Company: ANIX
Filing Date: 2025-09-10
Form Type: 10-Q
Source: 0001493152-25-013000
Chunk: 26

Company: Anixa Biosciences Inc
Filing Date: 2025-09-10
Form: 10-Q
Item: Part I, Item 1
Chunk 26
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 2026, and interim periods beginning after December 15, 2027. We are currently evaluating the impact of this guidance
on our consolidated financial statements and related disclosures.

8.
INCOME TAXES

We
recognize deferred tax assets and liabilities for the estimated future tax effects of events that have been recognized in our financial
statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the
financial statement and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are
expected to reverse. A valuation allowance is established, when necessary, to reduce deferred tax assets to the amount expected to be
realized. We have provided a full valuation allowance against our deferred tax asset due to our historical pre-tax losses and the uncertainty
regarding the realizability of these deferred tax assets.

We
have substantial net operating loss carryforwards for Federal and California income tax returns. These net operating loss carryforwards
could be subject to limitations under Internal Revenue Code section 382, the effects of which have not been determined by the Company.
We have no unrecognized income tax benefits as of July 31, 2025 and October 31, 2024 and we account for interest and penalties related
to income tax matters, if any, in general and administrative expenses.

9.
LEASES

We
lease approximately 2,000 square feet of office space at 3150 Almaden Expressway, San Jose, California (our principal executive offices)
from an unrelated party pursuant to an operating lease that, as amended, will expire on September 30, 2027, with an option to extend
the lease an additional two years. The base rent is approximately $5,000 per month and the lease provides for annual increases of approximately
3% and an escalation clause for increases in certain operating costs. The lease, as amended, resulted in a right-of-use asset and lease
liability of approximately $250,000 with a discount rate of 12%. Rent expense was approximately $16,000 and $16,000, respectively, for
the three months ended July 31, 2025 and 2024, and approximately $47,000 and $49,000, respectively, for the nine months ended July 31,
2025 and 2024.

For
operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments. The remaining
50-month lease term