’s Common Equity