What changed in this filing

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Item 1. Financial Statements

2024-11-14 compared with 2024-11-14 · 541 added, 744 removed, 531 unchanged (71% of the section changed)

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thousands, except share and per share amounts)

June 30, 2024

December 31, 2023

March 31, 2024 (unaudited)

(As Restated)

December 31, 2023 (audited)

Current assets

Cash and cash equivalents

Marketable Investments

Prepaid expenses and other current assets

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Operating lease right-of-use assets, net

Property, plant, and equipment, net

Prepaid expenses and other long-term assets

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Operating lease liability, current portion

Loans payable

Notes payable

Deferred commission payable

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Common stock, par value $ 0.0001 ;

250,000,000 shares authorized at June 30, 2024 and December 31, 2023, respectively, 74,000,234 and 73,829,536 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively

250,000,000 shares authorized at March

31, 2024 and December 31, 2023, respectively, 73,829,536

shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively

Preferred stock, par value $ 0.0001 ;

1,000,000 shares authorized at June 30, 2024 and December 31, 2023;

no shares issued and outstanding at June 30, 2024 and December 31, 2023

1,000,000 shares authorized at March

31, 2024 and December 31, 2023;

shares issued and outstanding at March 31, 2024 and December 31, 2023

Additional paid-in capital

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thousands, except share and per share amounts)

Three Months ended June 30,

Months ended June 30,

Three Months ended March 31,

Operating expenses:

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Total other (expense) income, net

Basic earnings/(net loss) per share

Diluted earnings/(net loss) per share

Basic and diluted earnings/(net loss) per share

Basic weighted-average common shares outstanding

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thousands, except share amounts)

comprehensive

stockholders’

Balance at April 1, 2024

Issuance of Common Stock for services

Issuance of Common Stock upon vesting of restricted stock units

Issuance of Warrants

Stock-based compensation

Foreign currency translation adjustment

Balance at June 30, 2024

comprehensive

stockholders’

Additional paid-in

Accumulated other comprehensive

Total stockholders’

Balance at January 1, 2024

Issuance of Common Stock for services

Issuance of Common Stock upon vesting of restricted stock units

Issuance of Warrants

Issuance of Warrants for lock-up

Stock-based compensation

Foreign currency translation adjustment

Balance at June 30, 2024

other comprehensive

stockholders’

Balance at April 1, 2023

Foreign currency translation adjustment

Balance at June 30, 2023

Balance at March 31, 2024

Additional paid-in

Accumulated other comprehensive

stockholders’

Total stockholders’

Balance at January 1, 2023

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Foreign currency translation adjustment

Balance at June 30, 2023

Balance at March 31, 2023

accompanying notes are an integral part of these condensed consolidated financial statements.

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CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months ended June 30,

Three Months ended March 31,

Cash flows used in operating activities:

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Gain on change in fair value of Cizzle option

Gain on change in fair value of Vela option

Loss on issuance of Vela option

Change in reserve for related party uncollectible loan

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Issuance of warrants for lock-up

Gain on change in fair value of derivative warrant liability

Gain on change in fair value of warrants

Stock-based compensation expense

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Amortization of financed Directors and Officers insurance

Issuance of common stock for services

Changes in operating assets and liabilities:

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Issuance of loan - related party

Purchases of property and equipment

Purchases of short term investments

Proceeds from the sale of short-term investments

Proceeds from the issuance of the Vela option

Net cash flows used in investing activities

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Proceeds from issuance of convertible notes payable, carried at fair value

Proceeds from issuance of warrants from lock-up

Proceeds from issuance of convertible promissory note payable, carried at cost

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Right-of-use assets obtained in exchange for operating lease liabilities

Purchases of PP&E in accounts payable

Receivables from issuance of warrants for lock-up

accompanying notes are an integral part of these condensed consolidated financial statements.

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company that was formed to facilitate the development and commercialization of clinical assets.

The Company has developed a unique business

model that allows it to act as a conduit to bring clinical assets from pharmaceutical companies and develop new treatments for patients.

Our novel approach addresses unmet medical needs and lengthens the intellectual property for our existing assets through cutting-edge

solid-form technology and then commercializing these products with life science companies.

The Company’s current

development pipeline, following the recently completed License Agreement with AstraZeneca AB (PUBL) (“AstraZeneca”)

dated August 7, 2024, includes two HK-4 Glucokinase Activators, which have been determined to be Phase 2 ready for application in

autoimmune disorders, as well as the Company’s proprietary, patent pending in some jurisdictions, solid-form compound targeting autoimmune disorders.

The Company’s development pipeline

also includes a potent, irreversible inhibitor of human Myeloperoxidase (MPO) that has been licensed in, and has the potential to

treat, idiopathic male infertility.

See Note 16, Subsequent Events .

Through June 30, 2024, the

Company’s development pipeline, through a relationship with St.

George Street Capital included a single HK-4 Glucokinase

Activator licensed to St George Street Capital for use in uveitis, Hashimoto’s Thyroiditis, preterm labor, and renal

transplant rejection.

The Company’s development pipeline also included a potent, irreversible inhibitor of human

Myeloperoxidase (MPO) licensed in idiopathic male infertility.

See Note 13, Related Party transactions .

The Company has developed a unique business model that allows it to act as a conduit to bring clinical assets from

pharmaceutical companies and develop new treatments for patients.

Our novel approach addresses unmet medical needs and lengthens the intellectual

property for our existing assets through cutting-edge solid-form technology and then commercializing these products with life science

Company’s current development pipeline through a relationship with St George Steet Capital (“St George Street”), a

related party (see Note 12), includes a glucokinase activator, which is Phase II ready in autoimmune diseases including uveitis, Hashimoto’s

Thyroiditis, preterm labor, and renal transplant rejection as well as the Company’s proprietary, patent pending, solid-form compound

targeting a wide range of autoimmune diseases.

The Company’s development pipeline also includes a potent, irreversible inhibitor

of human Myeloperoxidase (MPO) that has the potential to treat idiopathic male infertility.

September 22, 2023 (the “Closing Date”), a merger transaction between Conduit Pharmaceuticals Limited (“Old Conduit”),

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or other intangible assets recorded.

This determination is primarily based on the following predominant factors:

(i) post-closing, the

Old Conduit stockholders have a majority of the voting power of the combined company and ability to elect the members of the combined

company’s Board of Directors (“Board”);

(ii) the on-going operations post-merger will comprise those of Old Conduit;

and (iii) all of the senior management of the combined company, except for the Chief Financial Officer, will be members of the management

of Old Conduit.

As a result of the Merger, MURF was renamed “Conduit Pharmaceuticals Inc.” The boards of directors of MURF

and Conduit each approved the Merger.

of Presentation

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Standards Update (“ASUs”).

accompanying interim unaudited condensed consolidated financial statements included in this quarterly report have been prepared in accordance

GAAP and, in the opinion of the Company, contain all adjustments, consisting of only normal recurring adjustments, necessary

for a fair statement of its financial position as of June 30, 2024, and its results of operations for the three and six months ended

June 30, 2024 and 2023, and cash flows for the six months ended June 30, 2024 and June 30, 2023.

The condensed consolidated balance sheet

at December 31, 2023, was derived from the audited annual financial statements but does not contain all of the footnote disclosures from

the annual financial statements.

accompanying interim unaudited condensed consolidated financial statements included in this quarterly report have been prepared in

accordance with U.S.

GAAP and, in the opinion of the Company, contain all adjustments, consisting of only normal recurring

adjustments, necessary for a fair statement of its financial position as of March 31, 2024, and its results of operations for the

three months ended March 31, 2024 and 2023, and cash flows for the three months ended March 31, 2024 and March 31, 2023.

The condensed consolidated

balance sheet at December 31, 2023, was derived from the audited annual financial statements but does not contain all of the

footnote disclosures from the annual financial statements.

of Consolidation

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and Going Concern

accordance with ASC 205-40, Going Concern, the Company has evaluated whether there are conditions and events, considered in the

aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the

date the financial statements are issued.

Since its inception, the Company has generated significant losses and as of June 30, 2024,

the Company had an accumulated deficit of $ 20.2

As of June 30, 2024 and December 31, 2023, the Company had cash and cash equivalents of $ 0.2 million and $ 4.2 million,

respectively.

For the six months ended June 30, 2024 and 2023, the Company had net losses of $ 8.9

million and $ 3.4

million, respectively, and cash used in operating activities of $ 3.9

million and $ 2.4

million, respectively.

Management has determined that it does not have sufficient cash and other sources of liquidity to fund its current

business plan.

These factors raise substantial doubt regarding the Company’s ability to continue as a going concern for at least

the next 12 months from the financial statement filing date.

March 4, 2024, the Company received a Commitment Letter in the amount of $ 5 million,

subject to agreement and definition documentation, from Corvus Capital Limited (“Corvus”), a major stockholder and

related party.

The facility allows for single draws of up to $ 500,000 ,

and limits draw requests to $ 1,000,000 in

any 30-day period.

As of June 30, 2024, the Company had not received any proceeds from the $ 5.0 million

On August 5, 2024, the

Company entered into a Senior Secured Promissory Note (the “Note”) with Nirland Limited (“Nirland”),

pursuant to which the Company issued and sold to the Nirland the Note in the original principal amount of $ 2,650,000

(the “Note”), inclusive of a $ 500,000

original issuance discount.

Of the total amount of the Note, $ 1,675,000

was issued upon execution of the Note .

In connection with the Note, the Company issued the Purchaser 12,500,000 shares of the

Company’s common stock on August 6, 2024.

The balance of $ 475,000

will be paid after the shares have been registered for resale.

The Note bears interest at a rate of 12 %

per annum, accruing daily on a 365-day basis, payable monthly in arrears as cash, or accrued at the Nirland’s discretion.

matures on August

accordance with Accounting Standards Codification (“ASC”) 205-40, Going Concern, the Company has evaluated whether there

are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as

a going concern within one year after the date the financial statements are issued.

Since its inception, the Company has generated significant

losses and as of March 31, 2024, the Company had an accumulated deficit of $ 14.9 million.

For the three months ended March 31, 2024 and

2023, the Company had net losses of $ 3.6 million and $ 1.7 million, respectively, and cash used in operating activities of $ 2.4 million

and $ 2.0 million, respectively.

Company completed the Merger that also included a private placement of an aggregate amount of $ 20.0

million of the Company’s shares of common stock (referred to as the “PIPE”).

The proceeds received from the Merger

and PIPE, net of transaction costs, totaled $ 8.5

On March 4, 2024, the Company received a Commitment Letter in the amount of $ 5

million, subject to agreement and definition documentation, from Corvus Capital, a major shareholder and related party.

allows for single draws of up to $ 500,000 ,

and limits draw requests to $ 1,000,000

in any 30-day period.

An interest rate of 9.5 %

annually will apply from the date of the advance request, and repayment is to begin in 12 equal monthly installments, commencing on

April 30, 2025.

As of March 31, 2024, the Company had not received any proceeds from the additional $ 5.0

million commitment.

Despite the closing of the Merger and an additional $ 5.0

million commitment from a major stockholder, the Company has determined that it does not have sufficient cash and other sources of

liquidity to fund its current business plans.

Management believes these factors raise substantial doubt regarding the

Company’s ability to continue as a going concern for at least the next 12 months from the financial statement filing

Company’s expectation is to generate operating losses and negative operating cash flows in the future and will need additional

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the pursuit of additional cash resources through public or private equity or debt financings.

There is no assurance that such funding

will be available when needed or on acceptable terms.

If additional funding is not available when required, the Company would need to

delay or curtail its operations and its research and development activities until such funding is received, all of which could have a

material adverse effect on the Company and its financial condition.

There is no assurance that such funding will be available when needed or on acceptable terms.

If additional funding

is not available when required, the Company would need to delay or curtail its operations and its research and development activities

until such funding is received, all of which could have a material adverse effect on the Company and its financial condition.

financial statements have been prepared assuming the Company will continue as a going concern and do not include adjustments to reflect

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revenue from royalties or product sales.

Company licenses clinical assets from AstraZeneca.

See Note 13 and Note 17.

Company relies on agreements with related parties and third parties for the purpose of developing and licensing clinical assets from

St George Street and, in turn, St George Street licenses such assets from AstraZeneca.

If there is a breach or other termination

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and prospects.

In addition, the Company is not a party to the license agreements between St George Street and AstraZeneca.

The termination

of such third-party agreements could have a material impact on or materially disrupt operations.

While the Company holds its own intellectual

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commercialize our clinical assets.

Listing Deficiencies

Notice of Delisting or Failure

to Satisfy a Continued Listing Rule or Standard

On May 28, 2024, the Company received a notice (the “Notice”)

it was expecting from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company

that, due to the previously disclosed resignation of Ms.

Jennifer McNealey from the Company’s Board of Directors (the “Board”)

and from all committees on which she served, the Company, effective as of such date of resignation, was not in compliance with Nasdaq’s

independent audit committee requirements as set forth in Listing Rule 5605 as a result of the audit committee being comprised of only

two independent directors.

The Company has until the earlier of its next annual meeting of stockholders or May 13, 2025 or, if the

next annual meeting of stockholders is held before November 12, 2024, then the Company must evidence compliance no later than November

The Notice has no immediate effect on the listing of the Company’s securities on Nasdaq.

The Company intends to regain

compliance with the requirement that the audit committee be comprised of at least three independent directors prior to the expiration

of the cure period provided pursuant to Nasdaq Listing Rule 5605(c)(4).

of Failure to Satisfy a Continued Listing Rule

August 12, 2024, the Company received a deficiency letter from the Listing Qualifications Department (the “Staff”) of the

Nasdaq notifying the Company that for the last 30 consecutive business days the closing bid price for the Company’s common stock

had closed below the minimum $ 1.00 per share requirement for continued inclusion on the Nasdaq Global Market pursuant to Nasdaq Listing

Rule 5450(a)(1) (the “Bid Price Rule”).

The deficiency letter does not result in the immediate delisting of the Company’s

common stock from the Nasdaq Global Market.

accordance with Nasdaq Listing Rule 5810(c)(3)(A) (the “Compliance Period Rule”), the Company has been provided an initial

period of 180 calendar days, or until February 10, 2025 (the “Compliance Date”), to regain compliance with the Bid Price

If, at any time before the Compliance Date, the closing bid price for the Company’s common stock closes at $ 1.00 or more

for a minimum of 10 consecutive business days as required under the Compliance Period Rule, the Staff will provide written notification

to the Company that it complies with the Bid Price Rule, unless the Staff exercises its discretion to extend this 10 day period pursuant

to Nasdaq Listing Rule 5810(c)(3)(H).

the Company does not regain compliance by February 10, 2025, the Company may be eligible for an additional 180 calendar day grace period

if it applies to transfer the listing of its common stock to the Nasdaq Capital Market.

To qualify, the Company would be required to

meet the continued listing requirement for the market value of its publicly held shares and all other initial listing standards for the

Nasdaq Capital Market, with the exception of the minimum bid price requirement, and provide written notice of its intention to cure the

minimum bid price deficiency during the second compliance period.

If the Nasdaq staff determines that the Company will not be able to

cure the deficiency, or if the Company is otherwise not eligible for such additional compliance period, Nasdaq will provide notice that

the Company’s common stock will be subject to delisting.

The Company would have the right to appeal a determination to delist its

common stock, and the common stock would remain listed on the Nasdaq Global Market until the appeal process is complete.

no assurance that, if the Company does appeal the delisting determination by the Staff to the NASDAQ Listing Qualifications Panel, that

such appeal would be successful.

Company intends to monitor the closing bid price of its common stock and may, if appropriate, consider available options to regain compliance

with the Bid Price Rule, which could include effecting a reverse stock split.

However, there can be no assurance that the Company will

be able to regain compliance with the Bid Price Rule.

of Significant Accounting Policies

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bank account, with a balance

at June 30, 2024 of £ 93,014 (or approximately $ 117,623 ), which exceeds the country’s deposit limit of £ 85,000

at March 31, 2024 of approximately £ 78,585

(or approximately $ 99,266 )

does not exceed the country’s deposit limit of £ 85,000

(approximately $ 108,000 ).

The Company’s U.S.

depository bank participates in the Demand Deposit Marketplace program, insuring deposits

up to $ 10 million by sweeping amounts in excess of the $ 250,000 deposit insurance limit among participating banks.

The Company has not

experienced any losses on any accounts through the six months ended June 30, 2024.

Short-term may investments

include marketable debt and equity securities with maturities of less than one year or where management’s intent is to use the

investments to fund current operations or to make them available for current operations.

All investments in marketable securities

are classified as available-for-sale and are reported at fair value on the consolidated balance sheets.

Investments with remaining

maturities or that are due within one year from the balance sheet date are classified as current.

The Company reviews its short-term

investments for other-than-temporary impairment whenever the fair value of a marketable security is less than the amortized cost and

evidence indicates that a short-term investment’s carrying amount is not recoverable within a reasonable period of time.

Plant and Equipment

plant and equipment are initially recorded at cost.

Depreciation and amortization are computed using the straight-line method over the

estimated useful lives of the assets or, for leasehold improvements, the life of the lease, if shorter.

When assets are retired

or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss

is reflected in other income or expense for the period.

As of June 30, 2024, property, plant and equipment primarily consisted of leasehold

improvements.

depository bank participates in the Demand Deposit Marketplace program, insuring deposits up to $ 10

million by sweeping amounts in excess of the

$ 250,000 deposit

insurance limit among participating banks.

The Company has not experienced any losses on any accounts through the three months ended

March 31, 2024.

preparation of financial statements in conformity with U.S.

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These valuations require significant judgment.

Company’s Level 1 assets consist of cash and cash equivalents in the accompanying balance sheets, convertible notes payable and

the value of accrued expenses and other current liabilities approximate fair value due to the short-term nature of these assets and liabilities.

The Company determines the accounting classification of warrants as either liability or equity by first assessing

whether the Warrants meet liability classification in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”).

Under ASC 480, a financial instrument that embodies an unconditional obligation, or a financial instrument other than an outstanding share

that embodies a conditional obligation, that the issuer must or may settle by issuing a variable number of its equity shares must be classified

as a liability (or an asset in some circumstances) if, at inception, the monetary value of the obligation is based solely or predominantly

on any one of the following:

(a) a fixed monetary amount known at inception;

(b) variations in something other than the fair value of

the issuer’s equity shares;

or (c) variations inversely related to changes in the fair value of the issuer’s equity shares.

If financial instruments, such as the warrants, are not required to be classified as liabilities under ASC 480, the Company assesses whether

such instruments are indexed to the Company’s own stock under ASC 815-40.

In order for an instrument to be considered indexed to

an entity’s own stock, its settlement amount must always equal the difference between the following:

(a) the fair value of a fixed

number of the Company’s equity shares, and (b) a fixed monetary amount or a fixed amount of a debt instrument issued by the Company.

Equity classified warrants are recorded in stockholders’ deficit and liability classified warrants are recorded

as liabilities within the Consolidated Balance Sheets.

The liability classified warrants are remeasured each period with changes recorded

in the Consolidated Statements of Operations and Comprehensive Loss.

As of June 30, 2024, the Company

had outstanding warrants that are classified as a liability within the condensed consolidated balance sheets.

The fair value of the warrant

liability is determined each balance sheet date based on Level 2 inputs as such inputs are based on observable inputs other than quoted

The warrant liability is valued using a Black-Scholes model, with the most judgmental non-observable input being the volatility

Changes in the assumptions around the volatility can cause significant changes in the estimated fair value of the warrant liability.

See Note 4 for further information on the Company’s financial liabilities carried at fair value.

the sixth months ended June 30, 2024, the Company issued warrants that met the criteria to be classified within stockholders’ deficit

within the condensed consolidated balance sheets.

The fair value of the warrants was determined by using a Black-Scholes model, with

the most judgmental non-observable input being the volatility measure.

Changes in the assumptions around the volatility could have caused

significant changes in the estimated fair value of the warrants.

See Note 14 for further information on the warrants classified within

stockholders’ deficit.

Based Compensation

Company accounts for share based compensation arrangements granted to employees in accordance with ASC 718, Compensation:

Compensation, by measuring the grant date fair value of the award and recognizing the resulting expense over the period

during which the employee is required to perform service in exchange for the award.

The grant date fair value of stock options is determined

using a Black-Scholes model, with the most judgmental non-observable input being the volatility measure.

Changes in the assumptions around

the volatility can cause significant changes in the grant date fair value of stock options.

The Company accounts for forfeitures when

Company’s Level 1 assets consist of cash and cash equivalents in the accompanying balance sheets, convertible notes payable and the value of accrued expenses

and other current liabilities approximate fair value due to the short-term nature of these assets and liabilities.

of March 31, 2024, the Company has one financial liability, a warrant liability for which the fair value is determined based on Level

2 inputs as such inputs are valued based on observable inputs other than quoted prices included in Level 1, such as quoted prices for

either similar instrument in active markets.

See Note 4 for further information on the Company’s financial liabilities carried

at fair value.

and Development and Funding

and development expenses consist primarily of costs incurred in connection with the research and development of our clinical assets and

The Company expenses research and development costs and intangible assets acquired that have no alternative

future use as incurred.

Funding expenses consist primarily of costs incurred in connection with the Company providing funding to St George Street to carry out its research and development activities.

SGSC holds all licenses to conduct clinical research through

third party pharmaceutical companies.

The Company expenses research and development costs and intangible assets acquired that have no

alternative future use as incurred.

These expenses include:

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or until it is no longer expected that the goods will be delivered, or the services rendered.

and Administrative Expenses

and administrative expenses consist primarily of salaries and related costs for personnel in executive management, finance, corporate

and business development, and administrative functions.

General and administrative expenses also include legal fees relating to patent

and corporate matters; professional fees for accounting, auditing, tax, and administrative consulting services; insurance costs;

administrative travel expenses and other operating costs.

Topic 740, Income Taxes , sets forth standards for financial presentation and disclosure of income tax liabilities and expense.

Interest and penalties recognized have been classified in the unaudited condensed consolidated statements of operations and Comprehensive

Loss as income taxes.

Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences

between the financial statement carrying amount of existing assets and liabilities and their respective tax bases and operating losses

carried forward.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the

years in which those temporary differences are expected to be recovered or settled.

Interest and penalties recognized have been classified in the unaudited condensed consolidated statements of operations and Comprehensive Loss as income taxes.

Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary

differences between the financial statement carrying amount of existing assets and liabilities and their respective tax bases and operating

losses carried forward.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income

in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities

of a change in tax rates is recognized in the unaudited condensed consolidated statements of operations and Comprehensive Loss in the

period that includes the enactment date.

The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance for

any tax benefits of which future realization is uncertain.

of a change in tax rates is recognized in the unaudited condensed consolidated statements of operations and Comprehensive Loss

in the period that includes the enactment date.

The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance

for any tax benefits of which future realization is uncertain.

December 2023, the FASB issued ASU 2023-09, which introduces new income tax disclosure requirements.

The standard is effective for fiscal

years beginning after December 15, 2024, with early adoption permitted.

After reviewing the provisions of the new standard, the Company

has determined that these changes will not materially affect our financial condition, results of operations, or cash flows as presented

in our financial statements.

The standard is effective for

fiscal years beginning after December 15, 2024, with early adoption permitted.

After reviewing the provisions of the new standard,

the Company has determined that these changes will not materially affect our financial condition, results of operations, or cash

flows as presented in our financial statements.

Earnings/(Net

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to any liability-classified dilutive instruments.

Company determines the accounting classification of warrants as either liability or equity by first assessing whether the Warrants meet

liability classification in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”).

Under ASC 480, a

financial instrument that embodies an unconditional obligation, or a financial instrument other than an outstanding share that embodies

a conditional obligation, that the issuer must or may settle by issuing a variable number of its equity shares must be classified as

a liability (or an asset in some circumstances) if, at inception, the monetary value of the obligation is based solely or predominantly

on any one of the following:

(a) a fixed monetary amount known at inception;

(b) variations in something other than the fair value of

the issuer’s equity shares;

or (c) variations inversely related to changes in the fair value of the issuer’s equity shares.

The Company determined that the warrants should not be classified as liabilities under ASC 480.

financial instruments, such as the warrants, are not required to be classified as liabilities under ASC 480, the Company assesses whether

such instruments are indexed to the Company’s own stock under ASC 815-40.

In order for an instrument to be considered indexed to

an entity’s own stock, its settlement amount must always equal the difference between the following:

(a) the fair value of a fixed

number of the Company’s equity shares, and (b) a fixed monetary amount or a fixed amount of a debt instrument issued by the Company.

Equity classified warrants are recorded in stockholders’ deficit and liability classified warrants are recorded as liabilities

within the Consolidated Balance Sheets.

The liability classified warrants are remeasured each period with changes recorded in the Consolidated

Statements of Operations and Comprehensive Loss.

Currency Translation

Company translated the assets and liabilities of foreign subsidiaries from their respective functional currency, the British pound, to

United States dollars at the appropriate spot rates as of the balance sheet date.

Income and expenses of operations are translated to

United States dollars using weighted average exchange rates during the year.

The foreign subsidiaries use the local currency as their

functional currency.

The effects of foreign currency translation adjustments are included as a component of accumulated other comprehensive

income in the accompanying consolidated statements of changes in stockholders’ deficit.

Non-monetary items in the subsidiaries’

functional currency are re-measured into the reporting currency at the historical exchange rate (i.e., the rate of exchange at the date

of the transaction).

and Revision of Previously Issued Financial Statements

Company translated the assets and liabilities of foreign subsidiaries from their respective functional currency, the British pound,

to United States dollars at the appropriate spot rates as of the balance sheet date.

Income and expenses of operations are

translated to United States dollars using weighted average exchange rates during the year.

The foreign subsidiaries use the local

currency as their functional currency.

The effects of foreign currency translation adjustments are included as a component of

accumulated other comprehensive income in the accompanying consolidated statements of changes in stockholders’ deficit.

Non-monetary items in the subsidiaries’ functional currency are re-measured into the reporting currency at the historical

exchange rate (i.e., the rate of exchange at the date of the transaction).

Restatement and Revision of Previously Issued Financial Statements

of Previously Issued Financial Statements:

June 30, 2024

In connection with the preparation

of the Company’s financial statements for the three and nine months ended September 30, 2024, the Company’s management determined

that a reclassification was necessary in its previously issued unaudited financial statements, relating solely to the balance sheet, as

of June 30, 2024.

It was determined that the Company’s deferred commission payable, previously classified as a long term liability,

should have been classified as a current liability in the Company’s June 30, 2024 condensed consolidated balance sheet.

Such reclassification

did not have any impact on the total liabilities owed by the Company as of June 30, 2024.

Management has evaluated this change and concluded

it was material to the prior ending June 30, 2024.

Therefore, the Company is restating the previously issued unaudited financial statements,

and related notes thereto, as of June 30, 2024.

impact of the errors described above on the condensed consolidated balance sheet as of June 30, 2024, is as follows:

March 31, 2024

In connection

with the preparation of the Company’s financial statements for the three and nine months ended September 30, 2024, the

Company’s management determined that a reclassification was necessary in its previously issued unaudited financial statements,

relating solely to the balance sheet, as of March 31, 2024.

It was determined that the Company’s deferred

commission payable, previously classified as a long term liability, should have been classified as a current liability in the

Company’s March 31, 2024 condensed consolidated balance sheet.

Such reclassification did not have any impact

on the total liabilities owed by the Company as of March 31, 2024.

Management has evaluated this change and concluded it was material to the prior period.

Therefore, the Company is restating the previously issued unaudited financial

statements, and related notes thereto, as of March 31, 2024.

The impact of the errors described above on the condensed

consolidated balance sheet as of March 31, 2024, is as follows:

Schedule of Impact of the Errors on Financial Statement

As Previously Reported

As of June 30, 2024

As of March 31, 2024

(Dollar amounts in thousands)

5 unchanged sentences

Total liabilities

of Previously Issued Financial Statements:

June 30, 2023

of Previously Issued Financials Statements:

March 31, 2023

connection with the preparation of the Company’s financial statements as of and for the year ended December 31, 2023, the

Company’s management identified errors in its previously issued unaudited financial statements as of and for the three months

and six months ended June 30, 2023 with respect to how certain expenses relating to the Merger were previously expensed and that as

part of the Company’s annual audit it was determined that such expenses should have been capitalized and subsequently recorded

against equity and restated such quarterly period in the December 31, 2023 Form 10-K.

The accounting for legal costs was deemed to

be specific incremental costs directly attributable to the Merger and concurrent PIPE financing (See Note 3).

Management has

evaluated this correction to the accounting treatment of such costs, which overstated net loss, additional paid in capital, and accumulated deficit and understated

prepaid expense, and concluded it was material to the prior quarterly periods, individually and in the aggregate.

Additionally, certain items included in the comparative financial statements

for the prior period have been reclassified to conform to the current period presentation.

impact of the errors described above on the balance sheet as of June 30, 2023, is as follows (in thousands):

As of June 30, 2023 (Unaudited)

As Previously

Balance Sheets

ended March 31, 2023 with respect to how certain expenses relating to the Merger were previously expensed and that as part of the

Company’s annual audit it was determined that such expenses should have been capitalized and subsequently recorded against

equity and restated such quarterly period in the December 31, 2023 Form 10-K.

The accounting for legal costs was deemed to be

specific incremental costs directly attributable to the Merger and concurrent PIPE financing (See Note 3).

Management has evaluated

this correction to the accounting treatment of such costs, which overstated net loss, additional paid in capital, and accumulated deficit and understated prepaid

expense, and concluded it was material to the prior quarterly periods, individually and in the aggregate.

impact of the errors described above on the balance sheet as of March 31, 2023, is as follows (in thousands):

As Previously Reported

As of March 31, 2023 (Unaudited)

As Previously Reported

Balance Sheets (in thousands)

Current assets

5 unchanged sentences

Total liabilities and shareholders’ deficit

impact of the errors described above on the statements of operations and comprehensive loss for the three and six months ended June 30,

impact of the errors described above on the statements of operations and comprehensive loss for the three months ended March 31, 2023,

is as follows (in thousands):

For the three months ended June 30, 2023 (Unaudited)

As Previously Reported

Statements of Operations and Comprehensive Loss

Operating expenses:

General and administrative expenses

Total operating costs and expenses

Operating loss

Net income (loss)

Net loss per share attributable to ordinary shareholders – basic and diluted*

Total comprehensive income (loss)

Does not reflect the impact

of the Merger on the Company’s capital structure

For the six months ended June 30, 2023 (Unaudited)

For the three months ended March 31, 2023 (Unaudited)

As Previously Reported

Statements of Operations and Comprehensive Loss

Statements of Operations and Comprehensive Loss (in thousands)

Operating expenses:

2 unchanged sentences

Operating loss

Net income (loss)

Net loss per share attributable to ordinary shareholders – basic and diluted*

Total comprehensive income (loss)

Does not reflect the impact of the Merger on the Company’s

capital structure

impact of the errors described above on the statements of changes in shareholders’ deficit as of June 30, 2023, is as follows (in

As of June 30, 2023 (Unaudited)

As Previously

Statements of Changes in Shareholders’ Deficit

Accumulated deficit *

Total shareholders’ deficit

Does not reflect the impact of the Merger on the Company’s

capital structure

impact of the errors described above on the statements of cash flows for the six months ended June 30, 2023, is as follows (in thousands):

For the six months ended June 30, 2023 (Unaudited)

As Previously

Statements of Cash Flows

Cash flows from operating activities:

Changes in operating assets and liabilities:

Prepaid expenses and other current assets

connection with the preparation of the Company’s financial statements for the three and nine months ended September 30, 2024,

the Company’s management identified errors in its previously issued unaudited financial statements as of and for the three

months and six months ended June 30, 2024, with respect to how certain accrued expenses were accounted for in comparative three and

six months ended June 30, 2023.

The error relates to the Company inaccurately estimating accrued professional fees incurred in

connection with the Merger as of June 30, 2023.

Management has evaluated this correction to the accounting treatment of such costs, which overstated general and

administrative expense, other income (expense), net loss, accumulated deficit, and accrued professional fees, and concluded it was

not material to the prior periods, individually and in the aggregate.

Additionally,

certain items included in the comparative financial statements for the prior period have been reclassified to conform to the current

period presentation.

impact of the errors described above on the balance sheet as of June 30, 2023, is as follows (in thousands):

As of June 30, 2023 (Unaudited)

As Previously

Balance Sheets

Current liabilities

Accrued professional fees

Total current liabilities

Total liabilities

Stockholders’ deficit

Accumulated deficit *

Total shareholders’ deficit

Total liabilities and shareholders’ deficit

Reflects the impact of the Merger on the Company’s capital structure

impact of the errors described above on the statements of operations and comprehensive loss for the three and six months ended June 30,

2023, is as follows (in thousands):

Previously Reported

For the three months ended June 30, 2023 (Unaudited)

Total Comprehensive Loss

* Does not reflect the

impact of the Merger on the Company’s capital structure

impact of the errors described above on the statements of changes in shareholders’ deficit as of March 31, 2023, is as follows

(in thousands):

As Previously Reported

Statements of Operations and Comprehensive Loss

Operating expenses:

General and administrative expenses

Total operating costs and expenses

Operating loss

Other income (expense):

Other income (expense), net

Total other (expense) income, net

Net income (loss)

Basic earnings/(net loss) per share

Diluted earnings/(net loss) per share

Total comprehensive income (loss)

Previously Reported

For the six months ended June 30, 2023 (Unaudited)

As of March 31, 2023 (Unaudited)

As Previously Reported

Statements of Operations and Comprehensive Loss

Operating expenses:

General and administrative expenses

Total operating costs and expenses

Operating loss

Other income (expense):

Other income (expense), net

Total other (expense) income, net

Net income (loss)

Basic earnings/(net loss) per share

Diluted earnings/(net loss) per share

Total comprehensive income (loss)

impact of the errors described above on the statements of changes in shareholders’ deficit as of June 30, 2023, is as follows (in

As of June 30, 2023 (Unaudited)

As Previously

Statements of Changes in Shareholders’ Deficit

Statements of Changes in Shareholders’ Deficit (in thousands)

Accumulated deficit

Total shareholders’ deficit

Reflects the impact of the Merger on the Company’s capital structure

impact of the errors described above on the statements of cash flows for the six months ended June 30, 2023, is as follows (in thousands):

For the six months ended June 30, 2023 (Unaudited)

As Previously

Statements of Cash Flows

impact of the errors described above on the statements of cash flows for the three months ended March 31, 2023, is as follows (in thousands):

As Previously Reported

For the three months ended March 31, 2023 (Unaudited)

As Previously Reported

Statements of Cash Flows (in thousands)

Cash flows from operating activities:

Changes in operating assets and liabilities:

Accrued expenses and other current liabilities

Prepaid expenses and other current assets

discussed in Note 1, “Summary of Significant Accounting Policies,” on September 22, 2023, the Company and MURF completed

2 unchanged sentences

was exchanged for the right to receive 32,313.215 shares of the Company’s Common Stock (“Common Stock”) resulting

in the issuance of 64,626,430 shares of the Company’s Common Stock.

addition to the shares issued to legacy Conduit shareholders noted above, an additional 373,570 shares of Common Stock were issued

in the issuance of 64,626,430 shares of Conduit Pharmaceuticals, Inc.

Common Stock.

addition to the shares issued to legacy Conduit shareholders noted above, an additional 373,570 shares of Common Stock was issued

to Conduit convertible note holders, resulting in a total of 65,000,000 shares of Common Stock being issued to Conduit shareholders

19 unchanged sentences

investors (the “PIPE Investors”) for an aggregate of 2,000,000 units, with each

unit consisting of one share of Common Stock (the “PIPE Shares”), together with one warrant exercisable into one share

of Common Stock (the “PIPE Warrants”), at a purchase price of $ 10.00 per unit, for an aggregate purchase price of $ 20,000,000

(the “PIPE Financing”) .

Upon the closing of the PIPE Financing (which closed in connection with the closing of

the Merger), the Company received $ 20.0 million in cash, which was used to settle related party promissory notes issued by MURF to

the MURF Sponsor and an affiliate of the MURF Sponsor as well as transaction costs.

unit consisting of one share of Company common stock (the “PIPE Shares”), together with one warrant exercisable into

one share of Company common stock (the “PIPE Warrants”), at a purchase price of $ 10.00 per unit, for an aggregate purchase

price of $ 20,000,000 (the “PIPE Financing”) .

Upon the closing of the PIPE Financing (which closed in connection

with the closing of the Merger), the Company received $ 20.0 million in cash from the PIPE Financing, which was used to settle related

party promissory notes issued by MURF to the MURF Sponsor and an affiliate of the MURF Sponsor as well as transaction costs.

proceeds received by the Company from the Merger and PIPE Financing, net of transaction costs, totaled $ 8.5 million.

1 unchanged sentence

of Common Stock Outstanding

Number of Shares

Exchange of MURF common stock subject to possible redemption for Conduit Pharmaceuticals Inc.

Exchange of MURF Class A common stock held by MURF Directors for Conduit Pharmaceuticals Inc.

Exchange of MURF Class A common stock held by MURF Sponsor for Conduit Pharmaceuticals Inc.

Subtotal - Merger, net of redemptions

Issuance of Conduit Pharmaceuticals Inc.

of MURF common stock subject to possible redemption for Conduit Pharmaceuticals Inc.

of MURF Class A common stock held by MURF Directors for Conduit Pharmaceuticals Inc.

of MURF Class A common stock held by MURF Sponsor for Conduit Pharmaceuticals Inc.

- Merger, net of redemptions

of Conduit Pharmaceuticals Inc.

common stock in connection with PIPE Financing

Exchange of Conduit Pharmaceuticals Limited ordinary shares for Conduit Pharmaceuticals Inc.

of Conduit Pharmaceuticals Limited ordinary shares for Conduit Pharmaceuticals Inc.

common stock on the Closing Date

Issuance of Conduit Pharmaceuticals Inc.

of Conduit Pharmaceuticals Inc.

common stock to holders of Conduit Pharmaceuticals Limited convertible notes on the Closing Date

Issuance of Conduit Pharmaceuticals Inc.

of Conduit Pharmaceuticals Inc.

common stock to an advisor for services directly related to the Merger

Total - Conduit Pharmaceuticals Inc.

common stock outstanding as a result of the Merger, PIPE Financing, exchange of Conduit Pharmaceuticals Limited shares for shares of Conduit Pharmaceuticals Inc., issuance of Conduit Pharmaceuticals Inc.

common stock to holders of Conduit Pharmaceuticals Limited convertible notes, and advisors.

Marketable Investments

The following table summarizes

the Company’s investments accounted for as available-for-sale securities as of June 30, 2024 (in thousands):

Schedule of Available for Sale Securities

As of June 30, 2024

Amortized Cost

Unrealized Gain

Unrealized Loss

Available-for-sale, short-term investments:

Investment in trading securities

Total available-for-sale, short-term investments

The Company had no short-term investments as of December

Unrealized losses on available-for-sale

securities as of June 30, 2024, were not significant.

There were no significant realized gains or losses recognized on the sale or maturity

of available-for-sale investments for the six months ended June 30, 2024.

following table presents as of June 30, 2024 the Company’s liabilities subject to measurement at fair value on a recurring basis

- Conduit Pharmaceuticals Inc.

common stock outstanding as a result of the Merger, PIPE Financing, exchange of Conduit Pharmaceuticals

Limited shares for shares of Conduit Pharmaceuticals Inc., issuance of Conduit Pharmaceuticals Inc.

common stock to holders of Conduit

Pharmaceuticals Limited convertible notes, and advisors.

following table presents as of March 31, 2024 the Company’s liabilities subject to measurement at fair value on a recurring basis

(in thousands):

of Liabilities Subject to Measurement at Fair Value on Recurring Basis

Fair Value Measurements as of June 30, 2024

Investment in trading securities

Derivative warrant Liability

Total Liabilities

Value Measurements as of March 31, 2024

warrant Liability

following table presents as of December 31, 2023 the Company’s liabilities subject to measurement at fair value on a recurring

basis (in thousands):

Fair Value Measurements as of December 31, 2023

Derivative warrant liability

Total Liabilities

The fair value of the investment

in trading securities was valued based on the purchase price of the investments and has therefore been classified as a Level

3 fair value measurement.

The Company had no investment in trading securities as of December 31,

There were no significant gains or losses recognized on the sale of investments in trading securities for the six months ended June

warrants issued to the PIPE Investors and an advisor in connection with the Merger are accounted for as liabilities in accordance with

ASC 815-40 and are presented within warrant liabilities in the consolidated balance sheets.

The measurements of the liability classified

warrants are classified as Level 2 fair value measurements due to the use of an observable market quote for the Company’s publicly

traded warrants, which are considered to be a similar asset in an active market.

Value Measurements as of December 31, 2023

warrant liability

warrants issued to the PIPE Investor and an advisor in connection with the Merger are accounted for as liabilities in accordance

with ASC 815-40 and are presented within Warrant liabilities in the consolidated balance sheets.

The measurements of the liability

classified warrants are classified as Level 2 fair value measurements due to the use of an observable market quote for the

Company’s publicly traded warrants, which are considered to be a similar asset in an active market.

warrant liabilities are calculated by multiplying the quoted market price of the Company’s publicly traded warrants by the number

of liability classified warrants.

the period ended June 30, 2024, there were no transfers between Level 1 and Level 2, nor into or out of Level 3.

the period ended March 31, 2024, there were no transfers between Level 1 and Level 2, nor into or out of Level 3.

Balance Sheet Details

assets consisted of the following as of June 30, 2024 and December 31, 2023 (in thousands):

assets consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands):

of Balance Sheet Details

June 30, 2024

December 31, 2023

Prepaid directors and officers insurance

of December 31,

directors and officers insurance

Prepaid Expenses

Other Receivables

Other Current Assets

Total prepaid expenses and other current assets

Expenses and other current liabilities consisted of the following as of June 30, 2024 and December 31, 2023 (in thousands):

Current Assets

prepaid expenses and other current assets

Expenses and other current liabilities consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands):

of Accrued Expenses and Other Current Liabilities

June 30, 2024

December 31, 2023

As of March 31,

As of December 31,

Accrued Professional Fees

5 unchanged sentences

May 27, 2021, the Company approved a Master Convertible Loan Note Instrument (the “2021 Convertible Loan Note Instrument”),

permitting the Company to issue convertible notes in a maximum aggregate principal amount of up to $ 1.4 million (£ 1.0 million).

The convertible notes issuable under the 2021 Convertible Loan Note Instrument mature three years after issuance to the respective noteholders

and bear 5 % interest, only to be paid to the noteholders in the event of a material breach by the Company of the terms of the 2021 Convertible

Loan Note Instrument.

In the event of a Change of Control (as defined in the 2021 Convertible Loan Note Instrument), the convertible

notes issued under the 2021 Convertible Loan Note Instrument automatically convert into common shares of the Company at a conversion

price equal to a 20 % discount to the price per share paid for the most senior class of shares in respect of such Change of Control.

Company, with consent from the noteholders, may prepay the convertible notes payable issued under the 2021 Convertible Loan Note Instrument

without penalty.

The convertible notes payable issued under the 2021 Convertible Loan Note Instrument are general, unsecured obligations

of the Company.

permitting the Company to issue convertible notes in a maximum aggregate principal amount of up to $ 1.4

million (£ 1.0

The convertible notes issuable under

the 2021 Convertible Loan Note Instrument mature three years after issuance to the respective noteholders and bear 5 %

interest, only to be paid to the noteholders in the event of a material breach by the Company of the terms of the 2021 Convertible Loan

Note Instrument.

In the event of a Change of Control (as defined in the 2021 Convertible Loan Note Instrument), the convertible notes

issued under the 2021 Convertible Loan Note Instrument automatically convert into common shares of the Company at a conversion price

equal to a 20 %

discount to the price per share paid for the most senior class of shares in respect of such Change of Control.

The Company, with consent

from the noteholders, may prepay the convertible notes payable issued under the 2021 Convertible Loan Note Instrument without penalty.

The convertible notes payable issued under the 2021 Convertible Loan Note Instrument are general, unsecured obligations of the Company.

November 1, 2022, the Company approved a master Convertible Loan Note Instrument (the “2022 Convertible Loan Note Instrument”),

11 unchanged sentences

Instrument are general, unsecured obligations of the Company.

January and February 2023, under the terms of the 2022 Convertible Loan Note Instrument, the Company issued convertible notes

payable with an aggregate principal amount of $ 0.9

million (£ 0.8

million) to non-related third parties.

As discussed in Note 13, “Related Party Transactions,”

during January and February 2023, under the terms of the 2022 Convertible Loan Note Instrument, the Company issued convertible notes payable

with an aggregate principal amount of $ 0.4 million (£ 0.3 million) to the CEO of Corvus.

On September 22, 2023, as discussed in Note 3, “Merger,” the

Company and MURF completed the Merger, at which point all outstanding convertible notes issued under the 2021 and 2022 Convertible Loan

Instruments converted into 373,570 shares of Common Stock.

January and February 2023, under the terms of the 2022 Convertible Loan Note Instrument, the Company issued convertible notes payable

with an aggregate principal amount of $ 0.9 million (£ 0.8 million) to non-related third parties.

discussed in Note 15, “Related Party Transactions,” during January and February 2023, under the terms of the 2022 Convertible

Loan Note Instrument, the Company issued convertible notes payable with an aggregate principal amount of $ 0.4 million (£ 0.3 million

) to the CEO of Corvus.

Company elected to fair value the convertible notes payable issued under the 2021 and 2022 Convertible Loan Note Instruments.

3 unchanged sentences

There has been no change in fair value from a change in credit quality.

the three and six months ended June 30, 2023, the Company recorded a $ 0.3 million loss from the change in fair value of convertible notes

payable in other income (expense), net, in its unaudited condensed consolidated statements of operations and Comprehensive Loss.

the three months ended March 31, 2023, the Company recorded a $ 0.3 million loss from the change in fair value of convertible notes payable

in other income (expense), net, in its unaudited condensed consolidated statements of operations and Comprehensive Loss.

September 22, 2023, as discussed in Note 3, “Merger,” the Company and MURF completed the Merger, at which point all outstanding

convertible notes issued under the 2021 and 2022 Convertible Loan Instruments converted into 373,570 shares of Common Stock.

Promissory Notes Payable

2 unchanged sentences

note matures and is payable in full 18 months from the date of issuance.

The note contains a conversion option which allows

the holder of the note to convert the principal, plus any accrued interest at the date of conversion, into shares of Common Stock at

a conversion price of $ 10

note contains a conversion option which allows the holder of the note to convert the principal, plus any accrued interest at the date

of conversion, into shares of CDT common stock at a conversion price of $ 10 .

The note carries 20 %

interest, which is payable every six (6) months from the date of the note until the maturity date.

The promissory convertible note

payable was not converted at the closing of the Merger and was also not converted as of June 30, 2024.

For the six months ended June

30, 2024 and June 30, 2023, the Company incurred interest expense on the convertible promissory of $ 80,000 and $ 40,000 , respectively.

The promissory convertible note payable

was not converted at the closing of the Merger and was also not converted as of March 31, 2024.

The Company has not elected the fair

value option and will account for the promissory convertible note payable as a liability in accordance with ASC 480 on the Company’s

balance sheet.

The only subsequent measurement impact on a recurring basis until conversion (if conversion occurs) or prepayment (if

prepayment occurs) will be to record the accrued interest as a liability and reduce the balances of the Note and its accrued interest

for cash payments made against these balances.

For the three months ended March 31, 2024 and March 31, 2023, interest on the convertible

promissory note totaled forty thousand dollars and forty thousand dollars, respectively.

Loans Payable

May 1, 2022, the Company entered into Loan Agreements (the “Loans”) with two lenders, totaling $ 0.2

Loans matured two years from the date of the agreement and bore no interest.

loan was made available to the Company by the lenders in three tranches of (i) $ 33,000

(ii) $ 33,000

and (iii) $ 28,000

thousand), totaling $ 0.2

The Loans provided for events of default,

including, among others, failure to make payment, bankruptcy and non-compliance with the terms of the Loans.

As of June 30, 2024, the

Company utilized all three tranches of the first loan and two out of three tranches of the second loan, with total loans payable at June

30, 2024 and December 31, 2023 of $ 0.2 million

respectively.

May 1, 2022, the Company entered into Loan Agreements (the “Loans”) with two lenders, totaling $ 0.2 million.

The Loans mature

two years from the date of the agreement and bear no interest.

Each loan was made available to the Company by the lenders in three tranches

of (i) $ 33 thousand (£ 30 thousand);

(ii) $ 33 thousand (£ 30 thousand) and (iii) $ 28 thousand (£ 25 thousand), totaling

$ 0.2 million.

The Loans provided for events of default, including, among others, failure to make payment, bankruptcy and non-compliance

with the terms of the Loans.

As of March 31, 2024, the Company utilized all three tranches of the first loan and two out of three tranches

of the second loan, with total loans payable at March 31, 2024 and December 31, 2023 of $ 0.2 million and $ 0.2 million, respectively.

Deferred Commission Payable

discussed in Note 3, A.G.P was a financial advisor to both MURF and Old Conduit in connection with the Merger transaction.

discussed in Note 3, A.G.P was a financial advisor to both the MURF and Old Conduit in connection with the Merger transaction.

completion of the Merger, A.G.P.:

(i) received a cash fee of $ 6.5

million, 1,300,000

shares of Common Stock, and warrants to purchase 54,000

shares of Common Stock at an exercise price of $ 11.00

per share pursuant to its engagement agreement with Old Conduit entered into on August 2, 2022, and (ii) agreed to defer payment, to

be paid in the future under certain circumstances by a date no later than March 21, 2025, of $ 5.7

million of fees plus annual interest of 5.5 %

as a result of its engagement for MURF’s IPO.

(i) received a cash fee of $ 6.5 million, 1,300,000 shares of Common Stock, and warrants to purchase

54,000 shares of Common Stock at an exercise price of $ 11.00 per share pursuant to its engagement agreement with Old Conduit entered

into on August 2, 2022, and (ii) agreed to defer payment, to be paid in the future under certain circumstances by a date no later than

March 21, 2025, of $ 5.7 million of fees plus annual interest of 5.5 % as a result of its engagement for MURF’s IPO.

The $ 5.7 million

deferred commissions payable was recorded as a current liability on the Company’s unaudited condensed consolidated balance

sheet as of June 30, 2024.

The Company will pay the deferred commission payable using 25 % of the net proceeds received in connection

with any underwritten public offering, equity line, at the market offering, private placement, and any other public or private

fundraising activities that result in proceeds to the Company until the full amount has been paid.

Accrued interest was recorded as

a liability on the Company’s condensed consolidated balance sheet and totaled $ 0.2

million and $ 0.1

million as of June 30, 2024 and December 31, 2023, respectively.

sheet as of March 31, 2024.

Accrued interest was recorded as a liability on the Company’s condensed consolidated balance sheet

and totaled $ 0.2 million and $ 0.1 million as of March 31, 2024 and December 31, 2023.

Share Based Compensation

6 unchanged sentences

shares of Common Stock.

Pursuant to the 2023 Plan’s “evergreen” provision, the number of shares of Common Stock

available for issuance under the 2023 Plan was increased by 3,691,476

shares of common stock effective January 1, 2024.

The number of authorized shares will automatically increase on January 1, 2025 and

continuing annually on each anniversary thereof through (and including) January 1, 2033, equal to the lesser of (i) 5 %

of the shares of common stock outstanding on the last day of the immediately preceding fiscal year and (ii) such smaller number of

shares of common stock as determined by the Board or the applicable committee of the Board.

The 2023 Plan allows for awards to be issued to

employees and non-employee directors in the form of options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”),

performance stock units, dividend equivalents, other stock-based, or other cash-based awards.

As of June 30, 2024, there were 14,107,834

Pursuant to the Plan Evergreen Provision, the number of shares of Common Stock available for issuance under

the 2023 Plan was increased by 3,691,476 shares of common stock effective January 1, 2024.

The number of authorized shares will

automatically increase on January 1, 2025 and continuing annually on each anniversary thereof through (and including) January 1,

2033, equal to the lesser of (i) 5 %

of the Shares outstanding on the last day of the immediately preceding fiscal year and (ii) such smaller number of Shares as

determined by the Board or the Committee.

The 2023 Plan allows for awards to be issued to employees and non-employee directors in

the form of options, stock appreciation rights, restricted stock, restricted stock units, performance stock units, dividend

equivalents, other stock-based, or other cash-based awards.

As of March 31, 2024, there were 14,042,834

shares of Common Stock available for issuance under the 2023 Plan.

For the three months ended June 30, 2024 and 2023, there was a total of $ 0.5 million and $ 0 , respectively in stock-based compensation

expense recognized within General and Administrative expenses on the consolidated statements of operations and Comprehensive Loss, respectively,

related to the RSUs and stock options granted since the Merger.

the six months ended June 30, 2024 and 2023, there was a total of $ 0.9 million

and $ 0 , respectively

in stock-based compensation expense recognized within General and Administrative expenses on the consolidated statements of

operations and Comprehensive Loss, respectively, related to the RSUs and stock options granted since the Merger.

On June 24, 2024, in connection with a

services agreement with an unrelated third party to provide marketing services, the Company issued 96,154 shares of its Common Stock (the

“Service Shares”).

The Company valued the Service Shares at $ 1.56 per share, the closing price of the Company’s

Common Stock on June 21, 2024.

The total compensation for these shares is $ 0.2 million which will recognized within General and Administrative expenses

over the service period of the agreement.

connection with the Merger, as discussed in Notes 1 and 3, and by Unanimous Written Consent of the Board of Directors, the then

Chief Financial Officer of the Company was granted 74,545

RSUs on December 1, 2023 at a weighted average grant date fair value of $ 5.51 .

The RSUs were to vest in equal annual instalments on the first three anniversaries of the closing of the Merger.

Upon the then

Chief Financial Officer’s resignation, effective May 15, 2024, all such RSUs were forfeited.

On June 7, 2024 by Unanimous

Written Consent of the Board of Directors, the Interim Chief Financial Officer of the Company and a Board member

were each granted 37,272

shares of immediately vested restricted stock at a weighted average grant date fair value of $ 2.84 .

The shares of restricted stock were fully vested as of the grant date.

additional RSU’s or shares of restricted common stock were granted during the three and six months ended June 30, 2024.There

shares of restricted common stock vested as of June 30, 2024 and no

RSUs vested as of December 31, 2023.

following table summarizes restricted stock activity for the 2023 Plan:

of Restricted Stock Activity

Number of Awards

Weighted Average

Grant Date Fair

Value Per Unit

Outstanding at December 31, 2023

Cancelled/forfeited

Outstanding at June 30, 2024

the quarter ended March 31, 2024 and 2023, there was $ 0.4 million and nil in stock-based compensation expense recognized within General

and Administrative expenses on the consolidated statements of operations and Comprehensive Loss, respectively, related to the

RSUs and Stock Options granted since the Merger.

connection with the Merger, as discussed in Notes 1 and 3, and by Unanimous Written Consent of the Board of Directors, the Chief Financial

Officer of Conduit Pharmaceuticals, Inc.

was granted 74,545 restricted stock units (“RSUs”) on December 1, 2023 at a weighted

average grant date fair value of $ 5.51 .

The RSUs vest in equal annual installments on the first three anniversaries of the closing of

No additional RSU’s were granted during the quarter ended March 31, 2024.

No RSUs were vested as of March 31, 2024

and December 31, 2023.

of March 31, 2024 there was $ 0.4 million of total unrecognized compensation expense related to unvested restricted stock awards, which

is expected to be recognized over a weighted average vesting period of 2.5 years.

Company estimates the fair value of each option award on the date of grant using the Black-Scholes option-pricing model.

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there any plans to declare a dividend.

Company did not grant stock options during the three and six months ended June 30, 2024 or June 30, 2023.

Company did not grant stock options during the three months ended March 31, 2024 or March 31, 2023.

Company accounts for forfeitures as they occur, which may result in the reversal of compensation costs in subsequent periods as the forfeitures

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of Stock Option Activity

(in thousands)

Outstanding at December 31, 2023

Average Exercise Price

Average Remaining Contractual Term (years)

Intrinsic Value (in thousands)

at December 31, 2023

Cancelled/forfeited

Outstanding at June 30, 2024

at March 31, 2024

aggregate intrinsic value of options is calculated as the difference between the exercise price of the underlying options and the fair

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common stock.

As of June 30, 2024, the total compensation cost related to non-vested option awards not yet recognized was $ 3.1 million

As of March 31, 2024, the total compensation cost related to non-vested option awards not yet recognized was $ 3.7 million

with a weighted average remaining vesting period of 3.1 years.

the six months ended June 30, 2024, and 2023, the Company’s effective tax rate was 0.0 % and 0.0 %, respectively, due to the current

year tax loss and valuation allowance established against the Company’s net deferred tax assets, and due to operating in a no tax

jurisdiction, respectively.

the three months ended March 31, 2024, and 2023, the Company’s effective tax rate was 0.0 %

and 0.0 %, respectively, due to the current year tax loss and valuation allowance established against the Company’s net deferred tax assets, and due to operating in a no tax jurisdiction, respectively.

Earnings/(Net Loss) Per Share Attributable to Common Stockholders

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of Basic and Diluted Net Loss Per Share

For the three months ended

For the six months ended

For the three months ended March 31,

Net loss - basic

Change in fair value and income impact of Cizzle option liability

Change in fair value and income impact of Vela option liability

Net loss - diluted

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Cizzle option liability shares

Vela option liability shares

Weighted average shares used in computing net loss per share - diluted

Net loss per share attributable to common stockholders, basic

Net income loss per share attributable to common stockholders, diluted

Net loss per share attributable to common shareholders, basic

Net income loss per share attributable to common shareholders, diluted

dilutive securities (upon conversion) that were not included in the diluted per share calculations because they would have been anti-dilutive

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of Potentially Dilutive Securities

June 30, 2024

June 30, 2023

As of March 31,

Equity classified warrants

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Convertible promissory notes payable

Restricted stock units

Antidilutive Securities

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Capital Limited

is a significant investor in the Company and the Chief Executive Officer of Corvus is a member of Conduit’s Board.

conjunction with the execution of the Subscription Agreements, Corvus and its affiliates entered into a participation and inducement

agreement with the PIPE Investors whereby Corvus agreed to provide certain payments and economic benefits to such investor in the

event Corvus sold or pledged in a debt transaction any of the shares it was receiving in the Merger.

circumstances, such investor may have a right to cause Corvus to transfer certain of its shares to such investor.

the six months ended June 30, 2024, the Company incurred travel expenses on behalf of the CEO of Corvus of approximately $ 0.3 million.

For the three and six months ended June 30, 2023, the Company incurred director’s fees and travel expenses payable to the CEO

of Corvus of $ 0.3 million.

The $ 0.3 million

paid during the six months ended June 30, 2024 was inclusive of an advance of $ 0.2 million

for travel expenses.

As of June 30, 2024, approximately $ 50,000

was outstanding on the advance.

of June 30, 2024 and December 31, 2023, the Company did not owe the CEO of Corvus any director’s fees as the CEO of Corvus and

Capital Limited (“Corvus”) is a significant investor in the Company through subscribing to 1,000 common shares prior to the

closing of the Merger on September 22, 2023.

As discussed in Note 3, the shares held by Corvus on the closing date of the Merger were

exchanged for shares of Conduit Pharmaceuticals Inc.

common stock.

The Chief Executive Officer of Corvus is a member of Conduit’s

board of directors.

In conjunction with the execution of the PIPE Subscription Agreement, Corvus Capital and its affiliates entered into

a participation and inducement agreement with the Private Placement Investor whereby Corvus agreed to provide certain payments and economic

benefits to such investor in the event Corvus Capital sold or pledged in a debt transaction any of the shares it was receiving in the

Business Combination.

In certain circumstances, such investor may have a right to cause Corvus Capital to transfer certain of its shares

to such investor.

the period ended March 31, 2024, the Company incurred travel expenses on behalf of the CEO of Corvus of approximately $ 0.2 million.

the three months ended March 31, 2023, the Company incurred director’s fees and travel expenses payable to the CEO of Corvus $ 0.3

million paid during the three months ended March

31, 2024 was inclusive of an advance of $ 0.1

million for travel expenses.

As of March 31,

2024, approximately $ 40

thousand was outstanding on the advance.

of March 31,2024, and December 31, 2023, the Company did not owe the CEO of Corvus any director’s fees as the CEO of Corvus and

the Company agreed to cease director’s fees to the CEO of Corvus effective at the closing of the Merger.

of March 31, 2024 and December 31, 2023, the Company paid fees to an employee of Corvus of approximately $ 25

thousand and $ 65

thousand, respectively.

Amounts owed to the CEO

and employee of Corvus are included in accrued expenses and other current liabilities in the balance sheet.

January and February 2023, under the terms of the 2022 Convertible Loan Note Instrument, the Company issued convertible notes payable

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Convertible Loan Note Instrument.

All of the convertible notes payable were converted into Common Stock upon the closing of the Merger

at a 20 % discount as specified under the terms of the 2021 Convertible Note Loan Instrument and the 2022 Convertible Note Loan Instrument.

All of the convertible notes payable were converted into Common Stock upon the closing of the Merger at

a 20 % discount as specified under the terms of the 2021 Convertible Note Loan Instrument and the 2022 Convertible Note Loan Instrument.

George Street Capital

George Street Capital (“SGSC”) is a stockholder and the Company has a Funding Agreement (as defined below) with SGSC.

Following the execution of the License Agreement with AstraZeneca (See Note 16, Subsequent Events ), the Company

will no longer fund the development of AZD1656 or AZD5904 under the terms of the Funding Agreement, dated March 26, 2021 (the “Funding

In this regard, the Company

previously entered into a deed of amendment in May 2024 amending the Funding Agreement.

The parties agreed that the

project funding provisions of the Funding Agreement whereby the Company had the right to fund a project or refer other funders to SGSC, but not the obligation to fund any project, would be amended to provide that SGSC must still include the

Company in any project funding opportunities and requests but may now seek other third party p roject

funders in addition to the Company.

For the three and six months ended June 30, 2024 and 2023, the Company did not incur expenses to SGSC and as of June

30, 2024 and December 31, 2023, the Company did not owe any amounts to SGSC.

August 20, 2022, the Company entered into a loan agreement with SGSC, with a total principal amount of $ 0.6 million.

loan to SGSC carried no interest, and as such, no interest receivable was recorded.

The Company previously recorded a full

reserve against the loan as SGSC did not previously have the ability to repay the loan.

On September 22, 2023, the related

party paid back a significant portion of its outstanding loan and the Company forgave the remaining portion of the loan and the Company

recorded the $ 0.6 million payoff as a gain within general and administrative expense on the consolidated statement of operations and

Comprehensive Loss, as it had previously been fully reserved.

George Street Capital is a significant investor in the Company through subscribing to 147 common shares of Old Conduit, which were exchanged

for shares of Common Stock upon the closing of the Merger.

Further, the Company has an Exclusive Funding Agreement (as defined below) with St George Street Capital.

For the three months ended March 31, 2024 and 2023, the Company did no t incur expenses to St George Street Capital.

As of March 31, 2024

and December 31, 2023, the Company did not owe any amounts to St George Street Capital.

March 26, 2021, the Company entered into the Exclusive Funding Agreement (“Funding Agreement”) with St George Street Capital.

Under the agreement, the Company has the first exclusive right, but not the obligation, to provide or procure funding for the performance

of a drug discovery and/or development project that St George Street wishes to undertake (each a “Project”)

in consideration for a share of the Net Revenue, as defined in respect to each Project (each a “Project Option”).

Street must notify the Company in writing of each Project St George Street wishes to undertake (each a “Project Notice”).

Within 90 days of a Project Notice, the Company must notify St George Street in writing whether it wishes to exercise its exclusive right

to provide all or some of the funding.

Such notice exercising the Project Option will specify the source and amount of the required funding

the Company will provide.

In the event the Company exercises its Project Option, the parties shall come to agreement for the provision

of funding for the Project (each a “Project Funding Agreement”).

Within 30 days of the entry into any Project Funding Agreement,

a joint commercialization committee will be established to oversee the Project.

Upon the receipt of any Net Revenue, as defined, St George

Street will first pay the expenses it has incurred, and the remaining Net Revenue will be shared between the parties according to the

agreed percentage.

and St George Street have entered into five project funding agreements, which are subject to the terms of the Global Funding Agreement,

to develop certain clinical assets that have been licensed to St George Street by AstraZeneca.

The project funding agreements relate

AZD1656 for use in renal transplant,

AZD1656 for use in pre-term labor,

AZD1656 for use in Hashimoto’s thyroiditis,

AZD1656 for use in uveitis, and

AZD5904 for use in idiopathic male infertility.

present, the Company has not determined whether to fund any of these projects, although its ability to choose to remains at the present

Subject to the terms of the Global Funding Agreement, and project funding agreements, either we or St George Street may seek funding

for projects from third parties.

to its terms, the Global Funding Agreement remains effective in respect of each project until the expiration of the right of a party

to receive a share of the Net Revenue (as defined in the Global Funding Agreement) pursuant to the Global Funding Agreement.

Under certain

circumstances, St George Street may terminate a project (i) in the event of a material or persistent breach of the Global Funding Agreement

by us, subject to a cure period if the breach is capable of remedy, or (ii) in the event St George Street decides to cease development

of a project.

If an event of force majeure occurs and continues for a designated period of time, the innocent party may terminate the

Global Funding Agreement after a notice period.

party may terminate a project if a voluntary arrangement is proposed or approved or an administration order is made, or a receiver or

administrative receiver is appointed of any of the other party’s assets or undertakings or a winding-up resolution or petition

is passed (otherwise than for the purpose of solvent reconstruction or amalgamation, in particular with respect to any reorganization

of the structure of that party) or if any circumstances arise which entitle a court or a creditor to appoint a receiver, administrative

receiver or administrator or make a winding-up order or similar or equivalent action is taken against or by that other party by reason

of its insolvency or in consequence of debt.

Generally, each project funding agreement may be terminated by us if at any time St George

Street ceases the conduct of development or commercialization of the relevant products in accordance with the relevant development plan

for a designated period of time, provided that the termination is only effective with respect to the specified project and the Global

Funding Agreement continues in effect for all other projects.

They may also be terminated by either party upon written notice to other

party if the other party materially breaches the project funding agreement and does not fully cure the breach to the non-breaching party’s

satisfaction within 90 days.

of March 31, 2024, the Company has not recognized any net revenue from the Global Funding Agreement or project funding agreements.

August 20, 2022, the Company entered into a loan agreement with St George Street, with a total principal amount of $ 0.6 million.

The loan to St George Street carried no interest, and as such, no interest receivable was recorded.

The Company previously recorded

a full reserve against the loan as St George Street did not previously have the ability to repay the loan.

On September 22, 2023,

the related party paid back a significant portion of its outstanding loan and the Company forgave the remaining portion of the loan and

the Company recorded the $ 0.6 million payoff as a gain within general and administrative expense on the consolidated statement of operations

and Comprehensive Loss, as it had previously been fully reserved.

Other Income (expense), net

following table presents other income (expense), net, for the three and six months ended June 30, 2024 and 2023 (in thousands):

following table presents other income (expense), net, for the three months ended March 31, 2024 and 2023 (in thousands):

of Other Expense, Net

For the three months ended

For the six months ended

For the three months ended March 31,

Other income:

Change in fair value of Cizzle option

Change in fair value of Vela option liability

Gain on change in fair value of derivative warrant liability

Realized foreign Currency gain

Gain on change in fair value of warrant

Interest Income

1 unchanged sentence

Other expense:

Loss on Vela Option

Change in fair value of convertible notes payable

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to the Sponsor simultaneously with the closing of MURF’s initial public offering (the “Private Placement Warrants”).

In connection with the Merger, the Company also issued warrants to the PIPE Investors (the “PIPE Warrants”) pursuant to the

Subscription Agreements and to an advisor (the “A.G.P.

In connection with the Merger, the Company also issued warrants to the PIPE Investors (the “PIPE Warrants”) pursuant to

the Subscription Agreements and to an advisor (the “A.G.P.

Warrants,” and together with the PIPE Warrants, the “Liability

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a fixed number of shares and a fixed monetary amount (or a fixed amount of a debt instrument) and must be classified as a liability.

March 20, 2024, the Company issued in a private placement equity classified common stock purchase warrants to an unrelated third

party to purchase up to an aggregate 260,000

shares of the Company’s Common Stock, in exchange for entering into a lock-up with respect to the shares of common stock held

by such holder (the “March Lock-Up Agreement”).

March 20, 2024, the Company issued in a private placement common stock purchase warrants (the “Warrants”) to an unrelated

third party to purchase up to an aggregate 260,000 shares of the Company’s common stock, in exchange for entering into a lock-up

with respect to the shares of common stock held by such holder (the “Lock-Up Agreement”).

The Company recognized at $ 0.5

million loss on the issuance of the warrants in the period ending June 30, 2024.

estimated the fair value of the warrants issued as of March 20, 2024, using a Black-Scholes option-pricing model utilizing the

following assumptions:

million loss on the issuance of the warrants in the period ending March 31, 2024.

The Company estimated

the fair value of the warrants issued as of March 20, 2024, using a Black-Scholes option-pricing model utilizing the following assumptions:

of Black-Scholes Option Pricing Model

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Time period to expiration

April 20, 2024, the Company issued in a private placement equity classified common stock purchase warrants to shareholders’ of

the Company to purchase up to an aggregate 1,447,725 shares

of the Company’s Common Stock, in exchange for (1) $ 0.125

per warrant and (2) entering into a lock-up with respect to the shares of common stock held by such holders (the “April

Lock-Up Agreement”).

the total April 2024 Warrants issued were issued to directors, related parties and management of the Company.

The Company received

cash of $ 0.2 million

and recognized a $ 2.2 million

loss on the issuance of the warrants in the three months ended June 30, 2024.

estimated the fair value of the warrants issued as of April 20, 2024, using a Black-Scholes option-pricing model utilizing the

following assumptions:

April 20, 2024

Closing stock price

Contractual exercise price

Risk-free rate

Estimated volatility

Time period to expiration

Classified Warrants

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five years after the Closing Date of the Merger or earlier upon redemption or liquidation.

Company will not be obligated to deliver any shares of Common Stock pursuant to the exercise of an Equity Classified Warrant and will

Company will not be obligated to deliver any shares of Common Stock pursuant to the exercise of a Equity Classified Warrant and will

have no obligation to settle such exercise unless a registration statement under the Securities Act with respect to the shares of Common

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not less than 30 days’ prior written notice of redemption to each Publicly Traded Warrant holder;

and only if, the reported last sale price of the Common Stock equals or exceeds $ 18.00 per share (as adjusted for stock splits, stock

dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing once

the Publicly Traded Warrants become exercisable and ending three business days before we send the notice of redemption to the warrant

and only if, the reported last sale price of the Common Stock equals or exceeds $ 18.00 per share (as adjusted for stock

splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period

commencing once the Publicly Traded Warrants become exercisable and ending three business days before we send the notice of

redemption to the warrant holders.

and when the Publicly Traded Warrants become redeemable by Conduit, Conduit may not exercise its redemption right if the issuance of

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Warrants were offered by Conduit in the offering.

Conduit calls the Publicly Traded Warrants for redemption as described above, Conduit’s management will have the option to require

any holder that wishes to exercise its Publicly Traded Warrant to do so on a “cashless basis.” In determining whether to

require all holders to exercise their Publicly Traded Warrants on a “cashless basis,” Conduit’s management will consider,

among other factors, Conduit’s cash position, the number of Publicly Traded Warrants that are outstanding and the dilutive effect

on Conduit stockholders of issuing the maximum number of shares of Common Stock issuable upon the exercise of our Publicly Traded Warrants.

If Conduit’s management takes advantage of this option, all holders of Publicly Traded Warrants would pay the exercise price by

surrendering their Publicly Traded Warrants for that number of shares of Common Stock equal to the quotient obtained by dividing (x)

the product of the number of shares of Common Stock underlying the Publicly Traded Warrants, multiplied by the difference between the

exercise price of the Publicly Traded Warrants and the “fair market value” (defined below) by (y) the fair market value.

The “fair market value” for this purpose shall mean the average reported last sale price of the Common Stock for the 10 trading

days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of Publicly Traded Warrants.

If Conduit’s management takes advantage of this option, the notice of redemption will contain the information necessary to calculate

the number of shares of Common Stock to be received upon exercise of the Publicly Traded Warrants, including the “fair market value”

in such case.

Requiring a cashless exercise in this manner will reduce the number of shares to be issued and thereby lessen the dilutive

effect of a Publicly Traded Warrant redemption.

Private Placement Warrants are identical to the Publicly Traded Warrants, except that such warrants will be exercisable for cash or on

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the Sponsor or its permitted transferees.

warrants issued in March 2024 (the “March 2024 Warrants”) are not exercisable until one year after their date of

Each March 2024 Warrant is exercisable into one share of the Company’s Common Stock at a price per share of $ 3.18

(as adjusted from time to time in accordance with the terms thereof) for a two-year period after the date of exercisability.

is no established public trading market for the March 2024 Warrants.

Notwithstanding the foregoing, the March 2024 Warrants shall

vest, and not be subject to forfeiture, with respect to 25% of such March 2024 Warrants commencing on the 90th day after the date of

the March Lock-Up Agreement and 25% on each subsequent 90-day anniversary, in each case vesting only if the holder agrees to

continue to have its shares of common stock remain locked up pursuant to the March Lock-Up Agreement on such date .

warrants issued April 2024 (the “April 2024 Warrants”) are not exercisable until one year after their date of issuance.

Each April 2024 Warrant is exercisable into one share of the Company’s Common Stock at a price per share of $ 3.12

summarized above, the Company has the option to redeem all of the Publicly Traded Warrants at a cash price of $ 0.01 per warrant during

the exercisability period if the Company’s common stock has closed at a trading price above $ 18.00 for 20 days during a 30 day

trading window.

Management notes that this option is within the Company’s control, therefore it does not represent an “obligation”

and does not create a liability under ASC 480.

Management considered the guidance within ASC 815-40-15-7A, noting that an exercise contingency

would not preclude permanent equity classification if all of the other equity criteria are met.

As all other criteria to be classified

as permanent equity are met, the Publicly Traded Warrants are classified as permanent equity on the Consolidated Balance Sheets.

assessed the Private Placement Warrants and determined that the warrants are considered to be indexed to the entity’s own stock

and met all the criteria for permanent equity classification.

As such, the Private Placement Warrants are also classified as permanent

equity on the Consolidated Balance Sheets.

Warrants issued in March 2024 are not exercisable until one year after their date of issuance.

Each Warrant is exercisable into one

share of the Company’s common stock at a price per share of $ 3.18

(as adjusted from time to time in accordance with the terms thereof) for a two-year period after the date of exercisability.

is no established public trading market for the April 2024 Warrants.

Notwithstanding the foregoing, the April 2024 Warrants shall

vest, and not be subject to forfeiture, with respect to 25% of such March 2024 Warrants commencing on the 90th day after the date of

the April Lock-Up Agreement and 25% on each subsequent 90-day anniversary, in each case vesting only if the holder agrees to

continue to have its shares of common stock remain locked up pursuant to the April Lock-Up Agreement on such date.

is no established public trading market for the Warrants.

Notwithstanding the foregoing, the Warrants shall vest, and not be subject

to forfeiture, with respect to 25% of such Warrants commencing on the 90th day after the date of the Lock-Up Agreement and 25% on

each subsequent 90-day anniversary, in each case vesting only if the holder agrees to continue to have its shares of common stock

remain locked up pursuant to the Lock-Up Agreement on such date .

issuance of the Warrants was made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of

1933, as amended, and/or Regulation D promulgated thereunder.

Classified Warrants

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Additionally, on the Closing Date of the Merger, the Company issued 54,000 warrants to A.G.P.

Warrants”) for

services provided directly related to the Merger.

The warrants provide AGP the right to purchase up to 54,000 shares of Common Stock

at an exercise price of $ 11.00 per share.

Liability Classified Warrants contain materially the same terms and are exercisable for a period of five years, beginning on October

Warrants”) for services provided directly related

to the Merger.

The warrants provide AGP the right to purchase up to 54,000 shares of Common Stock at an exercise price of $ 11.00

warrants issued to the PIPE Investors and the advisor (collectively the “Liability Classified Warrants”) contain materially

the same terms and are exercisable for a period of five years, beginning on October 22, 2023.

PIPE Warrants are exercisable for cash or on a cashless basis, at the holder’s option.

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not less than 30 days’ prior written notice of redemption to each warrant holder;

and only if, the reported last sale price of the Common Stock equals or exceeds $ 18.00 per share (as adjusted for stock splits, stock

dividends, recapitalizations and other similar events) for any 20 trading days within a 30 trading day period commencing once the

Warrants become exercisable and ending three business days before we send the notice of redemption to the warrant holders;

there is a current registration statement in effect with respect to the shares of Common Stock underlying the A.G.P.

each day in the 30 trading day period and continuing each thereafter until the redemption date.

These warrants are classified as derivative liabilities because they do not meet the criteria in ASC 815-40 to be considered

and only if, the reported last sale price of the Common Stock equals or exceeds $ 18.00 per

share (as adjusted for stock splits, stock dividends, recapitalizations and other similar

events) for any 20 trading days within a 30 trading day period commencing once the A.G.P.

Warrants become exercisable and ending three business days before we send the notice of redemption

to the warrant holders;

there is a current registration statement in effect with respect to the shares of Common

Stock underlying the A.G.P.

Warrants for each day in the 30 trading day period and continuing

each thereafter until the redemption date.

the Company calls the A.G.P.

Warrants for redemption as described above, our management will have the option to require any holder that

wishes to exercise its A.G.P.

Warrant to do so on a “cashless basis.” If our management takes advantage of this option, holders

Warrants would pay the exercise price by surrendering their A.G.P.

Warrants for that number of shares of Common Stock as calculated

pursuant to the A.G.P.

Requiring a cashless exercise in this manner will reduce the number of shares to be issued and thereby

lessen the dilutive effect of an A.G.P.

Warrant redemption.

Liability Classified Warrants are classified as derivative liabilities because they do not meet the criteria in ASC 815-40 to be considered

indexed to the entity’s own stock as the warrants could be settled for an amount that is not equal to the difference between the

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period end dates and upon exercise (see Note 6 for additional information regarding fair value).

June 30, 2024 and December 31, 2023, the consolidated balance sheets contained derivative warrant liabilities of $ 32,000 and $ 0.1

March 31, 2024 and December 31, 2023, the consolidated balance sheets contained derivative warrant liabilities of $ 0.1

million and $ 0.1

million, respectively.

19 unchanged sentences

due to, among other things, defense legal cost and the diversion of the attention of our management.

March 7, 2024, the Company entered into a lease agreement with respect to approximately 2,100 square feet of space in Cambridge, England,

for a lease term commencing in March 2024 and ending in January 2027.

The Company recorded a right-of-use asset of $ 0.4 million and corresponding

lease liability of $ 0.3 million, using an incremental borrowing rate of 11.23 %.

The Company classified $ 0.1 million of the lease liability

as short-term and $ 0.1 million of the lease liability as long-term as of June 30, 2024.

March 7, 2024, the Company entered into a lease agreement with respect to approximately 2,100 square

feet of space in Cambridge, England, for a lease term commencing in March 2024 and ending in January 2027.

The Company recorded a

right-of-use asset of $ 0.4 million

and corresponding lease liability of $ 0.3 million,

using an incremental borrowing rate of 11.23 %.

Company classified $ 0.1

million of the lease liability as short-term and $ 0.2

million of the lease liability as long-term as of March 31, 2024.

Investment Regarding AZD 1656

June 3, 2020, the Company entered into an agreement with SGSC for an indirect investment in AZD 1656.

Under the terms of the agreement,

SGSC agreed to pay the Company a royalty of 30 % of sales in excess of $ 24.5 million (£ 19.2 million) of AZD 1656 should it reach

the commercialization stage and generate revenue in exchange for the Company funding SGSC’s research and development efforts.

of March 31, 2024 and March 31, 2023, the Company did not provide funding to SGSC.

Subsequent Events

August 7, 2024, the Company and AstraZeneca, a related party of the Company,

entered into a License Agreement, dated August 7, 2024 (the “License Agreement”).

Pursuant to such License Agreement,

AstraZeneca agreed to grant an exclusive license to the Company for certain intellectual property rights controlled by AstraZeneca related to

HK-4 Glucokinase activators AZD1656 and AZD5658 in all indications and myeloperoxidase inhibitor AZD5904 for the treatment,

prevention, and prophylaxis of idiopathic male infertility.

The Company will be responsible for the development and

commercialization of the relevant products licensed under the License Agreement (the “Licensed Products”) at its sole cost and expense in accordance with the Development

plan, as defined.

is required to use commercially reasonable efforts to develop and commercialize the Licensed Products.

consideration for the grant of the license, the Company (i) granted AstraZeneca Common Stock pursuant to a Stock Issuance Agreement

(as further set out below), (ii) paid AstraZeneca an up-front payment of $ 1.5

million, and (iii) will pay AstraZeneca a percentage (on a tiered basis) of any amounts it may receive in connection with a grant of

a sublicense (subject to various customary exceptions).

has been granted a right of first negotiation to develop, manufacture, and commercialize a Licensed Product if Conduit receives an

offer for, or solicits, a transaction where a third party would obtain the right to develop, manufacture, or commercialize a

Licensed Product.

If AstraZeneca exercises such right, the parties will negotiate in good faith for an agreed period of time on an

exclusive basis.

If Conduit intends to commercialize any Licensed Product itself, it shall discuss in good faith the appropriate royalty

to be paid to AstraZeneca, subject to a low double digit royalty floor.

AstraZeneca agreed to transfer to Conduit has the right to purchase all quantities of existing inventory of Licensed

Products including up to 450kg of AZD1656 at pre-agreed prices, which the Company believes would be sufficient to commercial launch,

assuming all clinical trials were successfully completed and regulatory approvals granted.

party may terminate the License Agreement for material breach (subject to a cure period) or insolvency of the other party.

may terminate the License Agreement for convenience (in its entirety or on a Licensed Product-by-Licensed Product basis).

AstraZeneca may terminate the License Agreement in certain circumstances, including (but not limited to) the Company ceasing development

of all Licensed Products (subject to certain exceptions for normal pauses or gaps between clinical studies).

connection with the execution of the License Agreement, the Company and AstraZeneca entered into a Stock Issuance Agreement, dated

August 7, 2024 (the “Issuance Agreement”), whereby the Company has issued AstraZeneca 9,504,465

shares of the Company’s Common Stock.

The Issuance Agreement provides AstraZeneca with resale registration rights for such shares.

2024, the Company entered into a Senior Secured Promissory Note (the “Note”) with Nirland Limited (the

“Nirland”), a related party of the Company, pursuant to which the Company issued and sold to the Nirland the Note in

the original principal amount of $ 2,650,000

(the “Note”), inclusive of a $ 500,000

original issuance discount.

Of the total amount of the Note, $ 1,675,000

was issued upon execution of the Note and the balance of $ 475,000

will be paid after the Closing Common Stock, defined below, has been registered for resale.

The Note bears interest at a rate of 12 %

per annum, accruing daily on a 365-day basis, payable monthly in arrears as cash, or accrued at the Nirland’s discretion.

Note matures in 12 months from August 5, 2024 .

The Company has certain

obligations to mandatorily prepay the Note, and any accrued interest, with portions of any proceeds received in connection with future

The Company may prepay the outstanding principal and accrued interest on the Note with no fee.

Until the Note is no longer

outstanding, Nirland has a right of first refusal to participate, in an amount up to 100%, with certain exceptions, in any future

equity or debt offering of the Company.

The Note is secured

by all assets of the Company and its subsidiary.

The Note is guaranteed by the subsidiary of the Company.

The Note contains customary

default provisions for a transaction of this nature.

Upon an event of default, the interest rate of the Note will increase to 18 % , until

such time as the default is remedied.

In connection with the Note, the Company issued the Nirland 12,500,000 shares of the Company’s

Common Stock on August 6, 2024.

April 2024, the Company issued in a private placement common stock purchase warrants (the “Warrants”) to multiple

parties to purchase up to an aggregate 1,447,725

shares of the Company’s common stock, in exchange for entering into a lock-up, one (1) year for all Warrants, with respect to

the shares of common stock held by such holder (the “Lock-Up Agreement”) and $ 0.125

907,725 of the total Warrants issued were issued to directors, related parties and management of the Company.

Warrants are not exercisable until one year after their date of issuance.

Each Warrant is exercisable into one share of the Company’s

common stock at a price per share of $ 3.12

(as adjusted from time to time in accordance

with the terms thereof) for a two-year period after the date of exercisability.

is no established public trading market for the Warrants.

issuance of the Warrants was made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of

1933, as amended, and/or Regulation D promulgated thereunder.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q/A

Item 1. Financial Statements