What changed in this filing

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Item 9A. Controls and Procedures

2023-01-04 compared with 2022-01-04 · 595 added, 654 removed, 525 unchanged (70% of the section changed)

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

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 2021.

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

Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of fiscal year

Report on Internal Control Over Financial Reporting

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Other Information.

is made to that certain consulting agreement, dated September 19, 2012, between the Company and Dr.

The consulting agreement,

which has been inoperative since June 2015, was formally terminated on December 30, 2021.

The termination of this consulting agreement

has no impact on Dr.

Kumar’s employment with the Company as Dr.

Kumar remains the Chief Executive Officer and President of the

Company on an at-will basis.

Directors, Executive Officers and Corporate Governance.

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(Incorporated by reference to Exhibit 4.1 to our Form 8-K, dated March 24, 2021.)

of Warrant issued to Acorn Management Partners LLC.

(Filed herewith.)

of the Company’s Securities Registered under Section 12 of the Exchange Act (Incorporated by reference to the description

of our common stock contained in our Current Report on Form 8-K filed on March 31, 2014.)

Description of the Company’s Securities Registered under Section 12 of the Exchange Act (Incorporated by reference to the description of our common stock contained in our Current Report on Form 8-K filed on March 31, 2014.)

2010 Share Incentive Plan.

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(Incorporated by reference to Exhibit 10.1 to our Form 10-Q for the fiscal quarter ended January 31, 2021.) (Certain information has been redacted in the marked portions of the exhibit.)

Amended and Restated Collaboration Agreement, dated November 1, 2021, between Certainty Therapeutics, Inc.

Amended and Restated Master Collaboration Agreement, dated November 1, 2021, between Certainty Therapeutics, Inc.

Lee Moffitt Cancer Center and Research Institute, Inc.

(Filed herewith.)

(Incorporated by reference to Exhibit 10.8 to our Form 10-K for the fiscal year ended October 31, 2021.)

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

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(Incorporated by reference to Exhibit 10.14 to our Form 10-K, for the fiscal year ended October 31, 2020.) (Certain information has been redacted in the marked portions of the exhibit.)

Amendment No.

1 to Exclusive License Agreement 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, 2022.) (Certain information has been redacted in the marked portions of the exhibit.)

Joint Development and Option Agreement, dated January 26, 2021, between the Company and The Cleveland Clinic Foundation.

(Incorporated by reference to Exhibit 10.2 to our Form 10-Q for the fiscal quarter ended January 31, 2021.) (Certain information has been redacted in the marked portions of the exhibit.)

Form of Controlled Equity Offering SM Sales Agreement (Incorporated by reference to Exhibit 10.1 to our Form S-3 dated September 9, 2022)

Code of Conduct (Incorporated by reference to Exhibit 14 to our Form 10-K, for the fiscal year ended October 31, 2020.)

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(Filed herewith.)

Certification

of Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 4, 2022.

Certification of Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 4, 2023.

(Filed herewith.)

Certification

of Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 4, 2022.

Certification of Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated January 4, 2023.

(Filed herewith.)

of Chief Executive Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 4, 2022.

of Chief Financial Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 4, 2022.

Statement of Chief Executive Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 4, 2023.

(Filed herewith.)

Statement of Chief Financial Officer, pursuant to Section 1350 of Title 18 of the United States Code, dated January 4, 2023.

(Filed herewith.)

Form 10-K Summary .

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Biosciences, Inc.

of the Board, President and

of the Board and

Executive Officer

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registrant and in the capacities and on the date indicated.

of the Board, President and

of the Board and

Executive Officer

Executive Officer)

Operating Officer and

Chief Operating Officer and

Financial Officer

Financial and Accounting Officer)

Accounting Officer)

Titterton, Jr.

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AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS OCTOBER 31, 2021

of Independent Registered Public Accounting Firm

Balance Sheets as of October 31, 2021 and 2020

Statements of Operations for the years ended October 31, 2021 and 2020

Statements of Equity for the years ended October 31, 2021 and 2020

Statements of Cash Flows for the years ended October 31, 2021 and 2020

TO CONSOLIDATED FINANCIAL STATEMENTS

of Independent Registered Public Accounting Firm (PCAOB ID:

Consolidated Balance Sheets as of October 31, 2022 and 2021

Consolidated Statements of Operations for the years ended October 31, 2022 and 2021

Consolidated Statements of Equity for the years ended October 31, 2022 and 2021

Consolidated Statements of Cash Flows for the years ended October 31, 2022 and 2021

Notes to Consolidated Financial Statements

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

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on the Consolidated Financial Statements

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

(the “Company”) as of October 31, 2021

and 2020, and the related consolidated statements of operations, equity, and cash flows for each of the two years in the period ended

October 31, 2021, 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, 2021

and 2020, and the consolidated results of its operations and its cash flows for each of the years in the two year period ended October

31, 2021, in conformity with accounting principles generally accepted in the United States of America.

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

(the “Company”) as of October 31, 2022 and 2021, and the related consolidated statements of operations, equity, and cash

flows for each of the two years in the period ended October 31, 2022, 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, 2022 and 2021, and the consolidated results of its operations and its cash flows for each of

the years in the two year period ended October 31, 2022, in conformity with accounting principles generally accepted in the United States

consolidated financial statements are the responsibility of the Company’s management.

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Audit Matters

critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that

was communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material

to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication

of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are

not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or

disclosures to which it relates.

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (continued)

Value of Stock Options – Refer to Note 5 to the Consolidated Financial Statements

Audit Matter Description:

Company uses the Black-Scholes option-pricing model to estimate the fair value of its time-based stock options.

The Black-Scholes option-pricing

model involves the use of significant estimates, including the following:

dividend yield;

interest rate;

share price volatility;

life of the award.

Additionally,

the Company uses the Monte-Carlo simulation option-pricing model to estimate the fair value of its market condition stock options.

Monte Carlo simulation option-pricing model calculates multiple potential outcomes for an award and establishes a fair value based on

the most likely outcome.

Key assumptions for the Monte-Carlo simulation option-pricing model include:

interest rate;

share price volatility;

the significant estimates involved in estimating the fair value of stock options, the related audit effort in evaluating management’s

estimates in determining the inputs to fair value stock option models was extensive and required a high degree of auditor judgment.

the Critical Audit Matter was Addressed in the Audit:

obtained an understanding over management’s process to estimate the fair value of stock options, including how each of the estimates

required are developed to utilize the Black-Scholes and Monte-Carlo simulation option-pricing models.

We applied the following audit

procedures related to testing management’s estimates utilized in the option-pricing models:

performed a look-back at the Company’s previously issued dividends, noting there were

We inquired with management who informed us that no future dividends were currently

compared the Company’s risk-free interest rate used to the comparable United States

treasury yield for a term comparable to the stock options’ expected term.

recalculated the Company’s historical share price volatility for a term comparable

to the stock options’ expected term.

recalculated the expected term of stock options granted to employees and non-employee directors

using the simplified method, whereby, the expected term equals the average of the vesting

term and the original contractual term of the option.

performed inquiries with the independent third-party valuation specialist assisting the Company

with the Monte-Carlo simulation to ensure the inputs used in the calculation, the fair value

of the awards, and the expected vesting periods, were reasonable.

Critical audit matters are matters arising from the current period audit

of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective,

or complex judgments.

We determined that there were no critical audit matters.

have served as the Company’s auditor since 2013

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BALANCE SHEETS

and cash equivalents

expenses and other current assets

thousands, except share and per share data)

Current assets:

lease right-of-use asset

lease liability

Cash and cash equivalents

Short–term investments

Prepaid expenses and other current assets

Total current assets

Operating lease right-of-use asset

LIABILITIES AND EQUITY

Current liabilities:

lease liability, non-current

and contingencies (Note 7)

Shareholders’

stock, par value $ 100 per

19,860 shares

Accounts payable

Accrued expenses

Operating lease liability

Total current liabilities

Operating lease liability, non-current

Total liabilities

Commitments and contingencies (Note 7)

Shareholders’ equity:

Preferred stock, par value $ 100 per share;

19,860 shares authorized;

issued or outstanding

A convertible preferred stock, par value $ 100

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

140 shares authorized;

shares issued or outstanding

stock, par value $ .01 per

100,000,000 shares

no shares issued or outstanding

Preferred stock

Common stock, par value $ .01 per share;

100,000,000 shares authorized;

30,913,902 and 30,050,894

24,248,695 shares

issued and outstanding, respectively

paid-in capital

( 204,790,018 )

( 191,835,618 )

shareholders’ equity

Noncontrolling

interest (Note 2)

liabilities and equity

shares issued and outstanding as of October 31, 2022 and 2021, respectively

Additional paid-in capital

Accumulated deficit

Total shareholders’ equity

Noncontrolling interest (Note 2)

Total liabilities and equity

accompanying notes are an integral part of these statements.

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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 $ 4,165,668

and $ 1,484,545 ,

respectively)

and administrative expenses (including non-cash share based compensation expenses of $ 3,892,410

and $ 2,652,915 ,

respectively)

thousands, except per share data)

For the years ended October 31,

Operating costs and expenses:

from operations

( 13,135,692 )

( 9,978,202 )

(loss) on disposal of property and equipment

( 13,127,923 )

( 10,092,363 )

Inventor royalties, contingent legal fees, litigation and licensing expenses

Research and development expenses (including non-cash share based compensation expenses of $ 3,635 and $ 4,166 , respectively)

General and administrative expenses (including non-cash share based compensation expenses of $ 3,020 and $ 3,892 , respectively)

Total operating costs and expenses

Loss from operations

Gain on disposal of property and equipment

Interest income

Net loss attributable to noncontrolling interest

loss attributable to common stockholders

$ ( 12,954,400 )

$ ( 10,018,355 )

loss per share:

average common shares outstanding:

Net loss attributable to common stockholders

Net loss per share:

Basic and diluted

Weighted average common shares outstanding:

Basic and diluted

accompanying notes are an integral part of these statements.

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THE YEARS ENDED OCTOBER 31, 2022 AND 2021

thousands, except share data)

Shareholders’

October 31, 2019

$ 186,849,299

$ ( 181,817,263 )

$ ( 422,975 )

option compensation to employees and directors

restricted stock award to employee

restricted stock award to employee, shares

options issued to consultants

stock issued upon exercise of stock options

stock issued pursuant to employee stock purchase plan

stock issued in a public offering, net of offering expenses of $2,208,150

stock issued in a public offering, net of offering expenses of $2,208,150, shares

stock issued in an at-the-market offering, net of offering expenses of $ 362,918

received on sale of common stock held by ZQX Advisors, LLC

( 10,018,355 )

( 10,092,363 )

October 31, 2020

$ 200,354,488

$ ( 191,835,618 )

$ ( 496,983 )

option compensation to employees and directors

restricted stock award to employee

( 1,500,000 )

options and warrants issued to consultants

stock issued upon exercise of stock options

stock issued pursuant to employee stock purchase plan

stock issued in a public offering, net of offering expenses of $ 2,208,150

stock issued in an at-the-market offering, net of offering expenses of $ 340,775

received on sale of common stock held by

received on sale of common stock held by ZQX Advisors, LLC

BALANCE, October 31, 2020

$ ( 191,836 )

Stock option compensation to employees and directors

Expired restricted stock award to employee

( 1,500,000 )

Stock options and warrants issued to consultants

Common stock issued upon exercise of stock options

Common stock issued pursuant to employee stock purchase plan

Common stock issued in a public offering, net of offering expenses of $ 2,208

Common stock issued in an at-the-market offering, net of offering expenses of $ 341

Proceeds received on sale of common stock held by ZQX Advisors, LLC

BALANCE, October 31, 2021

$ ( 204,790 )

October 31, 2021

Balance, value

$ ( 204,790 )

Stock option compensation to employees and directors

Stock options and warrants issued to consultants

Common stock issued upon exercise of stock options and warrants

Common stock issued to consultants

Common stock issued pursuant to employee stock purchase plan

BALANCE, October 31, 2022

$ ( 218,385 )

Balance, value

$ ( 218,385 )

Shareholders’ Equity [Member]

accompanying notes are an integral part of these statements.

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STATEMENTS OF CASH FLOWS

the years ended October 31,

flows from operating activities:

Reconciliation

of net loss to net cash used in operating activities:

$ ( 13,127,923 )

$ ( 10,092,363 )

option compensation to employees and directors

options and warrants issued to consultants

of property and equipment

loss on disposal of property and equipment

of operating lease right-of-use asset

in operating assets and liabilities:

expenses and other current assets

lease liability

cash used in operating activities

( 4,936,881 )

( 6,175,671 )

flows from investing activities:

Disbursements

to acquire short-term investments

( 16,498,895 )

( 5,010,000 )

from maturities of short-term investments

from sale of equipment

received on sale of common stock by ZQX Advisors, LLC

of property and equipment

cash used in investing activities

( 3,917,675 )

flows from financing activities:

from sale of common stock in a public offering, net of expenses

from sale of common stock in an at-the-market offering, net of expenses

from sale of common stock pursuant to employee stock purchase plan

from exercise of stock options

cash provided by financing activities

increase in cash and cash equivalents

and cash equivalents at beginning of year

and cash equivalents at end of year

cash flow information:

proceeds from interest income

For the years ended October 31,

Cash flows from operating activities:

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

Stock option compensation to employees and directors

Stock options and warrants issued to consultants

Common stock issued to consultants

Gain on disposal of property and equipment

Amortization of operating lease right-of-use asset

Change in operating assets and liabilities:

Prepaid expenses and other current assets

Accounts payable

Accrued expenses

Operating lease liability

Net cash used in operating activities

Cash flows from investing activities:

Disbursements to acquire short-term investments

Proceeds from maturities of short-term investments

Proceeds from sale of equipment

Proceeds received on sale of common stock by ZQX Advisors, LLC

Net cash used in investing activities

Cash flows from financing activities:

Proceeds from sale of common stock in a public offering, net of expenses

Proceeds from sale of common stock in an at-the-market offering, net of expenses

Proceeds from sale of common stock pursuant to employee stock purchase plan

Proceeds from exercise of stock options and warrants

Net cash provided by financing activities

Net (decrease) increase in cash and cash equivalents

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Supplemental cash flow information:

Cash proceeds from interest income

Supplemental disclosure of non-cash investing activity:

Operating lease

right-of-use asset

$ ( 259,479 )

disclosure of non-cash financing activities:

lease liability

value of warrants issued in connection with public offering

Operating lease right-of-use asset

Supplemental disclosure of non-cash financing activities:

Operating lease liability

Fair value of warrants issued in connection with public offering

accompanying notes are an integral part of these statements.

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TO CONSOLIDATED FINANCIAL STATEMENTS

BUSINESS AND FUNDING

used herein, “we,” “us,” “our,” the “Company” or “Anixa” means Anixa Biosciences,

and its consolidated subsidiaries.

Anixa Biosciences, Inc., incorporated on November 5, 1982 under the laws of the State of Delaware,

is a biotechnology company 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 therapy, a novel form of chimeric antigen receptor

T-cell (“CAR-T”) technology, initially focused on treating ovarian cancer which we are developing through a subsidiary, Certainty

Therapeutics, Inc.

(“Certainty”), and discovery and ultimately development of anti-viral drug candidates for the treatment

of COVID-19 focused on inhibiting certain protein functions of the virus.

Our vaccine programs include the development of a preventative

vaccine against triple negative breast cancer (“TNBC”), the most lethal form of breast cancer, as well as other forms of

breast cancer, and a preventative vaccine against ovarian cancer.

September 2017 we formed Certainty to develop 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 Wistar’s

CAR-T technology.

The license agreement requires Certainty to make certain cash and equity payments to Wistar upon achievement of specific

development milestones.

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.

In addition, in November 2017, we entered into a collaboration with the H.

Lee Moffitt Cancer Center

and Research Institute, Inc.

(“Moffitt”) to advance our CAR-T therapy toward human clinical trials.

April 2020, we entered into a collaboration with OntoChem GmbH (“OntoChem”), which subsequently assigned its rights and obligations

under the collaboration to MolGenie GmbH (“MolGenie”), a company spun-out from OntoChem focused on drug discovery and development,

to discover and develop anti-viral drug candidates against COVID-19.

In July 2019, we entered into 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 Clinic, and we are working in collaboration with Cleveland

Clinic to develop a method to vaccinate women against contracting breast cancer, focused specifically on TNBC.

Further, in October 2020,

we executed a license agreement with Cleveland Clinic pursuant to which we were 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.

July 2020, 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 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.

Our vaccine programs include (i) the development of a preventative vaccine against triple negative breast cancer (“TNBC”),

the most lethal form of breast cancer, as well other forms of breast cancer and (ii) the development of a preventative vaccine against

ovarian cancer.

Our therapeutics programs include (i) the development of a chimeric endocrine receptor T-cell therapy, a novel form of

chimeric antigen receptor T-cell (“CAR-T”) technology, initially focused on treating ovarian cancer, which is being developed

at our subsidiary, Certainty Therapeutics, Inc.

(“Certainty”), and (ii) the development of anti-viral drug candidates for

the treatment of COVID-19 focused on inhibiting certain protein functions of the virus.

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 Clinic.

this technology, we are working in collaboration with Cleveland Clinic to develop a method to vaccinate women against contracting breast

cancer, focused specifically on TNBC.

The focus of this vaccine is a specific protein, α-lactalbumin, that is only expressed during

lactation in a healthy mother’s mammary tissue.

This protein disappears when the mother is no longer lactating, but reappears in

many forms of breast cancer, especially TNBC.

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

Food and Drug Administration’s (“FDA”) authorization to proceed with clinical trials in December 2020, in

October 2021, we commenced dosing patients in a Phase 1 clinical trial of our breast cancer vaccine.

This study, which is being funded

Department of Defense grant, is a multiple-ascending dose Phase 1 trial to determine the maximum tolerated dose (“MTD”)

of the vaccine in patients with early-stage, triple-negative breast cancer as well as monitor immune response.

The study is being conducted

at Cleveland Clinic and will consist of 18 to 24 patients who have completed treatment for early-stage, triple-negative breast cancer

within the past three years and are currently tumor-free but at high risk for recurrence.

During the course of the study, participants

will receive three vaccinations, each two weeks apart, and will be closely monitored for side effects and immune response.

Initial indications

from preliminary analyses suggest that an immune response is being observed.

In December 2022, we announced that we had reached the MTD.

We are now expanding the MTD cohort and are vaccinating additional participants at that dose level.

Upon completion of vaccination and

follow-up tests of the expanded cohort, we will compile and analyze the data, and we anticipate presenting the complete immunological

data from the trial at a scientific conference or similar setting in the second calendar quarter of 2023.

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 among other things, the use of vaccines for the treatment or prevention of ovarian cancers

which express the anti-Mullerian hormone receptor 2 protein containing an extracellular domain (“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, this protein is expressed at high levels in the ovaries of postmenopausal women with ovarian cancer.

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

We entered into a joint

development agreement with Cleveland Clinic to advance this vaccine toward human clinical testing.

BIOSCIENCES, INC.

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TO CONSOLIDATED FINANCIAL STATEMENTS

the 2021 fiscal year as well as the past several years, our revenue, if any, 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.

In addition, 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, if it is to occur at all, and may depend on positive results

from human clinical trials.

May 2021, Cleveland Clinic was granted an award for our ovarian cancer vaccine technology by the National Cancer Institute’s (“NCI”)

PREVENT program.

The NCI is a part of the National Institutes of Health.

The PREVENT program is a peer-reviewed agent development program

designed to support pre-clinical development of innovative interventions and biomarkers for cancer prevention and interception towards

clinical trials.

The scientific and financial resources of the PREVENT program will be used for our ovarian cancer vaccine technology

to perform virtually all pre-clinical research and development, manufacturing and IND-enabling studies.

This work is being performed

at NCI facilities, by NCI scientific staff and with NCI financial resources and will require no material financial expenditures by the

Company, nor the transfer of any rights to the Company’s assets.

subsidiary, 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”), the nation’s first independent

biomedical research institute and a leading National Cancer Institute designated cancer research center, relating to Wistar’s chimeric

endocrine receptor targeted therapy technology.

We have initially focused on the development of a treatment for ovarian cancer, but we

also may pursue applications of the technology for the development of treatments for additional solid tumors.

The license agreement requires

Certainty to make certain cash and equity payments to Wistar upon achievement of specific development milestones.

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

in collaboration with the H.

Lee Moffitt Cancer Center and Research Institute, Inc.

(“Moffitt”), is advancing toward human

clinical testing of the CAR-T technology licensed by Certainty from Wistar aimed initially at treating ovarian cancer.

We received authorization

from the FDA in August 2021, to commence enrollment and treatment of patients in a Phase 1 clinical trial.

We began patient recruitment

for the trial in March 2022, and in August 2022, we treated the first patient in the trial.

The treatment appears to have been well-tolerated

by the patient, and we continue to monitor her condition.

The process of recruiting additional patients is ongoing.

This study is a dose-escalation

trial with two arms based on injection method—intraperitoneal or intravenous—to determine the maximum tolerated dose in patients

with recurrent epithelial ovarian cancer and to assess persistence, expansion and efficacy of the modified T-cells.

The study is being

conducted at Moffitt and will consist of 24 to 48 patients who have received at least two prior lines of chemotherapy.

The study is estimated

to be completed in two to four years depending on multiple factors including when maximum tolerated dose is reached, the rate of patient

recruitment, and how long we maintain the two different injection methods.

April 2020, we entered into a collaboration with OntoChem GmbH (“OntoChem”) 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.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

screening process resulted in the identification of multiple compounds that could potentially disrupt critical enzymes of the virus,

including the virus’ main protease, M pro .

Several of these compounds were synthesized and tested in in vitro

biological assays.

Upon completion of these biological assays, we identified two of the most promising compounds and tested them in animal

In these animal studies, the two compounds were compared to Remdesivir, which at the time the assays were performed was the only

anti-viral drug authorized by the FDA for COVID-19.

The data showed that administration of the drugs to infected hamsters did not cause

any noticeable adverse effects, and monitoring of weight and general animal behavior demonstrated comparable efficacy between each of

our compounds and Remdesivir.

Based on this promising data in the animal study, we directed our team to proceed to the next stage of

drug development and we selected one of the compounds around which our team is performing combinatorial synthetic medicinal chemistry

to evaluate whether potency can be increased and pharmacokinetics optimized.

This work is ongoing.

May 2021, after completion of the aforementioned animal studies, OntoChem assigned its rights and obligations related to this collaboration

to MolGenie GmbH (“MolGenie”), a company spun-out from OntoChem focused on drug discovery and development.

As a result of

the MolGenie spin-out, there was no change in the personnel working on our project, and the assignment caused no interruptions to the

program’s development.

use of preventative vaccines is widespread throughout much of the developed world, we believe that there is and will continue to be a

need for effective treatments for COVID-19.

We believe that there are a number of factors that have limited the effectiveness, both in

the near and long term, of the vaccines currently in use, including, but not limited to, vaccine persistence, viral escape and perceptions

of long-term safety resulting in vaccine resistance.

Furthermore, there are currently new anti-viral treatments, such as Pfizer’s

Paxlovid, which is a combination therapy consisting of the protease-inhibitor nirmatrelvir and the antiretroviral ritonavir, that have

been authorized for use in the U.S.

As the main component of Pfizer’s treatment is a protease-inhibitor targeting M pro ,

it is most similar to our compounds, and we therefore conducted a head-to-head analysis via a Fluorescence Resonance Energy Transfer

(FRET) assay that tested the ability of the compounds to inhibit the function of M pro .

The results of this head-to-head in

vitro analysis suggest that our compounds may be five times more effective at inhibiting M pro than Pfizer’s nirmatrelvir.

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 its liquid biopsy platform and in the area of encrypted audio/video conference

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.

In addition, 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

Our strategy is 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.

licensing of any of our technologies may take several years, if it is to occur at all, and may depend on positive results from human

clinical trials.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

and Management’s Plans

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to obtain more working capital.

During fiscal year 2021, we raised approximately $ 20,292,000 ,

net of expenses, through a public offering in which we sold an aggregate of 4,285,715

shares of common stock and approximately $ 10,834,000 ,

net of expenses, through an at-the-market equity program in which we sold an aggregate of 2,806,410

shares of common stock.

Our at-the-market equity

program was terminated on June 16, 2021.

We may seek to obtain working capital during our fiscal year 2022 or thereafter through sales

of our equity securities or through bank credit facilities or public or private debt from various financial institutions where possible.

Under our at-the-market equity program which is currently effective and may remain available for us to

use in the future, as of October 31, 2022, we may sell up to $ 100 million of common stock.

We did not sell any shares under our at-the-market

equity program during the year ended October 31, 2022.

We may seek to obtain working capital during our fiscal year 2023 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 will 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.

OF SIGNIFICANT ACCOUNTING POLICIES

If we do identify sources

for additional funding, the sale of additional equity securities or convertible debt will result in dilution to our stockholders.

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.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of Presentation

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interest represents Wistar’s 5 % 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, 2021:

The following table

sets forth the changes in noncontrolling interest for the two years ended October 31, 2022 (in thousands):

OF CHANGES IN NONCONTROLLING INTEREST

October 31, 2019

$ ( 422,975 )

loss attributable to noncontrolling interest

October 31, 2020

loss attributable to noncontrolling interest

October 31, 2021

$ ( 670,506 )

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

Balance October 31, 2020

Net loss attributable to noncontrolling interest

Balance October 31, 2021

Net loss attributable to noncontrolling interest

Balance October 31, 2022

revenue has been derived solely from technology licensing and the sale of patented technologies.

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is distinct from other promised goods or services and evaluating whether a license transfers to a customer at a point in time or over

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

revenue arrangements generally provide for the payment, within 30 days of execution of the agreement, of contractually determined, one-time,

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and development expenses, consisting primarily of employee compensation, payments to third parties for research and development activities,

and other direct costs associated with developing immuno-therapy drugs against cancer, developing anti-viral drug candidates for COVID-19,

developing our breast cancer vaccine, developing our ovarian cancer vaccine, and developing a platform for non-invasive blood tests for

early cancer detection (such development having been suspended in fiscal year 2020), are expensed in the consolidated financial statements

in the year incurred.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

including expenses related to clinical trials, and other direct costs associated with developing immuno-therapy drugs against cancer,

developing anti-viral drug candidates for COVID-19, developing our breast cancer vaccine and developing our ovarian cancer vaccine, are

expensed in the consolidated financial statements in the year incurred.

Value Measurements

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which we have the ability to access at the measurement date.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

2 – Financial instruments whose values are based on quoted market prices in markets where trading occurs infrequently or whose

4 unchanged sentences

a market participant would use in pricing the instrument.

following table presents the hierarchy for our financial assets measured at fair value on a recurring basis as of October 31, 2021:

following table presents the hierarchy for our financial assets measured at fair value on a recurring basis as of October 31, 2022 (in

OF HIERARCHY OF FINANCIAL ASSETS

market funds:

and cash equivalents

term investments

and cash equivalents

treasury bills:

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financial assets

BIOSCIENCES, INC.

AND SUBSIDIARIES

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, 2020:

following table presents the hierarchy for our financial assets measured at fair value on a recurring basis as of October 31, 2021 (in

market funds:

and cash equivalents

term investments

treasury bills:

term investments

financial assets

4 unchanged sentences

to the short-term nature of these measurements.

Cash and cash equivalents are stated at carrying value which approximates fair value.

and Cash Equivalents

Cash equivalents are stated at carrying value which approximates fair value.

equivalents consists of highly liquid, short-term investments with original maturities of three months or less when purchased.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2022 and 2021, we had certificates of deposit and United States treasury bills with maturities greater than 90 days and less

than 12 months when acquired of $ 6,599,595

and $ 2,640,000 ,

respectively, that were classified as short-term investments and reported at fair value.

and equipment

a result of the suspension of operations of our subsidiary, Anixa Diagnostics Corporation, as discussed in Note 1, we recorded a gain

of approximately $ 5,000

during the year ended October 31, 2021 and a loss of approximately

$ 148,000 during

the year ended October 31, 2020, on disposal of property and equipment

than 12 months when acquired of $ 17,327 and $ 6,599 , respectively, that were classified as short-term investments and reported at fair

recognize deferred tax assets and liabilities for the estimated future tax effects of events that have been recognized in our financial

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rights, stock awards, performance awards and stock units to employees, non-employee directors and consultants.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

Option Compensation Expense

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recorded stock-based compensation expense, related to service-based stock options granted to employees and directors, of approximately

and $ 3,923,000 ,

during the years ended October 31, 2021 and 2020, respectively.

Included in stock-based compensation cost for service-based options granted

to employees and directors during the years ended October 31, 2021 and 2020 was approximately $ 1,841,000

and $ 3,011,000 ,

respectively, related to the amortization of compensation cost for stock options granted in prior periods but not yet vested.

As of October

31, 2021, there was unrecognized compensation cost related to non-vested service-based stock options granted to employees and directors

of approximately $ 5,490,000 ,

which will be recognized over a weighted-average period of 2.2

stock options 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 expense over the implied

service period (median time to vest).

$ 3,463,000 and $ 3,531,000 , during the years ended October 31, 2022 and 2021, respectively.

Included in stock-based compensation cost

for service-based options granted to employees and directors during the years ended October 31, 2022 and 2021 was approximately $ 2,788,000

and $ 1,841,000 , respectively, related to the amortization of compensation cost for stock options granted in prior periods but not yet

As of October 31, 2022, there was unrecognized compensation cost related to non-vested service-based stock options granted to

employees and directors of approximately $ 5,141,000 , which will be recognized over a weighted-average period of 1 year.

stock options 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 expense over

the implied service period (median time to vest).

On May 8, 2018, we issued market condition stock 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

shares of common stock, to our Chairman, then-President and Chief Executive Officer, vesting at target trading prices of $ 5.00

per share before May

31, 2021 , with implied service periods of three

The assumptions used in the Monte Carlo

Simulation for the May 18, 2018 grant were stock price on date of grant and exercise price of $ 3.70 ,

The assumptions used in the Monte Carlo Simulation for the May 18, 2018 grant were stock price on date of grant and

exercise price of $ 3.70 ,

contract term of 10

2 unchanged sentences

In October 2018, the first tranche of 500,000

shares of market condition options became exercisable

upon achieving an average closing price above $ 5.00

shares of market condition options became exercisable upon achieving an average closing price above $ 5.00

per share for twenty

consecutive trading days.

The remaining tranches

did not vest as of May 31, 2021 and expired.

June 1, 2021, our Chairman, President and Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer were awarded

market condition stock options for 2,000,000

shares and 100,000

shares of common stock, respectively, that vest

in four equal installments upon the Company’s share price achieving targets ranging from $ 5.00

per share, with implied service periods of three

to fifteen months.

The remaining tranches did not vest as of May 31, 2021 and expired.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

June 1, 2021, our Chairman, then-President and Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer were awarded

market condition stock options for 2,000,000 shares and 100,000 shares of common stock, respectively, that vest in four equal installments

upon the Company’s share price achieving targets ranging from $ 5.00 to $ 8.00 per share, with implied service periods of three to

fifteen months.

The assumptions used in the Monte Carlo Simulation for the June 1, 2021 grants were stock price on date of grant and

exercise price of $ 4.02 ,

contract term of 10

years, expected volatility of 75 %

and risk-free interest rate of 1.62 %.

exercise price of $ 4.02 , contract term of 10 years, expected volatility of 75 % and risk-free interest rate of 1.62 %.

As of October 31,

shares and 25,000

shares granted to our Chairman, President and

Chief Executive Officer and our Chief Operating Officer and Chief Financial Officer, respectively, have vested.

2022, 500,000 options and 25,000 options granted to our Chairman, then-President and Chief Executive Officer and our Chief Operating Officer

and Chief Financial Officer, respectively, have vested.

recorded stock-based compensation expense related to market condition stock options granted to employees of approximately $ 2,537,000

during the year ended October 31, 2021, which

amount did not include any expense related to the amortization of compensation cost for stock options granted in prior periods.

not record any compensation expense related to market condition stock options during the year ended October 31, 2020.

As of October 31,

2021, there was unrecognized compensation cost related to market condition stock options granted to employees of approximately $ 2,537,000 ,

which will be recognized over a weighted-average period of 0.62

during the year ended October 31, 2022, which amount represented expense related to the amortization of compensation cost for stock options

granted during the year ended October 31, 2021.

We recorded stock-based compensation expense related to market condition stock options

granted to employees of approximately $ 3,972,000 during the year ended October 31, 2021, which amount did not include any expense related

to the amortization of compensation cost for stock options granted in prior periods.

As of October 31, 2022, there was no unrecognized

compensation cost related to market condition stock options granted to employees.

recorded consulting expense, related to service-based stock options granted to consultants, during the years ended October 31, 2022 and

2020 of approximately $ 460,000

and $ 215,000 ,

respectively.

Included in stock-based consulting expense for the years ended October 31, 2021 and 2020 was approximately $ 103,000

and $ 123,000 ,

respectively, related to compensation cost for stock options granted in prior periods but not yet vested.

As of October 31, 2021, there

was unrecognized consulting expense related to non-vested service-based stock options granted to consultants of approximately $ 900,000 ,

which will be recognized over a weighted-average period of 2.1

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

2021 of approximately $ 434,000 and $ 460,000 , respectively.

Included in stock-based consulting expense for the years ended October 31,

2022 and 2021 was approximately $ 434,000 and $ 103,000 , respectively, related to compensation cost for stock options granted in prior

periods but not yet vested.

As of October 31, 2022, there was unrecognized consulting expense related to non-vested service-based stock

options granted to consultants of approximately $ 466,000 , which will be recognized over a weighted-average period of 1.2 years.

Value Determination

2 unchanged sentences

The stock options we granted during each of the years ended October 31, 2022 and 2021 consisted

of awards with 5 -year

terms that vest over 12

of awards with 5 -year and 10 -year terms that vest over 12 to 36 months.

following weighted average assumptions were used in estimating the fair value of stock options granted during the years ended October

1 unchanged sentence

OF WEIGHTED AVERAGE ASSUMPTIONS USED IN ESTIMATING FAIR VALUE OF STOCK OPTIONS

the Year Ended October 31,

average fair value at grant date

interest rate

dividend yield

Ended October 31,

Weighted average fair value at grant date Valuation assumptions:

Expected life (years)

Expected volatility

Risk-free interest rate

Expected dividend yield

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

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

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.

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.

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.

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 cash 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

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the compensation expense that we record under ASC 718 may differ significantly from what we have recorded in the current period.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

Award Compensation Expense

1 unchanged sentence

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 was to vest in its entirety upon achievement of a target trading price

per share of the Company’s common stock

The restricted stock award did not

vest as of May 31, 2021 and expired.

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 %.

We did not record any compensation expense related to the restricted stock award during the years ended October 31, 2021 and 2020.

did not issue any stock awards during the years ended October 31, 2021 and 2020.

As of October 31, 2021, there was no unrecognized compensation

cost related to the restricted stock awards.

award of 1,500,000 shares of common stock was granted to our Chairman, then-President and Chief Executive Officer.

The restricted stock award

was to vest 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 .

The restricted stock award did not vest as of May 31, 2021 and expired.

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 %.

We did not record

any compensation expense related to the restricted stock award during the years ended October 31, 2022 and 2021.

We did not issue any

stock awards during the years ended October 31, 2022 and 2021.

As of October 31, 2022, there was no unrecognized compensation cost related

to the restricted stock awards.

warrants granted to consultants for services rendered we estimate the fair value using the Black-Scholes pricing model on the date of

During the years ended October 31, 2022 and 2021 we recorded consulting expense, based on the fair value, of approximately $ 221,000

respectively, for warrants granted to consultants.

and $ 96,000 , respectively, for warrants granted to consultants.

Loss Per Share of Common Stock

7 unchanged sentences

For this reason, excluded from the calculation of Diluted EPS for the years ended October 31,

2021 and 2020 were options to purchase 10,770,626

shares and 7,952,195

shares, respectively, and warrants to purchase

shares and 560,000

shares, respectively.

2022 and 2021 were options to purchase 10,318,872 shares and 10,770,626 shares, respectively, and warrants to purchase 300,000 shares

and 860,000 shares, respectively.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires

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after December 15, 2020, and interim periods within those fiscal years.

The adoption of this standard will not have a material impact

The adoption of this standard did not have a material impact

on our consolidated financial statements and related disclosures.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

August 2020, the FASB issued Accounting Standards Update 2020-06 (“ASU 2020-06”), Accounting for Convertible Instruments

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We do not expect the adoption of this standard to have a material impact on our consolidated financial statements and related

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

October 2021, the FASB issued Accounting Standards Update 2021-08 (“ASU No.

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during fiscal year 2021.

March 25, 2021, the Company completed a public offering in which we sold an aggregate of 4,285,715

shares of its common stock, which represented

of the Company’s outstanding shares at the time of the offering, at a public offering price of $ 5.25

The Company realized net proceeds

of approximately $ 20,292,000

from the public offering, after deducting underwriting

discounts and deal expenses.

In connection with the public offering, the Company issued to certain designees of the underwriter, as compensation,

warrants expiring on March

22, 2026 , to purchase 300,000

shares of common stock exercisable for $ 6.5625

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

March 25, 2021, the Company completed a public offering in which we sold an aggregate of 4,285,715 shares of its common stock, which

represented 15.8 % of the Company’s outstanding shares at the time of the offering, at a public offering price of $ 5.25 per share.

The Company realized net proceeds of approximately $ 20,292,000 from the public offering, after deducting underwriting discounts and deal

In connection with the public offering, the Company issued to certain designees of the underwriter, as compensation, warrants

expiring on March 22, 2026 , to purchase 300,000 shares of common stock exercisable for $ 6.5625 per share.

liabilities consist of the following as of:

OF ACCRUED EXPENSES

and related expenses

royalty and contingent legal fees

collaborative research and license expense

Payroll and related expenses

Accrued royalty and contingent legal fees

Accrued other

Accrued expenses

SHAREHOLDERS’

6 unchanged sentences

The 2018 Share Plan was approved by our shareholders on March

Further, we had an additional stock option plan, the Anixa Biosciences, Inc.

2003 Share Incentive Plan (the “2003 Share

Plan”), under which all outstanding options expired during the year ended October 31, 2020.

the years ended October 31, 2021 and 2020, stock options to purchase 207,697

shares, net of 60,691

shares withheld on cashless exercises, and 51,100

shares of common stock, respectively, were exercised

with aggregate proceeds of approximately $ 434,000

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 year ended October 31, 2020 is as follows:

OF OPTION ACTIVITY

Average Exercise

Price Per Share

Outstanding at October 31, 2019

Outstanding and Exercisable at October 31, 2020

BIOSCIENCES, INC.

1 unchanged sentence

TO CONSOLIDATED FINANCIAL STATEMENTS

the year ended October 31, 2022, stock options to purchase 793,103 shares, net of 1,083,517 shares withheld on cashless exercises, were

exercised with aggregate proceeds of approximately $ 439,000 .

During the year ended October 31, 2021, stock options to purchase 207,697

shares, net of 60,691 shares withheld on cashless exercises, were exercised with aggregate proceeds of approximately $ 434,000 .

2010 Share Plan provides for the grant of nonqualified stock options, stock appreciation rights, stock awards, performance awards and

1 unchanged sentence

On the first business day of each calendar year the 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, 2021 is as follows:

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, 2022 is as follows:

OF OPTION ACTIVITY

1 unchanged sentence

Price Per Share

Intrinsic Value

Outstanding at October 31, 2019

Outstanding at October 31, 2020

Outstanding and Exercisable at October 31, 2021

Aggregate Intrinsic Value

Options Outstanding at October 31, 2020

Options Outstanding at October 31, 2021

Options Outstanding and Exercisable at

October 31, 2022

following table summarizes information about stock options outstanding under the 2010 Share Plan as of October 31, 2022:

OF OUTSTANDING AND EXERCISABLE

Exercise Prices

Outstanding and

Weighted Average

Contractual Life

$ 0.67 - $ 2.27

$ 3.46 - $ 5.30

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,

1 unchanged sentence

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, 2021, the 2018 Share Plan had 1,147,937

shares available for future grants.

regarding the 2018 Share Plan for the two years ended October 31, 2021 is as follows:

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, 2022, the 2018 Share Plan had 605,134 shares available for future grants.

Information regarding

the 2018 Share Plan for the two years ended October 31, 2022 is as follows:

OF OPTION ACTIVITY

1 unchanged sentence

Price Per Share

Outstanding at October 31, 2019

Outstanding at October 31, 2020

Aggregate Intrinsic Value

Options Outstanding at October 31, 2020

( 1,392,781 )

Outstanding at October 31, 2021

Exercisable at October 31, 2021

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

Options Outstanding at October 31, 2021

Options Outstanding at October 31, 2022

Options Exercisable at October 31, 2022

following table summarizes information about stock options outstanding under the 2018 Share Plan as of October 31, 2022:

OF OUTSTANDING AND EXERCISABLE

Options Outstanding

Options Exercisable

Exercise Prices

Contractual Life

Exercise Price

Contractual Life

Exercise Price

$ 2.09 -$ 3.87

$ 3.96 -$ 5.30

addition to options granted under stock option plans, during the years ended October 31, 2012 and 2013, the Board of Directors approved

4 unchanged sentences

Price Per Share

Outstanding at October 31, 2019 and 2020

Outstanding and Exercisable at October 31, 2021

following table summarizes information about outstanding and exercisable Non-Plan Options as of October 31, 2021:

OF OUTSTANDING AND EXERCISABLE

Exercise Prices

Contractual Life

Options Outstanding at October 31, 2020

Options Outstanding October 31, 2021

( 1,642,000 )

Options Outstanding and Exercisable at October 31, 2022

BIOSCIENCES, INC.

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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.

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

During the years ended October 31, 2021 and 2020, employees purchased 2,377

shares, respectively, with aggregate proceeds

of approximately $ 6,000

and $ 18,000 ,

respectively.

During the years ended October 31, 2022 and 2021, employees purchased 4,741 and 2,377 shares, respectively, with aggregate

proceeds of approximately $ 13,000 and $ 6,000 , respectively.

Stock Purchase Warrants

November 1, 2019 an outstanding warrant, expiring on November 1, 2023, to purchase 25,000

shares of common stock at $ 4.04

per share, was exchanged for a stock option with

the same terms as the warrant.

October 30, 2020 we issued a warrant, expiring on October

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per share, vesting over five

months , to a consultant for investor relations

months , to a consultant for investor relations services.

We recorded consulting expense of approximately $ 96,000

during the year ended October 31, 2021, based

on the fair value of the warrant recognized on a straight-line basis over the vesting period.

during the year ended October 31, 2021, based on the fair value of the warrant recognized on a straight-line basis over the vesting

On November 16, 2021, the warrant was exercised in full on a cashless basis and 25,484

shares were withheld as payment.

November 1, 2021 we issued a warrant, expiring on October 30, 2026 , to purchase 60,000 shares of common stock at $ 4.77 per share, vesting

over five months , to a consultant for investor relations services.

We recorded consulting expense of approximately $ 221,000 during the

year ended October 31, 2022, based on the fair value of the warrant recognized on a straight-line basis over the vesting period.

warrant terminated in May 2022 upon termination of the consulting agreement.

discussed in Note 3, in connection with the March 25, 2021 public offering, we issued to certain designees of the underwriter, as compensation,

warrants to purchase 300,000

shares of common stock at $ 6.5625

per share, expiring on March

warrants to purchase 300,000 shares of common stock at $ 6.5625 per share, expiring on March 22, 2026 .

regarding the Company’s warrants for the two years ended October 31, 2022 is as follows:

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Intrinsic Value

Outstanding at October 31, 2019

Outstanding at October 31, 2020

Outstanding and Exercisable at October 31, 2021

Warrants Outstanding at October 31, 2020

Warrants Outstanding at October 31, 2021

Warrants Outstanding and Exercisable at

October 31, 2022

BIOSCIENCES, INC.

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OF OUTSTANDING AND EXERCISABLE

Exercise Prices

Outstanding and

Weighted Average

Contractual Life

Advisors, LLC

Advisors, LLC (“ZQX”) was an inactive joint venture in which we held a 19.5 %

interest, and which was dissolved during fiscal year 2021.

The only assets of ZQX were shares of our common stock which were sold during

fiscal year 2021, for which we received proceeds of approximately $ 6,000 .

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 was set to expire

Effective August 17, 2021, the lease

was amended to extend the expiration date to September

30, 2024 , with an option to extend the lease

an additional two

Our base rent is approximately $ 5,000

per month and the lease provides for annual increases

Advisors, LLC (“ZQX”) was an inactive joint venture in which we held a 19.5 % interest, and which was dissolved during fiscal

The only assets of ZQX were shares of our common stock which were sold during fiscal year 2021, for which we received proceeds

of approximately $ 6,000 .

and an escalation clause for increases in certain operating costs.

The amendment to the lease resulted in a right-of-use asset and lease

liability of approximately $ 260,000

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 was set to expire on September 30, 2021 .

Effective August 17, 2021, the lease

was amended to extend the expiration date to September 30, 2024, with an option to extend the lease an additional two years .

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.

The amendment to the lease resulted in a right-of-use asset and lease liability of approximately $ 260,000

with a discount rate of 10 %.

Rent expense was approximately $ 64,000

and $ 64,000 ,

respectively, for the years ended October 31, 2021 and 2020.

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.

The 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 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.

Rent expense was approximately $ 66,000 and $ 64,000 , respectively, for the years ended October 31, 2022 and

operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments.

The remaining

lease term as of October 31, 2021 for the Company’s lease includes the noncancelable period of the lease and the additional two-year

option period that the Company expects to exercise.

All ROU assets are reviewed for impairment.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

sheet information related to the Company’s lease is presented below:

OF OPERATING LEASE

lease right- of-use asset

liability, current

lease liability

liability, long-term

lease liability, non-current

of October 31, 2021, the annual minimum lease payments of our operating lease liability were as follows:

47 month lease term as of October 31, 2022 for the Company’s lease includes the noncancelable period of the lease and the additional

two-year option period that the Company believes it is reasonably certain to exercise.

All right-of-use assets are reviewed for impairment when indications of

impairment are present.

of October 31, 2022, the annual minimum lease payments of our operating lease liability were as follows (in thousands):

OF MINIMUM LEASE PAYMENTS

Years Ending October 31,

future minimum lease payments, undiscounted

For Years Ending October 31,

Operating Leases

Total future minimum lease payments, undiscounted

Imputed interest

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or financial condition.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

Collaborative

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of Coronavirus Pandemic

ongoing global outbreak of COVID-19 has resulted in significant governmental measures being implemented to control the spread of the

virus and while the Company cannot predict their scope or the severity of the outbreak, these developments and measures could materially

and adversely affect the Company’s business, the operations of the Company’s collaboration partners, and the Company’s

results of operations and financial condition.

The Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of

its business and has taken steps to minimize its impact on the Company’s business.

Although COVID-19 has not had a material adverse

impact on the Company’s operations and its clinical and preclinical programs, the extent to which COVID-19 ultimately impacts the

Company’s business, results of operations or financial condition will depend on future developments which are highly uncertain

and cannot be predicted with confidence, such as the duration of the outbreak, the occurrence of new mutations of the SARS-CoV-2 virus,

new information that may emerge concerning the severity of COVID-19 or the effectiveness of actions taken to contain the pandemic or

mitigate its impact, among others.

Certain of the Company’s collaboration partners have experienced shutdowns or other business

As a result, the Company’s ability to conduct its business in the manner and on the timelines presently planned could

be materially or negatively affected, which could have a material adverse impact on the Company’s business, results of operations

and financial condition.

extent to which the COVID-19 pandemic impacts our business, operations and financial results will depend on numerous evolving factors

that we may not be able to accurately predict, including:

the duration and scope of the pandemic;

governmental, business and individuals’

actions that have been and continue to be taken in response to the pandemic;

the impact of the pandemic on economic activity and actions

taken in response;

our ability to continue daily operations, including as a result of travel restrictions and people working from home;

the effect the pandemic may have on the ability to recruit patients to participate in our clinical trials;

and any closures of our and

our business partners’ offices and facilities.

the Company and its partners are not currently experiencing significant negative impact of COVID-19, there can be no assurance that the

current situation will continue.

Further, events such as natural disasters and public health emergencies divert our attention away from

normal operations and limited resources.

Our inability to timely resume normal operations following any pandemic disruption could adversely

affect our business, financial condition or results of operations in a material manner.

tax provision (benefit) consists of the following:

OF INCOME TAX PROVISION (BENEFIT)

Year Ended October 31,

( 1,021,000 )

Adjustment to valuation allowance related

to net deferred tax assets

Income tax provision

BIOSCIENCES, INC.

1 unchanged sentence

TO CONSOLIDATED FINANCIAL STATEMENTS

tax provision (benefit) consists of the following:

OF INCOME TAX PROVISION (BENEFIT)

Ended October 31,

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, 2022 and 2021,

1 unchanged sentence

OF DEFERRED TAX ASSETS AND LIABILITIES

deferred tax assets:

and state NOL and tax credit carryforwards

Long-term deferred tax assets:

Federal and state NOL and tax credit carryforwards

Deferred compensation

valuation allowance

1 unchanged sentence

( 28,281,000 )

tax asset, net

of October 31, 2021, we had tax net operating loss and tax credit carryforwards of approximately $ 82,393,000

and $ 1,597,000 ,

respectively, available within statutory limits (expiring at various dates between 2022 and 2041), 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, 2021, management

has not determined the extent of any such limitations, if any.

had California tax net operating loss carryforwards of approximately $ 32,714,000

as of October 31, 2021, available within statutory

limits (expiring at various dates between 2022 and 2041), to offset future corporate taxable income and taxes payable, if any, under

certain computations of such taxes.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

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.

Deferred tax asset, net

of October 31, 2022, we had Federal tax net operating loss and tax credit carryforwards of approximately $ 91,947,000 and

$ 1,614,000 ,

respectively.

At the federal level, businesses can carry forward their net operating losses indefinitely, but the deductions are

limited to 80 percent of taxable income.

Prior to the Tax Cuts and Jobs Act (TCJA) of 2017, businesses could carry losses forward

for 20 years (without a deductibility limit).

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, 2022, management has not determined the extent of any such limitations, if any.

had California tax net operating loss carryforwards of approximately $ 42,712,000 as of October 31, 2022, available within statutory limits

( expiring at various dates between 2023 and 2042 ), to offset future corporate taxable income and taxes payable, if any, under certain

computations of such taxes.

have provided a 100 % 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 %

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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):

The following is a reconciliation of

income taxes at the Federal statutory tax rate to income tax expense (benefit):

OF RECONCILIATION OF INCOME TAXES

Ended October 31,

tax benefit at U.S.

Year Ended October 31,

Income tax benefit at U.S.

Federal statutory income tax rate

1 unchanged sentence

$ ( 2,757,000 )

net operating losses, credits and other

in valuation allowance

tax provision

State income taxes

Permanent differences

Expiring net operating losses, credits and other

Change in valuation allowance

Income tax provision

the two fiscal years ended October 31, 2022, we incurred no Federal and no State income taxes.

unrecognized tax benefits as of October 31, 2021

and 2020 and we account for interest and penalties related to income tax matters in general and administrative expenses.

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.

We have no unrecognized tax benefits as

of October 31, 2022 and 2021 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 and California authorities to the extent which

the net operating losses have yet to be utilized.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

follow the accounting guidance of ASC 280, Segment Reporting (“ASC 280”).

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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:

(i) CAR-T Therapeutics, (ii) Cancer Vaccines, (iii) Anti-Viral Therapeutics, (iv) our

legacy Cancer Diagnostics activities and (v) our legacy Patent Licensing activities.

The following represents selected financial information

for our segments for the years ended October 31, 2021 and 2020:

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

are primarily reviewed on a consolidated basis, the chief operating decision-maker manages the enterprise in four reportable segments,

each with different operating and potential revenue generating characteristics:

(i) CAR-T Therapeutics, (ii) Cancer Vaccines, (iii) Anti-Viral

Therapeutics and (iv) Other.

The following represents selected financial information for our segments for the years ended October 31,

2022 and 2021:

OF SEGMENT INFORMATION

Ended October 31,

income/(loss):

$ ( 5,672,622 )

$ ( 2,241,443 )

( 4,558,811 )

( 2,927,979 )

( 1,168,969 )

( 5,836,594 )

$ ( 13,127,923 )

$ ( 10,092,363 )

operating costs and expenses

non-cash share-based compensation

( 8,058,078 )

( 4,137,460 )

costs and expenses excluding non-cash share-based compensation

costs and expenses excluding non-cash share based compensation:

Year Ended October 31,

Net income (loss):

CAR-T Therapeutics

Cancer Vaccines

Anti-Viral Therapeutics

Net income (loss)

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:

CAR-T Therapeutics

Cancer Vaccines

Anti-Viral Therapeutics

Operating costs and expenses excluding non-cash share based compensation

Total assets:

CAR-T Therapeutics

Cancer Vaccines

Anti-Viral Therapeutics

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 $ 512,500

and inventor royalties, contingent legal fees, litigation and

licensing expense of $ 385,002 ,

Company’s consolidated revenue of $ 512,000 and inventor royalties, contingent legal fees, litigation and licensing expense of $ 385,000 ,

for the year ended October 31, 2021 were solely related to our patent licensing segment.

2 unchanged sentences

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