NOTE 13 – COMMITMENTS AND CONTINGENCIES

Deferred Revenue

Amounts received by the Company for future purchases of inventory or for products that have yet to be delivered to the customers as of April 30, 2026 and October 31, 2025 are reflected in the Company’s balance sheet as deferred revenues and were comprised of the following:

Employment Agreement

Dr. John D. Kisiday, Ph.D.

Effective January 23, 2026, Dr. Kisiday was appointed the Company’s Chief Technology Officer. Dr. Kisiday’s employment agreement (“Employment Agreement”) provides for a base salary of $175,000 and a stock grant of 50,000 shares of common stock under our 2021 Incentive Plan. The stock grant vests as to 20,000 shares on the first anniversary of the of the Employment Agreement and 30,000 shares on the second anniversary of the Employment Agreement, contingent upon Dr. Kisiday’s continued employment with the Company. In addition, if Dr. Kisiday brought a commercially viable new product and/or business opportunity to the Company outside the existing scope of the Company’s current line of business, Dr. Kisiday will be entitled to receive additional compensation therefor.

Dr. Kisiday’s employment with the Company was “At Will” meaning that his employment with the Company and his Employment Agreement may be terminated by the Company at any time, for any reason or for no reason at all and with or without “Cause” (as defined in the Employment Agreement). Notwithstanding the foregoing, if at any time after the first ninety (90) days of the term, the Company terminates Dr. Kisiday’s employment without Cause or Dr. Kisiday terminates his employment with the Company for “Good Reason” (as defined in the Employment Agreement), Dr. Kisiday will be entitled to receive severance in an amount equal to one quarter (1/4) month’s salary for each successive three (3) months of employment completed.

Dr. Kisiday’s employment agreement contains customary confidentiality, non-competition and non-solicitation covenants.

On March 21, 2026, as provided for under the Employment Agreement, the Company provided Dr. Kisiday with notice that his employment was being terminated effective March 23, 2026. As a result of Dr. Kisiday’s termination, the stock grant was forfeited in full effective March 23, 2026.

Purchase Commitments

During July 2025, the Company entered into an exclusive supply agreement (“Supply Agreement”) with a third-party contract manufacturer (“CDMO”) in connection with the manufacturing and processing of certain biological products (“CDMO Products”) that the Company that the Company intends to sell to third party medical providers. Under the terms of the Supply Agreement, the Company prepaid $500,000. Under the terms of the Supply Agreement, the deposits will be applied against the actual CDMO Products that are released to the Company. The Company has agreed to make a minimum of 8 purchase orders within specified periods based on satisfactory release of prior productions of the CDMO Products (“Minimum Purchase Orders”). In connection with each purchase order, the Company is required to have minimum deposits paid to the CDMO equal to 50% of the value of the purchase order. The Supply Agreement may be extended by the Company based on submitting a minimum amount of additional purchase orders after the Minimum Purchase Orders have been released. As of April 30, 2026 and October 31, 2025, outstanding advances were $267,000 and $225,000, respectively that is included in prepaid expenses in the accompanying condensed consolidated balance sheets.

Legal Matters

Neurovive Holding Co., LLC

On January 26, 2026, Neurovive Holding Co., LLC (“Neurovive”), Paragon Medical Group, LLC (“Paragon”), and Dr. David Buechner (“Dr. Buechner,” and together with Neurovive and Paragon, “Plaintiffs”), filed a complaint in the Circuit Court of Benton County, Arkansas Civil Division against the Company asserting claims for breach of contract, breach of fiduciary duty, misappropriation of trade secrets, fraud, promissory estoppel, unjust enrichment and conversion (“Complaint”). Plaintiffs are seeking preliminary and permanent injunctive relief and compensatory damages. The litigation stems from a previous arrangement whereby Plaintiffs and the Company had sought to jointly pursue a proposed clinical trial (“Venture”) based on Plaintiffs agreeing to provide the necessary funding for the Venture (“Funding Obligations”). After a prolonged unsuccessful effort to secure the Funding Obligations, the Plaintiffs unilaterally elected to terminate further efforts to pursue the Venture.

The case was removed to the United States District Court for the Western District of Arkansas, Fayetteville Division, Case No. 5:26-cv-05055. On March 30, 2026, the Company filed a Motion to Transfer Venue pursuant to 28 U.S.C. § 1404(a), seeking transfer of the action to the United States District Court for the Southern District of Florida, Fort Lauderdale Division. The motion is now fully briefed and the parties await a ruling from the Court. We are unable to express an opinion as to the possible outcome of this matter. The Company’s disputes all allegations and intends to vigorously pursue all available legal remedies.

Dr. Golub

The Company’s employment agreement with Dr. Howard Golub, its former Chief Science Officer (“Golub Employment Agreement”) had an initial term that ended May 31, 2024. The Golub Employment Agreement was not renewed and accordingly, the Golub Employment Agreement expired and the employment of Dr. Golub by the Company ended on May 31, 2024.

On November 19, 2024, Dr. Golub (“Plaintiff”), filed a complaint in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida against the Company, alleging a breach of contract as a result of the Company’s failure to pay Plaintiff severance in the amount of $150,000 in connection with the non-renewal of Golub Employment Agreement. During June 2026, the parties entered into an agreement settling the matter and the action will be dismissed with prejudice.

Exotropin

On August 15, 2025, the Company terminated the Sales Agreement for cause. Exotropin filed a complaint (Case No. CACE-25-013178, in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida) against the Company for declaratory judgment on August 29, 2025, concerning the parties’ June 19, 2024, Amended and Restated Sales Representative Agreement, seeking declarations related to termination and the survival/enforceability of certain restrictive and other clauses. On November 6, 2025, the Company moved to dismiss Exotropin’s complaint. The Company filed counterclaims on November 17, 2025. On January 7, 2026, Exotropin filed a First Amended Complaint. On April 6, 2026, the parties filed a Joint Notice of Settlement with the Court. On April 13, 2026, the parties filed a Joint Stipulation of Dismissal With Prejudice, dismissing the action and all claims, counterclaims, and defenses asserted therein with prejudice, with each party bearing its own attorneys’ fees, costs, and expenses.

BioXtex

In June 2025, BioXtek sought to terminate the Binding MOU and the Joint Venture for alleged breaches by the Company, which the Company contested. As the Company and BioXtek were not able to amicably resolve the dispute, on December 17, 2025, the Company commenced an action against BioXtek (Case No. CACE-25-019364, in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida) and filed an amended complaint on January 5, 2026, asserting claims for breach of contract and implied covenant, fraudulent inducement, violation of the Florida Deceptive Unfair Trade Practices Act, equitable accounting, and declaratory judgment. The Company seeks damages for expectancy/consequential losses, equitable relief, and fees. On May 27, 2026, BioXtek filed a Motion to Dismiss the Amended Complaint. No hearing has been set on the Motion to Dismiss. The Company intends to oppose the Motion to Dismiss. Mediation has been scheduled for June 11, 2026. The Company continues to evaluate its legal options and intends to protect its rights under the Binding MOU and the Joint Venture.

Other

In addition to the foregoing, from time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in any such matter may harm our business.