NOTE 7 – FINANCE LEASE OBLIGATIONS

During April 2025, the Company entered into a lease agreement for certain lab equipment in the amount of $125,000 (“Lease Agreement”). The Lease Agreement was accounted for as a finance lease obligation. Under the terms of the lease agreement, the Company is required to make 60 equal monthly payments of $1,600 plus applicable sales taxes. Under the lease agreement, the Company has the option to acquire all of the leased equipment for a nominal amount upon termination of the lease. The annual interest rate charged in connection with the lease is 2.7%. Lease payments and depreciation of the leased equipment began during June 2025, the date that the lease equipment was installed and became operational. The leased equipment is included in Property and equipment and is being depreciated over its estimated useful lives of 15 years beginning from the date it became operational.

During June 2025, the Company entered into a lease agreement for certain lab equipment in the amount of $15,000 (“Lease Agreement”). The Lease Agreement was accounted for as a finance lease obligation. Under the terms of the lease agreement, the Company is required to make 36 equal monthly payments of $500 plus applicable sales taxes. Under the lease agreement, the Company has the option to acquire all of the leased equipment for a nominal amount upon termination of the lease. The annual interest rate charged in connection with the lease is 8.0%. Lease payments and depreciation of the leased equipment began during June 2025, the date that the lease equipment was installed and became operational. The leased equipment is included in Property and Equipment and is being depreciated over its estimated useful life of 3 years beginning from the date it became operational.

As of June 30, 2026 and October 31, 2025, finance lease obligations were $89,000 and $110,000, respectively, of which $30,000 and $33,000 were current, respectively.

The weighted average remaining term of the Company’s finance leases as of June 30, 2026 was 36.2 months. The minimum lease payments pursuant to the finance lease are as follows:

Other Leases

During the eight months ended June 30, 2026 and the years ended October 31, 2025 and 2024, the Company leased its administrative and research facility on a month-to-month basis. Rent expense was $13,000, $20,000 and $20,000 during the eight months ended June 30, 2026 and the years ended October 31, 2025 and 2024, respectively (see Note 21).