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Item 1. Financial Statements

2023-03-07 compared with 2022-05-13 · 809 added, 734 removed, 281 unchanged (85% of the section changed)

Financial Statements.

The accompanying financial statements

have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with

the instructions for Form 10-Q.

Accordingly, they do not include all of the information and footnotes required by generally accepted accounting

principles for complete financial statements.

The accompanying financial

statements have been prepared in accordance with generally accepted accounting principles for interim financial information and

in accordance with the instructions for Form 10-Q.

Accordingly, they do not include all of the information and footnotes required

by generally accepted accounting principles for complete financial statements.

In the opinion of management,

the financial statements contain all material adjustments, consisting only of normal recurring adjustments necessary to present fairly

the financial condition, results of operations, and cash flows of the Company for the interim periods presented.

The results for the periods ended

March 31, 2022, are not necessarily indicative of the results of operations for the full year.

These financial statements and related

footnotes should be read in conjunction with the financial statements and footnotes thereto included in the Company’s Form 10-K

for the fiscal year ended June 30, 2021, filed with the Securities and Exchange Commission on September 24, 2021.

the financial statements contain all material adjustments, consisting only of normal recurring adjustments necessary to present

fairly the financial condition, results of operations, and cash flows of the Company for the interim periods presented.

The results for the periods

ended September 30, 2022, are not necessarily indicative of the results of operations for the full year.

These financial statements

and related footnotes should be read in conjunction with the financial statements and footnotes thereto included in the Company’s

Form 10-K for the fiscal year ended June 30, 2022, filed with the Securities and Exchange Commission on February 27, 2023.

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

CURRENT ASSETS:

Other receivables

Prepaid expenses

Prepaids and other assets

Total Current Assets

2 unchanged sentences

Definite life intangible assets, net

Indefinite life intangible assets

Indefinite life intangible assets, net

Deposits and other assets

1 unchanged sentence

Total Other Assets

$ 180,100,613

$ 189,605,225

CURRENT LIABILITIES:

1 unchanged sentence

Accrued expenses

Contingent consideration liability

Other current liabilities

Notes payable, net

Convertible notes payable

2 unchanged sentences

NON-CURRENT LIABILITIES:

Contingent consideration liability

Convertible notes payable

Notes payable, net

Operating lease liabilities, net of current portion

Total Non-Current Liabilities

Total Liabilities

4 unchanged sentences

no shares issued and outstanding

Common stock, par value $ 0.0001 , 100,000,000 shares authorized, 52,798,267 shares issued and outstanding at March 31, 2022, and 52,219,661 shares issued and outstanding at June 30, 2021

Common stock, par value $ 0.0001 , 100,000,000 shares authorized, 55,507,082 shares issued and outstanding at September 30, 2022, and 53,007,082 shares issued and outstanding at June 30, 2022

Additional paid-in capital

5 unchanged sentences

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$ 180,100,613

$ 189,605,225

See accompanying notes to the unaudited condensed consolidated

financial statements.

See accompanying notes to the unaudited condensed

consolidated financial statements.

ENOCHIAN BIOSCIENCES INC.

2 unchanged sentences

For the Three Months Ended

For the Nine Months Ended

September 30,

Operating Expenses

6 unchanged sentences

( 7,504,673 )

( 17,870,020 )

( 9,217,903 )

Other Income (Expense)

Other Income (Expenses)

Loss on extinguishment of contingent consideration liability

Change in fair value of contingent consideration

( 2,824,642 )

( 5,070,891 )

Interest expense

(Loss) gain on currency transactions

Gain on currency transactions

Interest and other income

Total Other Income (Expense)

( 2,166,909 )

Total Other Income (Expenses)

( 2,907,262 )

2 unchanged sentences

( 10,411,935 )

( 23,196,341 )

( 9,485,377 )

Income Tax (Provision) Benefit

$ ( 6,201,465 )

$ ( 4,030,710 )

Income Tax (Expense) Benefit

$ ( 7,699,760 )

$ ( 10,411,969 )

BASIC AND DILUTED LOSS PER SHARE

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC AND DILUTED

See accompanying notes to the unaudited condensed consolidated

financial statements

BASIC AND DILUTED NET LOSS PER SHARE

WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK OUTSTANDING - BASIC AND DILUTED

See accompanying notes to the unaudited condensed

consolidated financial statements.

ENOCHIAN BIOSCIENCES INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE

CONDENSED CONSOLIDATED

STATEMENTS OF COMPREHENSIVE LOSS

For the Three Months Ended

For the Nine Months Ended

$ ( 6,201,465 )

$ ( 4,030,710 )

September 30,

$ ( 7,699,760 )

$ ( 10,411,969 )

Other Comprehensive Income (Loss)

Currency Translations

Other Comprehensive Loss

Foreign Currency Translation, net of taxes

Comprehensive Loss

1 unchanged sentence

$ ( 10,415,962 )

$ ( 23,207,035 )

$ ( 9,332,082 )

See accompanying notes to the unaudited condensed consolidated

financial statements.

See accompanying notes to the unaudited condensed

consolidated financial statements.

ENOCHIAN BIOSCIENCES INC.

7 unchanged sentences

$ ( 204,345,197 )

$ 174,662,939

Stock-based compensation

( 10,411,969 )

Currency translations

September 30, 2021

( 101,323,774 )

Stock issued pursuant to warrants exercised

Shares issued pursuant to LPC purchase agreement

Stock-based compensation

Shares issued for fully vested RSUs

Restricted shares converted to shares for services rendered

( 6,582,941 )

Currency translations

December 31, 2021

( 107,906,715 )

Contingent shares issued pursuant to acquisition agreement

Shares issued pursuant to LPC purchase agreement

Shares issued for fully vested RSUs

Shares issued for Earn-out

Stock-based Compensation

1 unchanged sentence

( 7,699,760 )

Currency translations

March 31, 2022

$ 275,367,091

Foreign Currency Translation Adjustment

September 30, 2022

$ 282,402,437

8 unchanged sentences

Stock-based Compensation

Issuance of commitment shares

( 10,411,969 )

Currency translations

Foreign Currency Translation Adjustment

September 30, 2021

$ 268,308,331

Stock issued pursuant to warrants exercised

Contingent shares issued pursuant to acquisition agreement

Stock-based compensation

$ ( 101,323,774 )

$ 166,974,952

Currency translations

December 31, 2020

( 69,518,064 )

Shares issued pursuant to 2021 private placement

Shares issued in lieu of interest on $5 million notes payable extension

Restricted shares converted to shares for services rendered

Stock-based compensation

( 4,030,710 )

Currency translations

March 31, 2021

$ 235,875,627

$ ( 73,548,774 )

$ 162,318,711

See accompanying notes to the unaudited condensed consolidated

financial statements.

See accompanying notes to the unaudited condensed

consolidated financial statements.

ENOCHIAN BIOSCIENCES INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Nine Months Ended

CONDENSED CONSOLIDATED STATEMENTS OF CASH

For the Three Months Ended

September 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

$ ( 23,196,375 )

$ ( 9,360,576 )

ADJUSTMENTS TO RECONCILE NET LOSS TO NET CASH USED IN OPERATING ACTIVITIES:

Depreciation and amortization

Loss on extinguishment of contingent consideration liability

Change in contingent consideration liability

Stock based compensation expense

Right-of-use assets

Amortization of discount of notes payable

5 unchanged sentences

Other current liabilities

Operating lease liabilities

Operating leases, net

NET CASH USED IN OPERATING ACTIVITIES

( 12,681,849 )

( 7,582,676 )

CASH FLOWS FROM INVESTING ACTIVITIES:

3 unchanged sentences

Proceeds from exercise of warrants

Repayment of finance agreement

Proceeds from LPC equity agreement

Proceeds from 2021 Private Placement

NET CASH PROVIDED BY FINANCING ACTIVITIES

1 unchanged sentence

NET CHANGE IN CASH

( 9,513,493 )

( 4,170,077 )

CASH, BEGINNING OF PERIOD

2 unchanged sentences

Cash paid during the period for:

SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES

Contingent shares issued pursuant to acquisition agreement

Shares issued in lieu of interest expense on $5 million note payable extension

Discount on $5 million note payable related to prepaid interest paid in the form of shares issued

Finance agreement entered into in exchange for prepaid assets

See accompanying notes to the unaudited condensed consolidated

financial statement.

SUPPLEMENTAL DISCLOSURES OF NON-CASH FINANCING ACTIVITIES

Common shares issued for contingent earn out liability

See accompanying notes to the unaudited condensed

consolidated financial statements.

ENOCHIAN BIOSCIENCES INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

NOTE 1 — THE BUSINESS AND SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES

– Enochian Biosciences Inc., (“Enochian,” or

“Registrant”, and together with its subsidiaries, the “Company”, “we” or “us”)

engages in the research and development of pharmaceutical and biological products for the human treatment of HIV, HBV, influenza and

coronavirus infections, and cancer with the intent to manufacture and commercialize said products.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

NOTE 1 — THE BUSINESS AND SUMMARY

OF SIGNIFICANT ACCOUNTING POLICIES

Business – Enochian

Biosciences Inc., (“Enochian,” or “Registrant”, and together with its subsidiaries, the “Company”,

“we” or “us”) engages in the research and development of pharmaceutical and biological products for the

treatment of Cancer, HIV, and HBV with the intent to manufacture said products.

Going Concern - These

financial statements have been prepared on a going concern basis, which assumes that the Company will continue to realize its assets

and discharge its liabilities in the normal course of business.

The Company has not generated any revenue, has incurred substantial

recurring losses from continuing operations and has an accumulated deficit of $ 212,044,957 as of September 30, 2022.

The continuation

of the Company as a going concern is dependent upon (i) its ability to successfully obtain FDA approval of its product candidates,

(ii) its ability to obtain any necessary debt and/or equity financing, and (iii) its ability to generate profits from the Company’s

future operations.

These factors raise substantial doubt regarding the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements.

These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and

classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Basis of Presentation

– The Company prepares consolidated financial statements in accordance with accounting principles generally accepted in the

United States of America (“U.S.

– The Company prepares consolidated financial statements in accordance with accounting principles generally accepted

in the United States of America (“U.S.

GAAP”) and follows the rules and regulations of the U.S.

3 unchanged sentences

In the opinion of management, all adjustments

(which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash

flows at March 31, 2022, and 2021 and for the periods then ended have been made.

(which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and

cash flows at September 30, 2022, and 2021 and for the periods then ended have been made.

Certain information and footnote disclosures

4 unchanged sentences

included in the Company’s June 30, 2022, audited financial statements.

The results of operations for the periods ended March

The results of operations for the periods ended September

30, 2022, and 2021 are not necessarily indicative of the operating results for the full year.

Consolidation – For the

three and nine months ended March 31, 2022, and 2021, the condensed consolidated financial statements include the accounts and operations

of the Registrant and its subsidiaries.

All material inter-company transactions and accounts have been eliminated in the consolidation.

Reclassification – Certain

amounts in the prior period financial statements, have been reclassified to conform to the current presentation.

For the three and nine

months ended March 31, 2021, we reclassified lab expenses of $39,596 and $110,078, respectively from general and administrative expenses

Consolidation –

For the three months ended September 30, 2022, and 2021, the condensed consolidated financial statements include the accounts and

operations of the Registrant and its subsidiaries.

All material inter-company transactions and accounts have been eliminated in

the consolidation.

Reclassification –

Certain amounts in the prior period financial statements, have been reclassified to conform to the current presentation.

the three months ended September 2021, we reclassified lab expenses of $ 49,192 , from general and administrative expenses

to research and development expenses .

Accounting Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the

date of the financial statements and the reported amount of revenues and expenses during the reporting period.

Actual results could differ

from those estimated.

Significant estimates include the fair value and potential impairment of intangible assets, and fair value of equity

instruments issued.

COVID-19 – The pandemic

continues to evolve, and to date has led to the implementation of various mitigation responses, including government-imposed quarantines,

travel restrictions and other public health safety measures, as well as leading to reported adverse impacts on healthcare resources, facilities,

and providers across the United States and in other countries.

– The preparation of financial statements in conformity with generally accepted accounting principles requires management

to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets

and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period.

Actual results could differ from those estimated.

Significant estimates include the fair value and potential impairment of intangible

assets, and fair value of equity instruments issued.

COVID-19 Update

The COVID-19 pandemic continues

COVID-19 may cause delays in our research activities.

To date, it has not

materially affected our operations;

however, it has caused delays in the conduct of experiments due to limitations of various organizations,

in particular those conducting experiments related to COVID-19.

There have also been increases in the cost to conduct animal studies due

to staffing and other limitations.

The full extent to which the COVID-19

pandemic may impact our business and operations is subject to future developments, which are uncertain and difficult to predict.

quarantines, shelter-in-place or similar restrictions and other actions taken or imposed by foreign, federal, state, and local governments

could adversely impact our or our partners’ clinical, research and development, regulatory and manufacturing operations, or timelines.

We continue to monitor the impact

of the COVID-19 pandemic on our business and operations and will seek to adjust our activities as appropriate.

To date, the COVID-19 pandemic has not materially affected our

However, it has caused delays in the conduct of experiments due to limitations in resources and supply chain issues,

in particular for those third-parties conducting experiments.

There have also been increases in the cost to conduct animal studies

due to staffing and other limitations.

The full extent to which

the COVID-19 pandemic may impact our business and operations is subject to future developments, which are uncertain and difficult

We continue to monitor the impact of the COVID-19 pandemic on our business and operations and will seek to adjust our

activities as appropriate.

In addition, the pandemic

could result in significant and prolonged disruption of global financial markets, reducing our ability to access capital, which could

in the future negatively affect the financial resources available to us.

Functional Currency & Foreign

Currency Translation – The functional currency of Enochian Denmark is the Danish Kroner (“DKK”).

The Company’s reporting

currency is the U.S.

could result in significant and prolonged disruption of global financial markets, reducing our ability to access capital, which

could in the future negatively affect the financial resources available to us.

Functional Currency &

Foreign Currency Translation – The functional currency of Enochian Denmark is the Danish Kroner (“DKK”).

The Company’s reporting currency is the U.S.

Dollar for the purpose of these financial statements.

The Company’s balance sheet accounts are translated into

dollars at the period-end exchange rates and all revenue and expenses are translated into U.S.

dollars at the average exchange rates

prevailing during the periods ended March 31, 2022, and 2021.

Translation gains and losses are deferred and accumulated as a component

of other comprehensive income in stockholders’ equity.

Transaction gains and losses that arise from exchange rate fluctuations from

transactions denominated in a currency other than the functional currency are included in the statement of operations as incurred.

The Company’s balance

sheet accounts are translated into U.S.

dollars at the period-end exchange rates and all revenue and expenses are translated into

dollars at the average exchange rates prevailing during the periods ended September 30, 2022, and 2021.

Translation gains

and losses are deferred and accumulated as a component of other comprehensive income in stockholders’ equity.

gains and losses that arise from exchange rate fluctuations from transactions denominated in a currency other than the functional

currency are included in the statement of operations as incurred.

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 — THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES (Continued)

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents.

The Company had balances held in financial institutions in Denmark and in the United States in excess of federally insured amounts

at March 31, 2022, and June 30, 2021, of $ 10,883,620 and $ 20,287,212 , respectively.

– The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash

The Company had balances held in financial institutions in Denmark and in the United States in excess of federally

insured amounts at September 30, 2022, and June 30, 2022, of $ 7,622,223 and $ 8,805,495 , respectively.

Property and Equipment

– Property and equipment are stated at cost.

Expenditures for major renewals and betterments that extend the useful lives of property and

equipment are capitalized and depreciated upon being placed in service.

Expenditures for maintenance and repairs are charged to expense

Depreciation is computed for financial statement purposes on a straight-line basis over the estimated useful lives of the

assets, which range from four to ten years (see Note 3.)

Intangible Assets – The

Company has both definite and indefinite life intangible assets.

Definite life intangible assets

include patents.

The Company accounts for definite life intangible assets in accordance with Financial Accounting Standards Board (“FASB”)

Accounting Standards Codification (“ASC”) Topic 350, “Goodwill and Other Intangible Assets”.

Expenditures for major renewals and betterments that extend the useful lives

of property and equipment are capitalized and depreciated upon being placed in service.

Expenditures for maintenance and repairs

are charged to expense as incurred.

Depreciation is computed for financial statement purposes on a straight-line basis over the

estimated useful lives of the assets, which range from four to ten years (see Note 4.)

Intangible Assets –

are recorded at cost.

The Company has both definite and indefinite life intangible assets.

Definite life intangible

assets include patents.

The Company accounts for definite life intangible assets in accordance with Financial Accounting Standards

Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 350, “Goodwill and Other Intangible

Intangible assets are recorded at cost.

Patent costs consist of costs incurred to acquire the underlying patent.

If it is determined that a patent will

not be issued, the related remaining capitalized patent costs are charged to expense.

Intangible assets are amortized on a straight-line

basis over their estimated useful life.

The estimated useful life of patents is twenty years from the date of application.

Indefinite life intangible assets

include license agreements and goodwill.

The Company accounts for indefinite life intangible assets in accordance with ASC 350, “Goodwill

and Other Intangible Assets”.

License agreement costs represent the fair value of the license agreement on the date acquired and

are tested annually for impairment, as well as whenever events or changes in circumstances indicate the carrying value may not be recoverable.

If it is determined that a patent will not be issued, the related remaining capitalized patent costs are charged to expense.

assets are amortized on a straight-line basis over their estimated useful life.

The estimated useful life of patents is twenty

years from the date of application.

Indefinite life intangible

assets include license agreements and goodwill.

The Company accounts for indefinite life intangible assets in accordance with ASC

350, “Goodwill and Other Intangible Assets”.

License agreement costs represent the fair value of the license agreement

on the date acquired and are tested annually for impairment, as well as whenever events or changes in circumstances indicate the

carrying value may not be recoverable.

Goodwill is not amortized but is evaluated for impairment annually as of June 30 th of each fiscal year or whenever events

or changes in circumstances indicate the carrying value may not be recoverable.

Impairment of Goodwill and Indefinite Lived Intangible

Assets – We test for goodwill impairment at the reporting unit level, which is one level below the operating segment level.

Our detailed impairment testing involves comparing the fair value of each reporting unit to its carrying value, including goodwill.

value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit and is based on discounted

cash flows or relative market-based approaches.

If the carrying value of the reporting unit exceeds its fair value, we record an impairment

loss for such excess.

The carrying value of in-process research and development (“IPR&D”) and goodwill at March 31, 2022,

were $ 154,824,000 and $ 11,640,000 , respectively.

For indefinite-lived intangible assets, such as licenses

acquired as an IPR&D asset, on an annual basis we determine the fair value of the asset and record an impairment loss, if any, for

the excess of the carrying value of the asset over its fair value.

The fair value analysis performed on the license agreement, and the

annual fair value analysis performed on goodwill supported that both indefinite life intangible assets are not impaired as of June 30,

2021, and no impairment is deemed necessary as of March 31, 2022 (see Note 4.)

of Goodwill and Indefinite Lived Intangible Assets – We test for goodwill impairment at the reporting unit level,

which is one level below the operating segment level.

Our detailed impairment testing involves comparing the fair value of each

reporting unit to its carrying value, including goodwill.

Fair value reflects the price a market participant would be willing to pay

in a potential sale of the reporting unit and is based on discounted cash flows or relative market-based approaches.

If the carrying

value of the reporting unit exceeds its fair value, we record an impairment loss for such excess.

The annual fair value analysis

performed on goodwill supported that goodwill was not impaired as of June 30, 2022, and no additional impairment is deemed necessary

as of September 30, 2022 (see Note 5.)

For indefinite-lived intangible

assets, such as licenses acquired as an IPR&D asset, on an annual basis we determine the fair value of the asset and record

an impairment loss, if any, for the excess of the carrying value of the asset over its fair value.

For the year ended June 30,

2022, the carrying value of the licenses acquired as an IPR&D asset exceeded its fair value.

Therefore, the Company recorded

an impairment loss of $ 93,253,000 during the year ended June 30, 2022.

No impairment is deemed necessary as of September 30, 2022

(see Note 5.)

The carrying value of IPR&D

and goodwill at September 30, 2022, were $ 61,571,000 and $ 11,640,000 , respectively.

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Impairment of Long-Lived Assets

– Long-lived assets, such as property and equipment, definite and indefinite life intangible assets are reviewed for impairment whenever

events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Circumstances which could trigger

a review include, but are not limited to:

NOTE 1 — THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES (Continued)

Impairment of Long-Lived

Assets – Long-lived assets, such as property and equipment, definite and indefinite life intangible assets are reviewed

for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Circumstances which could trigger a review include, but are not limited to:

significant decreases in the market price of the asset;

significant adverse changes in the business

climate or legal factors;

current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses

associated with the use of the asset;

and current expectations that the asset will more likely than not be sold or disposed of significantly

before the end of its estimated useful life.

Recoverability of assets to be

held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be

generated by the asset.

If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge

is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset.

Assets to be disposed of would

be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell and would

no longer be depreciated.

The depreciable basis of assets that are impaired and continue in use are their respective fair values.

Leases – In accordance

with ASC Topic 842, the Company determined the initial classification and measurement of its right-of-use assets and lease liabilities

at the lease commencement date and thereafter.

The lease terms include any renewal options and termination options that the Company is

reasonably assured to exercise, if applicable.

The present value of lease payments is determined by using the implicit interest rate in

the lease, if that rate is readily determinable;

otherwise, the Company develops an incremental borrowing rate based on the information

available at the commencement date in determining the present value of the future payments.

Rent expense for operating leases

is recognized on a straight-line basis, unless the operating lease right of use assets have been impaired, over the reasonably assured

lease term based on the total lease payments and is included in operating expenses in the condensed consolidated statements of operations.

For operating leases that reflect impairment, the Company will recognize the amortization of the operating lease right-of-use assets on

a straight-line basis over the remaining lease term with rent expense still included in general and administrative expenses in the unaudited

condensed consolidated statements of operations.

The Company has elected the practical

expedient to not separate lease and non-lease components.

The Company’s non-lease components are primarily related to property maintenance,

insurance, and taxes, which vary based on future outcomes, and thus are recognized in general and administrative expenses when incurred

(see Note 5.)

Research and Development Expenses

– The Company expenses research and development costs incurred in formulating, improving, validating, and creating alternative

or modified processes related to and expanding the use of the HIV, HBV, Coronaviruses and Oncology therapies and technologies for use

in the prevention, treatment, amelioration of and/or therapy for HIV, HBV, Coronaviruses and Oncology.

Research and development expenses

for the three and nine months ended March 31, 2022, amounted to $ 1,212,380 and $ 6,605,038 , respectively.

Research and development expenses

for the three and nine months ended March 31, 2021, amounted to $ 1,119,203 , and $ 3,574,529 , respectively.

Income Taxes – The

Company accounts for income taxes in accordance with FASB ASC Topic 740, “Accounting for Income Taxes”, which requires an

asset and liability approach for accounting for income taxes.

Loss Per Share –

The Company calculates earnings/ (loss) per share in accordance with FASB Topic ASC 260, “Earnings Per Share”.

Basic earnings

per common share (EPS) are based on the weighted average number of shares of Common Stock outstanding during each period.

Diluted earnings

per common share are based on shares outstanding (computed as under basic EPS) and potentially dilutive shares of Common Stock.

shares of Common Stock included in the diluted earnings per share calculation include in-the-money stock options that have been granted

but have not been exercised.

Because of the net loss for the three and nine months ended March 31, 2022, and 2021, the dilutive shares

for both periods were excluded from the Diluted EPS calculation as the effect of these potential shares of Common Stock is anti-dilutive.

The Company had 7,201,108 and 3,967,275 potential shares of Common Stock excluded from the Diluted EPS calculation as of March 31, 2022,

and March 31, 2021, respectively.

significant adverse changes in the business climate or legal factors;

current period cash flow or operating losses combined with

a history of losses or a forecast of continuing losses associated with the use of the asset;

and current expectations that the

asset will more likely than not be sold or disposed of significantly before the end of its estimated useful life.

Recoverability of assets

to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows

expected to be generated by the asset.

If the carrying amount of an asset exceeds its estimated undiscounted future cash flows,

an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset.

Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or

fair value less costs to sell and would no longer be depreciated.

The depreciable basis of assets that are impaired and continue

in use are their respective fair values.

accordance with ASC Topic 842, the Company determined the initial classification and measurement of its right-of-use assets and

lease liabilities at the lease commencement date and thereafter.

The lease terms include any renewal options and termination options

that the Company is reasonably assured to exercise, if applicable.

The present value of lease payments is determined by using the

implicit interest rate in the lease, if that rate is readily determinable;

otherwise, the Company develops an incremental borrowing

rate based on the information available at the commencement date in determining the present value of the future payments.

Rent expense for operating

leases is recognized on a straight-line basis, unless the operating lease right of use assets have been impaired, over the reasonably

assured lease term based on the total lease payments and is included in operating expenses in the condensed consolidated statements

of operations.

For operating leases that reflect impairment, the Company will recognize the amortization of the operating lease

right-of-use assets on a straight-line basis over the remaining lease term with rent expense still included in general and administrative

expenses in the unaudited condensed consolidated statements of operations.

The Company has elected

the practical expedient to not separate lease and non-lease components.

The Company’s non-lease components are primarily

related to property maintenance, insurance, and taxes, which vary based on future outcomes, and thus are recognized in general

and administrative expenses when incurred (see Note 6.)

Research and Development

Expenses – The Company expenses research and development costs incurred in formulating, improving, validating, and creating

alternative or modified processes related to and expanding the use of the Oncology, HIV and HBV therapies and technologies for use

in the prevention, treatment, amelioration of and/or therapy for Oncology, HIV and HBV.

Research and development expenses for the

three months ended September 30, 2022 and 2021, amounted to $ 2,605,375 , and $ 3,055,435 , respectively.

Income Taxes –

The Company accounts for income taxes in accordance with FASB ASC Topic 740, “Accounting for Income Taxes”, which requires

an asset and liability approach for accounting for income taxes.

Per Share – The Company calculates earnings/ (loss) per share in accordance with FASB ASC Topic 260,

“Earnings Per Share”.

Basic earnings per common share (EPS) are based on the weighted average number of shares of Common

Stock outstanding during each period.

Diluted earnings per common share are based on shares outstanding (computed as under basic

EPS) and potentially dilutive shares of Common Stock.

Potential shares of Common Stock included in the diluted earnings per share

calculation include in-the-money stock options that have been granted but have not been exercised.

Because of the net loss for the

three months ended September 30, 2022, and 2021, the dilutive shares for both periods were excluded from the Diluted EPS calculation

as the effect of these potential shares of Common Stock is anti-dilutive.

The Company had 4,495,477

and 7,116,667

potential shares of Common Stock excluded from the Diluted EPS calculation as of September 30, 2022, and September 30, 2021,

respectively.

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 — THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES (Continued)

Fair Value of Financial

Instruments – The Company accounts for fair value measurements for financial assets and financial liabilities in

accordance with FASB ASC Topic 820, “Fair Value Measurements”.

The authoritative guidance, among other things, defines

fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability

category measured at fair value on either a recurring or nonrecurring basis.

Fair value is defined as the exit price, representing

the amount that would either be received to sell an asset or be paid to transfer a liability in an orderly transaction between

market participants.

As such, fair value is a market-based measurement that should be determined based on assumptions that market

participants would use in pricing an asset or liability (see Note 2.)

Stock Options and

Restricted Share Units – The Company has granted stock options, restricted share units (“RSUs”) and warrants.

The Company accounts for options in accordance with the provisions of FASB ASC Topic 718, “Compensation - Stock

Compensation”.

Compensation – The Company records stock-based compensation in accordance with ASC Topic 718, “Compensation - Stock

Compensation”.

All transactions in which goods or services are the consideration received for the issuance of equity

instruments are accounted for based on the fair value of the consideration received or the fair value of the equity

instrument issued, whichever is more reliably measurable.

Equity instruments issued to consultants and the cost of the services

received as consideration are measured and recognized based on the fair value of the equity instruments issued and are

recognized over the required service period, which is generally the vesting period.

Stock based compensation costs for the vesting

of options and RSUs granted for the three and nine months ended March 31, 2022, were $ 577,676 and $ 5,348,943 , respectively.

Stock-based compensation costs for the vesting of the options and RSUs granted for the three and nine months ended March 31, 2021,

were $ 499,428 and $ 1,184,975 , respectively.

(See Note 7.)

Recently Adopted

Accounting Pronouncements – Recent accounting pronouncements issued by the FASB do not or are not believed by management

to have a material impact on the Company’s present or future financial statements.

Instruments – The Company accounts for fair value measurements for financial assets and financial liabilities in accordance

with FASB ASC Topic 820, “Fair Value Measurements”.

The authoritative guidance, among other things, defines fair value,

establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category

measured at fair value on either a recurring or nonrecurring basis.

Fair value is defined as the exit price, representing the amount

that would either be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants.

As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would

use in pricing an asset or liability (see Note 3.)

Options and Restricted Share Units – The Company has granted stock options, restricted share units

(“RSUs”) and warrants.

The Company accounts for stock-based awards in accordance with the provisions of FASB ASC Topic

718, “Compensation - Stock Compensation”.

Stock-Based Compensation

– The Company records stock-based compensation in accordance with ASC Topic 718, “Compensation - Stock Compensation”.

All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted

for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever

is more reliably measurable.

Equity instruments issued to consultants and the cost of the services received as consideration are

measured and recognized based on the fair value of the equity instruments issued and are recognized over the required service

period, which is generally the vesting period.

Stock based compensation costs for the vesting of options and RSUs granted for the

three months ended September 30, 2022 and 2021 were $ 1,026,008 and $ 2,727,975 , respectively (See Note 8.)

Recently Adopted Accounting

Pronouncements – Recent accounting pronouncements issued by the FASB do not or are not believed by management to have

a material impact on the Company’s present or future financial statements.

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 — FAIR VALUE MEASUREMENTS

– The Company accounts for fair value measurements for financial assets and financial liabilities in accordance with FASB ASC

Topic 820, “Fair Value Measurements”.

The authoritative guidance among other things, defines fair value, establishes a consistent

framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either

a recurring or nonrecurring basis.

Fair value is defined as the exit price, representing the amount that would either be received to sell

an asset or be paid to transfer a liability in an orderly transaction between market participants.

As such, fair value is a market-based

measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability.

for considering such assumptions, the guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring

fair value as follows:

NOTE 2 – GOING CONCERN

The Company’s

consolidated financial statements are prepared using the generally accepted accounting principles applicable to a going concern,

which contemplates the realization of assets and liquidation of liabilities in the normal course of business.

However, the Company

has incurred substantial recurring losses from continuing operations, has used cash in the Company’s continuing operations,

and is dependent on additional financing to fund operations.

The Company incurred a net loss of approximately $ 7,699,760

and $ 10,411,969

for the quarters ended September 30, 2022 and 2021, respectively.

As of September 30, 2022, the Company had cash and cash

equivalents of $ 7,971,918

and an accumulated deficit of $ 212,044,957 .

These conditions raise substantial doubt about the Company’s ability to continue as a going concern for one year after the

date the financial statements are issued.

The condensed consolidated financial statements do not include any adjustments relating to

the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the

Company be unable to continue in existence.

Management intends to raise additional funds for (a) research and development, (b)

increases in personnel, and (c) the purchase of equipment, specifically to advance the Company’s potential products through

the regulatory process.

The Company may raise such funds from time to time through public or private sales of equity or debt

Such financing may not be available on acceptable terms, or at all, and the failure to raise capital when needed could

materially adversely affect the Company’s growth plans and its financial condition and results of operations.

NOTE 3 — FAIR VALUE

MEASUREMENTS – The Company accounts for fair value measurements for financial assets and financial liabilities in accordance

with FASB ASC Topic 820, “Fair Value Measurements”.

The authoritative guidance among other things, defines fair value,

establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category

measured at fair value on either a recurring or nonrecurring basis.

Fair value is defined as the exit price, representing the amount

that would either be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants.

As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would

use in pricing an asset or liability.

As a basis for considering such assumptions, the guidance establishes a three-tier fair value

hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Observable inputs such as quoted prices in active markets for identical assets or liabilities;

1 unchanged sentence

Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

There were no Level 1, 2 or 3

assets, nor any Level 1 or 2 liabilities as of March 31, 2022.

Level 3 liabilities held as of

March 31, 2022, consisted of a contingent consideration liability related to the February 16, 2018, acquisition of Enochian Biopharma

(the “Acquisition”).

As consideration for the Acquisition, the stockholders of Enochian Biopharma received (i) 18,081,962

shares of Common Stock, and (ii) the right to receive contingent shares pro rata upon the exercise of warrants, which were outstanding

The contingent consideration liability was recorded at fair value of $ 21,516,000 at the time of acquisition and is subsequently

remeasured to fair value at the end of each reporting period.

At March 31, 2022, there were 1,250,000 contingent shares issuable in connection

with the Acquisition of Enochian Biopharma.

The fair value of the contingent

consideration liability is estimated using an option-pricing model.

The key inputs to the model are all contractual or observable with

the exception being volatility, which is computed, based on the Company’s underlying stock.

The key inputs to valuing the contingent

consideration liability as of March 31, 2022, include the Company’s stock price on the valuation date of $ 8.25 ;

the exercise price

of the warrants of $ 1.30 , the risk-free rate of 0.59 %, the expected volatility of the Company’s Common Stock of 90.7 %, the digital

call rate of 99.98 %, and the 1,250,000 contingent shares remaining at the end of the period.

Fair Value measurements are highly sensitive

to changes in these inputs and significant changes in these inputs could result in a significantly higher or lower fair value.

Unless otherwise disclosed, the

fair value of the Company’s financial instruments including cash, accounts receivable, prepaid expenses, investments, accounts payable,

accrued expenses, capital lease obligations and notes payable approximate their recorded values due to their short-term maturities.

The following table sets forth

the Level 3 liability at March 31, 2022, which is recorded on the balance sheet at fair value on a recurring basis.

As required, this

liability is classified based on the lowest level of input that is significant to the fair value measurement:

Summary of significant to the fair value measurement

Fair Value Measurements at

Reporting Date Using

Quoted Prices in

Active Markets for Identical Assets Inputs

Significant Other

Observable Inputs

Significant Other Unobservable Inputs

The roll forward of the contingent consideration liability is as follows:

Balance June 30, 2021

Contingent Shares issued pursuant to the Acquisition Agreement

Fair value adjustment

Contingent Consideration Liability at March 31, 2022

There were no Level 1, 2

or 3 assets, nor any Level 1, 2 or 3 liabilities as of September 30, 2022.

ENOCHIAN BIOSCIENCES INC.

4 unchanged sentences

Summary of property and equipment

March 31, 2022

September 30, 2022

June 30, 2022

5 unchanged sentences

Depreciation expense amounted

to $ 27,990 , and $ 83,787 for the three and nine months ended March 31, 2022, respectively, and $ 26,814 and $ 80,172 for the three and nine

months ended March 31, 2021, respectively.

to $ 26,915 , and $ 27,806 for the three months ended September 30, 2022 and 2021, respectively.

NOTE 5 — INTANGIBLE ASSETS

At March 31, 2022, and June 30,

2021, definite-life intangible assets, net of accumulated amortization, consisted of patents on the Company’s products and processes

of $ 50,596 and $ 65,906 , respectively.

The patents are recorded at cost and amortized over twenty years from the date of application.

expense for the three and nine months ended March 31, 2022, was $ 3,730 and $ 11,471 , respectively.

Amortization expense for the three and

nine months ended March 31, 2021, was $ 4,012 and $ 11,871 , respectively.

At March 31, 2022, and 2021, indefinite

life intangible assets consisted of a license agreement classified as In-Process Research and Development (“IPR&D”) intangible

assets, which are not amortizable until the intangible asset provides economic benefit, and goodwill.

At March 31, 2022, and June 30,

2021, definite and indefinite-life intangible assets consisted of the following:

At September 30, 2022, and

June 30, 2022, definite-life intangible assets, net of accumulated amortization, consisted of patents on the Company’s products

and processes of $ 39,953 and $ 44,268 , respectively.

The patents are recorded at cost and amortized over twenty years from the date

of application.

Amortization expense for the three months ended September 30, 2022, and September 30, 2021, was $ 1,486 and $ 3,927 ,

respectively.

At September 30, 2022, and

2021, indefinite life intangible assets consisted of a license agreement classified as In-Process Research and Development (“IPR&D”)

intangible assets, which are not amortizable until the intangible asset provides economic benefit, and goodwill.

At September 30, 2022, and

June 30, 2022, definite and indefinite-life intangible assets consisted of the following:

Schedule of life intangible assets

1 unchanged sentence

Effect of Currency Translation

September 30,

Definite Life Intangible Assets

3 unchanged sentences

License Agreement

$ 154,824,000

Total Indefinite Life Intangible Assets

$ 166,464,000

Expected future amortization expense

is as follows:

Expected future amortization

expense is as follows:

Schedule of expected future amortization expense

Year ending June 30,

During February 2018, the Company

acquired a License Agreement (as licensee) to an HIV therapy which consists of a perpetual, fully paid-up, royalty-free, sub-licensable,

and sole and exclusive worldwide license to research, develop, use, sell, have sold, make, have made, offer for sale, import and otherwise

commercialize certain intellectual property in cellular therapies for the prevention, treatment, amelioration of and/or therapy exclusively

for HIV in humans, and research and development exclusively relating to HIV in humans.

Because the HIV License Agreement is considered

an IPR&D intangible asset it is classified as an indefinite life asset that is tested annually for impairment.

Impairment – Following the

fourth quarter of each year, management performs its annual test of impairment of intangible assets by performing a quantitative assessment

and determines if it is more likely than not that, the fair value of the asset is greater than or equal to the carrying value of the asset.

The results of the quantitative assessment supported Management’s conclusion that an impairment adjustment was not required as of

June 30, 2021, and no impairment is deemed necessary as of March 31, 2022.

During February 2018, the

Company acquired a License Agreement (as licensee) to an HIV therapy which consists of a perpetual, fully paid-up, royalty-free,

sub-licensable, and sole and exclusive worldwide license to research, develop, use, sell, have sold, make, have made, offer for

sale, import and otherwise commercialize certain intellectual property in cellular therapies for the prevention, treatment, amelioration

of and/or therapy exclusively for HIV in humans, and research and development exclusively relating to HIV in humans.

HIV License Agreement is considered an IPR&D intangible asset it is classified as an indefinite life asset that is tested annually

for impairment.

Impairment – Following

the fourth quarter of each year, management performs its annual test of impairment of intangible assets by performing a quantitative

assessment and determines if it is more likely than not that the fair value of the asset is greater than or equal to the carrying

value of the asset.

The results of the quantitative assessment indicated that the carrying value of the licenses acquired as an

IPR&D asset exceeded its fair value, due to the sublicensing of ENOB HV-01, which required a different valuation approach and

changes in other factors impacting the fair value of the asset.

Therefore, an impairment adjustment of $ 93,253,000

was recorded in the three months ended June 30, 2022.

ENOCHIAN BIOSCIENCES INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

NOTES TO UNAUDITED CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

NOTE 6 — LEASES

Leases — On November 13, 2017, Enochian entered into a Lease Agreement for a term of five years and two months from November

1, 2017, with Plaza Medical Office Building, LLC, a California limited liability company, as landlord, (the “Landlord”), pursuant

to which the Company agreed to lease from the Landlord approximately 2,325 rentable square feet.

The base rent increases by 3% each year,

and ranges from approximately $8,719 per month for the first year to $10,107 per month for the two months of the sixth year.

On June 19, 2018, Enochian entered

into a Lease Agreement for a term of ten years from September 1, 2018, with Century City Medical Plaza Land Co., Inc., pursuant to which

the Company agreed to lease approximately 2,453 rentable square feet.

On February 20, 2019, the Registrant entered into an Addendum to

the original Lease Agreement with an effective date of December 1, 2019, where it expanded the lease area to include another 1,101 square

feet for a total rentable 3,554 square feet.

The base rent increases by 3% each year, and ranges from $17,770 per month for the first

year to $23,186 per month for the tenth year.

The equalized monthly lease payment for the term of the lease is $20,050.

The Company identified and assessed

the following significant assumptions in recognizing the right-of-use asset and corresponding liabilities:

November 13, 2017, Enochian entered into a Lease Agreement for a term of five years and two months from November 1, 2017, with Plaza

Medical Office Building, LLC, a California limited liability company, as landlord, (the “Landlord”) pursuant to which

the Company agreed to lease from the Landlord approximately 2,325 rentable square feet.

The base rent increased by 3% each year, and

ranged from approximately $8,719 per month for the first year to $10,107 per month for the two months of the sixth year.

was terminated early without penalties or additional costs as of September 30, 2022, that released an accrual

related to leasehold improvements that was not utilized.

On June 19, 2018, Enochian

entered into a Lease Agreement for a term of ten years from September 1, 2018, with Century City Medical Plaza Land Co., Inc.,

pursuant to which the Company agreed to lease approximately 2,453 rentable square feet.

On February 20, 2019, Enochian entered

into an Addendum to the original Lease Agreement with an effective date of December 1, 2019, where it expanded the lease area to

include another 1,101 square feet for a total rentable 3,554 square feet.

The base rent increases by 3% each year, and ranges from

$17,770 per month for the first year to $23,186 per month for the tenth year.

The equalized monthly lease payment for the term

of the lease is $20,050.

Enochian subleased the space as of June 25, 2022 (see subsection below “ Sublease Agreement ”

for details.)

The Company identified and

assessed the following significant assumptions in recognizing the right-of-use asset and corresponding liabilities:

Expected lease term

— The expected lease term includes both contractual lease periods and, when applicable, cancelable option periods when it is reasonably

certain that the Company would exercise such options.

The Company’s leases have remaining lease terms between 9 months and 65 months.

As of March 31, 2022, the weighted-average remaining term is 5.11 years.

Incremental borrowing rate

— The Company’s lease agreements do not provide an implicit rate.

As the Company does not have any external borrowings for

comparable terms of its leases, the Company estimated the incremental borrowing rate based on the U.S.

Treasury Yield Curve rate that

corresponds to the length of each lease.

This rate is an estimate of what the Company would have to pay if borrowing on a collateralized

basis over a similar term in an amount equal to the lease payments in a similar economic environment.

As of March 31, 2022, the weighted-average

discount rate is 4.01 %.

Lease and non-lease components

— In certain cases the Company is required to pay for certain additional charges for operating costs, including insurance, maintenance,

taxes, and other costs incurred, which are billed based on both usage and as a percentage of the Company’s share of total square

The Company determined that these costs are non-lease components, and they are not included in the calculation of the lease liabilities

because they are variable.

Payments for these variable, non-lease components are considered variable lease costs and are recognized in

the period in which the costs are incurred.

Lease expense charged to

general and administrative expenses for the three and nine months ended March 31, 2022, amounted to $ 85,027 and $ 253,223 , respectively.

Lease expense charged to general and administrative expenses for the three and nine months ended March 31, 2021, amounted to $ 77,345

and $ 255,719 , respectively.

— The expected lease term includes both contractual lease periods and, when applicable, cancelable option periods when it

is reasonably certain that the Company would exercise such options.

The Company’s lease has a remaining lease term of 59

As of September 30, 2022, the weighted-average remaining term is 4.92 years.

Incremental borrowing

rate — The Company’s lease agreements do not provide an implicit rate.

As the Company does not have any external

borrowings for comparable terms of its leases, the Company estimated the incremental borrowing rate based on the U.S.

Yield Curve rate that corresponds to the length of each lease.

This rate is an estimate of what the Company would have to pay if

borrowing on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.

As of September 30, 2022, the weighted-average discount rate is 4.03 %.

Lease and non-lease

components — In certain cases the Company is required to pay for certain additional charges for operating costs,

including insurance, maintenance, taxes, and other costs incurred, which are billed based on both usage and as a percentage of

the Company’s share of total square footage.

The Company determined that these costs are non-lease components, and they are

not included in the calculation of the lease liabilities because they are variable.

Payments for these variable, non-lease components

are considered variable lease costs and are recognized in the period in which the costs are incurred.

Below are the lease commitments

for the next 5 years and thereafter:

for the next 5 years:

Lease commitments

2 unchanged sentences

Less imputed interest

Sublease Agreement

On June 20, 2022, the Company

entered into a sublease Agreement with One Health Labs (the “Subtenant”), whereby the Subtenant agreed to lease 3,554

square feet of space currently rented by the Company in Century City Medical Plaza as of June 25, 2022, for a period of 3.5 years

with an option to renew for the remaining term of the lease that ends as of June 19, 2028.

The base rent is $17,770 per month plus

$750 towards utility fees that are part of the original lease agreement and will increase by 3% each year over the term of the

The Company received a total of $57,022 on July 1, 2022 after execution of the sublease to cover the first month

rent, utility fee and deposit.

The first sublease payment began on August 1, 2022.

In accordance with ASC Topic

842, the Company treats the sublease as a separate lease, as the Company was not relieved of the primary obligation under the original

The Company continues to account for the Century City Medical Plaza lease as a lessee and in the same manner as prior to

the commencement date of the sublease.

The Company accounts for the sublease as a lessor of the lease.

The sublease is classified

as an operating lease, as it does not meet the criteria of a sales-type or direct financing lease.

The Company will recognize

operating income from the sublease on a straight-line basis in its statements of operations over the lease term.

For the three months ended September 30, 2022,

and 2021, the net operating lease expenses were as follows:

Schedule of net operating lease expenses

Three Months Ended September 30,

Operating Lease Expense

Sublease Income

Total Net Lease Expense (Income)

Lease expense (income)

charged to general and administrative expenses for the three months ended September 30, 2022, and 2021, amounted to $ ( 9,380 )

and $ 84,083 ,

respectively.

ENOCHIAN BIOSCIENCES INC.

2 unchanged sentences

NOTE 7 — NOTES PAYABLE

Convertible Notes Payable — On February

6, 2020, the Company issued two Convertible Notes (the “Convertible Notes”) to an existing stockholder of the Company each

with a face value amount of $ 600,000 , convertible into shares of the Company’s Common Stock.

The outstanding principal amount of

the Convertible Notes is due and payable on February 6, 2023 .

Interest on the Convertible Notes commenced accruing on the date of issuance

at six percent ( 6 %) per annum, computed on the basis of twelve 30-day months, and is compounded monthly on the final day of each calendar

month based upon the Principal and all accrued and unpaid interest outstanding as of such compound date.

The interest is payable in cash

on a semi-annual basis.

Convertible Notes Payable — On

February 6, 2020, the Company issued two Convertible Notes (the “Convertible Notes”) to Paseco APS (the “Holder”),

a Danish limited company and an existing stockholder of the Company each with a face value amount of $ 600,000 , convertible into

shares of Common Stock, $ 0.0001 par value per share.

The outstanding principal amount of the Convertible Notes was due and payable

on February 6, 2023 .

Interest on the Convertible Notes commenced accruing on the date of issuance at six percent ( 6 %) per annum,

computed on the basis of twelve 30-day months, and is compounded monthly on the final day of each calendar month based upon the

principal and all accrued and unpaid interest outstanding as of such compound date.

The interest was payable in cash on a semi-annual

The holder of the Convertible

Notes had the right at any time prior to the date that is twelve months from issuance to convert all or any part of the outstanding and

unpaid principal and all unpaid interest into shares of the Company’s Common Stock.

The conversion price was equal to $ 12.00 per

share of Common Stock.

Notes had the right at any time prior to the date that is twelve months from issuance to convert all or any part of the outstanding

and unpaid principal and all unpaid interest into shares of the Company’s Common Stock.

The conversion price was equal to

$ 12.00 per share of Common Stock.

The Holder did not exercise the conversion feature that expired on February 6, 2021.

The Company evaluated the

Convertible Notes in accordance with ASC 470-20 and identified that they each contain an embedded conversion feature that shall not be

bifurcated from the host document (i.e., the Convertible Notes) as they are not deemed to be readily convertible into cash.

received from the issuance have been recognized as a liability on the balance sheet.

The Convertible Notes balance as of March 31, 2022,

and 2021 was $ 1,200,000 .

As of March 31, 2022, and 2021, the Company recorded accrued interest in the amount of $ 12,030 and $ 6,000 , which

is included in accrued expenses for each period.

For the three and nine months ended March 31, 2022, the interest expense related to the

Convertible Notes amounted to $ 18,151 and $ 54,604 , respectively.

Note Payable — On March 30, 2020 (the

“Issuance Date”), the Company issued a Promissory Note in the principal amount of $ 5,000,000 (the “Unsecured Note”)

to Paseco APS, a Danish limited company, and an existing stockholder of the Company.

The principal amount of the Note was originally payable

on November 30, 2021 (the “Maturity Date”) and bears interest at a fixed rate of 6 % per annum, computed based on the number

of days between the Issuance Date and the Maturity Date, which was prepaid by the Company in full on the Issuance Date through the issuance

of 188,485 shares of the Company’s Common Stock based on the closing market price on that date for a total value of $ 501,370 .

Company evaluated the Unsecured Note and PIK interest in accordance with ASC 470-Debt and ASC 835-Interest, respectively.

ASC 470-20, proceeds received from the issuance are to be recognized at their relative fair value, thus the liability was shown net of

the corresponding discount of $ 493,192 , which is the relative fair value of the shares issued for the PIK interest on the closing date

using the effective interest method.

The discount of $ 493,192 is being accreted over the life of the Unsecured Note.

evaluated the Convertible Notes in accordance with ASC 470-20 and identified that they each contain an embedded conversion feature

that shall not be bifurcated from the host document (i.e., the Convertible Notes) as they are not deemed to be readily convertible

All proceeds received from the issuance have been recognized as a liability on the balance sheet.

The Convertible Notes

balance as of September 30, 2022 and 2021, was $ 1,200,000 .

Effective December 30, 2022,

the Company amended and restated the Convertible Notes (the “Amended and Restated Secured Notes”).

Pursuant to the

Amended and Restated Secured Notes, the due date was extended to February 28, 2024 , and the interest was increased to twelve percent

( 12 %) per annum, which was prepaid by the Company in full on the date of amendment through the issuance of 198,439 shares of the

Company’s Common Stock based on the closing market price on that date, of $ 1.03 , which included 29,419 shares for interest

accrued through December 30, 2022, and the obligations of the Company under the Amended and Restated Secured Notes were secured

by a security agreement (the “Security Agreement”).

As of September 30, 2022

and 2021, the Company recorded accrued interest in the amount of $ 12,030 and $ 6,000 , which is included in accrued expenses.

the three months ended September 30, 2022 and 2021, the interest expense related to the Convertible Notes amounted to $ 18,182 and

$ 18,272 respectively.

Note Payable —

On March 30, 2020 (the “Issuance Date”), the Company issued a Promissory Note in the principal amount of $ 5,000,000

(the “Promissory Note”) to the Holder.

The principal amount of the Promissory Note was originally payable on

November 30, 2021 (the “Maturity Date”).

The Promissory Note bore interest at a fixed rate of 6 % per annum, computed

based on the number of days between the Issuance Date and the Maturity Date, which was prepaid by the Company in full on the Issuance

Date through the issuance of 188,485 shares of the Company’s Common Stock based on the closing market price on that date

for a total value of $ 501,370 .

The Company evaluated the Unsecured Note and PIK interest in accordance with ASC 470-Debt and ASC

835-Interest, respectively.

Pursuant to ASC 470-20, proceeds received from the issuance are to be recognized at their relative

fair value, thus the liability is shown net of the corresponding discount of $ 493,192 , which is the relative fair value of the

shares issued for the PIK interest on the closing date using the effective interest method.

The discount of $ 493,192 will be accreted

over the life of the Promissory Note.

On February 11, 2021, the Company

entered into an amendment to the Unsecured Note in the principal amount of $ 5,000,000 that extends the Maturity Date out to November 30,

All other terms of the Unsecured Note remain the same.

The change in Maturity Date required an additional year of interest at the

fixed rate of 6 % per annum, which was prepaid by the Company in full on the date of the amendment through the issuance of 74,054 shares

of the Company’s Common Stock based on the closing market price on that date for a total value of $ 298,178 .

For the three and nine

months ended March 31, 2022, respectively, discount amortization of $ 74,274 and $ 222,822 was charged to interest expense.

For the three

and nine months ended March 31, 2021, discount amortization of $ 74,274 and $ 148,253 , respectively was charged to interest expense.

Unsecured Note balance, net of discount at March 31, 2022, was $ 4,801,936 , and is reflected in current liabilities.

Finance Agreement — On November 30, 2021,

the Company entered into a premium finance agreement (the “Agreement”) with a principal amount of $ 666,875 at 3.99 % interest

The repayment of the Agreement will be made in nine equal monthly installments of $ 56,469 .

For the three and nine months

ended March 31, 2022, the Company recorded total interest expense in the amount of $ 2,782 and $ 4,977 , respectively.

This amount is reflected

in other income and expenses.

Total interest expense recorded

for the three and nine months ended March 31, 2022, was $ 95,207 and $ 278,327 , respectively.

Interest expense recorded for the three and

nine months ended March 31, 2021, was $ 96,347 and $ 282,086 , respectively.

entered into an amendment to the Promissory Note that extended the Maturity Date to November

All other terms of the Promissory Note remained the same.

The change in Maturity Date required an additional

year of interest at the fixed rate of 6 %

per annum, which was prepaid by the Company in full on the date of the amendment through the issuance of 74,054

shares of the Company’s Common Stock based on the closing market price on that date for a total value of $ 298,178 .

On May 17, 2022, the Company

entered into a second amendment to the Promissory Note that extended the Maturity Date to November 30, 2023 and increased the

interest rate from 6 % to 12 % per annum.

All other terms of the Promissory Note remained the same.

The change in Maturity Date required

an additional year of interest at the fixed rate of 12% per annum.

Pursuant to the amendment, the Company prepaid interest for

the period November 30, 2022 until May 30, 2023 on the date of the amendment through the issuance of 47,115 shares of the Company’s

Common Stock based on the closing market price on that date for a total value of $ 299,178 .

All other accrued interest payable from

May 30, 2023 to the Maturity Date shall be payable by the Company on May 30, 2023, at the option of the Holder either (i) in cash

or (ii) in non-assessable shares of the Company’s Common Stock, valued at the closing sale price of the Common Stock of the

Nasdaq Capital Market on May 30, 2023.

Effective December 30, 2022,

the Company entered into a third amendment to the Promissory Note.

Pursuant to the third amendment, the Company’s obligations

under the Promissory Note were secured by the Security Agreement.

To secure the Company’s obligations under each of the Amended

and Restated Secured Notes and the Promissory Note, the Company entered into a Security Agreement with the Holder, pursuant to

which the Company granted a lien on all assets of the Company (the “Collateral”) for the benefit of the Holder.

an Event of Default (as defined in the Amended and Restated Secured Notes and Promissory Note, respectively) the Holder may, among

other things, collect or take possession of the Collateral, proceed with the foreclosure of the security interest in the Collateral

or sell, lease, or dispose of the Collateral.

For the three months ended

September 30, 2022 and 2021, discount amortization of $ 74,621 and $ 74,274 was charged to interest expense.

The Promissory Note

balance, net of discount at September 30, 2022 is $ 4,651,769 .

Finance Agreement —

On November 30, 2021, the Company entered into a premium finance agreement (the “Agreement”) with a principal amount of

interest per annum.

The repayment of the Agreement was made in nine equal monthly installments of $ 56,469 .

For the three months ended September 30, 2022 and 2021, the Company recorded total interest expense in the amount of $ 2,782

and $ 1,267 ,

respectively.

This amount is reflected in other income and expenses.

Total interest expense

recorded for the three months ended September 30, 2022 and 2021, was $ 95,585 and $ 89,739 , respectively.

ENOCHIAN BIOSCIENCES INC.

3 unchanged sentences

Preferred Stock —The

Company has 10,000,000 authorized shares of Preferred Stock, par value $ 0.0001 per share.

At March 31, 2022, and June 30, 2021, there

were zero shares issued and outstanding.

Company has 10,000,000 authorized

shares of Preferred Stock, par value $ 0.0001 per

At September 30, 2022, and June 30, 2022, there were zero 0 shares

issued and outstanding.

Common Stock —The

Company has 100,000,000 authorized shares of Common Stock, par value $ 0.0001 per share.

At March 31, 2022, and June 30, 2021, there were

52,798,267 and 52,219,661 shares issued and outstanding, respectively.

At September 30, 2022, and June 30, 2022,

there were 55,507,082 and 53,007,082 shares issued and outstanding, respectively.

Voting — Holders

of Common Stock are entitled to one vote for each share held of record on each matter submitted to a vote of stockholders, including the

election of directors, and do not have any right to cumulate votes in the election of directors.

of Common Stock are entitled to one vote for each share held of record on each matter submitted to a vote of stockholders, including

the election of directors, and do not have any right to cumulate votes in the election of directors.

Dividends — Holders

of Common Stock are entitled to receive ratably such dividends as the Board from time to time may declare out of funds legally available.

of Common Stock are entitled to receive ratably such dividends as the Board from time to time may declare out of funds legally

Liquidation Rights —

In the event of any liquidation, dissolution or winding up of affairs of the Company, after payment of all of our debts and liabilities,

the holders of Common Stock will be entitled to share ratably in the distribution of any of our remaining assets.

In the event of any liquidation, dissolution or winding up of affairs of the Company, after payment of all debts and liabilities,

the holders of Common Stock will be entitled to share ratably in the distribution of any of the remaining assets.

Purchase Agreement with Lincoln Park Capital

On July 8, 2020, we entered into

a purchase agreement (the “Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant

to which the Company may sell and issue to Lincoln Park, and Lincoln Park is obligated to purchase, up to $ 20,000,000 of shares of our

Common Stock from time to time through August 1, 2023.

Under the Purchase Agreement,

we may direct Lincoln Park, at our sole discretion subject to certain conditions, to purchase up to 200,000 shares of Common Stock on

any business day (a “Regular Purchase”).

The amount of a Regular Purchase may be increased under certain circumstances up

to 125,000 shares of Common Stock, provided that Lincoln Park’s committed obligation for Regular Purchases on any business day shall

not exceed $ 1,000,000 .

In the event we direct Lincoln Park to purchase the full amount allowed for a Regular Purchase on any given

business day, we may also direct Lincoln Park to purchase additional amounts as accelerated and additional accelerated purchases.

purchase price of shares of Common Stock related to the future funding will be based on the then prevailing market prices of such shares

at the time of sales as described in the Purchase Agreement.

Our sale of shares of Common Stock

to Lincoln Park pursuant to the Purchase Agreement is limited to 12,016,457 shares of Common Stock, representing 19.99% of the shares

of the Common Stock outstanding on the date of the Purchase Agreement unless (i) stockholder approval is obtained, (ii) the average price

of all applicable sales to Lincoln Park under the Purchase Agreement equals or exceeds the lesser of (A) the closing price of the Common

Stock on the Nasdaq Capital Market immediately preceding the date of the Purchase Agreement or (B) the average of the closing prices on

the Nasdaq Capital Market for the five Business Days immediately preceding the date of the Purchase Agreement or (iii) to the extent it

would cause Lincoln Park to beneficially own more than 9.99% of the Company’s outstanding shares of Common Stock at any given time.

On July 8, 2020, we entered

into a purchase agreement (the “Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”),

pursuant to which the Company may sell and issue to Lincoln Park, and Lincoln Park is obligated to purchase, up to $ 20,000,000

of shares of our Common Stock from time to time through August 1, 2023 .

In consideration for entering

into the Purchase Agreement, we issued 139,567 shares of Common Stock to Lincoln Park as a commitment fee on July 21, 2020.

During the three and nine months

ended March 31, 2022, we issued 60,000 and 337,340 shares of Common Stock to Lincoln Park under the Purchase Agreement for a purchase

price of $ 451,700 and $ 3,500,039 , respectively.

At March 31, 2022, an amount of $15,278,611 remained available under the Purchase Agreement.

During the three months

ended September 30, 2022 and 2021, we did no t sell any shares of Common Stock to Lincoln Park under the Purchase Agreement.

September 30, 2022, an amount of $ 14,102,251 remained available under the Purchase Agreement.

As of October 17, 2022, we no longer

have access to this Purchase Agreement as we are no longer able to use the registration statement on Form S-3 that registered the shares issuable to Lincoln Park under the Purchase

ENOCHIAN BIOSCIENCES INC.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 — STOCKHOLDERS’ EQUITY (Continued)

NOTE 8 — STOCKHOLDERS’ EQUITY

Common Stock Issuances

In the three and nine months ended March 31, 2022, there were 165,000 and 578,606 shares of Common Stock issued, respectively.

the three and nine months ended March 31, 2021, there were 1,032,732 and 1,298,543 shares of Common Stock issued, respectively.

Acquisition of Enochian Biopharma

/ Contingently issuable shares — On February 16, 2018, the Acquisition was completed when the subsidiary merged

with and into Enochian Biopharma, with Enochian Biopharma as the surviving corporation.

As consideration for the Acquisition, the stockholders

of Enochian Biopharma received (i) 18,081,962 shares of Common Stock, and (ii) the right to receive contingent shares pro rata upon the

exercise or conversion of warrants, which were outstanding at closing.

At March 31, 2022, 1,250,000 contingent shares are issuable in

connection with the Acquisition of Enochian Biopharma.

Acquisition of Enochian Denmark

— At March 31, 2022, and June 30, 2021, the Company maintained a reserve of 17,414 shares of Common Stock of the Registrant

held in escrow according to Danish law (the “Escrow Shares”), all of which are reflected as issued and outstanding in the

accompanying financial statements.

The Escrow Shares are reserved to acquire the shares of Enochian Denmark held by non-consenting shareholders

of Enochian Denmark on both March 31, 2022, and June 30, 2021, in accordance with Section 70 of the Danish Companies Act and the Articles

of Association of DanDrit Denmark.

There have been 167,639 shares of Common Stock issued to non-consenting shareholders of Enochian Denmark

as of March 31, 2022.

During the three and nine months ended March 31, 2022, the Company issued zero shares of Common Stock to such non-consenting

shareholders of Enochian Denmark.

There is no impact on outstanding shares as these shares are reflected as issued and outstanding.

On July 14, 2022, certain of our

warrant holders exercised warrants to purchase 1,250,000

shares of Common Stock for total proceeds to the Company of $ 1,625,000 ,

with corresponding earn-out distribution of the same number of shares in connection with the acquisition of Enochian BioPharma, Inc.,

based on the share price on that date of $ 2.21 .

This non-cash earn-out distribution impacted stockholders’ equity in the amount of $ 2,762,500

based on the share price on July 14, 2022 of $ 2.21 .

In the three months ended September 30, 2022 and 2021 there were 2,500,000

shares of Common Stock issued, respectively.

For the period ending September 30, 2022, the Company recorded a loss on extinguishment

of contingent consideration liability of $ 419,182 which reflects the difference between the fair value of the shares and the contingent

consideration liability at the time of issuance.

As of September 30, 2022, all outstanding warrants have been exercised and there is

no further contingent consideration liability balance remaining as of the end of this period.

Acquisition of Enochian

Biopharma Inc.

/ Contingently issuable shares — On February 16, 2018, the acquisition of Enochian Biopharma was

As part of the acquisition, the stockholders of Enochian Biopharma received (i) 18,081,962 shares of Common Stock, and

(ii) the right to receive Contingent Shares of Common Stock pro rata upon the exercise or conversion of warrants, which were outstanding

As of September 30, 2022, no further Contingent Shares are issuable.

Acquisition of Enochian

Denmark — At September 30, 2022, and June 30, 2022, the Company maintained a reserve of 17,414 shares

of Common Stock of the Registrant held in escrow according to Danish law (the “Escrow Shares”), all of which are

reflected as issued and outstanding in the accompanying financial statements.

The Escrow Shares are reserved to acquire the shares

of Enochian Denmark held by non-consenting shareholders of Enochian Denmark on both September 30, 2022, and June 30, 2022, in

accordance with Section 70 of the Danish Companies Act and the Articles of Association of DanDrit Denmark.

There have been 167,639 shares

of Common Stock issued to non-consenting shareholders of Enochian Denmark as of September 30, 2022.

During the three months ended

September 30, 2022, the Company issued zero 0 shares

of Common Stock to such non-consenting shareholders of Enochian Denmark.

There is no impact on outstanding shares as these shares

are reflected as issued and outstanding.

ENOCHIAN BIOSCIENCES INC.

5 unchanged sentences

costs for stock option awards to employees and directors based on their grant-date fair value.

The value of each stock option is estimated

on the date of grant using the Black-Scholes option-pricing model.

The weighted-average assumptions used to estimate the fair values of

the stock options granted using the Black-Scholes option-pricing model are as follows:

The value of each stock option is

estimated on the date of grant using the Black-Scholes option-pricing model.

The weighted-average assumptions used to estimate

the fair values of the stock options granted using the Black-Scholes option-pricing model are as follows in the three months ended September 30, 2022:

Summary of weighted-average assumptions used to estimate the fair values of the stock options granted

5 unchanged sentences

Dividend yield

The Company recognized stock-based compensation expense related to the

options of $ 577,676 and $ 5,348,943 for the three and nine months ended March 31, 2022, respectively.

The Company recognized stock-based

compensation expense related to the options of $ 499,428 and $ 1,184,975 for the three and nine months ended March 31, 2021, respectively.

At March 31, 2022, the Company had approximately $ 7,184,117 of unrecognized compensation cost related to non-vested options.

On February 6, 2014, the Board

adopted the Company’s 2014 Equity Incentive Plan (the “2014 Plan”), and the Company had reserved 1,206,000 shares of

Common Stock for issuance in accordance with the terms of the 2014 Plan.

On October 30, 2019, the Board

approved and on October 31, 2019, the Company’s shareholders adopted Enochian’s 2019 Equity Incentive Plan (the “2019

Plan”), which replaced the 2014 Plan.

The 2019 Plan authorized options to be awarded to not exceed the sum of (1) 6,000,000 new

shares of Common Stock, and (2) the number of shares of Common Stock available for the grant of awards as of the effective date under

the 2014 Plan that, after the effective date of the 2019 Plan, expires, or is terminated, surrendered, or forfeited for any reason without

issuance of shares.

The remaining shares of Common Stock available for grant related to the 2014 Plan was 655,769 as of the effective

this amount along with the new 6,000,000 shares totals 6,655,769 shares of Common Stock that were available to grant immediately

after the effective date of the 2019 Plan.

The Company recognized stock-based compensation expense related

to the options of $ 1,026,008 and $ 2,727,975 for the three months ended September 30, 2022 and 2021, respectively.

30, 2022, the Company had approximately $ 5,485,468 of unrecognized compensation cost related to non-vested options.

On February 6, 2014, the

Board adopted the Company’s 2014 Equity Incentive Plan (the “2014 Plan”), and the Company had reserved 1,206,000

shares of Common Stock for issuance in accordance with the terms of the 2014 Plan.

On October 30, 2019,

the Board approved and on October 31, 2019, the Company’s stockholders adopted Enochian’s 2019 Equity Incentive Plan

(the “2019 Plan”), which replaced the 2014 Plan.

The 2019 Plan authorized options to be awarded to not exceed the sum

of (1) 6,000,000 new shares, and (2) the number of shares available for the grant of awards as of the effective date under the

2014 Plan plus any options related to awards that expire, are terminated, surrendered, or forfeited for any reason without issuance

of shares under the 2014 Plan after the effective date of the 2019 Plan.

Pursuant to the 2019 Plan,

the Company granted options to purchase 11,900

and 3,142,100

shares of Common Stock to employees with a 3 three-year vesting period during the three and nine months ended March 31, 2022,

the Company granted options to purchase zero 0 and 3,009,300 shares

of Common Stock to employees with a three-year vesting period during the three months ended September 30, 2022 and 2021,

respectively.

For the three and nine months ended March 31, 2021, the Company granted options to purchase zero and 9,201

shares of Common Stock to employees with a 3 three-year vesting period.

During the three and nine

months ended March 31, 2022, the Company granted options to purchase 65,000

shares of Common stock to employees with a 1 one-year vesting period.

For the three and nine months ended March 31, 2021, the

Company granted options to purchase zero shares of Common Stock to employees with a one-year vesting period.

During the three and nine months

ended March 31, 2022, the Company granted options to purchase 23,314 and 86,776 shares of Common stock, respectively, to the Board of

Directors and Scientific Advisory Board Members with a one-year vesting period.

For the three and nine months ended March 31, 2021, the

Company granted annual options to purchase 52,500 and 140,131 shares of Common Stock, respectively to members of the Board of Directors

and Scientific Advisory Board with a one-year vesting period.

The Company issued options for

consulting services to purchase zero and 21,979 shares of Common Stock with immediate vesting, issued options to purchase zero and 24,500

shares of Common Stock with a one-year vesting period, and issued options to purchase zero and 60,000 shares of Common Stock with a three-year

vesting period during the three and nine months ended March 31, 2022, respectively.

All of the above options are exercisable

at the market price of the Company’s Common Stock on the date of the grant.

To date the Company has granted

options under the Plan (“Plan Options”) to purchase 4,729,508 shares of Common Stock.

During the three months

ended September 30, 2022, the Company granted options to purchase 184,800 shares of Common stock to employees with a six-month

vesting period.

For the three months ended September 30, 2021, the Company did no t grant options to purchase shares of Common Stock

to employees with a six-month vesting period.

During the three months

ended September 30, 2022, the Company granted options to purchase 73,200 shares of Common stock to employees with a one-year vesting

For the three months ended September 30, 2021, the Company did no t grant options to purchase shares of Common Stock to

employees with a one-year vesting period.

During the three months

ended September 30, 2022, the Company granted options to purchase 50,958 shares of Common Stock, to the Board of Directors and

Scientific Advisory Board Members with a one-year vesting period.

For the three months ended September 30, 2021, the Company granted

options to purchase 26,735 shares of Common Stock to members of the Board of Directors and Scientific Advisory Board with a one-year

vesting period.

During the three months ended

September 30, 2022, the Company did no t

grant options to purchase shares of Common stock for consulting services with immediate vesting.

For the three months ended

September 30, 2021, the Company granted options to purchase 21,979

shares of Common Stock to consultants with immediate vesting.

During the three months ended

September 30, 2022, the Company did no t

grant options to purchase shares of Common stock for consulting services with a one-year vesting period.

For the three months ended September

30, 2021, the Company granted options to purchase 24,500

shares of Common Stock to for consulting services with a one-year vesting period.

All of the above options

are exercisable at the market price of the Company’s Common Stock on the date of the grant.

To date the Company has

granted options under the 2014 Plan and 2019 Plan (“Plan Options”) to purchase 5,106,000

shares of Common Stock.

At September 30, 2022, the Company has 2,679,848 options available to be issued under the Plan.

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 — STOCKHOLDERS’ EQUITY (Continued)

A summary of the status of the

Plan Options outstanding at March 31, 2022, is presented below:

Summary of stock option activity

NOTE 8 — STOCKHOLDERS’ EQUITY

A summary of the status

of the Plan Options outstanding at September 30, 2022, is presented below:

Summary of stock options outstanding

Options Outstanding

7 unchanged sentences

Weighted Average Exercise Price

A summary of the status of the

Plan Options at March 31, 2022, and changes since July 1, 2021, are presented below:

$ 2.00 – 4.50

$ 4.51 – 6.50

$ 6.51 – 12.00

A summary of the status

of the Plan Options at September 30, 2022, and changes since July 1, 2022, are presented below:

Summary of stock option activity

3 unchanged sentences

Outstanding at beginning of period

Expired/Canceled

Outstanding at end of period

Exercisable at end of period

At March 31, 2022, the Company

had 1,283,729 exercisable Plan Options outstanding.

The total intrinsic value of options exercisable at March 31, 2022, was $ 1,153,019 .

Intrinsic value is measured using the fair market value at the date of exercise (for shares exercised) or at March 31, 2022 (for outstanding

options), less the applicable exercise price.

At September 30, 2022, the

Company had 1,914,007 exercisable

Plan Options outstanding.

The total intrinsic value of options exercisable at September 30, 2022, was 0 zero .

Intrinsic value is measured using the fair market value at the date of exercise (for shares exercised) and at September 30, 2022

(for outstanding options), less the applicable exercise price.

Common Stock Purchase Warrants

A summary of the warrants outstanding

at March 31, 2022, and changes since July 1, 2021, are presented below:

A summary of the warrants

outstanding at September 30, 2022, and changes since July 1, 2022, are presented below:

Summary of common stock purchase warrants outstanding

2 unchanged sentences

Outstanding at beginning of period

( 1,250,000 )

Cancelled/Expired

Outstanding and exercisable at end of period

Summary of common stock purchase warrants

Underlying Warrants Outstanding

Equivalent Shares Exercisable

Exercise Prices

Equivalent Shares

Weighted Average Remaining Contractual Life (years)

Weighted Average Exercise Price

Number Exercisable

Weighted Average Exercise Price

The exercise price of certain

warrants and the number of shares underlying the warrants are subject to adjustment for stock dividends, subdivisions of the outstanding

shares of Common Stock and combinations of the outstanding shares of Common Stock.

For so long as the warrants remain outstanding, we

are required to keep reserved from our authorized and unissued shares of Common Stock a sufficient number of shares to provide for the

issuance of the shares underlying the warrants.

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 — STOCKHOLDERS’ EQUITY (Continued)

NOTE 8 — STOCKHOLDERS’ EQUITY

Restricted Stock Units (RSUs)

The Company recognized stock-based compensation expense

related to RSUs of $ 228 and $ 258,559 for the three and nine months ended March 31, 2022, respectively.

The Company recognized stock-based

compensation expense related to the RSUs of $ 147,000 for the three and nine months ended March 31, 2021, respectively.

A summary of the status of Restricted Stock Units outstanding

at March 31, 2022, and changes since July 1, 2021, is presented below:

Summary of restricted stock units outstanding

Weighted Average Issuance

Weighted Average Remaining

Weighted Average Intrinsic

Outstanding at beginning of period

Cancelled/Expired

Outstanding at end of period

The Company recognized

stock-based compensation expense related to RSUs of zero 0 and

the three months ended September 30, 2022 and 2021, respectively.

The Company had zero 0 Restricted

Stock Units outstanding at September 30, 2022.

ENOCHIAN BIOSCIENCES INC.

2 unchanged sentences

NOTE 9 — COMMITMENTS AND CONTINGENCIES

On July 9, 2018, the Company entered

into a consulting agreement with G-Tech Bio, LLC, a California limited liability company (“G-Tech”) to assist the Company

with the development of the gene therapy and cell therapy modalities for the prevention, treatment, and amelioration of HIV in humans,

and with the development of a genetically enhanced Dendritic Cell for use as a wide spectrum platform for various diseases (including

but not limited to cancers and infectious diseases) (the “G-Tech Agreement”).

G-Tech was entitled to consulting fees for 20

months, with a monthly consulting fee of not greater than $130,000 per month.

Upon the completion of the 20 months, the monthly consulting

fee of $ 25,000 continued for scientific consulting and knowledge transfer on existing HIV experiments and will continue until the services

are no longer rendered or the agreement is terminated.

For the three and nine months ended March 31, 2022, $ 75,000 and $ 225,000 , respectively,

was charged to research and development expenses in our Condensed Consolidated Statements of Operations related to this consulting agreement.

For the three and nine months ended March 31, 2021, $ 75,000 and 200,000 , respectively, was charged to research and development expenses

in our Condensed Consolidated Statements of Operations related to this consulting agreement.

On January 31, 2020, the Company

entered into a Statement of Work & License Agreement (the “HBV License Agreement”) by and among the Company, G-Tech ,

and G Health Research Foundation, a not for profit entity organized under the laws of California doing business as Seraph Research Institute

(“SRI”), whereby the Company acquired a perpetual, sublicensable, exclusive license (the “HBV License”) for a

treatment under development (the “Treatment”) aimed to treat Hepatitis B Virus (HBV) infections in accordance with its agreement

in principle with G-Tech and SRI.

The HBV License Agreement contains

customary representations, warranties, and covenants of the parties with respect to the development of the Treatment and the HBV License.

G-Tech and SRI are each controlled by certain members of Weird Science, LLC, a shareholder of the Company.

On July 9, 2018, the Company

entered into a consulting agreement with G-Tech Bio, LLC, a California limited liability company (“G-Tech”) to assist

the Company with the development of the gene therapy and cell therapy modalities for the prevention, treatment, and amelioration

of HIV in humans, and with the development of a genetically enhanced Dendritic Cell for use as a wide spectrum platform for various

diseases (including but not limited to cancers and infectious diseases) (the “G-Tech Agreement”).

G-Tech was entitled

to consulting fees for 20 months, with a monthly consulting fee of not greater than $ 130,000 per month.

Upon the completion of

the 20 months, the monthly consulting fee of $25,000 continued for scientific consulting and knowledge transfer on existing HIV

experiments until the services were no longer being rendered or the G-Tech Agreement is terminated.

As of May 25, 2022, the consultant

was no longer able to render services, therefore no expense was incurred for the three months ended September 30, 2022.

three months ended September 30, 2021, $75,000 was charged to research and development expenses in our Condensed Consolidated

Statements of Operations related to this consulting agreement.

On January 31, 2020, the

Company entered into a Statement of Work and License Agreement (the “HBV License Agreement”) by and among the Company, G-Tech, and G Health Research Foundation, a not for profit entity organized under the laws of California doing business as

Seraph Research Institute (“SRI”) (collectively the “Licensors”), whereby the Company acquired a perpetual,

sublicensable, exclusive license (the “HBV License”) for a treatment under development (the “Treatment”)

aimed to treat Hepatitis B Virus (HBV) infections.

The HBV License Agreement

states that in consideration for the HBV License, the Company shall provide cash funding for research costs and equipment and certain

other in-kind funding related to the Treatment over a 24 month period, and provides for an up-front payment of $ 1.2 million within

7 days of January 31, 2020, along with additional payments upon the occurrence of certain benchmarks in the development of the

technology set forth in the HBV License Agreement, in each case subject to the terms of the HBV License Agreement.

Additionally,

the HBV License Agreement provides for cooperation related to the development of intellectual property related to the Treatment

and for a 2 % royalty to G-Tech on any net sales that may occur under the HBV License.

On February 6, 2020, the Company paid the

$ 1.2 million up-front payment.

The HBV License Agreement contains customary representations, warranties, and covenants of the parties

with respect to the development of the Treatment and the HBV License.

The cash funding for research

costs pursuant to the HBV License consists of monthly payments amounting to $ 144,500 that cover scientific staffing resources to complete

the project, as well as periodic payments for materials and equipment needed to complete the project.

For the three and nine months ended

March 31, 2022, the Company paid a total of $ 144,500 and $ 1,011,500 , respectively for scientific staffing resources.

During the three

and nine months ended March 31, 2022, the Company paid zero and $ 1,500,000 , respectively, for the milestone completion of a Pre-Investigational

New Drug (IND) process following receipt of written comments in accordance with the HBV License.

During the three and nine months ended

March 31, 2021, respectively the Company paid $ 433,500 for scientific staffing resources, and $ 275,000 and $ 675,000 , respectively, for

costs related to research studies pursuant to the HBV License.

costs pursuant to the HBV License Agreement consisted of monthly payments amounting to $144,500 that

covered scientific staffing resources to complete the project as well as periodic payments for materials and equipment needed to

complete the project.

There were no payments made after January 31, 2022.

During the three months ended September 30, 2022 and 2021,

the Company paid a total of zero 0 and

respectively, for scientific staffing resources, research and development and Investigational New Drug ("IND") Enabling studies.

During the three months ended September 30, 2022, and 2021, the Company paid zero 0 and

$ 1,500,000 ,

respectively, for the milestone completion of a Pre-IND process following receipt of written comments in accordance the HBV License

The Company has filed a claim against the Licensors, which includes certain payments it made related to this license (see

Contingencies sub-section below).

On April 18, 2021, the Company

entered into a Statement of Work and License Agreement (the “License Agreement”), by and among the Company, G-Tech and SRI,

whereby the Company acquired a perpetual sublicensable, exclusive license (the “Development License”) to research, develop,

and commercialize certain formulations which are aimed at preventing and treating pan-coronavirus or the potential combination of the

pan-coronavirus and pan-influenza, including the SARS-coronavirus that causes COVID-19 and pan-influenza (the “Prevention and Treatment”).

entered into a Statement of Work and License Agreement (the “License Agreement”), by and among the Company, G-Tech

and SRI (collectively, the “Licensors”), whereby the Company acquired a perpetual sublicensable, exclusive license

(the “Development License”) to research, develop, and commercialize certain formulations which are aimed at preventing

and treating pan-coronavirus or the potential combination of the pan-coronavirus and pan-influenza, including the SARS-coronavirus

that causes COVID-19 and pan-influenza (the “Prevention and Treatment”).

The License Agreement was

entered into pursuant to the existing Framework Agreement between the parties dated November 15, 2019.

The License Agreement states

that in consideration for the Development License, the Company shall provide cash funding for research costs and equipment and

certain other in-kind funding related to the Prevention and Treatment over a 24-month period.

Additionally, the License Agreement

provides for an up-front payment of $ 10,000,000 and a $ 760,000 payment for expenditures to date prior to the effective date related

to research towards the Prevention and Treatment within 60 days of April 18, 2021.

The License Agreement provides for additional

payments upon the occurrence of certain benchmarks in the development of the technology set forth in the License Agreement, in

each case subject to the terms of the License Agreement.

The License Agreement

provides for cooperation related to the development of intellectual property related to the Prevention and Treatment and for a 3%

royalty to G-Tech on any net sales that may occur under the License Agreement.

For the three months ended September 30, 2022, and

2021, the Company paid zero 0 and

$ 75,000 related

to the Prevention and Treatment research.

The Company is no longer pursuing any product candidates that relate to this license.

Company has filed a claim against the Licensors to recover all monies it paid related to this license (see Contingencies sub-section

ENOCHIAN BIOSCIENCES INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The License Agreement was entered

into pursuant to the existing Framework Agreement between the parties dated November 15, 2019.

The License Agreement states that in consideration

for the Development License, the Company shall provide cash funding for research costs and equipment and certain other in-kind funding

related to the Prevention and Treatment over a 24-month period.

Additionally, the License Agreement provides for an up-front payment of

$ 10,000,000 and a $ 760,000 payment for expenditures to date prior to the effective date related to research towards the Prevention and

Treatment within 60 days of April 18, 2021.

The License Agreement provides for additional payments upon the occurrence of certain benchmarks

in the development of the technology set forth in the License Agreement, in each case subject to the terms of the License Agreement.

The License Agreement provides

for cooperation related to the development of intellectual property related to the Prevention and Treatment and for a 3% royalty to G-Tech

on any net sales that may occur under the License Agreement.

For the three and nine months ended March 31, 2022, the Company paid zero

and $ 150,000 , respectively, related to the Prevention and Treatment research.

G-Tech is controlled by Dr.

Gümrükcü and Anderson Wittekind, shareholders of the Company, and SRI is controlled by Dr.

Serhat Gümrükcü.

G-Tech and SRI are each controlled by certain members of Weird Science, LLC, a shareholder of the Company.

On August 25, 2021, the Company

entered into an ALC Patent License and Research Funding Agreement in the HIV Field (the “ALC License Agreement”) with Dr.

Gümrükcü and SRI whereby Dr.

Gümrükcü granted the Company an exclusive, worldwide, perpetual, fully paid-up,

royalty-free license, with the right to sublicense, his proprietary technology subject to a U.S.

patent application, to make, use, offer

to sell, sell or import products for use solely for the prevention, treatment, amelioration of or therapy exclusively for HIV in humans,

and research and development exclusively relating to HIV in humans;

Gümrükcü retained the right to conduct

HIV research in the field.

Pursuant to the ALC License Agreement, the Company granted a non-exclusive license back to Dr.

and SRI, under any patents or other intellectual property owned or controlled by the Company, to the extent arising from the ALC License,

to make, use, offer to sell, sell or import products for use in the diagnosis, prevention, treatment, amelioration or therapy of any (i)

HIV Comorbidities and (ii) any other diseases or conditions outside the HIV Field.

The Company made an initial payment to SRI of $ 600,000

and agreed to fund future HIV research conducted by Dr.

Gümrükcü and SRI, as mutually agreed to by the parties.

10, 2021, pursuant to the ALC License Agreement, the Company paid the initial payment of $600,000.

Shares held for non-consenting

shareholders – The 17,414 remaining shares of Common Stock related to the Acquisition of Enochian Denmark have been

reflected as issued and outstanding in the accompanying financial statements.

There were zero shares of Common Stock issued to such non-consenting

shareholders during the three and nine months ended March 31, 2022 (see Note 7.)

Service Agreements – The

Company has a consulting agreement for services of a Senior Medical Advisor for up to $ 210,000 per year on a part-time basis.

Contingencies – The

Company is from time to time involved in routine legal and administrative proceedings and claims of various types.

While any proceeding

or claim contains an element of uncertainty, management does not expect a material impact on our results of operations or financial position

from such proceedings or claims.

On August 25, 2021, the

Company entered into an ALC Patent License and Research Funding Agreement in the HIV Field (the “ALC License Agreement”)

with Serhat Gümrükcü and SRI (collectively, the “Licensors”) whereby the Licensors granted the Company

an exclusive, worldwide, perpetual, fully paid-up, royalty-free license, with the right to sublicense, proprietary technology

subject to a U.S.

patent application, to make, use, offer to sell, sell or import products for use solely for the prevention, treatment,

amelioration of or therapy exclusively for HIV in humans, and research and development exclusively relating to HIV in humans;

the Licensors retained the right to conduct HIV research in the field.

Pursuant to the ALC License Agreement, the Company granted

a non-exclusive license back to the Licensors, under any patents or other intellectual property owned or controlled by the Company,

to the extent arising from the ALC License, to make, use, offer to sell, sell or import products for use in the diagnosis, prevention,

treatment, amelioration or therapy of any (i) HIV Comorbidities and (ii) any other diseases or conditions outside the HIV Field.

The Company made an initial payment to SRI of $ 600,000 and agreed to fund future HIV research conducted by the Licensors, as mutually

agreed to by the parties.

On September 10, 2021, pursuant to the ALC License Agreement, the Company paid the initial payment of

G-Tech and SRI are controlled

by Serhat Gümrükcü and Anderson Wittekind, shareholders of the Company.

Shares held for

non-consenting shareholders – The 17,414 remaining

shares of Common Stock related to the Acquisition of Enochian Denmark have been reflected as issued and outstanding in the

accompanying financial statements.

There were zero 0 shares

of Common Stock issued to such non-consenting shareholders during the three months ended September 30, 2022 (see Note

Service Agreements

– The Company has a consulting agreement for services of a Senior Medical Advisor for up to $210,000 per year on a

part-time basis.

This consulting agreement was terminated as of October 31, 2022.

The Company maintains employment agreements with

other staff in the ordinary course of business.

Contingencies

Securities Class Action

On July 26, 2022 and July 28, 2022, securities class action complaints were filed by purported stockholders of

ours in the United States District Court for the Central District of California against us and certain of our current and former

officers and directors.

The complaints allege, among other things, that the defendants violated Sections 10(b) and 20(a) of the

Securities Exchange Act of 1934, as amended, and Rule 10b-5 thereunder, by making false and misleading statements and omissions

of material fact in connection with the Company’s relationship with Serhat Gümrükcü and its commercial prospects.

The complaints seek unspecified damages, interest, fees, and costs.

The defendants have not yet responded to the complaints.

Federal Derivative Litigation .

On September 22, 2022, Samuel E.

Koenig filed a shareholder derivative action in the United States District Court for the Central

District of California.

On January 19, 2023, John Solak filed a substantially similar shareholder derivative action in the United

States District Court for the District of Delaware.

Both derivative actions recite similar underlying facts as those alleged in

the Securities Class Action Litigation.

The actions, filed on behalf of the Company, name Serhat Gümrükcü and certain

of the Company’s current and former directors as defendants.

The actions also name the Company as a nominal defendant.

actions allege violations of Sections 14(a) and 20(a) of the Securities Exchange Act of 1934 and also set out claims for breach

of fiduciary duty, contribution and indemnification, aiding and abetting, and gross mismanagement.

Plaintiffs do not quantify any

alleged injury, but seek damages, disgorgement, restitution, and other costs and expenses.

On January 24, 2023, the United States

District Court for the Central District of California stayed the Koenig matter pending resolution of the defendants’ anticipated

motion to dismiss in the Securities Class Action Litigation.

The defendants have not yet responded to either complaint.

State Derivative Litigation .

On October 20, 2022, Susan Midler filed a shareholder derivative action in the Superior Court of California, Los Angeles County,

reciting similar underlying facts as those alleged in the Securities Class Action Litigation.

The action, filed on behalf of the

Company, names Serhat Gümrükcü and certain of the Company’s current and former directors as defendants.

action also names the Company as a nominal defendant.

The action sets out claims for breaches of fiduciary duty, contribution,

and indemnification, aiding and abetting, and gross mismanagement.

Plaintiff does not quantify any alleged injury, but seeks damages,

disgorgement, restitution, and other costs and expenses.

The defendants have not yet responded to the complaint.

On October 21, 2022, the

Company filed a Complaint in the Superior Court of the State of California for the County of Los Angeles against Serhat Gümrükcü,

William Anderson Wittekind, G-Tech Bio LLC, SG & AW Holdings LLC, and Seraph Research Institute.

The Complaint alleges that

the defendants engaged in a “concerted, deliberate scheme to alter, falsify, and misrepresent to the Company the results

of multiple studies supporting its [Hepatitis B] and SARS-CoV-2/influenza pipelines.” Specifically, “Defendants manipulated

negative results to reflect positive outcomes from various studies, and even fabricated studies out of whole cloth.” As a

result of the defendants’ conduct, the Company claims that it “paid approximately $25 million to Defendants and third-parties

that it would not otherwise have paid.” The defendants have not yet answered the allegations set forth in the Company’s

On December 28, 2022, the

Company received a demand letter on behalf of Weird Science LLC (“Weird Science”), William Anderson Wittekind, the

William Anderson Wittekind 2020 Annuity Trust, the William Anderson Wittekind 2021 Annuity Trust, the Dybul 2020 Angel Annuity

Trust, and the Ty Mabry 2021 Annuity Trust alleging that the Company breached the February 16, 2018 Investor Rights Agreement between

the Company, Weird Science, and RS Group ApS.

Specifically, the demand letter alleges that the Company “breached its obligations

under the Investor Rights Agreement to provide the requisite thirty days’ notice” to Holders of Registrable Securities

in connection with SEC Form S-3 filings on July 13, 2020 and February 11, 2022 and demands over $64 million in damages.

denies these allegations and intends to vigorously defend against this claim.

On March 1, 2021, former

Enochian BioSciences Chief Financial Officer, Robert Wolfe and his company, Crossfield, Inc., filed a Complaint in the U.S.

Court for the District of Vermont against the Company, Enochian BioSciences Denmark ApS, and certain directors and officers.

Complaint, Mr.

Wolfe and Crossfield, Inc.

asserted claims for abuse of process and malicious prosecution, alleging, inter alia, that

the Company lacked probable cause to file and prosecute an earlier action, and sought millions of dollars of compensatory damages,

as well as punitive damages.

The allegations in the Complaint relate to an earlier action filed by the Company and Enochian

BioSciences Denmark ApS in the Vermont Superior Court, Orange Civil Division.

On March 3, 2022, the court partially granted the

Company’s motion to dismiss, dismissing the abuse of process claim against all defendants and all claims against Mark Dybul

and Henrik Grønfeldt-Sørensen.

On November 29, 2022, the Company filed a motion for summary judgment with respect to the

sole remaining claim of malicious prosecution.

The Company denies the allegations set forth in the Complaint and will continue to

vigorously defend against the remaining claim.

NOTE 10 — RELATED PARTY TRANSACTIONS

The Company paid G-Tech $ 354,500

and $ 3,891,500 , which included payments for consulting agreements related to HIV, contractual costs related to the HBV License and the

Development License (See Note 8), and security expenses, for the three and nine months ended March 31, 2022, respectively.

Company paid G-Tech zero 0 and

$ 2,218,500 which

included payments for consulting agreements related to HIV, and contractual costs related to the HBV License, the Development

License and the ALC License (see Note 9), and security expenses, for the three months ended September 30, 2022 and 2021,

respectively.

NOTE 11 — SUBSEQUENT EVENTS

In accordance with ASC 855-10,

the Company performed a review of events subsequent to the balance sheet date through the date of this report and determined that there

were no such events requiring recognition or disclosure.

Subsequent to September 30, 2022, the Company

became involved in a number of legal proceedings.

Please see Note 9 above and Part II, Item 1 - Legal Proceedings for details of

such matters.

As of December 30, 2022,

the Company entered into amended and restated secured convertible promissory notes (see Note 7.)

On December 30, 2022, the

Company entered into a security agreement with the Holder (see Note 7.)

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

What changed 10-Q

Item 1. Financial Statements