3. STOCK-BASED COMPENSATION

The Company maintains stock equity incentive plans under which the Company may grant incentive stock options, non-qualified stock options, stock appreciation rights, stock awards, performance awards, or stock units to employees, directors and consultants.

Stock Option Compensation Expense

We account for stock options granted to employees, directors and consultants using the accounting guidance in ASC 718, Stock Compensation. We estimate the fair value of service-based stock options on the date of grant, using the Black-Scholes pricing model, and recognize compensation expense over the requisite service period of the grant. We recorded stock-based compensation expense related to service-based stock options granted to employees and directors of approximately $1,031,000 and $1,108,000 during the three months ended January 31, 2025 and 2024.

The compensation cost for service-based stock options granted to consultants is measured at the grant date, based on the fair value of the award using the Black-Scholes pricing model, and is expensed on a straight-line basis over the requisite service period (the vesting period of the stock option) which is one to three years. We recorded stock-based consulting expense related to stock options granted to consultants of approximately $24,000 and $56,000 during the three months ended January 31, 2025 and 2024, respectively.

Stock Option Activity

During the three months ended January 31, 2025 and 2024, we granted options to purchase 1,355,000 shares and 1,335,000 shares of common stock, respectively, to employees and consultants, with exercise prices ranging from $2.37 to $4.39 per share, pursuant to the 2018 Share Plan. During the three months ended January 31, 2025, no stock options were exercised. During the three months ended January 31, 2024, stock options to purchase 24,000 shares of common stock were exercised on a cash basis, with aggregate proceeds of approximately $67,000.

Stock Option Plans

During the three months ended January 31, 2025, we had two stock option plans: the Anixa Biosciences, Inc. 2010 Share Incentive Plan (the “2010 Share Plan”) and the Anixa Biosciences, Inc. 2018 Share Incentive Plan (the “2018 Share Plan”), which were adopted by our Board of Directors on July 14, 2010 and January 25, 2018, respectively. The 2018 Share Plan was approved by our shareholders on March 29, 2018.

2010 Share Plan

The 2010 Share Plan provided for the grant of nonqualified stock options, stock appreciation rights, stock awards, performance awards and stock units to employees, directors and consultants. In accordance with the provisions of the 2010 Share Plan, the plan terminated with respect to the ability to grant future awards on July 14, 2020. Information regarding the 2010 Share Plan for the three months ended January 31, 2025 is as follows:

 SCHEDULE OF OPTION ACTIVITY

The following table summarizes information about stock options outstanding and exercisable under the 2010 Share Plan as of January 31, 2025:

 SCHEDULE OF OPTIONS OUTSTANDING AND EXERCISABLE

2018 Share Plan

The 2018 Share Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, stock awards, performance awards and stock units to employees, directors and consultants. As of January 31, 2025, the 2018 Share Plan had 645,000 shares available for future grants. Information regarding the 2018 Share Plan for the three months ended January 31, 2025 is as follows:

 SCHEDULE OF OPTION ACTIVITY

The following table summarizes information about stock options outstanding and exercisable under the 2018 Share Plan as of January 31, 2025:

 SCHEDULE OF OPTIONS OUTSTANDING AND EXERCISABLE

Employee Stock Purchase Plan

The Company maintains the Anixa Biosciences, Inc. Employee Stock Purchase Plan (the “ESPP”) which permits eligible employees to purchase shares at not less than 85% of the market value of the Company’s common stock on the offering date or the purchase date of the applicable offering period, whichever is lower. The ESPP was adopted by our Board of Directors on August 13, 2018 and approved by our shareholders on September 27, 2018. During the three months ended January 31, 2025 and 2024, no shares were purchased under the ESPP.

Warrants

As of January 31, 2025, we had warrants outstanding to purchase 300,000 shares of common stock at $6.56 per share, issued during fiscal year 2021 and expiring on March 22, 2026.

Information regarding the Company’s warrants for the three months ended January 31, 2025 is as follows:

 SCHEDULE OF WARRANTS ACTIVITY

The following table summarizes information about the Company’s outstanding and exercisable warrants as of January 31, 2025:

 SCHEDULE OF OUTSTANDING AND EXERCISABLE

Stock Awards

During the three months ended January 31, 2025, we did not issue any stock awards. During the three months ended January 31, 2024, we issued 29,336 shares of common stock to consultants providing investor relations services, and recorded expense of approximately $96,000.

Treasury stock

As of January 31, 2025, the Company held 2,000 shares of its common stock as treasury stock. These shares were repurchased during the fiscal year ended October 31, 2024, at an average cost of $3.17 per share for a total cost of approximately $6,000. The repurchases were made as part of a stock buyback program approved by our Board of Directors on July 11, 2024. The treasury shares are accounted for under the cost method and are recorded as a reduction in shareholders’ equity in the consolidated balance sheet. The Company may reissue treasury shares for stock option exercises, acquisitions, or other corporate purposes.