UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

~~(Mark~~(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~December 31, 2021~~June 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to ______________.

Commission File Number 001-11889

CEL-SCI CORPORATION

Colorado

84-0916344

State or other jurisdiction

of incorporation

(IRS) Employer

Identification Number

8229 Boone Boulevard, Suite 802

Vienna, Virginia 22182

Address of principal executive offices

(703) 506-9460

~~Registrant's~~Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock		CVM		NYSE American

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) had been subject to such filing requirements for the past 90 ~~days.~~

~~Yes~~days.Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated ~~filer~~Filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Exchange Act Rule 12b-2 of the Exchange Act).

~~Yes~~.Yes ☐ No ☒

Class of Stock		No. Shares Outstanding		Date
Common	43,367,462	~~43,275,738~~		~~February 2,~~August 3, 2022

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION

Item 1.			Page

	Condensed Balance Sheets at ~~December 31, 2021~~June 30, 2022 (unaudited) and September 30, 2021		3

	Condensed Statements of Operations for the nine months ended June 30, 2022 and 2021 (unaudited)	4

	Condensed Statements of Operations for the three months ended ~~December 31,~~June 30, 2022 and 2021 ~~and 2020~~ (unaudited)		4	5

	Condensed ~~Statement~~Statements of Stockholders’ Equity for the ~~three~~nine months ended ~~December 31,~~June 30, 2022 and 2021 ~~and 2020~~ (unaudited)		5	6

	Condensed Statements of Cash Flows for the ~~three~~nine months ended ~~December 31,~~June 30, 2022 and 2021 ~~and 2020~~ (unaudited)		6	8

	Notes to Condensed Financial Statements (unaudited)		8	10

Item 2.	~~Management's~~Management’s Discussion and Analysis of Financial Condition and Results of Operations		20	24

Item 3.	Quantitative and Qualitative Disclosures about Market Risks		23	29

Item 4.	Controls and Procedures		23	29

PART II

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		24	30

Item 6.	Exhibits		25	30

	Signatures		26	31

Table of Contents

CEL-SCI CORPORATION	CEL-SCI CORPORATION							CEL-SCI CORPORATION
CONDENSED BALANCE SHEETS	CONDENSED BALANCE SHEETS							CONDENSED BALANCE SHEETS


		DECEMBER 31,			SEPTEMBER 30,				JUNE 30,			SEPTEMBER 30,
ASSETS		2021			2021				2022			2021
		(UNAUDITED)							(UNAUDITED)
Current assets:
Cash and cash equivalents		$	37,109,917		$	36,060,148			$	28,073,673		$	36,060,148
U.S. Treasury Bills			0			6,151,385				0			6,151,385
Receivables			54,922			54,922				0			54,922
Prepaid expenses			723,782			998,482				708,621			998,482
Supplies used for R&D and manufacturing			2,067,723			2,006,584				2,173,037			2,006,584
Short-term deposits			1,910,917			0

Total current assets			41,867,261			45,271,521				30,955,331			45,271,521

Finance lease right of use assets			12,252,663			12,691,921				11,389,249			12,691,921
Operating lease right of use assets			2,014,185			2,056,178				1,928,561			2,056,178
Property and equipment, net			13,290,109			13,663,562				12,394,189			13,663,562
Patent costs, net			247,521			275,866				222,462			275,866
Deposits			0			1,910,917				0			1,910,917

Total assets		$	69,671,739		$	75,869,965			$	56,889,792		$	75,869,965


LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable		$	1,192,825		$	1,675,813			$	852,860		$	1,675,813
Accrued expenses			899,901			859,216				992,945			859,216
Due to employees			475,039			265,993				496,005			265,993
Derivative instruments, current portion			2,195			437,380				0			437,380
Lease liabilities, current portion			763,535			698,665				1,673,653			698,665

Total current liabilities			3,333,495			3,937,067				4,015,463			3,937,067

Finance lease obligations, net of current portion			12,880,449			13,252,364				12,124,979			13,252,364
Operating lease obligations, net of current portion			1,981,340			2,021,308				1,895,987			2,021,308
Other liabilities			125,000			125,000				125,000			125,000

Total liabilities			18,320,284			19,335,739				18,161,429			19,335,739

Commitments and contingencies			0			0

STOCKHOLDERS' EQUITY
Preferred stock, $.01par value-200,000shares authorized; -0- shares issued and outstanding			0			0
Common stock, $.01par value - 600,000,000shares authorized; 43,259,013and 43,207,183shares issued and outstanding at December 31, 2021 and September 30, 2021, respectively			432,590			432,072
Preferred stock, $0.01 par value - 200,000 shares authorized; 0 shares issued and outstanding										0			0
Common stock, $0.01 par value - 600,000,000 shares authorized; 43,355,529 and 43,207,183 shares issued and outstanding at June 30, 2022 and September 30, 2021, respectively										433,555			432,072
Additional paid-in capital			477,897,883			474,298,566				484,729,902			474,298,566
Accumulated deficit			(426,979,018	)		(418,196,412	)			(446,435,094	)		(418,196,412	)

Total stockholders' equity			51,351,455			56,534,226				38,728,363			56,534,226

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	69,671,739		$	75,869,965			$	56,889,792		$	75,869,965

See notes to condensed financial statements.	See notes to condensed financial statements.							See notes to condensed financial statements.

Table of Contents

CEL-SCI CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED)

2021

2020

Operating expenses:

Research and development

$ 6,083,167

$ 5,414,760

General and administrative

2,760,208

3,316,156

Total operating expenses

8,843,375

8,730,916

Operating loss

(8,843,375 )

(8,730,916 )

Gain on derivative instruments

364,596

932,836

Other non-operating gains

(30,793 )

121,606

Interest expense, net

(273,034 )

(260,390 )

Net loss

(8,782,606 )

(7,936,864 )
Modification of warrants

-

(85,779 )

Net loss available to common shareholders

$ (8,782,606 )

$ (8,022,643 )

Net loss per common share

BASIC and DILUTED

$ (0.20 )

$ (0.21 )

Weighted average common shares outstanding

BASIC

43,077,961

38,670,247

DILUTED

43,083,420

38,767,286

CEL-SCI CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
NINE MONTHS ENDED JUNE 30, 2022 and 2021
(UNAUDITED)

	2022			2021

Operating expenses:
Research and development	$	18,893,857		$	17,818,373
General and administrative		8,220,768			9,902,120
Total operating expenses		27,114,625			27,720,493

Operating loss		(27,114,625	)		(27,720,493	)

Gain (loss) on derivative instruments		366,791			(991,562	)
Other non-operating (loss) gain		(30,793	)		1,428,260
Interest expense, net		(1,460,055	)		(872,457	)

Net loss		(28,238,682	)		(28,156,252	)
Modification of warrants		(294,409	)		(350,861	)

Net loss available to common shareholders	$	(28,533,091	)	$	(28,507,113	)

Net loss per common share - basic	$	(0.66	)	$	(0.71	)
Weighted average common shares outstanding - basic		43,124,972			39,907,624

Net loss per common share - diluted	$	(0.66	)	$	(0.74	)
Weighted average common shares outstanding - diluted		43,124,972			40,158,321

See notes to condensed financial statements.

~~See notes to condensed financial statements.~~

Table of Contents

CEL-SCI CORPORATION
STATEMENTS OF STOCKHOLDERS' EQUITY
(UNAUDITED)

Additional

Common Stock

Paid-In

Accumulated

Shares

Amount

Capital

Deficit

Total

BALANCES AT OCTOBER 1, 2021

43,207,183

$ 432,072

$ 474,298,566

$ (418,196,412 )

$ 56,534,226

Warrant exercises

19,705

197

157,757

0

157,954

Equity based compensation - employees

-

0

3,262,296

0

3,262,296

401(k) contributions paid in common stock

7,605

76

52,479

0

52,555

Stock and options issued to nonemployees for service

18,020

180

142,980

0

143,160

Option exercises

6,500

65

29,770

0

29,835

Share issuance costs

-

0

(45,965 )

0

(45,965 )
Net loss

-

0

0

(8,782,606 )

(8,782,606 )

BALANCES AT DECEMBER 31, 2021

43,259,013

$ 432,590

$ 477,897,883

$ (426,979,018 )

$ 51,351,455

Additional

Common Stock

Paid-In

Accumulated

Shares

Amount

Capital

Deficit

Total

BALANCES AT OCTOBER 1, 2020

38,730,150

$ 387,302

$ 401,174,675

$ (381,835,303 )

$ 19,726,674

Proceeds from the sale of common stock

1,000,000

10,000

13,549,500

0

13,559,500

Warrant exercises

15,000

150

89,100

0

89,250

Equity based compensation - employees

(2,000 )

(20 )

3,296,329

0

3,296,309

401(k) contributions paid in common stock

3,564

36

41,635

0

41,671

Stock and options issued to nonemployees for service

15,044

150

152,300

0

152,450

Option exercises

5,300

53

23,458

0

23,511

Modification of warrants

-

0

192

0

192

Share issuance costs

-

0

(117,021 )

0

(117,021 )
Net loss

-

0

0

(7,936,864 )

(7,936,864 )

BALANCES AT DECEMBER 31, 2020

39,767,058

$ 397,671

$ 418,210,168

$ (389,772,167 )

$ 28,835,672

~~See notes to condensed financial statements.~~

CEL-SCI CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 2022 and 2021
(UNAUDITED)

	2022			2021

Operating Expenses:
Research and development	$	6,286,873		$	7,182,099
General and administrative		2,432,518			3,274,480
Total operating expenses		8,719,391			10,456,579

Operating loss		(8,719,391	)		(10,456,579	)

Gain on derivative instruments		0			1,116,619
Other non-operating gains		0			753,024
Interest expense, net		(913,193	)		(351,332	)

Net loss		(9,632,584	)		(8,938,268	)
Modification of warrants		(294,409	)		(265,082	)

Net loss available to common shareholders	$	(9,926,993	)	$	(9,203,350	)


Net loss per common share - basic	$	(0.23	)	$	(0.22	)
Weighted average common shares outstanding - basic		43,174,775			41,020,485

Net loss per common share - diluted	$	(0.23	)	$	(0.25	)
Weighted average common shares outstanding - diluted		43,174,775			41,231,082

See notes to condensed financial statements.

Table of Contents

CEL-SCI CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED)

2021

2020

Net loss

$ (8,782,606 )

$ (7,936,864 )
Adjustments to reconcile net loss to

net cash used in operating activities:

Depreciation and amortization

887,930

550,682

Share-based payments for services

218,318

248,660

Equity based compensation

3,262,296

3,296,309

Common stock contributed to 401(k) plan

52,555

41,671

Gain on short-term investments

(615 )

-

Loss on patent impairment

30,793

-

Gain on derivative instruments

(364,596 )

(932,836 )
Modification of warrants

-

192

(Increase)/decrease in assets:

Receivables

-

532,328

Prepaid expenses

144,542

(332,785 )
Supplies used for R&D and manufacturing

(61,139 )

Increase/(decrease) in liabilities:

Accounts payable

(523,152 )

532,679

Accrued expenses

95,685

143,028

Due to employees

209,046

10,718

Other liabilities

24,997

18,319

Net cash used in operating activities

(4,805,946 )

(3,827,899 )

CASH FLOWS FROM INVESTING ACTIVITIES:

Proceeds from maturity of US treasury bills

6,152,000

-

Purchases of property and equipment

(17,036 )

(3,149,820 )
Expenditures for patent costs

(22,741 )

-

Net cash provided by (used in) investing activities

6,112,223

(3,149,820 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of common stock

-

13,559,500

Payments of stock issuance costs

(32,800 )

(79,499 )
Proceeds from exercises of warrants and options

117,200

70,911

Payments on obligations under finance lease

(340,908 )

(221,620 )

Net cash (used in) provided by financing activities

(256,508 )

13,329,292

NET INCREASE IN CASH AND CASH EQUIVALENTS

1,049,769

6,351,573

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

36,060,148

15,508,909

CASH AND CASH EQUIVALENTS, END OF PERIOD

$ 37,109,917

$ 21,860,482

CEL-SCI CORPORATION
STATEMENTS OF STOCKHOLDERS' EQUITY
(UNAUDITED)

					Additional
	Common Stock				Paid-In			Accumulated
	Shares		Amount		Capital			Deficit			Total

BALANCES AT OCTOBER 1, 2021		43,207,183	$	432,072	$	474,298,566		$	(418,196,412	)	$	56,534,226

Warrant exercises		19,705		197		157,757			0			157,954
Equity based compensation - employees		-		-		3,262,296			-			3,262,296
401(k) contributions paid in common stock		7,605		76		52,479			0			52,555
Stock and options issued to nonemployees for service		18,020		180		142,980			0			143,160
Option exercises		6,500		65		29,770			0			29,835
Share issuance costs		-		0		(45,965	)		0			(45,965	)
Net loss		-		0		0			(8,782,606	)		(8,782,606	)

BALANCES AT DECEMBER 31, 2021		43,259,013	$	432,590	$	477,897,883		$	(426,979,018	)	$	51,351,455

Warrant exercises		5,500		55		13,805			0			13,860
Equity based compensation - employees		-		-		3,392,706			-			3,392,706
401(k) contributions paid in common stock		14,614		146		57,371			0			57,517
Stock and options issued to nonemployees for service		25,475		255		139,797			0			140,052
Share issuance costs		-		0		(4,550	)		0			(4,550	)
Net loss		-		0		0			(9,823,492	)		(9,823,492	)

BALANCES AT MARCH 31, 2022		43,304,602	$	433,046	$	481,497,012		$	(436,802,510	)	$	45,127,548

Equity based compensation - employees		-		-		2,447,772			-			2,447,772
401(k) contributions paid in common stock		12,640		126		57,082			0			57,208
Stock and options issued to nonemployees for service		38,287		383		121,883			0			122,266
Modification of warrants		-		0		634,713			0			634,713
Share issuance costs		-		0		(28,560	)		0			(28,560	)
Net loss		-		0		0			(9,632,584	)		(9,632,584	)

BALANCES AT JUNE 30, 2022		43,355,529	$	433,555	$	484,729,902		$	(446,435,094	)	$	38,728,363

~~See notes to condensed financial statements.~~

Table of Contents

CEL-SCI CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED DECEMBER 31, 2021 and 2020

2021

2020

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Property and equipment included in current liabilities

$ 469,005

$ 1,700,969

Capitalizable patent costs included in current liabilities

$ -

$ 15,000

Finance lease obligation included in accounts payable

$ 771

$ 1,752

Prepaid consulting services paid with issuance of common stock

$ 233,753

$ 243,687

Exercise of derivative liabilities

$ 70,589

$ 41,850

Financing costs included in current liabilities

$ 13,165

$ 88,021

Cash paid for interest

$ 290,212

$ 277,618

CEL-SCI CORPORATION

STATEMENTS OF STOCKHOLDERS' EQUITY continued

(UNAUDITED)

	Common Stock						Paid-In			Accumulated
	Shares			Amount			Capital			Deficit			Total

BALANCES AT OCTOBER 1, 2020		38,730,150		$	387,302		$	401,174,675		$	(381,835,303	)	$	19,726,674

Proceeds from the sale of common stock		1,000,000			10,000			13,549,500			0			13,559,500
Warrant exercises		15,000			150			89,100			0			89,250
Equity based compensation - employees		(2,000	)		(20	)		3,296,329			-			3,296,309
401(k) contributions paid in common stock		3,564			36			41,635			0			41,671
Stock and options issued to nonemployees for service		15,044			150			152,300			0			152,450
Option exercises		5,300			53			23,458			0			23,511
Modification of warrants		-			0			192			0			192
Share issuance costs		-			0			(117,021	)		0			(117,021	)
Net loss		-			0			0			(7,936,864	)		(7,936,864	)

BALANCES AT DECEMBER 31, 2020		39,767,058		$	397,671		$	418,210,168		$	(389,772,167	)	$	28,835,672

Warrant exercises		991,239			9,912			7,928,929			0			7,938,841
Equity based compensation - employees		-			-			3,282,742			-			3,282,742
401(k) contributions paid in common stock		3,347			33			51,387			0			51,420
Stock and options issued to nonemployees for service		13,486			135			379,142			0			379,277
Option exercises		48,845			489			138,299			0			138,788
Share issuance costs		-			0			(13,828	)		0			(13,828	)
Net loss		-			0			0			(11,281,120	)		(11,281,120	)

BALANCES AT MARCH 31, 2021		40,823,975		$	408,240		$	429,976,839		$	(401,053,287	)	$	29,331,792

Proceeds from the sale of common stock		1,610,000			16,100			33,787,826			0			33,803,926
Warrant exercises		437,312			4,373			1,375,117			0			1,379,490
Equity based compensation - employees		-			-			3,511,359			-			3,511,359
401(k) contributions paid in common stock		6,111			61			53,144			0			53,205
Stock and options issued to nonemployees for service		13,184			132			266,936			0			267,068
Option exercises		72,809			728			463,434			0			464,162
Modification of warrants		-			0			24,195			0			24,195
Share issuance costs		-			0			(103,185	)		0			(103,185	)
Net loss		-			0			0			(8,938,268	)		(8,938,268	)

BALANCES AT JUNE 30, 2021		42,963,391		$	429,634		$	469,355,665		$	(409,991,555	)	$	59,793,744


See notes to condensed financial statements.

~~See notes to condensed financial statements.~~

Table of Contents

~~CEL-SCI CORPORATION~~

~~NOTES TO CONDENSED FINANCIAL STATEMENTS~~

~~THREE MONTHS ENDED DECEMBER 31, 2021 AND 2020 (UNAUDITED)~~

A.	~~BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES~~

	~~Basis of Presentation~~

	The accompanying condensed financial statements of CEL-SCI Corporation (the Company) are unaudited and certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission. While management of the Company believes that the disclosures presented are adequate to make the information presented not misleading, these interim condensed financial statements should be read in conjunction with the financial statements and notes included in the Company’s annual report on Form 10-K for the year ended September 30, 2021.

	In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments necessary for a fair presentation of the Company’s financial position as of December 31, 2021 and the results of its operations for the three months then ended. The condensed balance sheet as of September 30, 2021 is derived from the September 30, 2021 audited financial statements.

	The financial statements have been prepared assuming that the Company will continue as a going concern, but due to recurring losses from operations and future liquidity needs, there is substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Refer to discussion in Note B.

	~~Summary of Significant Accounting Policies:~~

	~~Cash and Cash Equivalents~~ – Cash and cash equivalents consist principally of unrestricted cash on deposit and short-term money market funds. The Company considers all highly liquid investments with a maturity when purchased of less than three months as cash and cash equivalents.

	~~U.S. Treasury Bills –~~ ~~U.S. Treasury Bills (“T-bills”) are highly liquid short-term investments with maturity dates of greater than 3 months, but less than one year. These investments are recorded at fair value.~~

	~~Property and Equipment~~ – Property and equipment is recorded at cost and depreciated using the straight-line method over estimated useful lives of five to seven years. Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the term of the lease. Repairs and maintenance which do not extend the life of the asset are expensed when incurred. Property and equipment is reviewed on a quarterly basis to determine if any of the assets are impaired.

	~~Patents~~ - Patent expenditures are capitalized and amortized using the straight-line method over the shorter of the expected useful life or the legal life of the patent (17 years). In the event changes in technology or other circumstances impair the value or life of the patent, appropriate adjustment to the asset value and period of amortization is made. An impairment loss is recognized when estimated future undiscounted cash flows expected to result from the use of the asset, and from disposition, are less than the carrying value of the asset. The amount of the impairment loss would be the difference between the estimated fair value of the asset and its carrying value.

	~~Leases –~~ The Company accounts for contracts that convey the right to control the use of identified property, plant or equipment over a period of time in exchange for consideration as leases upon inception. The Company leases certain real estate, machinery, laboratory equipment and office equipment over varying periods. Many of these leases include an option to either renew or terminate the lease. For purposes of calculating lease liabilities, these options are included in the lease term when it is reasonably certain that the Company will exercise such options. The incremental borrowing rate utilized to calculate the lease liabilities is based on the information available at the commencement date, as most of the leases do not provide an implicit borrowing rate. Short-term leases, defined as leases with initial terms of 12 months or less, are not reflected on the balance sheet. Lease expense for such short-term leases is not material.

CEL-SCI CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED JUNE 30, 2022 and 2021
(UNAUDITED)

	2022			2021

Net loss	$	(28,238,682	)	$	(28,156,252	)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation and amortization		2,845,978			1,649,699
Share-based payments for services		603,147			955,900
Equity based compensation		9,102,774			10,090,410
Common stock contributed to 401(k) plan		167,280			146,296
Gain on short-term investments		(615	)		(6,578	)
Loss on patent impairment		30,793			0
Gain (loss) on derivative instruments		(366,791	)		991,562
Modification of warrants		634,713			24,387
(Increase)/decrease in assets:
Receivables		54,922			0
Prepaid expenses		147,192			232,752
Supplies used for R&D and manufacturing		(166,453	)		(759,193	)
Deposits		1,910,917			(248,712	)
Increase/(decrease) in liabilities:
Accounts payable		(410,536	)		689,812
Accrued expenses		78,729			297,928
Due to employees		230,012			84,598
Other liabilities		49,390			22,459

Net cash used in operating activities		(13,327,230	)		(13,984,932	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturity (purchases) of US treasury bills		6,152,000			(11,145,667	)
Purchases of property and equipment		(621,826	)		(8,628,648	)
Expenditures for patent costs		(22,741	)		0

Net cash provided by (used in) investing activities		5,507,433			(19,774,315	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock		0			47,363,426
Share issuance costs		(50,515	)		(207,673	)
Proceeds from exercises of warrants and options		131,060			6,195,571
Proceeds from landlord funding of leasehold improvements		786,454			1,613,546
Payments on obligations under finance lease		(1,033,677	)		(756,817	)

Net cash (used in) provided by financing activities		(166,678	)		54,208,053

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(7,986,475	)		20,448,806

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		36,060,148			15,508,909

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	28,073,673		$	35,957,715

See notes to condensed financial statements.

Table of Contents

	~~Derivative Instruments~~ – The Company has financing arrangements that consist of freestanding derivative instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with Accounting Standards Codification (ASC) 815, ~~Accounting for Derivative Instruments and Hedging Activities~~. In accordance with ASC 815, derivative instruments and hybrid instruments are recognized as either assets or liabilities on the balance sheet and are measured at fair value with gains or losses recognized in earnings or other comprehensive income depending on the nature of the derivative or hybrid instruments. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models considering all the rights and obligations of each instrument. The derivative liabilities are re-measured at fair value at the end of each interim period.

	~~The Company adopted Accounting Standards Update (ASU) 2020-06,~~ Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity ~~effective October 1, 2021. The amendments in this Update simplify and clarify the guidance in Subtopic 815-40. There was no financial impact in the period of adoption.~~

	~~Stock-Based Compensation~~ ~~– Compensation cost for all stock-based awards is measured at fair value as of the grant date in accordance with the provisions of ASC 718~~ ~~Compensation – Stock Compensation~~. The fair value of stock options is calculated using the Black-Scholes option pricing model. The Black-Scholes model requires various judgmental assumptions including volatility and expected option life. The stock-based compensation cost is recognized using the straight-line allocation method as expense over the requisite service or vesting period.

	The Company has Incentive Stock Option Plans, Non-Qualified Stock Option Plans, Stock Compensation Plans, Stock Bonus Plans and an Incentive Stock Bonus Plan. These Plans are collectively referred to as the "Plans". All Plans have been approved by the Company’s stockholders.

	The Company’s stock options are not transferable, and the actual value of the stock options that an employee may realize, if any, will depend on the excess of the market price on the date of exercise over the exercise price. For options issued with service conditions only, the Company has based its assumption for stock price volatility on the variance of daily closing prices of the Company’s stock. The risk-free interest rate assumption is based on the U.S. Treasury rate at the date of grant with the term equal to the expected life of the option. Forfeitures are accounted for when they occur. The expected term of options represents the period that options granted are expected to be outstanding and has been determined based on an analysis of historical exercise behavior. If any of the assumptions used in the Black-Scholes model change significantly, stock-based compensation expense for new awards may differ materially in the future from that recorded in the current period.

	Restricted stock granted under the Incentive Stock Bonus Plan and options granted under the 2021 and 2020 Non-Qualified Stock Option Plan are subject to service, performance and market conditions and meet the classification of equity awards. These awards were measured at fair value on the grant dates using a Monte Carlo simulation for issuances where the attainment of performance criteria is uncertain. The total compensation cost will be expensed over the estimated requisite service period.

	~~Research and Development Costs~~ - Research and development costs are expensed as incurred. Management accrues Clinical Research Organization (“CRO”) expenses and clinical trial study expenses based on services performed and relies on the CROs to provide estimates of those costs applicable to the completion stage of a study. Estimated accrued CRO costs are subject to revisions as such studies progress to completion. The Company records revisions to estimated expense in the period in which the facts that give rise to the revision become known.

	~~Net Loss Per Common Share~~ – The Company calculates net loss per common share in accordance with ASC 260 “Earnings Per Share” (ASC 260). Basic and diluted net loss per common share was determined by dividing net loss applicable to common shareholders by the weighted average number of common shares outstanding during the period. The Company’s potentially dilutive shares, which include outstanding common stock options, unvested restricted stock and common stock warrants, have not been included in the computation of diluted net loss per share for all periods as the result would be anti-dilutive.

CEL-SCI CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED JUNE 30, 2022 and 2021
(UNAUDITED)

	2022		2021
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Property and equipment included in current liabilities	$	0	$	589,400
Assets purchased under finance leases	$	32,409	$	0
Capitalizable patent costs included in current liabilities	$	0	$	20,000
Changes to right of use assets and liabilities	$	16,268	$	551,444
Finance lease obligation included in accounts payable	$	1,800	$	1,328
Prepaid consulting services paid with issuance of common stock	$	221,242	$	292,792
Accrued consulting services to be paid with issuance of common stock	$	110,000	$	110,000
Exercise of derivative liabilities	$	70,589	$	3,838,471
Financing costs included in current liabilities	$	28,560	$	76,860

Cash paid for interest	$	872,023	$	876,779

See notes to condensed financial statements.

Table of Contents

CEL-SCI CORPORATION NOTES TO CONDENSED FINANCIAL STATEMENTS NINE MONTHS ENDED JUNE 30, 2022 AND 2021 (UNAUDITED)	~~Income Taxes~~ – The Company uses the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating and tax loss carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be recognized. A full valuation allowance was recorded against the deferred tax assets as of December 31, 2021 and September 30, 2021.

	~~The Company adopted ASU No. 2019-12,~~ ~~Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes~~ effective October 1, 2021. The new standard includes several provisions that simplify accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and increasing consistency and clarity for the users of financial statements. The adoption of ASU 2019-12 had no impact on the Company’s financial statements.

	~~Use of Estimates~~ – The preparation of financial statements in conformity U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying disclosures. These estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Estimates are used in accounting for, among other items, inventory obsolescence, accruals, stock options, useful lives for depreciation and amortization of long-lived assets, right of use assets and lease liabilities, deferred tax assets and the related valuation allowance, and the valuation of derivative liabilities. Actual results could differ from estimates, although management does not generally believe such differences would materially affect the financial statements in any given year. However, in regard to the valuation of derivative liabilities determined using the Black-Scholes pricing model, significant fluctuations may materially affect the financial statements in a given year. Additionally, in calculating the right of use assets and lease liabilities, estimates and assumptions were used to determine the incremental borrowing rates and the expected lease terms. The Company considers the estimates used in valuing the derivative liabilities, stock options and the lease assets and liabilities to be significant.

	~~New Accounting Pronouncements~~

	~~The Company has considered all recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements.~~

A. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed financial statements of CEL-SCI Corporation (the Company) are unaudited and certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission. While management of the Company believes that the disclosures presented are adequate to make the information presented not misleading, these interim condensed financial statements should be read in conjunction with the financial statements and notes included in the Company’s annual report on Form 10-K for the year ended September 30, 2021.

In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments necessary for a fair presentation of the Company’s financial position as of June 30, 2022 and the results of its operations for the nine and three months then ended. The condensed balance sheet as of September 30, 2021 is derived from the September 30, 2021 audited financial statements. All accounting policies have been consistently applied in the interim financial statements and the annual financial statements. The results of operations for the nine and three months ended June 30, 2022 are not necessarily indicative of the results to be expected for the entire year.

The financial statements have been prepared assuming that the Company will continue as a going concern, but due to recurring losses from operations and future liquidity needs, there is substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Refer to the discussion in Note B.

Summary of Significant Accounting Policies:

Cash and Cash Equivalents – Cash and cash equivalents consist principally of unrestricted cash on deposit and short-term money market funds. The Company considers all highly liquid investments with a maturity when purchased of less than three months as cash equivalents.

Property and Equipment – Property and equipment is recorded at cost and depreciated using the straight-line method over estimated useful lives of five to seven years. Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the term of the lease. Repairs and maintenance which do not extend the life of the asset are expensed when incurred. Property and equipment are reviewed on a quarterly basis to determine if any of the assets are impaired.

Patents - Patent expenditures are capitalized and amortized using the straight-line method over the shorter of the expected useful life or the legal life of the patent (17 years). In the event changes in technology or other circumstances impair the value or life of the patent, appropriate adjustment to the asset value and period of amortization is made. An impairment loss is recognized when estimated future undiscounted cash flows expected to result from the use of the asset, and from disposition, are less than the carrying value of the asset. The amount of the impairment loss would be the difference between the estimated fair value of the asset and its carrying value.

Leases – The Company accounts for contracts that convey the right to control the use of identified property, plant or equipment over a period of time in exchange for consideration as leases upon inception. The Company leases certain real estate, machinery, laboratory equipment and office equipment over varying periods. Many of these leases include an option to either renew or terminate the lease. For purposes of calculating lease liabilities, these options are included in the lease term when it is reasonably certain that the Company will exercise such options. The incremental borrowing rate utilized to calculate the lease liabilities is based on the information available at the commencement date, as most of the leases do not provide an implicit borrowing rate. Short-term leases, defined as leases with initial terms of 12 months or less, are not reflected on the balance sheet. Lease expense for such short-term leases is not material.

~~OPERATIONS AND FINANCING~~

On June 28, 2021, the Company announced results from its 9.5 year pivotal Phase 3 study for its immunotherapy Multikine® (Leukocyte Interleukin, Injection) in the treatment of advanced (stages III and IV) primary (previously untreated) squamous cell carcinoma of the head and neck (SCCHN). The Phase 3 results showed a long-term 5 year overall survival (OS) benefit in the treatment arm that received Multikine treatment followed by surgery and radiation. This survival benefit was robust and durable, with no safety issues, something not commonly seen with cancer drugs. In fact, the survival benefit increased over time and at 5 years the overall survival benefit reached an absolute 14.1% advantage for the Multikine treated arm over control (n=380, total study patients treated with surgery plus radiation), control arm 48.6%, Multikine arm 62.7% survival.

Table of Contents

Derivative Instruments – The Company has financing arrangements that consist of freestanding derivative instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with Accounting Standards Codification (ASC) 815, Accounting for Derivative Instruments and Hedging Activities. In accordance with ASC 815, derivative instruments and hybrid instruments are recognized as either assets or liabilities on the balance sheet and are measured at fair value with gains or losses recognized in earnings or other comprehensive income depending on the nature of the derivative or hybrid instruments. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models considering all the rights and obligations of each instrument. The derivative liabilities are re-measured at fair value at the end of each interim period.	~~Liquidity~~

	The Company has incurred significant costs since its inception for the acquisition of certain proprietary technology and scientific knowledge relating to the human immunological defense system, patent applications, research and development, administrative costs, construction of laboratory facilities and participation in clinical trials. The Company has funded such costs primarily with proceeds from loans and the public and private sale of its securities. The Company will be required to raise additional capital or find additional long-term financing to continue with its efforts to bring Multikine to market. The ability to raise capital may be dependent upon market conditions that are outside the control of the Company. The ability of the Company to obtain approval from the U.S. Food and Drug Administration (FDA) for the sale of products to be developed on a commercial basis is uncertain. Ultimately, the Company must complete the development of its products, obtain the appropriate regulatory approvals and obtain sufficient revenues to support its cost structure. The Company believes there is a high likelihood that it will continue to receive funds from private and public offerings and warrant exercises similarly to the way it has funded operations in the past. However, there can be no assurance that the Company will be able to raise sufficient capital to support its operations.

	To finance the Company through marketing approval, the Company plans to raise additional capital in the form of warrant exercises, corporate partnerships, and debt and/or equity financings. The Company believes that it will be able to obtain additional financing because it has done so consistently in the past and because it showed great survival benefit in the Phase 3 study in one of the two treatment arms for advanced primary head and neck cancer. However, there can be no assurance that the Company will be successful in raising additional funds on a timely basis or that the funds will be available to the Company on acceptable terms or at all. If the Company does not raise the necessary amounts of money, it may have to curtail its operations until such time as it is able to raise the required funding.

	Primarily as a result of the Company’s losses incurred to date, the Company’s expected continued future losses, and the uncertainties associated with obtaining regulatory approval and ultimately commercializing its products, management has identified conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern. Management has evaluated the significance of those conditions and has concluded that here is sufficient cash on hand to meet the Company’s budgeted cash requirements, substantial doubt about the Company’s ability to continue as a going concern for more than twelve months from the date of these financial statements has been alleviated.

	~~Impact of the COVID-19 Pandemic~~

	In response to the global outbreak of COVID-19 and the World Health Organization’s classification of the outbreak as a pandemic, the Company continues to take the necessary precautions to ensure the safety of its employees and to minimize interruptions to its operations. Management follows the Centers for Disease Control and Prevention’s (“CDC”) guidance and the recommendations and restrictions provided by state and local authorities. The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. As such, it is uncertain as to the full magnitude of impact the pandemic will have on the Company’s financial condition, liquidity and future results of operations. Management is actively monitoring the risks to public health and the impact of overall global business activity on its financial condition, liquidity, operations, suppliers, industry, and workforce.

C. The Company adopted Accounting Standards Update (ASU) 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity effective October 1, 2021. The amendments in this Update simplify and clarify the guidance in Subtopic 815-40. There was no financial impact upon adoption. The Company adopted ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. This standard was issued to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. ASU 2021-04 is effective for fiscal years beginning after December 15, 2021, however, as permitted, the Company has elected to prospectively adopt the standard this quarter, effective as of October 1, 2021. Adoption of this standard had no impact on prior quarters within this fiscal year. Stock-Based Compensation – Compensation cost for all stock-based awards is measured at fair value as of the grant date in accordance with the provisions of ASC 718, Compensation – Stock Compensation. The fair value of stock options is calculated using the Black-Scholes option pricing model. The Black-Scholes model requires various judgmental assumptions including volatility and expected option life. The stock-based compensation cost is recognized using the straight-line allocation method as expense over the requisite service or vesting period. The Company has Incentive Stock Option Plans, Non-Qualified Stock Option Plans, Stock Compensation Plans, Stock Bonus Plans and an Incentive Stock Bonus Plan. These plans are collectively referred to as the “Plans.” All Plans have been approved by the Company’s stockholders. The Company’s stock options are not transferable, and the actual value of the stock options that an employee may realize, if any, will depend on the excess of the market price on the date of exercise over the exercise price. For options issued with service conditions only, the assumption for stock price volatility is based on the variance of daily closing prices of the Company’s stock. The risk-free interest rate assumption is based on the U.S. Treasury rate at the date of grant with the term equal to the expected life of the option. Forfeitures are accounted for when they occur. The expected term of options represents the period that options granted are expected to be outstanding and has been determined based on an analysis of historical exercise behavior. If any of the assumptions used in the Black-Scholes model change significantly, stock-based compensation expense for new awards may differ materially in the future from that recorded in the current period. Restricted stock granted under the Incentive Stock Bonus Plan and options granted under the 2021 and 2020 Non-Qualified Stock Option Plans are subject to service, performance and market conditions and meet the classification of equity awards. These awards were measured at fair value on the grant dates using a Monte Carlo simulation for issuances where the attainment of performance criteria is uncertain. The total compensation cost will be expensed over the estimated requisite service period.	~~STOCKHOLDERS’ EQUITY~~

	~~Proceeds from the Sale of Common Stock~~

	~~In December 2020, the Company sold 1,000,000shares of common stock at a public offering price of $14.65 per share and received aggregate proceeds of approximately $13.6 million.~~

	~~Equity Compensation~~

	~~Underlying share information for equity compensation plans as of December 31, 2021 is as follows:~~

Table of Contents

Name of Plan

Total Shares Reserved
Under Plans

Shares Reserved for Outstanding Options

Shares
Issued

Remaining Options/Shares
Under Plans

Incentive Stock Option Plans

138,400

76,829

N/A

213

Non-Qualified Stock Option Plans

11,787,200

11,204,380

N/A

172,592

Stock Bonus Plans

783,760

N/A

370,691

413,036

Stock Compensation Plans

634,000

N/A

153,195

462,395

Incentive Stock Bonus Plan

640,000

N/A

614,500

25,500

Research and Development Costs - Research and development costs are expensed as incurred. Management accrues Clinical Research Organization (CRO) expenses and clinical trial study expenses based on services performed and relies on the CROs to provide estimates of those costs applicable to the completion stage of a study. Estimated accrued CRO costs are subject to revisions as such studies progress to completion. The Company records revisions to estimated expense in the period in which the facts that give rise to the revision become known.

Net Loss Per Common Share – The Company calculates net loss per common share in accordance with ASC 260, “Earnings Per Share” (ASC 260). Basic and diluted net loss per common share was determined by dividing net loss applicable to common shareholders by the weighted average number of common shares outstanding during the period. The Company’s potentially dilutive shares, which include outstanding common stock options, unvested restricted stock and common stock warrants, have not been included in the computation of diluted net loss per share for all periods as the result would be anti-dilutive.

~~Underlying share information for equity compensation plans as of September 30, 2021 is as follows:~~

Name of Plan

Total Shares Reserved
Under Plans

Shares Reserved for Outstanding Options

Shares
Issued

Remaining Options/Shares
Under Plans

Incentive Stock Option Plans

138,400

76,829

N/A

213

Non-Qualified Stock Option Plans

11,787,200

10,972,880

N/A

410,592

Stock Bonus Plans

783,760

N/A

363,086

420,641

Stock Compensation Plans

634,000

N/A

153,195

462,395

Incentive Stock Bonus Plan

640,000

N/A

614,500

25,500

Income Taxes – The Company uses the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating and tax loss carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be recognized. A full valuation allowance was recorded against the deferred tax assets as of June 30, 2022 and September 30, 2021.

Stock option activity:

Three Months Ended December31,

2021

2020

Options granted

251,000

7,500

Options exercised

6,500

5,300

Options forfeited

13,000

42,166

Options expired

-

55

The Company adopted ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, effective October 1, 2021. The new standard includes several provisions that simplify accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and increasing consistency and clarity for the users of financial statements. The adoption of ASU 2019-12 had no impact on the Company’s financial statements.

Use of Estimates – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying disclosures. These estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Estimates are used in accounting for, among other items, obsolescence of supplies used for R&D and manufacturing, accruals, stock options, useful lives for depreciation and amortization of long-lived assets, right of use assets and lease liabilities, deferred tax assets and the related valuation allowance, and the valuation of derivative liabilities. Actual results could differ from estimates, although management does not generally believe such differences would materially affect the financial statements in any given year. However, regarding the valuation of derivative liabilities determined using the Black-Scholes pricing model, significant fluctuations may materially affect the financial statements in a given year. Additionally, in calculating the right of use assets and lease liabilities, estimates and assumptions were used to determine the incremental borrowing rates and the expected lease terms. The Company considers the estimates used in valuing the derivative liabilities, stock options and the lease assets and liabilities to be significant.

During the quarter ended December 31, 2021, the Company granted 250,000performance-based stock options from the 2020 Non-Qualified Stock Option Plan to officers. Each option entitles the holder to purchase one share of the Company’s common stock at a price of $10.48per share, the fair value on the date of issuance. The stock options will vest 100% upon approval of the first marketing application for any pharmaceutical based upon the Company’s Multikine technology in any of the USA, Canada, UK, Germany, France, Italy, Spain, Japan, or Australia. None of the options will be exercisable before November 19, 2022. All options which have not vested as of November 18, 2031 will be canceled. On the grant date, the options were valued using a Monte Carlo Simulation approach. A Monte Carlo Simulation is a statistical technique that is used to model probabilistic systems and establish the probabilities for a variety of outcomes. However, because attainment of the performance condition cannot be considered probable, no compensation cost is recognized relating to these options as of December 31, 2021. Management will re-assess the probability of achieving the performance condition at each reporting date.

Stock-Based Compensation Expense

Three months Ended December 31,

2021

2020

Employees

$ 3,262,296

$ 3,296,309

Non-employees

$ 218,318

$ 248,660

New Accounting Pronouncements

The Company has considered all recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements.

Employee compensation expense includes the expense related to options and restricted stock that is expensed over the vesting periods. Non-employee expense includes the expense related to options and stock issued to consultants expensed over the period of the related service contracts.

Table of Contents

	~~Warrants and Non-Employee Options~~

	~~The following chart represents the warrants and non-employee options outstanding at December 31, 2021:~~

Warrant/Options

Issue Date

Shares Issuable upon Exercise
of Warrants/ Options

Exercise Price

Expiration Date

Reference

Series N

8/18/2008

85,339

$ 3.00

8/18/2022

*

Series UU

6/11/2018

93,603

$ 2.80

6/30/2022

*

Series X

1/13/2016

120,000

$ 9.25

7/13/2022

*

Series Y

2/15/2016

26,000

$ 12.00

8/15/2022

*

Series HH

2/23/2017

200

$ 3.13

2/16/2022

*

Series AA

8/26/2016

100,000

$ 13.75

2/22/2022

*

Series MM

6/22/2017

333,432

$ 1.86

6/22/2022

*

Series NN

7/24/2017

205,587

$ 2.52

7/24/2022

2

Series RR

10/30/2017

251,761

$ 1.65

10/30/2022

*

Series SS

12/19/2017

200,000

$ 2.09

12/18/2022

*

Series TT

2/5/2018

600

$ 2.24

2/5/2023

*

Consultants

7/28/2017 - 11/18/2020

15,000

$2.18 $11.61

11/17/2022 - 7/27/2027

*

* No current period changes to these warrants

1.	~~Derivative Liabilities~~

	~~The table below presents the fair value of the warrant liabilities at the balance sheet dates:~~

December 31,
2021

September 30,
2021

Series Z warrants

$ -

$ 64,787

Series AA warrants

1,400

276,035

Series CC warrants

-

94,961

Series HH warrants

795

1,597

Total warrant liabilities

$ 2,195

$ 437,380

~~The table below presents the gains on the warrant liabilities for the three months ended December 31:~~

2021

2020

Series W warrants

$ -

$ 73,570

Series Z warrants

64,787

278,363

Series ZZ warrants

-

51,867

Series AA warrants

274,635

333,808

Series BB warrants

-

30,632

Series CC warrants

24,372

164,345

Series HH warrants

802

251

Net gain on warrant liabilities

$ 364,596

$ 932,836

The Company reviews all outstanding warrants in accordance with the requirements of ASC 815. This topic provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The warrant agreements provide for adjustments to the exercise price for certain dilutive events. Under the provisions of ASC 815, the warrants are not considered indexed to the Company’s stock because future equity offerings or sales of the Company’s stock are not an input to the fair value of a “fixed-for-fixed” option on equity shares, and equity classification is therefore precluded.

~~Table of Contents~~

	In accordance with ASC 815, derivative liabilities must be measured at fair value upon issuance and re-valued at the end of each reporting period through expiration. Any change in fair value between the respective reporting dates is recognized as a gain or loss.

	~~Changes in Warrant Liabilities~~

	During the three months ended December 31, 2021, 15,205 Series CC warrants were exercised at an exercise price of $5.00for gross proceeds of $76,000. During the three months ended December 31, 2020, 5,000 Series CC warrants were exercised at an exercise price of $5.00for gross proceeds of $25,000.

	~~On December 8, 2021, 640 Series CC warrants, with an exercise price of $5.00, expired. On November 23, 2021, 184,800 Series Z warrants, with an exercise price of $13.75, expired.~~

	~~On August 22, 2021, 16,000 Series BB warrants, with an exercise price of $13.75, expired. On October 28, 2020, 688,930 Series W warrants, with an exercise price of $16.75, expired.~~

2.	~~Equity Warrants~~

	~~Changes in Equity Warrants~~

	~~During the three months ended December 31, 2021, 4,500 Series NN warrants were exercised at an exercise price of $2.52 for gross proceeds of $11,340.~~

	~~During the three months ended December 31, 2020, 10,000 Series TT warrants were exercised at an exercise price of $2.24 for gross proceeds of $22,400.~~

	On December 7, 2020, the expiration date of the Series N warrants was extended six months from February 18, 2021 to August 18, 2021. The incremental cost of this extension was approximately $1,000, which was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020. The Series N warrants are held by the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a beneficiary.

	On December 7, 2020, the expiration date of the Series X warrants was extended six months from January 13, 2021 to July 13, 2021. The incremental cost of this extension was approximately $85,000, which was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020. The Series X warrants are also held by the de Clara Trust.

	On December 7, 2020, the expiration date of the Series Y warrants, which were issued in connection with a financing, was extended six months from February 15, 2021 to August 15, 2021. The incremental cost of this extension was approximately $41,000 and was recorded as additional paid-in capital.

	On December 7, 2020, the expiration date of Series UU warrants was extended six months from December 31, 2020 to June 30, 2021. These warrants were previously issued as an inducement to convert notes payable into shares of common stock. The incremental cost of this extension was $192 and was recorded as interest expense for the three months ended December 31, 2020. The Series UU warrants are held by Geert Kersten, Patricia Prichep (current Officers of the Company) and the de Clara Trust.

3.	~~Options and Shares Issued to Consultants~~

	During the three months ended December 31, 2021 and 2020, the Company issued 18,020 and 15,044 shares of restricted common stock, respectively, to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $9.93 and $12.45 per share, respectively, during the three months ended December 31, 2021 and 2020.

	During the three months ended December 31, 2020, the Company issued to a consultant 5,000 options to purchase common stock with an exercise price of $11.61. The options are exercisable beginning May 18, 2021 and expire on November 17, 2022. The options were expensed on a straight-line basis over the six month vesting period at a fair value of approximately $28,000 or $5.65 per option.

~~Table of Contents~~

	As of December 31, 2021 and September 30, 2021, 15,000 options issued to consultants remained outstanding, all of which were issued from the Non-Qualified Stock Option plans. All 15,000 options are vested as of December 31, 2021.

	During the three months ended December 31, 2021 and 2020, the Company recorded total expense of approximately $218,000 and $249,000, respectively, relating to the share based compensation under these consulting agreements. At December 31, 2021 and September 30, 2021, approximately $234,000and $364,000, respectively, are included in prepaid expenses.

4.	~~Securities Purchase Agreement~~

	The Company entered into a Securities Purchase Agreement with Ergomed plc (Ergomed), one of the Company’s CROs responsible for managing the Company’s Phase 3 clinical trial, to facilitate payment of amounts due to Ergomed. Under the Agreement, the Company issued Ergomed shares of common stock and the net proceeds from Ergomed's sales of those shares would reduce outstanding amounts due to Ergomed. Upon issuance, the Company expensed the full value of the shares as other non-operating gain/loss and subsequently offset the gain/loss as amounts were realized through the sale by Ergomed and reduced accounts payable to Ergomed.

	No sales were made by Ergomed during the three months ended December 31, 2021. As of December 31, 2021, Ergomed had no shares for resale. During the three months ended December 31, 2020, the Company realized approximately $0.1 million through the sale by Ergomed of 9,000 shares of the Company’s common stock and the Company reduced the payables to Ergomed and credited Other Operating Gain by that amount. No shares were issued to Ergomed during the three months ended December 31, 2021 and 2020.

D.	~~FAIR VALUE MEASUREMENTS~~

	~~In accordance with ASC 820-10,~~ ~~“Fair Value Measurements,”~~ the Company determines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company generally applies the income approach to determine fair value. This method uses valuation techniques to convert future amounts to a single present amount. The measurement is based on the value indicated by current market expectations with respect to those future amounts.

	ASC 820-10 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to active markets for identical assets and liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company classifies fair value balances based on the observability of those inputs. The three levels of the fair value hierarchy are as follows:

	·	~~Level 1 – Observable inputs such as quoted prices in active markets for identical assets or liabilities~~

	·	Level 2 – Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and amounts derived from valuation models where all significant inputs are observable in active markets

	·	Level 3 – Unobservable inputs that reflect management’s assumptions. Assumptions from market participants are used when pricing the asset or liabilities, given there is no readily available market information.

For disclosure purposes, assets and liabilities are classified in their entirety in the fair value hierarchy level based on the lowest level of input that is significant to the overall fair value measurement. The Company’s assessment of the significance of an input to the fair value measurement requires judgment and may affect the placement within the fair value hierarchy levels.

~~Table of Contents~~

	The Company purchased short-term U.S. Treasury bills during the year ended September 30, 2021 that are classified as trading securities. Quoted market prices were applied to determine the fair value of short-term investments; therefore, they were categorized as Level 1 in the fair value hierarchy. The Treasury bills matured in December 2021 and yielded a weighted average interest rate of 0.10%.

	~~As of December 31, 2021 and September 30, 2021, all of the Company’s derivative instruments are classified as Level 3 on the fair value hierarchy.~~

	The following sets forth a reconciliation of beginning and ending balances related to fair value measurements using significant unobservable inputs (Level 3) for the three months ended December 31, 2021 and the year ended September 30, 2021:

3 months ended December 31, 2021

12 months ended September 30, 2021

Beginning balance

$ 437,380

$ 3,765,613

Issuances

0

0

Exercises

(70,589 )

(4,023,091 )
Realized and unrealized (gains) and losses

(364,596 )

694,858

Ending balance

$ 2,195

$ 437,380

The fair values of the Company’s derivative instruments disclosed above under Level 3 are primarily derived from valuation models where significant inputs such as historical price and volatility of the Company’s stock, as well as U.S. Treasury Bill rates, are observable in active markets. At December 31, 2021, the Company’s Level 3 derivative instruments have a weighted average fair value of $0.02 per share and a weighted average exercise price of $13.73 per share. Fair values were determined using a weighted average risk-free interest rate of 0.06% and weighted average volatility of 79%. The instruments have a weighted average time to maturity of 0.14 years. At September 30, 2021, the Company’s Level 3 derivative instruments have a weighted average fair value of $1.45 per share and a weighted average exercise price of $13.28 per share. Fair values were determined using a weighted average risk-free interest rate of 0.05% and volatility of 109%. The instruments have a weighted average time to maturity of 0.3 years.

E.	~~RELATED PARTY TRANSACTIONS~~

	~~During the quarter ended December 31, 2021, the Company issued officers 250,000 options that vest upon FDA approval of the marketing application. See Note C for more information about the options.~~

	On December 7, 2020, the expiration dates of the Series N and Series X warrants held by the de Clara Trust were extended by six months (Note C). The incremental cost of these modifications was approximately $86,000 and was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020.

	On December 7, 2020, the expiration date of 93,603 Series UU warrants was extended from December 31, 2020 to June 30, 2021. The incremental cost of this extension was $192 and was recorded as interest expense for the three months ended December 31, 2020. The Series UU warrants are held by certain officers of the Company and were originally issued with convertible debt.

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F.	~~COMMITMENTS AND CONTINGENCIES~~

	~~Clinical Research Agreements~~

	Under co-development and revenue sharing agreements with Ergomed, Ergomed agreed to contribute up to $12 million towards the Company’s Phase 3 Clinical Trial in the form of discounted clinical services in exchange for a single digit percentage of milestone and royalty payments, up to a specific maximum amount. The Company accounted for the co-development and revenue sharing agreements in accordance with ASC 808 “Collaborative Arrangements”. The Company determined the payments to Ergomed are within the scope of ASC 730 “Research and Development.” Therefore, the Company records the discount on the clinical services as a credit to research and development expense on its statements of operations. Since the inception of the agreement with Ergomed, the Company has incurred research and development expenses of approximately $35.3 million for Ergomed’s services. This amount is net of Ergomed’s discount of approximately $11.7 million. During the three months ended December 31, 2021 and 2020, the Company recorded, net of Ergomed’s discount, approximately $0.2 million and $0.6 million, respectively, as research and development expense related to Ergomed’s services.

	~~Lease Agreements~~

	The Company leases a manufacturing facility near Baltimore, Maryland (the San Tomas lease). The building was remodeled in accordance with the Company’s specifications so that it can be used by the Company to manufacture Multikine for the Company’s Phase 3 clinical trial and sales of the drug if approved by the FDA. The lease is for a term of twenty years and requires annual base rent to escalate each year at 3%. The Company is required to pay all real estate and personal property taxes, insurance premiums, maintenance expenses, repair costs and utilities. The lease allows the Company, at its election, to extend the lease for two ten-year periods or to purchase the building at the end of the 20-year lease, which expires in October 2028. The renewal options are not included in the calculation of the right of use asset and lease liability because exercise of those options is not probable.

	On December 31, 2021 and September 30, 2021, the net book value of the finance lease right of use asset is approximately $12.3 million and $12.7 million, respectively and the balance of the finance lease liability is approximately $13.5 million and $13.8 million, respectively, of which approximately $0.6 million is current in each quarter. These amounts include the San Tomas lease as well as several other smaller finance leases for office equipment. The finance right of use assets are being depreciated using the straight-line method over the underlying lease terms. Total cash paid related to finance leases during the three months ended December 31, 2021 and 2020 was approximately $0.6 million and $0.5 million, respectively, of which approximately $0.3 million was for interest in each quarter. As of December 31, 2021, the weighted average discount rate of the Company’s finance leases is 8.45% and the weighted average time to maturity is 6.8 years.

	In August 2020, the Company entered into an amendment to the San Tomas lease under which the landlord agreed to allow the Company to substantially upgrade the manufacturing facility in preparation for the potential commercial production of Multikine. The project was finished and the improvements were placed in service in October 2021. Total cost was $11.1 million, of which the landlord agreed to finance $2.4 million. Approximately $1.6 million of the landlord financing was received as of December 31 2021, and the remaining balance is expected to be received in the second quarter of fiscal year 2022. The landlord financing is being repaid through increased lease payments which started in March 2021 and extend over the remaining lease term. The repayment includes a base rent which escalates at 3% each year plus interest that accrues at 13.75% per year. The Company remeasured the lease liability to account for the modified payments using a 8.45% implicit interest rate. The rate was determined using a synthetic credit rating analysis prepared by an outside valuation specialist. Additionally, this financing is considered to be a lease incentive from the landlord and has been included in the calculation of the lease liability as it is realized. The leasehold improvements are recorded in property and equipment, were deemed to be placed in service in October 2021 and are being amortized over the remaining lease term.

	The Company was required to deposit the equivalent of one year of base rent in accordance with the lease. Under the landlord’s $2.4 million financing arrangement, the Company was required to deposit an additional $0.2 million in March 2021. When the Company meets the minimum cash balance required by the lease, the deposit will be returned to the Company. During the quarter ended December 31, 2021, it was determined that the Company met the minimum cash requirement and the deposits were returned in January 2022. The approximate $1.9 million deposit is included in current assets at December 31, 2021 and non-current assets at September 30, 2021.

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~~Approximate future minimum lease payments under finance leases as of December 31, 2021 are as follows:~~

Nine months ending September 30, 2022

$ 1,083,000

Year ending September 30,

2023

2,569,000

2024

2,648,000

2025

2,733,000

2026

2,824,000

2027

2,919,000

Thereafter

3,267,000

Total future minimum lease obligation*

18,043,000

Less imputed interest on finance lease obligations

(4,539,000 )
Net present value of finance lease obligations

$ 13,504,000

	*~~Amount is net of landlord incentive of approximately $0.8 million expected to be received during the quarter ended March 31, 2022.~~

	The Company leases two facilities under operating leases. The lease for the Company’s office headquarters will expire on November 30, 2025. The lease for its research and development laboratory was renewed in September 2021 for an additional ten years and will expire on February 29, 2032. The renewal was considered a modification for accounting purposes and the right of use asset and liability were remeasured as of the date of the renewal. This resulted in an increase of approximately $1.1 million to the operating lease right of use asset and liability. The operating leases include escalating rental payments. The Company is recognizing the related rent expense on a straight-line basis over the terms of the leases. As of December 31, 2021 and September 30, 2021, the net book value of the operating lease right of use assets is approximately $2.0 million and $2.1 million, respectively. As of December 31, 2021 and September 30, 2021, the balance of the operating lease liabilities is approximately $2.1 million. of which approximately $0.1 million, is current in each quarter. The Company incurred lease expense for operating leases of approximately $91,000 and $66,000, respectively, for the three months ended December 31, 2021 and 2020. Total cash paid related to operating leases during the three months ended December 31, 2021 and 2020 was approximately $66,000 and $48,000, respectively. The weighted average discount rate of the Company’s operating leases is 9.11% and the weighted average time to maturity is 9.5 years.

	~~As of December 31, 2021, future minimum lease payments on operating leases are as follows:~~

Nine months ending September 30, 2022

$ 243,000

Year ending September 30,

2023

348,000

2024

357,000

2025

366,000

2026

287,000

2027

277,000

Thereafter

1,325,000

Total future minimum lease obligation

3,203,000

Less imputed interest on operating lease obligation

(1,081,000 )
Net present value of operating lease obligation

$ 2,122,000

G.	~~PATENTS~~

	During the three months ended December 31, 2021, the Company recorded approximately $31,000 in patent impairment charges. No patent impairment charges were recorded during the three months ended December 2020. During the three months ended December 31, 2021 and 2020, amortization of patent costs totaled approximately $14,000 and $13,000, respectively. Approximate estimated future amortization expense is as follows:

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Nine months ending September 30, 2022

$ 35,000

Year ending September 30,

2023

38,000

2024

30,000

2025

28,000

2026

24,000

2027

21,000

Thereafter

72,000

Total

$ 248,000

H.	~~LOSS PER COMMON SHARE~~

	Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. For the years presented, the gain on warrant liabilities priced lower than the average market price during the period is excluded from the numerator and the incremental shares, determined using the treasury stock method, are added to the denominator in calculating diluted loss per share.

	~~The following tables provide the details of the basic and diluted loss per-share computations:~~

Three months ended December 31,

2021

2020

Loss per share – basic

Net loss available to common shareholders - basic

$ (8,782,606 )

$ (8,022,643 )
Weighted average shares outstanding - basic

43,077,961

38,670,247

Basic loss per common share

$ (0.20 )

$ (0.21 )

Loss per share – diluted

Net loss available to common shareholders - basic

$ (8,782,606 )

$ (8,022,643 )
Gain on derivatives (1)

(25,114 )

(164,073 )
Net loss available to common shareholders - diluted

$ (8,807,720 )

$ (8,186,716 )

Weighted average shares outstanding - basic

43,077,961

38,670,247

Incremental shares underlying dilutive - warrants and options (1)

5,459

97,039

Weighted average shares outstanding – diluted

43,083,420

38,767,286

Diluted loss earnings per common share

$ (0.20 )

$ (0.21 )

~~(1)~~

~~Includes Series CC and HH warrants for the three months ended December 31, 2021 and 2020.~~

~~In accordance with the contingently issuable shares guidance of FASB ASC Topic 260,~~ ~~Earnings Per Share~~~~, the calculation of diluted net earnings (loss) per share excludes the following securities because their inclusion would have been anti-dilutive as of December 31:~~

2021

2020

Options and Warrants

10,477,966

6,517,160

Unvested Restricted Stock

151,250

302,500

Total

10,629,216

6,819,660

J.	~~SUBSEQUENT EVENTS~~

	~~The Company has evaluated subsequent events through the date these financial statements were filed and determined there are no subsequent events that require disclosure.~~

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B. ~~Item 2. MANAGEMENT'S DISCUSSION~~OPERATIONS AND ~~ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~

~~Liquidity and Capital Resources~~FINANCING

On June 28, 2021, the Company announced results from its ~~9.5 year~~9.5-year pivotal Phase 3 study for its immunotherapy Multikine® (Leukocyte Interleukin, Injection) in the treatment of advanced (stages III and IV) primary (previously untreated) squamous cell carcinoma of the head and neck (SCCHN). The Phase 3 results showed a long-term 5-year overall survival (OS) benefit in the treatment arm that received Multikine treatment followed by surgery and radiation. This survival benefit was robust and durable, with no safety issues, something not commonly seen with cancer drugs. In fact, the survival benefit increased over time and at 5 years the overall survival benefit reached an absolute 14.1% advantage for the Multikine treated arm over control (n=380, total study patients treated with surgery plus radiation), control arm 48.6%, Multikine arm 62.7% survival.

The study used the standard of care treatment for advanced primary head and neck cancer patients as a comparison. The patients received surgery followed by either radiation or chemoradiation (chemotherapy and radiation at the same time), as determined by the physician. This ~~means~~meant that there were 2two treatment ~~arms, 1)~~arms: (1) surgery plus radiation or 2)(2) surgery plus chemoradiation. The arm that received Multikine treatment followed by surgery and radiation showed great survival benefit, but when chemotherapy was added in the second treatment arm, the immunological effect of Multikine was negated. Therefore, when the two treatment arms were combined the study did not achieve its primary endpoint of a 10% improvement in overall survival.

Multikine is given for three weeks after cancer diagnosis, but before surgery and other treatments. In the peer-reviewed abstract presented at ASCO, a clear survival advantage for patients treated with Multikine prior to surgery in the surgery-plus-radiation arm of the IT-MATTERS study was described. The survival advantage was driven by objective data derived from patients in the intent-to-treat (ITT) population who had a significant number of early complete and partial tumor responses which occurred prior to surgery. Five patients in the study had their tumors completely disappear (confirmed by pathology) before surgery. In the ITT population as a whole, 8.5% of all Multikine-treated patients had a tumor response before surgery, but not a single tumor response before surgery was seen in the ITT control group before surgery, statistically a highly significant finding (p-value of less than 0.00000000001). This indicates that the likelihood of seeing these results by chance is less than 1 in ten billion. These results confirm findings from the Phase 1 and 2 studies with Multikine and provide direct evidence of Multikine’s anticancer activity.

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Liquidity

The Company has incurred significant costs since its inception for the acquisition of certain proprietary technology and scientific knowledge relating to the human immunological defense system, patent applications, research and development, administrative costs, construction and expansion of manufacturing and laboratory facilities, and participation in clinical trials. The Company has funded such costs primarily with proceeds from loans and the public and private sale of its securities. The Company will be required to raise additional capital or find additional long-term financing to continue with its efforts to bring Multikine to market. The ability to raise capital may be dependent upon market conditions that are outside the control of the Company. The ability of the Company to obtain approval from the U.S. Food and Drug Administration (FDA) for the sale of products to be developed on a commercial basis is uncertain. Ultimately, the Company must complete the development of its products, obtain the appropriate regulatory approvals and obtain sufficient revenues to support its cost structure. The Company believes there is a high likelihood that it will continue to receive funds from private and public offerings and warrant exercises similar to the way it has funded operations in the past. However, there can be no assurance that the Company will be able to raise sufficient capital to support its operations.

To finance the Company through marketing approval, the Company plans to raise additional capital in the form of warrant exercises, corporate partnerships, and debt and/or equity financings. The Company believes that it will be able to obtain additional financing because it has done so consistently in the past and because it showed great survival benefit in the Phase 3 study in one of the two treatment arms for advanced primary head and neck cancer. However, there can be no assurance that the Company will be successful in raising additional funds on a timely basis or that the funds will be available to the Company on acceptable terms or at all. If the Company does not raise the necessary amounts of money, it may have to curtail its operations until such time as it is able to raise the required funding.

Primarily because of the losses incurred to date, the expected continued future losses, and the uncertainties associated with obtaining regulatory approval and ultimately commercializing its products, management has identified conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern. Management has evaluated the significance of those conditions and has concluded that there is sufficient cash on hand to meet the Company’s budgeted cash requirements. As a result, substantial doubt about the Company’s ability to continue as a going concern for more than twelve months from the date of these financial statements has been alleviated.

Impact of the COVID-19 Pandemic

In response to the global outbreak of COVID-19 and the World Health Organization’s classification of the outbreak as a pandemic, the Company continues to take the necessary precautions to ensure the safety of its employees and to minimize interruptions to its operations. Management follows the Centers for Disease Control and Prevention’s (CDC) guidance and the recommendations and restrictions provided by state and local authorities. The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. As such, it is uncertain as to the full impact the pandemic will have on the Company’s future financial condition, liquidity and results of operations. Management is actively monitoring the risks to public health and the impact of overall global business activity on the Company’s financial condition, liquidity, operations, suppliers, industry, and workforce.

C. STOCKHOLDERS’ EQUITY

Proceeds from the Sale of Common Stock

In June 2021, the Company sold 1,400,000 shares of common stock at a public offering price of $22.62 per share and received aggregate net proceeds of approximately $29.4 million. The Company also granted the underwriters a 30-day option to purchase up to 210,000 additional shares of common stock to cover over-allotments. The underwriters fully exercised this option in June 2021, resulting in additional net proceeds to the Company of approximately $4.4 million.

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In December 2020, the Company sold 1,000,000 shares of common stock at a public offering price of $14.65 per share and received aggregate proceeds of approximately $13.6 million.

Equity Compensation

Underlying share information for equity compensation plans as of June 30, 2022 is as follows:

Name of Plan	Total Shares Reserved Under Plans		Shares Reserved for Outstanding Options		Shares Issued		Remaining Options/Shares Under Plans

Incentive Stock Option Plans		138,400		75,329		N/A		213
Non-Qualified Stock Option Plans		13,787,200		12,909,350		N/A		455,508
Stock Bonus Plans		783,760		N/A		397,945		385,782
Stock Compensation Plans		634,000		N/A		153,195		462,395
Incentive Stock Bonus Plan		640,000		N/A		614,500		25,500

Stock option activity:

	Nine Months Ended June 30,
	2022		2021
Options granted		1,975,250		2,603,500
Options exercised		6,500		126,954
Options forfeited		20,166		42,166
Options expired		13,614		9,374

	Three Months Ended June 30,
	2022		2021
Options granted		1,722,750		2,595,500
Options exercised		-		72,809
Options forfeited		-		-
Options expired		13,614		9,307

During the three months ended June 30, 2022, the Company adopted the 2022 Non-Qualified Stock Option Plan, which provides for the issuance of up to 2,000,000 options to purchase shares of common stock.

During the nine months ended June 30, 2022, the Company granted 250,000 performance-based stock options from the 2020 Non-Qualified Stock Option Plan to officers. Each option entitles the holder to purchase one share of the Company’s common stock at a price of $10.48 per share, the fair value on the date of issuance. The stock options will vest 100% upon approval of the first marketing application for any pharmaceutical based upon the Company’s Multikine technology in the USA, Canada, UK, Germany, France, Italy, Spain, Japan, or Australia. None of the options will be exercisable before November 19, 2022. All options which have not vested as of November 18, 2031 will be canceled. On the grant date, the options were valued using a Monte Carlo Simulation approach. A Monte Carlo Simulation is a statistical technique that is used to model probabilistic systems and establish the probabilities for a variety of outcomes. However, because attainment of the performance condition cannot be considered probable, no compensation cost is recognized relating to these options as of June 30, 2022. Management re-assesses the probability of achieving the performance condition at each reporting date.

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Stock-Based Compensation Expense

	Nine months Ended June 30,
	2022		2021
Employees	$	9,102,774	$	10,090,410
Non-employees	$	603,147	$	955,900

	Three months Ended June 30,
	2022		2021
Employees	$	2,447,772	$	3,511,359
Non-employees	$	200,877	$	403,236

Warrants and Non-Employee Options

Warrant/Options	Issue Date	Underlying Shares		Exercise Price		Expiration Date	Reference
Series N	8/18/2008		85,339	$	3.00	8/18/2024		2
Series UU	6/11/2018		93,603	$	2.80	6/30/2024		2
Series X	1/13/2016		120,000	$	9.25	7/13/2024		2
Series Y	2/15/2016		26,000	$	12.00	8/15/2024		2
Series MM	6/22/2017		333,432	$	1.86	6/22/2024		2
Series NN	7/24/2017		200,087	$	2.52	7/24/2024		2
Series RR	10/30/2017		251,761	$	1.65	10/30/2022	*
Series SS	12/19/2017		200,000	$	2.09	12/18/2022	*
Series TT	2/5/2018		600	$	2.24	2/5/2023	*
Consultants	7/28/2017 – 11/18/2020		15,000	$2.18 -$11.61		11/17/2022 - 7/27/2027	*

*	No current period changes to these warrants

1.	Warrant Liabilities

The table below presents the fair value of the warrant liabilities as of:

	June 30, 2022		September 30, 2021
Series Z warrants	$	0	$	64,787
Series AA warrants		0		276,035
Series CC warrants		0		94,961
Series HH warrants		0		1,597
Total warrant liabilities	$	0	$	437,380

The table below presents the net gains (losses) on the warrant liabilities for the nine months ended June 30:

	2022		2021
Series W warrants	$	0	$	73,570
Series Z warrants		64,787		(113,094	)
Series ZZ warrants		0		(98,692	)
Series AA warrants		276,035		(306,606	)
Series BB warrants		0		48,477
Series CC warrants		24,372		(596,001	)
Series HH warrants		1,597		784
Net gain (loss) on warrant liabilities	$	366,791	$	(991,562	)

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The table below presents the net gains (losses) on the warrant liabilities for the three months ended June 30:

	2022		2021
Series Z warrants	$	0	$	583,404
Series ZZ warrants		0		(87,162	)
Series AA warrants		0		355,215
Series BB warrants		0		64,678
Series CC warrants		0		199,256
Series HH warrants		0		1,228
Net gain loss on warrant liabilities	$	0	$	1,116,619

In accordance with ASC 815, derivative liabilities must be measured at fair value upon issuance and re-valued at the end of each reporting period through expiration. Any change in fair value between the respective reporting dates is recognized as a gain or loss.

During the nine months ended June 30, 2022, 15,205 Series CC warrants were exercised at an exercise price of $5.00 for gross proceeds of $76,025. No warrants were exercised during the three months ended June 30, 2022.

The following warrants recorded as liabilities were exercised during the following periods:

	Nine Months Ended June 30, 2021						Three Months Ended June 30, 2021
Warrants	Warrants Exercised		Exercise Price		Proceeds		Warrants Exercised		Exercise Price		Proceeds
Series Z		79,200	$	13.75	$	1,089,000		-		0	$	0
Series ZZ		20,000	$	13.75		275,000		19,200	$	13.75		264,000
Series AA		100,000	$	13.75		1,375,000		-		0		0
Series CC		107,298	$	5.00		536,490		5,000	$	5.00		25,000
		306,498			$	3,275,490		24,200			$	289,000

In February 2022, 100,000 Series AA warrants with an exercise price of $13.75 and 200 Series HH warrants with an exercise price of $3.13, expired. In December 2021, 640 Series CC warrants, with an exercise price of $5.00, expired. In November 2021, 184,800 Series Z warrants, with an exercise price of $13.75, expired.

On October 28, 2020, 688,930 Series W warrants, with an exercise price of $16.75, expired.

2. Equity Warrants

During the nine months ended June 30, 2022, 10,000 Series NN warrants were exercised at an exercise price of $2.52 for gross proceeds of $25,200. No warrants were exercised during the three months ended June 30, 2022.

The following warrants recorded as equity were exercised during the following periods:

	Nine Months Ended June 30, 2021						Three Months Ended June 30, 2021
Warrants	Warrants Exercised		Exercise Price		Proceeds		Warrants Exercised		Exercise Price		Proceeds
Series MM		464,201	$	1.86	$	863,414		147,929	$	1.86	$	275,148
Series NN		131,004	$	2.52		330,130		109,170	$	2.52		275,108
Series RR		165,888	$	1.65		273,715		95,799	$	1.65		158,068
Series SS		105,264	$	2.09		220,002		-	$	2.09		0
Series TT		270,696	$	2.24		606,359		60,214	$	2.24		134,879
		1,137,053			$	2,293,620		413,112			$	843,204

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On June 13, 2022, the expiration dates of the Series N, Series X, Series Y, Series UU, Series MM and Series NN warrants were extended two years. The incremental costs of the warrant extensions were recorded consistent with the accounting for the initial warrant issuances. The incremental costs of the Series N, Series X and Series Y warrant extensions were recorded as a deemed dividend and totaled approximately $294,000 for the nine and three months ended June 30, 2022. The Series N and Series X warrants are held by the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a trustee and beneficiary. The incremental cost of the Series MM, Series NN and Series UU warrant extensions were recorded as interest expense, because these warrants were originally issued with convertible notes payable and totaled approximately $635,000 for the nine and three months ended June 30, 2022. The Series UU warrants and a portion of the Series MM and Series NN warrants are held by Geert Kersten, Patricia Prichep (current officers of the Company) and the de Clara Trust.

On June 28, 2021, the expiration dates of the Series N, Series X, Series Y and Series UU warrants were extended one year. On December 7, 2020, the expiration dates of the Series N, Series X, Series Y and Series UU warrants were extended six months. The incremental costs of the warrant extensions were recorded consistent with the accounting for the initial warrant issuances. The incremental costs of the Series N and Series X warrant extensions were recorded as a deemed dividend and totaled approximately $351,000 and $265,000 for the nine and three months ended June 30, 2021, respectively. The Series N and Series X warrants are held by the de Clara Trust. The incremental cost of the Series Y warrant extension was recorded as additional paid in capital and totaled approximately $103,000 and $62,000 for the nine and three months ended June 30, 2021. The incremental cost of the Series UU warrant extension was recorded as interest expense because these warrants were initially issued as an inducement to convert notes payable into common stock. The Series UU warrants are held by Geert Kersten, Patricia Prichep and the de Clara Trust.

3. Options and Shares Issued to Consultants

During the nine months ended June 30, 2022 and 2021, the Company issued 81,782 and 41,714 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $5.40 and $19.47 during the nine months ended June 30, 2022 and 2021, respectively. During the three months ended June 30, 2022 and 2021, the Company issued 38,287 and 13,184 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $3.52 and $23.39, respectively, during the three months ended June 30, 2022 and 2021. The aggregate values of the issuances of restricted common stock and common stock options are recorded as prepaid expenses and are charged to general and administrative expenses over the periods of service.

No options were issued to consultants during the nine and three months ended June 30, 2022. During the nine months ended June 30, 2021, the Company issued a consultant 5,000 options to purchase common stock with an exercise price of $11.61, at an aggregate fair value of approximately $28,000 and an expiration date of November 17, 2022. As of June 30, 2022 and September 30, 2021, 15,000 options issued to consultants were outstanding, all of which were issued from the Non-Qualified Stock Option plans and all of which are vested as of the balance sheet dates.

During the nine months ended June 30, 2022 and 2021, the Company recorded total expense of approximately $603,000 and $956,000, respectively, relating to the share-based compensation under these consulting agreements. During the three months ended June 30, 2022 and 2021, the Company recorded total expense of approximately $201,000 and $403,000, respectively, relating to the share-based compensation under these consulting agreements. On June 30, 2022 and September 30, 2021, consulting fees of approximately $221,000 and $364,000, respectively, are included in prepaid expenses.

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4. Securities Purchase Agreement

In prior years, the Company was party to a Securities Purchase Agreement (SPA) with Ergomed plc (Ergomed), one of the Company’s Clinical Research Organizations responsible for managing the Company’s Phase 3 clinical trial, to facilitate payment of amounts due to Ergomed. Under the Agreement, the Company issued Ergomed shares of common stock and the net proceeds from the sales of those shares reduced outstanding amounts due Ergomed. Upon issuance, the Company expensed the full value of the shares as other non-operating gain/loss and subsequently offset the gain or loss as amounts were realized through the sale of shares by Ergomed and reduced accounts payable to Ergomed. Ergomed resold the final balance of shares issued in the quarter ended September 30, 2021. No shares were issued during the periods presented. No sales were made by Ergomed during the nine and three months ended June 30, 2022. During the nine and three months ended June 30, 2021, respectively, the Company realized approximately $1.4 million and $0.8 million through the sale by Ergomed of 111,500 and 36,000 shares of common stock and the Company reduced the payable to Ergomed and credited other operating gain by those amounts.

D. FAIR VALUE MEASUREMENTS

In accordance with ASC 820-10, “Fair Value Measurements,” the Company determines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company generally applies the income approach to determine fair value. This method uses valuation techniques to convert future amounts to a single present amount. The measurement is based on the value indicated by current market expectations with respect to those future amounts.

ASC 820-10 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to active markets for identical assets and liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company classifies fair value balances based on the observability of those inputs. The three levels of the fair value hierarchy are as follows:

	·	Level 1 – Observable inputs such as quoted prices in active markets for identical assets or liabilities.

	·	Level 2 – Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and amounts derived from valuation models where all significant inputs are observable in active markets.

	·	Level 3 – Unobservable inputs that reflect management’s assumptions. Assumptions from market participants are used when pricing the assets or liabilities, given there is no readily available market information.

The Company purchased short-term U.S. Treasury bills during the year ended September 30, 2021 that are classified as trading securities. Quoted market prices were applied to determine the fair value of short-term investments; therefore, they were categorized as Level 1 in the fair value hierarchy. The Treasury bills matured in December 2021 and yielded a weighted average interest rate of 0.10%.

As of June 30, 2022, there were no outstanding derivative instruments. As of September 30, 2021, all the Company’s derivative instruments are classified as Level 3 of the fair value hierarchy.

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The following sets forth the reconciliation of beginning and ending balances related to fair value measurements using significant unobservable inputs (Level 3) for the nine months ended June 30, 2022 and the year ended September 30, 2021:

	Nine months ended			Twelve months ended
	June 30, 2022			September 30, 2021

Beginning balance	$	437,380		$	3,765,613
Issuances		0			0
Exercises		(70,589	)		(4,023,091	)
Realized and unrealized net (gain) loss		(366,791	)		694,858
Ending balance	$	0		$	437,380

E. RELATED PARTY TRANSACTIONS

During the nine months ended June 30, 2022, the Company issued officers 250,000 options that vest upon FDA approval of the marketing application. See Note C for more information about the options.

On June 13, 2022, the expiration dates of certain warrants, some of which are held by related parties, were extended by twenty-four months (Note C). The incremental cost of the modification of the Series N and Series X warrants, held by the de Clara Trust, was approximately $264,000 and was recorded as a deemed dividend in the financial statements for the nine and three months ended June 30, 2022. The incremental cost of the modification of the Series MM, Series NN and Series UU warrants, relating to those warrants held by the de Clara Trust and certain officers of the Company, was approximately $457,000 and was recorded as interest expense for the nine and three months ended June 30, 2022. This accounting treatment is consistent with the original recording of these warrants which were issued with convertible debt. All warrants holders were given the same modified terms.

In June 2021, the expiration dates of the Series N, Series X, Series Y and Series UU warrants were extended one year. In December 2020, the expiration dates of the Series N, Series X, Series Y and Series UU warrants were extended six months. The incremental costs of the warrant extensions were recorded consistent with the accounting for the initial warrant issuances. The incremental costs of the Series N and Series X warrant extensions were recorded as a deemed dividend and totaled approximately $351,000 and $265,000 for the nine and three months ended June 30, 2021, respectively. The incremental cost of the Series UU warrant extension was recorded as interest expense and totaled approximately $24,000 for the nine and three months ended June 30, 2021.

F. COMMITMENTS AND CONTINGENCIES

Clinical Research Agreements

Under co-development and revenue sharing agreements with Ergomed, Ergomed agreed to contribute up to $12 million towards the Company’s Phase 3 Clinical Trial in the form of discounted clinical services in exchange for a single digit percentage of milestone and royalty payments, up to a specific maximum amount. The Company accounted for the co-development and revenue sharing agreements in accordance with ASC 808 “Collaborative Arrangements.” The Company determined the payments to Ergomed are within the scope of ASC 730 “Research and Development.” Therefore, the Company records the discount on the clinical services as a credit to research and development expense on its Statements of Operations. Since the inception of the agreement with Ergomed, the Company has incurred research and development expenses of approximately $35.5 million for Ergomed’s services. This amount is net of Ergomed’s discount of approximately $11.8 million. During the nine months ended June 30, 2022 and 2021, the Company recorded, net of Ergomed’s discount, approximately $0.5 million and $1.4 million, respectively, of research and development expense related to Ergomed’s services. During the three months ended June 30, 2022 and 2021, the Company recorded, net of Ergomed’s discount, approximately $0.1 million and $0.4 million, respectively, as research and development expense related to Ergomed’s services.

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Lease Agreements

The Company leases a manufacturing facility near Baltimore, Maryland (the San Tomas lease). The building was remodeled in accordance with the Company’s specifications so that it can be used by the Company to manufacture Multikine for the Company’s Phase 3 clinical trial and sales of the drug if approved by the FDA. The lease is for a term of twenty years and requires annual base rent to escalate each year at 3%. The Company is required to pay all real estate and personal property taxes, insurance premiums, maintenance expenses, repair costs and utilities. The lease allows the Company, at its election, to extend the lease for two ten-year periods or to purchase the building at the end of the 20-year lease, which expires in October 2028. The renewal options are not included in the calculation of the right of use asset and lease liability because exercise of those options is not probable.

On June 30, 2022 and September 30, 2021, the net book value of the finance lease right of use asset is approximately $11.4 million and $12.7 million, respectively, and the balance of the finance lease liability is approximately $13.6 million and $13.8 million, respectively, of which approximately $1.5 million and $0.6 million is current on June 30, 2022 and September 30, 2021, respectively. These amounts include the San Tomas lease as well as several other smaller finance leases for office equipment. The finance right of use assets are being depreciated using the straight-line method over the underlying lease terms. Total cash paid related to finance leases during the nine months ended June 30, 2022 and 2021 was approximately $1.9 million and $1.6 million, respectively, of which approximately $0.9 million was for interest in each nine-month period. As of June 30, 2022, the weighted average discount rate of the Company’s finance leases is 8.45% and the weighted average time to maturity is 6.3 years.

In August 2020, the Company entered an amendment to the San Tomas lease under which the landlord agreed to allow the Company to substantially upgrade the manufacturing facility in preparation for the potential commercial production of Multikine. The project was completed and the improvements were placed in service in October 2021. The total cost was $11.1 million, of which the landlord financed $2.4 million. The landlord financing is being repaid through increased lease payments which started in March 2021 and extend over the remaining lease term. The repayment includes a base rent which escalates at 3% each year plus interest that accrues at 13.75% per year. The Company remeasured the lease liability to account for the modified payments using an 8.45% implicit interest rate. The rate was determined using a synthetic credit rating analysis prepared by an outside valuation specialist. The financing is accounted for as a lease incentive from the landlord and is included in the calculation of the lease liability as it was realized. The leasehold improvements are recorded in property and equipment and are being amortized over the remaining lease term.

The Company was required to deposit the equivalent of one year of base rent in accordance with the lease. Under the landlord’s $2.4 million financing arrangement, the Company deposited an additional $0.2 million in March 2021. Because the Company met the minimum cash balance required by the lease, the full balance of the deposit was returned to the Company in January 2022. If the Company’s cash balance falls below the required balance, the Company will be required to re-deposit these funds with the landlord. The approximate $1.9 million deposit is included in non-current assets on September 30, 2021.

Approximate future minimum lease payments under finance leases as of June 30, 2022 are as follows:

Three months ending September 30, 2022	$	625,000
Year ending September 30,
2023		2,576,000
2024		2,655,000
2025		2,741,000
2026		2,832,000
2027		2,923,000
Thereafter		3,267,000
Total future minimum lease obligation		17,619,000
Less imputed interest on finance lease obligations		(3,985,000	)
Net present value of finance lease obligations	$	13,634,000

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The Company leases two facilities under operating leases. The lease for the Company’s office headquarters will expire on November 30, 2025. The lease for its research and development laboratory was renewed in September 2021 for an additional ten years and will expire on February 29, 2032. The renewal was considered a modification for accounting purposes and the right of use asset and liability were remeasured as of the date of the renewal. This resulted in an increase of approximately $1.1 million to the operating lease right of use asset and liability. The operating leases include escalating rental payments. The Company is recognizing the related rent expense on a straight-line basis over the terms of the leases. As of June 30, 2022 and September 30, 2021, the net book value of the operating lease right of use assets is approximately $1.9 million and $2.1 million, respectively. As of June 30, 2022 and September 30, 2021, the balance of the operating lease liabilities is approximately $2.1 million, of which approximately $0.2 million and $0.1 million is current on June 30, 2022 and September 30, 2021, respectively. The Company incurred lease expense for operating leases of approximately $272,000 and $198,000, respectively, for the nine months ended June 30, 2022 and 2021. The Company incurred lease expense for operating leases of approximately $91,000 and $66,000, respectively, for the three months ended June 30, 2022 and 2021. Total cash paid related to operating leases during the nine months ended June 30, 2022 and 2021 was approximately $199,000 and $176,000, respectively. The weighted average discount rate of the Company’s operating leases is 9.09% and the weighted average time to maturity is 9.0 years.

As of June 30, 2022, future minimum lease payments on operating leases are as follows:

Three months ending September 30, 2022	$	86,000
Year ending September 30,
2023		348,000
2024		357,000
2025		366,000
2026		287,000
2027		277,000
Thereafter		1,325,000
Total future minimum lease obligation		3,046,000
Less imputed interest on operating lease obligation		(986,000	)
Net present value of operating lease obligation	$	2,060,000

G. PATENTS

During the nine months ended June 30, 2022 and 2021, respectively, patent impairment charges of approximately $31,000 and $0, were recorded. No patent impairment charges were recorded during the three months ended June 30, 2022 and 2021. For the nine months ended June 30, 2022 and 2021, amortization of patent costs totaled approximately $39,000 in each period. For the three months ended June 30, 2022 and 2021, amortization of patent costs totaled approximately $12,000 and $13,000, respectively. Approximate estimated future amortization expense is as follows:

Three months ending September 30, 2022	$	10,000
Year ending September 30,
2023		38,000
2024		30,000
2025		28,000
2026		24,000
2027		21,000
Thereafter		71,000
Total	$	222,000

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H. LOSS PER COMMON SHARE

Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. For the years presented, the gain on warrant liabilities priced lower than the average market price during the period is excluded from the numerator and the incremental shares, determined using the treasury stock method, are added to the denominator in calculating diluted loss per share.

The following tables provide the details of the basic and diluted loss per-share computations:

	Nine months ended June 30,						Three months ended June 30,
	2022			2021			2021			2021
Loss per share - basic
Net loss available to common shareholders - basic	$	(28,533,091	)	$	(28,507,113	)	$	(9,926,993	)	$	(9,203,350	)
Weighted average shares outstanding - basic		43,124,972			39,907,624			43,174,775			41,020,485
Basic loss per common share	$	(0.66	)	$	(0.71	)	$	(0.23	)	$	(0.22	)

Loss per share - diluted
Net loss available to common shareholders - basic	$	(28,533,091	)	$	(28,507,113	)	$	(9,926,993	)	$	(9,203,350	)
Unrealized gain on derivatives ⁽¹⁾		0			(1,236,514	)		0			(1,233,597	)
Net loss available to common shareholders – diluted	$	(28,533,091	)	$	(29,743,627	)	$	(9,926,993	)	$	(10,436,947	)

Weighted average shares outstanding - basic		43,124,972			39,907,624			43,174,775			41,020,485
Incremental shares underlying dilutive “in the money” warrants ⁽¹⁾		-			250,697			-			210,597
Weighted average shares outstanding - diluted		43,124,972			40,158,321			43,174,775			41,231,082
Diluted loss per common share	$	(0.66	)	$	(0.74	)	$	(0.23	)	$	(0.25	)

(1)

Includes shares issuable upon the exercise of the Series Z, AA, BB, CC and HH warrants for the nine and three months ended June 30, 2021.

In accordance with the contingently issuable shares guidance of FASB ASC Topic 260, Earnings Per Share, the calculation of diluted net earnings (loss) per share excludes the following securities because their inclusion would have been anti-dilutive as of June 30:

	2022		2021

Options and Warrants		14,295,501		6,979,170
Unvested Restricted Stock		151,250		166,500
Total		14,446,751		7,145,670

J. SUBSEQUENT EVENTS

On August 2 2022, the Company appointed Dr. Gail K. Naughton to the Company's Board of Directors.

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Liquidity and Capital Resources

On June 28, 2021, the Company announced results from its 9.5-year pivotal Phase 3 study for its immunotherapy Multikine® (Leukocyte Interleukin, Injection) in the treatment of advanced (stages III and IV) primary (previously untreated) squamous cell carcinoma of the head and neck (SCCHN). The Phase 3 results showed a long-term 5-year overall survival (OS) benefit in the treatment arm that received Multikine treatment followed by surgery and radiation. This survival benefit was robust and durable, with no safety issues, something not commonly seen with cancer drugs. In fact, the survival benefit increased over time and at 5 years the overall survival benefit reached an absolute 14.1% advantage for the Multikine treated arm over control (n=380, total study patients treated with surgery plus radiation), control arm 48.6%, Multikine arm 62.7% survival.

The study used the standard of care treatment for advanced primary head and neck cancer patients as a comparison. The patients received surgery followed by either radiation or chemoradiation (chemotherapy and radiation at the same time), as determined by the physician. This meant that there were two treatment arms: (1) surgery plus radiation or (2) surgery plus chemoradiation. The arm that received Multikine treatment followed by surgery and radiation showed great survival benefit, but when chemotherapy was added in the second treatment arm, the immunological effect of Multikine was negated. Therefore, when the two treatment arms were combined the study did not achieve its primary endpoint of a 10% improvement in overall survival.

The analysis of the separate treatment arms (radiation and chemoradiation) was prespecified in the protocol and carried out prior to the Company becoming unblinded. The OS benefit of 14.1% at 5 years for this treatment arm exceeded the 10% OS benefit set out for the study population as a whole. The OS results for this treatment arm are significant (two-sided p=0.0236, HR=0.68) and the effect is robust, durable and increasing over ~~time. The results from the Phase 3 cancer study proved that Multikine met all of the protocol required benefits stated in the study protocol in patients in the treatment arm receiving surgery~~time, and ~~radiation as their standard therapies. Based on this the Company aims to file for FDA approval for the use of Multikine in the treatment of~~ advanced primary head and neck cancer represents an unmet medical need. The Company believes that these results for one treatment arm in ~~this patient population~~the Phase 3 cancer study of ~~about 210,000 patients annually worldwide.~~Multikine are very meaningful and is working on the best way to bring Multikine to market in the US and other countries.

On May 27, 2022, the Company announced the American Society of Clinical Oncology (ASCO) published two abstracts related to our pivotal Phase 3 Multikine head and neck cancer clinical trial. The poster was presented by the Company’s Chief Scientific Officer, Eyal Talor, Ph.D. at the 2022 ASCO Annual Meeting on June 6, 2022 in Chicago, Illinois. The abstract titles and corresponding links are as follows:

“Leukocyte interleukin injection (LI) immunotherapy extends overall survival (OS) in treatment-naive low-risk (LR) locally advanced primary squamous cell carcinoma of the head and neck: The IT-MATTERS study.”

		o	Link to abstract: https://meetings.asco.org/abstracts-presentations/207201

		o	Link to poster: https://cel-sci.com/wp-content/uploads/2022/06/CEL-SCI-ASCO-2022-Poster-6032-June-6-Head-and-Neck-Cancer-1.pdf

“Novel algorithm for assigning risk/disease-directed treatment (DDT) choice in locally advanced primary squamous cell carcinoma of the head and neck (SCCHN): Using pretreatment data only.”

Link to abstract: https://meetings.asco.org/abstracts-presentations/207202/

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Multikine (Leukocyte Interleukin, Injection) is the full name of this investigational therapy, which, for simplicity, is referred to in this report as Multikine. Multikine is the trademark that the Company has registered for this investigational therapy, and this proprietary name is subject to FDA review under the Company’s future anticipated regulatory submission for approval. Multikine has not been licensed or approved by the FDA or any other regulatory agency, nor has its safety or efficacy been established for any use.

The Company also owns and is developing a pre-clinical technology called LEAPS (Ligand Epitope Antigen Presentation System). The Company has product candidates under development for the potential treatment of rheumatoid arthritis.

All of the Company’s projects are under development. Consequently, the Company cannot predict when it will be able to generate any revenue from the sale of any of its products.

Since inception, the Company has financed its operations through the sale of equity securities, convertible notes, loans and certain research grants. The Company’s expenses will continue to exceed its revenues as it continues the development of Multikine and brings other drug candidates into clinical trials. Until the Company becomes profitable, any or all of these financing vehicles or others may be utilized to assist in funding the Company’s capital requirements.

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Capital raised by the Company has been expended primarily for patent applications, research and development, administrative costs, and the construction and upgrade of the Company’s manufacturing and laboratory facilities. The Company does not anticipate realizing significant revenues until entering into licensing arrangements for its technology and know-how or until it receives regulatory approval to sell its products (which could take several years). Thus, the Company has been dependent upon the proceeds from the sale of its securities to meet all ~~its~~of the Company’s liquidity and capital requirements and anticipates having to do so in the future.

The Company will be required to raise additional capital or find additional long-term financing to continue with its research efforts. The ability to raise capital may be dependent upon market conditions that are outside the control of the Company. The ability of the Company to complete the necessary clinical trials and obtain FDA approval for the sale of products to be developed on a commercial basis is uncertain. Ultimately, the Company must complete the development of its products, obtain the appropriate regulatory approvals and obtain sufficient revenues to support its cost structure. However, there can be no assurance that the Company will be able to raise sufficient capital to support its operations.

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~~Since the Company launched its Phase 3 clinical trial for Multikine,~~

As of June 30, 2022, the Company has incurred ~~expenses~~approximately $63.6 million of ~~approximately $62.6 million as of December 31, 2021 on~~ direct costs for the Phase 3 clinical trial and the filing of the clinical study report to the ~~FDA.~~FDA since the Company launched its Phase 3 clinical trial for Multikine. The Company estimates it will incur additional expenses of approximately ~~$1.2~~$0.9 million for the remainder of the Phase 3 clinical trial and the filing of the clinical study report to the FDA. It should be noted that this estimate is based only on the information currently available from the CROs responsible for managing the Phase 3 clinical trial and does not include other related costs, e.g., the manufacturing of the drug.

The Company uses two CROs to manage the global Phase 3 study; ICON and Ergomed, who are both international leaders in managing oncology trials.

Under a co-development agreement, Ergomed agreed to contribute up to $12 million towards the study where it will perform clinical services in exchange for a single digit percentage of milestone and royalty payments, up to a specified maximum amount. Approximately ~~$11.7~~$11.8 million of the committed $12 million contribution has been realized as of ~~December 31, 2021.~~June 30, 2022.

During the ~~three~~nine months ended ~~December 31, 2021,~~June 30, 2022, the Company used approximately ~~$5.1~~$14.1 million in cash, ~~before~~after considering the maturity and transfer to cash of the remaining $6.2 million in U.S. Treasury ~~bills.~~bills (T-bills). Significant components of this ~~increase~~decrease include cash used to fund the Company’s regular operations, including its Phase 3 clinical trial, of approximately ~~$4.8~~$13.3 million, leasehold improvement costs of approximately $0.6 million and approximately ~~$0.3~~$1.1 million in lease payments. These outflows are offset by approximately $0.8 million in lease incentives received from the landlord to partially offset costs of the manufacturing facility upgrade and approximately $0.1 million in proceeds from the exercise of options and warrants.

During the ~~three~~nine months ended ~~December 31, 2020,~~June 30, 2021, the Company’s cash increased by approximately ~~$6.4~~$20.4 million after the purchase of $11.1 million of U.S. Treasury bills (T-bills). Not including the purchase of the T-bills, cash increased by approximately $31.6 million. Significant components of ~~this~~the increase include approximately $47.2 million in net proceeds from the sale of common stock ~~and~~through public offerings, approximately $6.2 million in proceeds from the exercise of warrants and options, and receipt of approximately ~~$13.6~~$1.6 million in lease incentives, offset by net cash used to fund the Company’s ~~regular~~ operations, including its Phase 3 clinical trial, of approximately ~~$3.8~~$14.0 million, ~~expenditures for~~approximately $8.6 million of equipment and leasehold ~~improvements and equipment of approximately $3.2 million,~~improvement expenditures and approximately ~~$0.2~~$0.8 million in lease payments.

~~Prepaid expenses decreased by approximately $0.3 million, or 28%, at December 31, 2021 as compared to September 30, 2021 primarily due to the utilization of amounts paid in advance to Ergomed.~~

~~During the three months ended December 31,~~In October 2021, the Company completed a major upgrade of its leased manufacturing facility to prepare for the potential commercial production of ~~its products.~~Multikine. Total costs of this upgrade were approximately $11.1 million, of which the landlord of the property ~~agreed to finance~~financed $2.4 million. ~~As of December 31, 2021, approximately $1.6 million of the landlord financing was received and the remaining $0.8 million is expected to be received in the second quarter of fiscal year 2022.~~ The landlord financing is being repaid through increased lease payments over the remaining term of the lease.

During the ~~three~~nine months ended ~~December 31, 2021, 19,705~~June 30, 2022, 25,205 warrants were exercised at a weighted average exercise price of ~~$4.43~~$4.02 for total proceeds of approximately ~~$87,000.~~$0.1 million. During the ~~three~~nine months ended ~~December 31, 2020, 15,000~~June 30, 2021, 1,443,551 warrants were exercised at a weighted average exercise price of ~~$3.16~~$3.86 for total proceeds of approximately ~~$47,000.~~$5.6 million. These exercises include 437,312 warrants exercised during the three months ended June 30, 2021 for proceeds of approximately $1.1 million and a weighted average exercise price of $2.59.

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Results of Operations and Financial Condition

~~During~~The Company incurred a net operating loss of approximately $27.1 million for the nine months ended June 30, 2022. This net operating loss consists of significant non-cash expenses including approximately $9.1 million in stock-based employee compensation and approximately $2.8 million in depreciation and amortization expense and approximately $0.6 million in warrant modification expenses. The Company incurred a net operating loss of approximately $8.7 million for the three months ended ~~December 31, 2021,~~June 30, 2022. This net operating loss consists of significant non-cash expenses including approximately $2.4 million in employee stock-based compensation and approximately $1.0 million in depreciation and amortization expense and approximately $0.6 million in warrant modification expenses.

During the nine months ended June 30, 2022, research and development expenses increased by approximately ~~$0.7~~$1.1 million, or 6%, compared to the nine months ended June 30, 2021. Major components of this increase include approximately $1.1 million increase in employee stock compensation expense and approximately $1.2 million increase in depreciation, primarily related to leasehold improvements to the manufacturing facility that were placed in service in October 2021, an increase of approximately $0.8 million of costs incurred to prepare for the potential commercial sale of Multikine, and an increase of approximately $0.1 million in other miscellaneous research and development expenses. These increases were offset by a decrease of approximately $2.1 million in costs related to the Phase 3 clinical study. During the three months ended June 30, 2022, research and development expenses decreased by approximately $0.9 million, or 12%, compared to the three months ended ~~December 31, 2020.~~June 30, 2021. Major components of this ~~increase~~decrease include approximately ~~$0.6~~$1.5 million ~~in employee stock compensation expense and $0.3~~less costs related to the Phase 3 clinical study offset by approximately $0.4 million increase in depreciation, primarily of leasehold improvements to the manufacturing facility that were placed in service in October ~~2022. This~~2021, and a net increase ~~is offset by overall reductions~~of approximately $0.2 million in ~~expenses related to the Phase 3 clinical study and~~ other research and development ~~costs of approximately $0.2 million.~~expenses.

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During the ~~three~~nine months ended ~~December 31, 2021,~~June 30, 2022, general and administrative expenses decreased by approximately ~~$0.6~~$1.7 million, or 17%, compared to the ~~three~~nine months ended ~~December 31, 2020. A major component of the~~June 30, 2021. This decrease is ~~an approximate $0.6 million~~primarily due to a decrease in employee stock compensation ~~costs resulting from~~expense of approximately $2.0 million offset by a ~~change~~$0.3 million increase in ~~the requisite service period for the performance-based stock options.~~

other net general and administrative expenses. During the three months ended ~~December 31, 2021~~June 30, 2022, general and ~~2020,~~administrative expenses decreased by approximately $0.8 million, or 26%, compared to the ~~Company recorded derivative gains~~three months ended June 30, 2021. This decrease is primarily due to a decrease in employee stock compensation expense of approximately $1.0 million offset by a $0.2 million increase in other net general and administrative expenses.

The approximate $0.4 million ~~and $0.9~~gain on derivative instruments for the nine months ended June 30, 2022 varies significantly from the $1.0 million ~~respectively. This variation was~~loss on derivative instruments for the nine months ended June 30, 2021. The variance is the result of the change in fair value of the derivative liabilities ~~during~~at the ~~period~~respective balance sheet dates, which ~~was~~is caused mainly by ~~fluctuations~~fluctuation in the share price of the Company’s common stock. All derivative warrants have been exercised or have expired as of June 30, 2022, and therefore, unless additional liability classified warrants are issued, there will be no additional gain or loss reported.

~~Net interest expense, which consists~~Other non-operating gain primarily relates to the Securities Purchase Agreement (SPA) with Ergomed plc as described in Item 4 under Note C. Under the SPA, the Company issued Ergomed shares of ~~interest paid on lease liabilities, remained relatively constant at approximately $0.3 million for both~~common stock and the net proceeds from the sales of those shares reduces outstanding amounts due Ergomed. Upon issuance, the Company expensed the full value of the shares as other non-operating gain/loss and subsequently offset the gain or loss as amounts were realized through the sale by Ergomed and reduced accounts payable to Ergomed. The amount of the gain or loss is a result of the timing of shares issued to Ergomed and the subsequent re-sale of those shares. There was no activity under the agreement during the nine months ended June 30, 2022. During the nine and three months ended ~~December 31,~~June 30, 2021, the Company realized approximately $1.4 million and ~~December 31, 2020.~~$0.8 million, respectively, in value upon the resale of shares. Ergomed resold the final balance of shares issued in the quarter ended September 30, 2021.

Research and Development Expenses

The Company’s research and development efforts involve Multikine and LEAPS. The table below shows the research and development expenses associated with each project.

	Three months ended December 31,
	2021		2020		Nine months ended June 30,				Three months ended June 30,
					2022		2021		2022		2021
MULTIKINE	$	5,791,419	$	5,011,950	$	18,035,279	$	16,582,740	$	6,039,977	$	6,849,923
LEAPS		291,748		402,810		858,578		1,235,633		246,896		332,176

TOTAL	$	6,083,167	$	5,414,760	$	18,893,857	$	17,818,373	$	6,286,873	$	7,182,099

Clinical and other studies necessary to obtain regulatory approval of a new drug involve significant costs and require several years to complete. The extent of the Company’s clinical trials and research programs are primarily based upon the amount of capital available to the Company and the extent to which the Company has received regulatory approvals for clinical trials. The inability of the Company to conduct clinical trials or research, whether due to a lack of capital or regulatory approval, will prevent the Company from completing the studies and research required to obtain regulatory approval for any products which the Company is developing. Without regulatory approval, the Company will be unable to sell any of its products. Since all of the Company’s projects are under development, the Company cannot predict when it will be able to generate any revenue from the sale of any of its products.

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Critical Accounting Estimates and Policies

Management’s discussion and analysis of the Company’s financial condition and results of operations is based on its unaudited condensed financial statements. The preparation of these financial statements is based on the selection of accounting policies and the application of significant accounting estimates, some of which require management to make judgments, estimates and assumptions that affect the amounts reported in the financial statements and notes.

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The Company believes some of the more critical estimates and policies that affect its financial condition and results of operations are in the areas of leases and stock-based compensation.

The measurement of the finance and operating lease right-of-use asset and lease liabilities requires the determination of an estimated lease term and an incremental borrowing rate, which involves complex judgment by management. Significant judgment is required by management to develop inputs and assumptions used to determine the incremental borrowing rate for lease contracts. Share-based compensation cost to employees is measured at fair value as of the grant date in accordance with the provisions of ASC 718. The fair value of the stock options is calculated using the Black-Scholes option pricing model which requires various judgmental assumptions including volatility and expected option life. The compensation cost is recognized as expense over the requisite service or vesting period. Performance-based options are valued using a Monte-Carlo simulation model, which requires inputs based on estimates, including the likelihood of the occurrence of performance and market conditions, volatility and expected option life.

For more information regarding the Company’s critical accounting estimates and policies, see Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended September 30, 2021. The application of these critical accounting policies and estimates has been discussed with the Audit Committee of the Company’s Board of Directors.

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Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

The Company does not believe that it has any significant exposures to market risk.

Item 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the direction and with the participation of the Company’s management, including the Company’s Chief Executive and Chief Financial Officer, the Company has conducted an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures as of ~~December 31, 2021.~~June 30, 2022. The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its periodic reports with the Securities and Exchange Commission is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and regulations, and that such information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Company’s disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching its desired disclosure control objectives. Based on the evaluation, the Chief Executive and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of ~~December 31, 2021.~~

~~Management’s Report on Internal Control over Financial Reporting~~

CEL-SCI’s management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of internal control over financial reporting. As defined by the Securities and Exchange Commission, internal control over financial reporting is a process designed by, or under the supervision of CEL-SCI’s Chief Executive and Principal Financial and Accounting Officer and implemented by CEL-SCI’s Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of CEL-SCI’s financial statements in accordance with U.S. generally accepted accounting principles.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of management, including CEL-SCI’s Principal Executive and Principal Financial Officer, CEL-SCI evaluated the effectiveness of its internal control over financial reporting as of December 31, 2021 based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, or the COSO Framework. Management’s assessment included an evaluation of the design of CEL-SCI’s internal control over financial reporting and testing of the operational effectiveness of those controls. CEL-SCI's Chief Executive and Principal Financial and Accounting Officer concluded that as of such date, CEL-SCI's internal control over financial reporting was effective.June 30, 2022.

Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting that occurred during the ~~three months~~quarter ended ~~December 31, 2021~~June 30, 2022 that ~~has~~have materially affected, or isare reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

During the ~~three~~nine months ended ~~December 31, 2021,~~June 30, 2022 the Company issued ~~18,020~~81,782 restricted shares of common stock to consultants for investor relations services.

The Company relied upon the exemption provided by Section 4(a)(2) of the Securities Act of 1933 with respect to the issuance of these shares. The individuals who acquired these shares were sophisticated investors and were provided full information regarding the Company’s business and operations. There was no general solicitation in connection with the offer or sale of these securities. The individuals who acquired these shares acquired them for their own accounts. The certificates representing these shares bear a restricted legend which provides they cannot be sold except pursuant to an effective registration statement or an exemption from registration. No commission or other form of remuneration was given to any person in connection with the issuance of these shares.

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Item 6. Exhibits

Number	Exhibit

~~3(a)~~	~~Articles of Incorporation~~	~~Incorporated by reference to Exhibit 3(a) of CEL-SCI's combined Registration Statement on Form S-1 and Post-Effective Amendment ("Registration Statement"), Registration Nos. 2-85547-D and 33-7531.~~

~~3(b)~~	~~Amended Articles~~	~~Incorporated by reference to Exhibit 3(a) of CEL-SCI's Registration Statement on Form S-1, Registration Nos. 2-85547-D and 33-7531.~~

~~3(c)~~	~~Amended Articles (Name change only)~~	~~Incorporated by reference to Exhibit 3(c) of CEL-SCI's Registration Statement on Form S-1 Registration Statement (No. 33-34878).~~

~~3(d)~~	~~By laws (as amended)~~	~~Incorporated by reference to Exhibit 3(d) of CEL-SCI's Post-Effective Amendment No. 3 to Registration Statement on Form S-1 (No. 333-229295).~~

4	~~Shareholders Rights Agreement, as Amended~~	~~Incorporated by reference to Exhibit 4 filed with CEL-SCI’s 8-K report dated October 30, 2020.~~

~~4(b)~~	~~Incentive Stock Option Plan~~	~~Incorporated by reference to Exhibit 4 (b) filed on September 25, 2012 with CEL-SCI’s registration statement on Form S¬8 (File number 333-184092.~~

~~4(c)~~	~~Non-Qualified Stock Option Plan~~	~~Incorporated by reference to Exhibit 4 (b) filed on August 19, 2014 with CEL-SCI’s registration statement on Form S¬8 (File number 333-198244).~~

~~4(d)~~	~~Stock Bonus Plan~~	~~Incorporated by reference to Exhibit 4 (d) filed on September 25, 2012 with CEL-SCI’s registration statement on Form S¬8 (File number 333-184092).~~

~~4(e)~~	~~Stock Compensation Plan~~	~~Incorporated by reference to Exhibit 4 (e) filed on September 25, 2012 with CEL-SCI’s registration statement on Form S¬8 (File number 333-184092).~~

~~4(f)~~	~~2014 Incentive Stock Bonus Plan~~	~~Filed with this Amendment No. 2 to CEL-SCI’s annual report on Form 10-K for the year ended September 30, 2014.~~

31	Rule 13a-14(a) Certifications

32	Section 1350 Certifications

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	CEL-SCI CORPORATION

Date: ~~February 11,~~August 12, 2022	By:	/s/ Geert Kersten
		Geert Kersten
		Principal Executive Officer*

* Also signing in the capacity of the Principal Accounting and Financial Officer.

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CEL-SCI CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED)

	2021			2020

Operating expenses:
Research and development	$	6,083,167		$	5,414,760
General and administrative		2,760,208			3,316,156
Total operating expenses		8,843,375			8,730,916

Operating loss		(8,843,375	)		(8,730,916	)

Gain on derivative instruments		364,596			932,836
Other non-operating gains		(30,793	)		121,606
Interest expense, net		(273,034	)		(260,390	)

Net loss		(8,782,606	)		(7,936,864	)
Modification of warrants		-			(85,779	)

Net loss available to common shareholders	$	(8,782,606	)	$	(8,022,643	)

Net loss per common share
BASIC and DILUTED	$	(0.20	)	$	(0.21	)

Weighted average common shares outstanding
BASIC		43,077,961			38,670,247
DILUTED		43,083,420			38,767,286

Name of Plan	Total Shares Reserved Under Plans		Shares Reserved for Outstanding Options		Shares Issued		Remaining Options/Shares Under Plans

Incentive Stock Option Plans		138,400		76,829		N/A		213
Non-Qualified Stock Option Plans		11,787,200		11,204,380		N/A		172,592
Stock Bonus Plans		783,760		N/A		370,691		413,036
Stock Compensation Plans		634,000		N/A		153,195		462,395
Incentive Stock Bonus Plan		640,000		N/A		614,500		25,500

Stock option activity:
	Three Months Ended December31,
	2021		2020

Options granted		251,000		7,500
Options exercised		6,500		5,300
Options forfeited		13,000		42,166
Options expired		-		55

Warrant/Options	Issue Date	Shares Issuable upon Exercise of Warrants/ Options		Exercise Price		Expiration Date	Reference
Series N	8/18/2008		85,339	$	3.00	8/18/2022	*
Series UU	6/11/2018		93,603	$	2.80	6/30/2022	*
Series X	1/13/2016		120,000	$	9.25	7/13/2022	*
Series Y	2/15/2016		26,000	$	12.00	8/15/2022	*
Series HH	2/23/2017		200	$	3.13	2/16/2022	*
Series AA	8/26/2016		100,000	$	13.75	2/22/2022	*
Series MM	6/22/2017		333,432	$	1.86	6/22/2022	*
Series NN	7/24/2017		205,587	$	2.52	7/24/2022	2
Series RR	10/30/2017		251,761	$	1.65	10/30/2022	*
Series SS	12/19/2017		200,000	$	2.09	12/18/2022	*
Series TT	2/5/2018		600	$	2.24	2/5/2023	*
Consultants	7/28/2017 - 11/18/2020		15,000	$2.18 $11.61		11/17/2022 - 7/27/2027	*

	December 31, 2021		September 30, 2021
Series Z warrants	$	-	$	64,787
Series AA warrants		1,400		276,035
Series CC warrants		-		94,961
Series HH warrants		795		1,597
Total warrant liabilities	$	2,195	$	437,380

	3 months ended December 31, 2021			12 months ended September 30, 2021

Beginning balance	$	437,380		$	3,765,613
Issuances		0			0
Exercises		(70,589	)		(4,023,091	)
Realized and unrealized (gains) and losses		(364,596	)		694,858
Ending balance	$	2,195		$	437,380

Nine months ending September 30, 2022	$	1,083,000
Year ending September 30,
2023		2,569,000
2024		2,648,000
2025		2,733,000
2026		2,824,000
2027		2,919,000
Thereafter		3,267,000
Total future minimum lease obligation*		18,043,000
Less imputed interest on finance lease obligations		(4,539,000	)
Net present value of finance lease obligations	$	13,504,000

Nine months ending September 30, 2022	$	243,000
Year ending September 30,
2023		348,000
2024		357,000
2025		366,000
2026		287,000
2027		277,000
Thereafter		1,325,000
Total future minimum lease obligation		3,203,000
Less imputed interest on operating lease obligation		(1,081,000	)
Net present value of operating lease obligation	$	2,122,000

Nine months ending September 30, 2022	$	35,000
Year ending September 30,
2023		38,000
2024		30,000
2025		28,000
2026		24,000
2027		21,000
Thereafter		72,000
Total	$	248,000