Company: CPMV
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001683168-25-002584
Chunk: 719

Company: Mosaic ImmunoEngineering Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 7
Chunk 719
---
 and transition. Under this guidance, we may only recognize
tax positions that meet a “more likely than not” threshold.

We follow authoritative guidance to evaluate whether
a valuation allowance should be established against our deferred tax assets based on the consideration of all available evidence using
a “more likely than not” standard. In making such judgments, significant weight is given to evidence that can be objectively
verified. We assess our deferred tax assets annually under more likely than not scenarios in which they may be realized through future
income.

In addition, utilization of our net operating loss
carryforwards may be subject to an annual limitation due to ownership change limitations that may have occurred as a result of the Reverse
Merger that closed in August 2020, or that could occur in the future, as required by Section 382 of the Internal Revenue Code of 1986,
as amended (the “Code”). These ownership changes may limit the amount of the net operating loss carry forwards that can be
utilized annually to offset future taxable income and tax, respectively. In general, an “ownership change” as defined by Section
382 of the Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more
than 50 percentage points of the outstanding stock of a Company by certain stockholders. Moreover, since we will need to raise substantial
additional funding to finance our operations, we may undergo further ownership changes in the future, which could further limit our ability
to use net operating loss carryforwards. As a result, if we generate taxable income, our ability to use some of our net operating loss
carryforwards to offset U.S. federal taxable income may be subject to limitations, which could result in increased future tax liability
to us.

With the exception of refundable income taxes, we
have determined that it was more likely than not that all of our deferred tax assets will not be realized in the future due to our continuing
pre-tax and taxable losses in addition to the potential loss of deferred tax assets as a result of the change in control (see Note 1 to
the accompanying consolidated financial statements). As a result of this determination, and with the exception for the aforementioned
refundable income taxes, we have recorded a full valuation allowance against our deferred tax assets.

Results of Operations

Years Ended December 31, 2024 and 2023

Research and Development Expenses

Research and development expenses of approximately
$184,000 for the year ended December 31,