Note 10 – Subsequent Events

Line of Credit Agreement, Warrant Issuance and Warrant Exercise - Related Party

A. Line of Credit Agreement with a Related Party

On August 13, 2026, the Company entered into a line of credit agreement with an individual who is a significant stockholder of the Company and accordingly a related party (the “Related Party Lender”), providing a revolving line of credit in the maximum aggregate principal amount of $2,000,000, evidenced by a promissory note issued August 13, 2026 and maturing August 13, 2028.

Advances bear interest at a fixed rate of 12% per annum and accrue only on amounts actually advanced. Interest is payable quarterly in arrears, with interest only due through August 13, 2027 and principal payable in addition to interest from August 13, 2027 through August 13, 2028. The Company may prepay at any time without premium or penalty, and amounts repaid may be reborrowed. The line of credit is unsecured and is not guaranteed.

Draws are subject to the following limitations:

Proceeds are restricted to working capital, commercialization of the Company's positron emission tomography and computed tomography (PET-CT) imaging platform, customer installations, inventory and strategic growth initiatives. Without the prior written consent of the lender, the Company may not:

Events of default under the agreement include the following:

Upon an event of default the lender may declare all outstanding principal and accrued and unpaid interest immediately due and payable, and the outstanding principal balance bears interest at 18% per annum, or the maximum rate permitted by applicable law if lower.

No advances had been drawn under the line of credit through August 14, 2026.

B. Warrants Issued in Connection with the Line of Credit

In consideration of the lender's commitment to provide the line of credit, on August 13, 2026 the Company issued to the Related Party Lender warrants to purchase 300,000 shares of common stock at an exercise price of $1.50/share, expiring December 31, 2030. The warrants remain outstanding whether or not any advance is made under the line of credit. Upon an event of default in the payment of interest or principal, the exercise price of the warrants is automatically reduced to $1/share, effective as of the date of the default.

The fair value of the warrants will be determined on the issuance date using the Black-Scholes-Merton option pricing model, recorded as a deferred financing cost and amortized ratably over the twenty-four (24) month term of the arrangement from August 13, 2026 through August 13, 2028. Deferral and presentation of the cost as an asset, rather than as a reduction of a debt liability, follows the Securities and Exchange Commission staff guidance at ASC 835-30-S45-1 applicable to line-of-credit arrangements, under which the cost is amortized over the term of the arrangement regardless of whether any borrowings are outstanding.

The Company evaluated the warrants under ASC 815-40, Derivatives and Hedging - Contracts in Entity's Own Equity. The number of shares is fixed at 300,000, the exercise price is fixed at $1.50/share and is fixed at $1/share in the event of a payment default, and the reduction in the exercise price is contingent on the Company's own credit standing, which ASC 815-40-15-7E identifies as an input to the fair value of a fixed-for-fixed option on equity shares. The warrants are indexed to the Company's own common stock, meet the conditions for equity classification, and will be recorded in additional paid-in capital.

C. Exercise of Previously Issued Warrants

On August 13, 2026, the Related Party Lender exercised 250,000 previously issued warrants, separate from the 300,000 warrants described above, at an exercise price of $1/share for aggregate exercise proceeds of $250,000. The exercise price had not been received by the Company as of August 14, 2026, and the Company will record the issuance of the 250,000 shares of common stock and the related proceeds of $250,000 upon receipt of the exercise price.