What changed in this filing

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Item 1. Financial Statements

2026-08-13 compared with 2026-05-14 · 260 added, 190 removed, 631 unchanged (42% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

March 31, 2026

June 30, 2026

December 31, 2025

4 unchanged sentences

250,000 250,000

Accounts receivable, net of allowance for credit losses of $ 980,000 and $ 980,000 at March 31, 2026 and December 31, 2025, respectively

Accounts receivable, net of allowance for credit losses of $ 1,110,000 and $ 980,000 at June 30, 2026 and December 31, 2025, respectively

8,323,000 10,521,000

28 unchanged sentences

1,606,000 937,000

Asset retirement obligations, related party (includes $ 250,000 and $ 250,000 non-related party at March 31, 2026 and December 31, 2025, respectively)

Asset retirement obligations, related party (includes $ 125,000 and $ 250,000 non-related party at June 30, 2026 and December 31, 2025, respectively)

600,000 1,200,000

14 unchanged sentences

Common stock, no par value ( 10,000,000 authorized shares;

Issued and outstanding shares - 6,600,000 at March 31, 2026 and 6,575,000 at December 31, 2025)

Issued and outstanding shares - 6,625,000 at June 30, 2026 and 6,575,000 at December 31, 2025)

10,763,000 10,763,000

14 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Rental revenue from medical equipment leasing

21 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2026 AND 2025

FOR THE THREE AND SIX-MONTH PERIODS ENDED JUNE 30, 2026 AND 2025

Common Shares

8 unchanged sentences

Balances at March 31, 2025

Stock-based compensation expense

Vested restricted stock awards

Balances at June 30, 2025

Balances at January 1, 2026

3 unchanged sentences

Balances at March 31, 2026

Stock-based compensation expense

Vested restricted stock awards

Balances at June 30, 2026

See accompanying notes

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

Operating activities:

Adjustments to reconcile net loss to net cash from operating activities:

Depreciation, amortization, and other

Depreciation and amortization

Allowance for credit losses

Accretion of debt issuance costs

Loss on write down of impaired assets

Non cash lease expense

5 unchanged sentences

Related party liabilities

Asset retirement obligations, related party

Lease liabilities

5 unchanged sentences

Principal payments on long-term debt

Payments on line of credit

Advances on line of credit

18 unchanged sentences

Basis of Presentation

In the opinion of the management of American Shared Hospital Services (“ASHS”), the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary for the fair presentation of ASHS consolidated financial position as of March 31, 2026 , the results of its operations for the three -month periods ended March 31, 2026 and 2025 , and the cash flows for the three -month periods ended March 31, 2026 and 2025 .

The results of operations for the three -month periods ended March 31, 2026 are not necessarily indicative of results on an annualized basis.

In the opinion of the management of American Shared Hospital Services (“ASHS”), the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary for the fair presentation of ASHS consolidated financial position as of June 30, 2026 , the results of its operations for the three and six -month periods ended June 30, 2026 and 2025 , and the cash flows for the six -month periods ended June 30, 2026 and 2025 .

The results of operations for the three and six -month periods ended June 30, 2026 are not necessarily indicative of results on an annualized basis.

Consolidated balance sheet amounts as of December 31, 2025 have been derived from the audited consolidated financial statements.

13 unchanged sentences

The Company (through ASRS) and Elekta AB (“Elekta”), the manufacturer of the Gamma Knife (through its wholly-owned United States subsidiary, GKV Investments, Inc.), entered into an operating agreement and formed GKF.

As of March 31, 2026 , GKF provides Gamma Knife units to seven medical centers in the United States in the states of Illinois, Indiana, Mississippi, New Mexico, New York, Oregon, and Texas.

As of June 30, 2026 , GKF provides Gamma Knife units to seven medical centers in the United States in the states of Illinois, Indiana, Mississippi, New Mexico, New York, Oregon, and Texas.

GKF also owns and operates two single-unit Gamma Knife facilities in Lima, Peru and Guayaquil, Ecuador.

6 unchanged sentences

February 6, 2025, the Company’s subsidiary, Bristol, closed on the acquisition of certain parcels of real property located on Gooding Avenue, Bristol, Rhode Island.

The purchase price for the property was

$ 1,185,000 .

The transaction was effected pursuant to the terms of a Real Estate Purchase and Sale Agreement dated

The transaction was effected pursuant to a Real Estate Purchase and Sale Agreement dated

November 21, 2024 by and between the Company and the sellers identified therein, with the Company having assigned its rights under that agreement to Bristol effective

14 unchanged sentences

Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance.

The Company adopted ASU 2025 - 05 for the period-ended March 31, 2026 and concluded it did not have a material impact to its condensed consolidated financial statements.

The Company adopted ASU 2025 - 05 during the three -month period ended March 31, 2026 and concluded it did not have a material impact to its condensed consolidated financial statements.

Accounting pronouncements issued and not yet adopted - In November 2024, the FASB issued ASU 2024 - 03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (“ASU 2024 - 03” ) which requires entities to 1.

17 unchanged sentences

The operating costs are recorded as other direct operating costs in the condensed consolidated statements of operations.

For the three -month period ended March 31, 2026 , the Company recognized leasing revenue of approximately $ 3,020,000 compared to $ 2,991,000 for the same period in the prior year.

For the three -month period ended March 31, 2026 , $ 1,956,000 of the ASC 842 revenues were for PBRT services compared to $ 1,642,000 , for the same period in the prior year.

For the three and six -month periods ended June 30, 2026 , the Company recognized leasing revenue of approximately $ 3,545,000 and $ 6,565,000 compared to $ 3,571,000 and $ 6,562,000 for the same periods in the prior year, respectively.

For the three and six -month periods ended June 30, 2026 , $ 2,346,000 and $ 4,302,000 of the ASC 842 revenues were for PBRT services compared to $ 1,921,000 and $ 3,563,000 for the same periods in the prior year, respectively.

Direct patient services income – The Company has stand-alone facilities in Lima, Peru, Guayaquil, Ecuador, and Puebla, Mexico where contracts exist between the Company’s facilities and the individual patients treated at the facility.

7 unchanged sentences

The Company did not capitalize any incremental costs related to the fulfillment of its customer contracts.

The Company holds a 60 % equity interest in each of SNERCC and RWRT (collectively, the “RI Companies”) and was assigned certain payor contracts for a purchase price of $ 2,850,000 , in May 2024 ( such transaction, the “RI Acquisition”).

The Company acquired a 60 % equity interest in each of SNERCC and RWRT (collectively, the “RI Companies”) and was assigned certain payor contracts for a purchase price of $ 2,850,000 in May 2024 ( such transaction, the “RI Acquisition”).

The RI Companies operate three, existing, stand-alone radiation therapy cancer centers in Woonsocket, Warwick and Providence, Rhode Island, where contracts exist between the Company’s facilities and the individual patients treated at the facility.

5 unchanged sentences

The Company also concluded the three facilities are part of its direct patient services segment, see further discussion below.

Accounts receivable balances under ASC 606 at March 31, 2026 and January 1, 2026 were $ 8,484,000 and $ 8,138,000 , respectively.

Accounts receivable balances under ASC 606 at March 31, 2025 and January 1, 2025 were $ 6,120,000 and $ 6,073,000 , respectively.

For the three -month period ended March 31, 2026 , the Company recognized direct patient services revenues of approximately $ 4,064,000 compared to $ 3,121,000 for the same period in the prior year.

Accounts receivable balances under ASC 606 at June 30, 2026 and January 1, 2026 were $ 7,466,000 and $ 8,138,000 , respectively.

Accounts receivable balances under ASC 606 at June 30, 2025 and January 1, 2025 were $ 6,657,000 and $ 6,073,000 , respectively.

For the three and six -month periods ended June 30, 2026 , the Company recognized direct patient services revenues of approximately $ 4,885,000 and $ 8,949,000 compared to $ 3,500,000 and $ 6,621,000 for the same periods in the prior year, respectively.

Liquidity - On April 9, 2021, ASHS, Orlando, GKF (together with ASHS and Orlando, the “Borrowers”), and ASRS (together with the Borrowers, collectively, the “Loan Parties”) entered into a five -year $ 22,000,000 credit agreement (the “Credit Agreement”) with Fifth Third Bank, N.A.

(“Fifth Third”).

(“Fifth Third”, the “Lender”).

The loan entered into with United States International Development Finance Corporation (“DFC”) in connection with the acquisition of GKCE in June 2020 ( the “DFC Loan”;

1 unchanged sentence

On December 10, 2025, the Loan Parties received a notice from Fifth Third asserting that a specified Event of Default (as defined in the Credit Agreement) occurred under the Credit Agreement due to the Borrower's failure to maintain minimum unrestricted domestic cash of at least an aggregate of $ 5,000,000 (the “Minimum Cash Covenant”) as of September 30, 2025.

As of December 31, 2025, the Company was not in compliance with the minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant required by the Credit Agreement, and the Company notified Fifth Third of such defaults.

As of December 31, 2025, March 31, 2026 and June 30, 2026, the Company was not in compliance with the minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant required by the Credit Agreement, and the Company put Fifth Third on notice that it was not in compliance with those covenants.

ASHS has also determined that the Borrowers’ defaults under the Credit Agreement could be deemed to have resulted in an Event of Default (as defined in the DFC Loan) under the DFC Loan.

However, as of the date of this Quarterly Report, DFC has not delivered any notice asserting that such an Event of Default has occurred or sought to exercise any remedies it may have under the DFC Loan.

The Credit Agreement matured on April 9, 2026 and is secured by a lien on substantially all of the assets of the Loan Parties and is guaranteed by ASHS, Orlando and ASRS.

The Credit Agreement had a maturity date of April 9, 2026 and obligations under the Credit Agreement are secured by a lien on substantially all of the assets of the Loan Parties and is guaranteed by ASHS, Orlando and ASRS.

The Loan Parties did not satisfy all outstanding obligations under the Credit Agreement on the maturity date.

ASHS is currently in discussions with Fifth Third regarding a potential amendment and extension of the maturity date of the Credit Agreement.

However, there can be no assurance that Fifth Third will agree to such an extension or, if obtained, as to the terms or duration of any such extension.

If ASHS is unable to obtain an extension of the maturity date of the Credit Agreement, and Fifth Third were to demand payment in Full in lump-sum, the Company will not have sufficient cash on hand to repay all outstanding obligations due under the Credit Agreement at maturity.

See Note 3 - “Long Term Debt” for additional information.

As of March 31, 2026 , HoldCo was not in compliance with the cash-to-debt covenant under the DFC Loan.

If Fifth Third were to have demanded payment in full in lump-sum, the Company would not have had sufficient cash on hand to repay all outstanding obligations due under the Credit Agreement at maturity.

Subsequent to June 30, 2026 , the Loan Parties and Fifth Third entered into an amendment to the Credit Agreement and as a part of that amendment Fifth Third agreed to forbear from exercising certain rights and remedies in respect of certain alleged events of default under the Credit Agreement until June 30, 2027.

See Note 3 - “Long Term Debt” and Note 10 - “Subsequent Events” for additional information.

As of June 30, 2026 and March 31, 2026, HoldCo was not in compliance with the cash-to-debt covenant under the DFC Loan.

The Company notified DFC of this non-compliance and is in discussions for an extended waiver or amendment to the DFC Loan, but there can be no assurances regarding the outcome of such discussions.

Furthermore, ASHS has determined that HoldCo’s non-compliance with the DFC Loan could be deemed to have resulted in an Event of Default (as defined in the Credit Agreement) of the Credit Agreement with Fifth Third.

However, as of the date of this Quarterly Report, Fifth Third has not delivered any notice to the Loan Parties asserting that such an Event of Default has occurred or sought to exercise any remedies it may have under the Credit Agreement.

Furthermore, ASHS determined that HoldCo’s non-compliance with the DFC Loan could have been deemed to have resulted in an Event of Default (as defined in the Credit Agreement) of the Credit Agreement with Fifth Third.

The Company reassessed its ability to continue as a going concern in light of the Events of Default discussed above.

As long as the Company remains in default under the Credit Agreements, Fifth Third and DFC could accelerate all payment obligations under the Credit Agreements.

If Fifth Third or DFC were to accelerate all payment obligations under the Credit Agreements as a result of the defaults thereunder, the Company would not have sufficient cash on hand to satisfy such accelerated payment obligations.

At any time there exists an event of default that the Company is in default under the Credit Agreements, Fifth Third and DFC could accelerate all payment obligations under the Credit Agreements.

Upon acceleration, the Company would not have sufficient cash on hand to satisfy the accelerated payment obligations.

As a result, these conditions raise substantial doubt about the Company’s ability to continue as a going concern.

To date, the Company has not negotiated a definitive extension and, if the Company is ultimately unable to do so, the Company’s liquidity will be adversely impacted and the Company’s ability to satisfy all of its commitments over the next twelve months in accordance with their current terms would be jeopardized.

To date, the Company has not negotiated an extension beyond June 30, 2027, and, if the Company is ultimately unable to do so, (or otherwise identify and execute on a new source of liquidity that is sufficient to allow the Company to satisfy in full the obligations owed under the Credit Agreement), the Company’s liquidity will be adversely impacted and its ability to satisfy all of its commitments over the next twelve months in accordance with their current terms would be jeopardized.

As a result of these conditions, in connection with management’s assessment of going-concern considerations in accordance with ASC 205 - 40 Presentation of Financial Statements - Going Concern , management has determined that the Company’s liquidity condition raises substantial doubt about the Company’s ability to continue as a going concern.

The Company’s condensed consolidated balance sheet as of March 31, 2026 , does not contain any adjustments that might result from the uncertainty regarding the Company’s ability to continue as a going concern.

The Company’s condensed consolidated balance sheet as of June 30, 2026 , does not contain any adjustments that might result from the uncertainty regarding the Company’s ability to continue as a going concern.

Business segment information - Based on the guidance provided in accordance with ASC 280 Segment Reporting (“ASC 280” ), the Company analyzed its subsidiaries which are all in the business of providing radiosurgery and radiation therapy services, either through leasing to healthcare providers or directly to patients, and concluded there are two reportable segments, leasing and direct patient services.

As of March 31, 2026 , the Company provided Gamma Knife and PBRT equipment to eight hospitals in the United States, which constitutes the leasing segment.

As of March 31, 2026 , the Company owns and operates two single-unit Gamma Knife facilities in Lima, Peru and Guayaquil, Ecuador, one single-unit radiation therapy facility in Puebla, Mexico and the Company also owns a majority interest in and operates, three single-unit radiation therapy facilities in Rhode Island, which collectively constitute the direct patient services segment.

As of June 30, 2026 , the Company provided Gamma Knife and PBRT equipment to eight hospitals in the United States, which constitutes the leasing segment.

As of June 30, 2026 , the Company owns and operates two single-unit Gamma Knife facilities in Lima, Peru and Guayaquil, Ecuador, one single-unit radiation therapy facility in Puebla, Mexico and the Company also owns a majority interest in and operates, three single-unit radiation therapy facilities in Rhode Island, which collectively constitute the direct patient services segment.

An operating segment is defined by ASC 280 as a component of an entity that engages in business activities in which it may recognize revenues and incur expenses, that has operating results that are regularly reviewed by the Company’s Chief Operating Decision Maker (“CODM”), and for which its discrete financial information is available.

1 unchanged sentence

The operating results of the two reportable segments are reviewed by the Company’s Executive Chairman of the Board, who is also the CODM.

For the three -month periods ended March 31, 2026 and 2025 , the Company’s PBRT operations represented a majority of the revenue and net income of the leasing segment, which reported an overall net loss for the period .

The revenues, depreciation, amortization, and other expense, interest expense, interest income, income tax expense (benefit), net (loss) income attributable to American Shared Hospital Services, and total assets for the Company’s two reportable segments as of March 31, 2026 and 2025 consist of the following:

Three Months Ended March 31,

For the three and six -month periods ended June 30, 2026 and 2025 , the Company’s PBRT operations represented a majority of the revenue and net income of the leasing segment .

Three Months Ended June 30,

Six Months Ended June 30,

$ 3,545,000 $ 3,571,000 $ 6,565,000 $ 6,562,000

27 unchanged sentences

$ ( 514,000 ) $ ( 280,000 ) $ ( 1,126,000 ) $ ( 905,000 )

June 30, 2026

December 31, 2025

$ 22,507,000 $ 24,334,000

17 unchanged sentences

The estimated useful life of the PBRT unit is consistent with the estimated economic life of 20 years.

The following table summarizes property and equipment as of March 31, 2026 and December 31, 2025 :

During the first quarter of 2026, the Company amended its lease for the PBRT equipment with Orlando Health.

The amendment extended the lease an additional seven years, beginning April 6, 2026.

Following the amendment, the Company changed its remaining estimate for the useful life for the PBRT equipment.

The net effect of this change in estimate for the three and six -month periods ended June 30, 2026 , was a decrease in net income of approximately $ 52,000 or $ 0.01 per diluted share, for both periods.

This change in estimate will also impact future periods.

The following table summarizes property and equipment as of June 30, 2026 and December 31, 2025 :

Medical equipment and facilities

11 unchanged sentences

$ 7,687,000 $ 8,082,000

Depreciation expense recorded in costs of revenue and selling and administrative expense in the condensed consolidated statements of operations for the three -month periods ended March 31, 2026 and 2025 is as follows:

Three Months Ended March 31,

Depreciation expense recorded in costs of revenue and selling and administrative expense in the condensed consolidated statements of operations for the three and six -month periods ended June 30, 2026 and 2025 is as follows:

Three Months Ended June 30,

Six Months Ended June 30,

Depreciation expense

6 unchanged sentences

The third loan facility provides for a $ 7,000,000 revolving line of credit (the “Revolving Line”) available for future projects and general corporate purposes.

The facilities have a five -year maturity, which matured on April 9, 2026, and carry a floating interest rate based on the Secured Overnight Financing Rate (“SOFR”) plus 3.0 % ( 6.86 % as of March 31, 2026 ) and are secured by a lien on substantially all of the assets of the Loan Parties and guaranteed by ASHS, Orlando and ASRS.

The facilities have a five -year maturity, by their original terms, that matured on April 9, 2026, and carry a floating interest rate based on the Secured Overnight Financing Rate (“ SOFR ”) plus 3.0 % ( 6.74 % as of June 30, 2026 ) and are secured by a lien on substantially all of the assets of the Loan Parties and guaranteed by ASHS, Orlando and ASRS.

There was an aggregate of $ 7,075,000 due on April 9, 2026 for the Term Loan and DDTL.

Subsequent to June 30, 2026, Fifth Third agreed to forbear from exercising certain rights and remedies in respect of certain alleged events of default under the Credit Agreement until June 30, 2027.

See Note 10 – “Subsequent Events”.

On January 25, 2024 ( the “First Amendment Effective Date”), the Company and Fifth Third entered into a First Amendment to Credit Agreement (the “First Amendment”), which amended the Credit Agreement to add a new term loan in the aggregate principal amount of $ 2,700,000 (the “Supplemental Term Loan”).

13 unchanged sentences

Pursuant to the First Amendment, advances under the Credit Agreement bear interest at a floating rate per annum equal to SOFR plus 3.00 %, subject to a SOFR floor of 0.00 %.

The long-term debt on the condensed consolidated balance sheets related to the Term Loan, DDTL, Revolving Line, Supplemental Term Loan and Second Supplemental Term Loan was $ 15,895,000 and $ 16,197,000 as of March 31, 2026 and December 31, 2025 , respectively.

The Company did not capitalize any debt issuance costs as of March 31, 2026 and December 31, 2025 , related to the issuance of the Supplemental Term Loan and Second Supplemental Term Loan.

The long-term debt on the condensed consolidated balance sheets related to the Term Loan, DDTL, Revolving Line, Supplemental Term Loan and Second Supplemental Term Loan was $ 15,427,000 and $ 16,197,000 as of June 30, 2026 and December 31, 2025 , respectively.

The Credit Agreement contains customary covenants and representations, including without limitation, a minimum fixed charge coverage ratio of 1.25 and maximum funded debt to EBITDA ratio of 3.0 to 1.0 (tested on a trailing twelve -month basis at the end of each fiscal quarter), an obligation that the Company maintain $ 5,000,000 of unrestricted cash, reporting obligations, limitations on dispositions, changes in ownership, mergers and acquisitions, indebtedness, encumbrances, distributions, investments, transactions with affiliates and capital expenditures.

On September 30, 2025, the Company received a limited waiver from Fifth Third with respect to its failure to be in compliance with the maximum funded debt to EBITDA ratio covenant in the Credit Agreement as of June 30, 2025 and with respect to the delivery of items following the closing of the Second Amendment.

As previously disclosed, (i) on December 10, 2025, the Loan Parties received notice from Fifth Third asserting that an Event of Default had occurred under the Credit Agreement due to the Borrowers’ failure to comply with the Minimum Cash Covenant as of September 30, 2025, and (ii) as of December 31, 2025, the Company was not in compliance with the minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant required by the Credit Agreement and notified Fifth Third of such non-compliance (all such defaults in clauses (i) and (ii), collectively, the “Financial Covenant Defaults”).

The Financial Covenant Defaults under the Credit Agreement remain uncured as of March 31, 2026, and, as a result, the Loan Parties are not in compliance with the Credit Agreement as of such date.

Due to the Financial Covenant Defaults described above, Fifth Third may exercise any of its rights, powers, privileges, and remedies under the Credit Agreement, the other Loan Documents, and applicable law, including but not limited to the right to accelerate the Borrowers’ payment obligations under the Credit Agreement.

In December 2025, as a result of the Financial Covenant Defaults, Fifth Third notified the Company that, among other things, it had suspended the Revolving Loan Commitment with respect to additional Revolving Loan Advances.

On September 30, 2025, the Company received a limited waiver from Fifth Third with respect to compliance with the maximum funded debt to EBITDA ratio covenant in the Credit Agreement as of June 30, 2025, and with respect to the delivery of items following the closing of the Second Amendment.

On December 16, 2025 and, May 29, 2026, the Loan Parties received a notice from the Lender (the “Notice”) asserting that certain Events of Default had occurred under the Credit Agreement, including that the Company was not in compliance with the minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant as of December 31, 2025 and as of March 31, 2026 and that the Company failed to pay outstanding obligations under the Credit Agreement when the Term Loan and DDTL by its original terms matured on April 9, 2026 ( such alleged defaults being collectively referred to as the “Specified Events of Default”).

In December 2025, Fifth Third notified the Company that, among other things, it had suspended the Revolving Loan Commitment with respect to additional Revolving Loan Advances.

In the notice delivered to the Loan Parties on May 29, 2026, Fifth Third exercised its right to increase interest on advances to the default rate effective from and after the earliest to occur of the Specified Events of Default.

The default rate added two percent per annum to the existing interest rate in effect for amounts outstanding under the Credit Agreement.

These Specified Events of Default were uncured as of June 30, 2026.

Additionally, as of June 30, 2026, the Company was not in compliance with minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant under the Credit Agreement.

As a result, the Loan Parties were not in compliance with the Credit Agreement as of such date.

Fifth Third had the right to exercise its rights, powers, privileges, and remedies under the Credit Agreement, the other Loan Documents, and applicable law, including to accelerate the Borrowers’ payment obligations under the Credit Agreement, however, as described in Note 10 – “Subsequent Events”, the parties entered into the Third Amendment and Fifth Third agreed to forbear from exercising certain rights and remedies under the Credit Agreement.

To date, Fifth Third has not accelerated the obligations of the Loan Parties under the Credit Agreement or other Loan Documents.

On July 22, 2026, Fifth Third and the Loan Parties entered into an amendment to the Credit Agreement that, among other things, extended the maturity date to June 30, 2027.

See Note 10 – “Subsequent Events”.

The Loan Parties did not satisfy all outstanding obligations under the Credit Agreement when it matured on April 9, 2026.

Due to the Financial Covenant Defaults described above, the Loan Parties are not in compliance with the Credit Agreement as of March 31, 2026 .

To date, Fifth Third has not accelerated the obligations of the Loan Parties under the Credit Agreement or other Loan Documents.

ASHS is currently in discussions with Fifth Third regarding an amendment to extend the maturity date of the Credit Agreement.

However, there can be no assurances regarding the outcome of such discussions.

Due to the Financial Covenant Defaults described above, the Loan Parties are not in compliance with the Credit Agreement as of June 30, 2026 .

The loan entered into with DFC in connection with the acquisition of GKCE in June 2020 was obtained through the Company’s wholly-owned subsidiary, HoldCo and is guaranteed by GKF.

4 unchanged sentences

The amount outstanding under the second tranche of the DFC Loan is payable in 16 quarterly installments with a fixed interest rate of 7.49 %.

The Company did not capitalize any debt issuance costs as of March 31, 2026 and December 31, 2025 , related to the maintenance and administrative fees on the DFC Loan.

The long-term debt on the condensed consolidated balance sheets related to the DFC Loan was $ 985,000 and $ 1,149,000 as of March 31, 2026 and December 31, 2025 , respectively.

The long-term debt on the condensed consolidated balance sheets related to the DFC Loan was $ 821,000 and $ 1,149,000 as of June 30, 2026 and December 31, 2025 , respectively.

The DFC Loan contains customary covenants including without limitation, requirements that HoldCo maintain certain financial ratios related to liquidity and cash flow as well as depository requirements.

On March 28, 2024, HoldCo received a waiver and amendment from DFC for certain covenants as of December 31, 2023 and through December 31, 2024, and amended other covenants and definitions permanently.

On March 28, 2024, HoldCo received a waiver and amendment from DFC that, among other things, amended other covenants and definitions permanently.

On March 3, 2025, the Company received an additional waiver from DFC for certain covenants as of December 31, 2024 and through December 31, 2025.

HoldCo was not in compliance with the cash to debt covenant at March 31, 2026 .

HoldCo was not in compliance with the cash to debt covenant at June 30, 2026 .

As a result of the Loan Parties’ Financial Covenant Defaults under the Credit Agreement with Fifth Third discussed above, ASHS has determined that the non-compliance with the Credit Agreement could be deemed to have resulted in an Event of Default (as defined in the DFC Loan) under the DFC Loan.

However, as of the date of this Quarterly Report, DFC has not delivered any notice to HoldCo or ASHS asserting the occurrence of an Event of Default resulting from the Financial Covenant Defaults or sought to exercise any remedies it may have under the DFC Loan.

Additionally, HoldCo was not in compliance with the cash-to-debt covenant under the DFC Loan as of March 31, 2026.

Additionally, HoldCo was not in compliance with the cash-to-debt covenant under the DFC Loan as of March 31, 2026 and June 30, 2026 .

The Company notified DFC of this non-compliance and is in discussions for an extended waiver or amendment to the DFC Loan.

1 unchanged sentence

Furthermore, ASHS has determined that HoldCo’s non-compliance with the DFC Loan could be deemed to have resulted in an Event of Default (as defined in the Credit Agreement) under the Credit Agreement with Fifth Third.

However, prior to the parties entering into the Third Amendment (as further described in Note 10 - “Subsequent Events”), Fifth Third did not deliver any notice to the Loan Parties asserting that an Event of Default occurred nor sought to exercise any remedies under the Credit Agreement.

The Company’s failure to comply with the covenants under the Credit Agreements could result in the Company’s credit commitments being terminated and the principal of any outstanding borrowings, together with any accrued but unpaid interest, under the Credit Agreements could be declared immediately due and payable.

Furthermore, the lenders under the Credit Agreements could also exercise their rights to take possession of, and to dispose of, the collateral securing the credit facilities and loans and could pursue additional default remedies upon default as set forth in each such agreement.

As long as the Company remains in default under the Credit Agreements, Fifth Third and DFC could accelerate all payment obligations under the Credit Agreements.

Furthermore, upon declaring an Event of Default, the lenders under the Credit Agreements could exercise their rights to take possession of, and to dispose of, the collateral securing the credit facilities and loans and could pursue additional default remedies.

If Fifth Third or DFC were to accelerate all payment obligations under the Credit Agreements as a result of the defaults thereunder, the Company would likely not have sufficient cash on hand to satisfy such accelerated payment obligations.

As a result, these conditions raise substantial doubt about the Company’s ability to continue as a going concern.

2 unchanged sentences

The Company did not capitalize any debt issuance costs related to the GKCE Loans.

Total long-term debt on the condensed consolidated balance sheets related to the GKCE Loans was $ 47,000 and $ 53,000 as of March 31, 2026 and December 31, 2025 , respectively.

The accretion of debt issuance costs for the three -month period ended March 31, 2026 was $ 21,000 compared to $ 24,000 for the same period in the prior year.

As of March 31, 2026 and December 31, 2025 , the unamortized deferred issuance costs on the condensed consolidated balance sheet was $ 84,000 and $ 105,000 , respectively.

As of March 31, 2026 , long-term debt on the condensed consolidated balance sheets was $ 16,843,000 .

The following are contractual maturities of long-term debt as of March 31, 2026 , excluding deferred issuance costs of $ 84,000 :

Total long-term debt on the condensed consolidated balance sheets related to the GKCE Loans was $ 39,000 and $ 53,000 as of June 30, 2026 and December 31, 2025 , respectively.

The accretion of debt issuance costs for the three and six -month periods ended June 30, 2026 was $ 13,000 and $ 34,000 compared to $ 55,000 and $ 79,000 for the same periods in the prior year, respectively.

As of June 30, 2026 and December 31, 2025 , the unamortized deferred issuance costs on the condensed consolidated balance sheet was $ 71,000 and $ 105,000 , respectively.

As of June 30, 2026 , long-term debt on the condensed consolidated balance sheets was $ 16,216,000 .

The following are contractual maturities of long-term debt as of June 30, 2026 , excluding deferred issuance costs of $ 71,000 :

Year ending December 31,

2026 (excluding the three-months ended March 31, 2026)

2026 (excluding the six-months ended June 30, 2026)

Other Accrued Liabilities

Other accrued liabilities consist of the following as of March 31, 2026 and December 31, 2025 :

Other accrued liabilities consist of the following as of June 30, 2026 and December 31, 2025 :

Professional services

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The sublease in San Francisco is for 80 square feet for $ 1,003 per month located at 601 Montgomery Street, Suite 850.

The sublease in Downers Grove was signed in February 2025 and is for two offices and three cubicle spaces for $ 2,300 per month located at 3041 Woodcreek Drive.

The sublease in Downers Grove was signed in February 2025 for two offices and three cubicle spaces for $ 2,300 per month located at 3041 Woodcreek Drive.

Total ROU assets and lease liabilities for the Downers Grove sublease were $ 26,000 .

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The facility in Providence, RI also has a ground lease, which was contributed by one of the minority partners.

On January 1, 2025, the Company entered into the Amended and Restated Lease Agreement (the “Amended Lease”) for the facility lease in Warwick, Rhode Island.

The Amended Lease includes a lease extension to December 31, 2039 and modified the monthly lease payment to $ 26,443 .

On January 1, 2025, the Company entered into the Amended and Restated Lease Agreement (the “Amended Lease”) for the facility lease in Warwick, Rhode Island, which included a lease extension to December 31, 2039 and modified the monthly lease payment to $ 26,443 .

The Company assessed the Amended Lease under ASC 842 and concluded it was a lease modification.

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Total ROU assets and lease liabilities for the Puebla lease were $ 149,000 .

Sublease income for the three -month period ended March 31, 2026 was $ 15,000 compared to $ 15,000 for the same period in the prior year.

Sublease income for the three and six -month periods ended June 30, 2026 was $ 32,000 and $ 47,000 compared to $ 15,000 and $ 30,000 for the same periods in the prior year, respectively.

The Company’s lessee operating leases are accounted for as ROU assets, current portion of lease liabilities, and lease liabilities on the condensed consolidated balance sheets.

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These leases have remaining lease terms of approximately 8 to 15 y ears, some of which include options to renew or extend the lease.

As of March 31, 2026 , operating ROU assets, net of unfavorable leasehold interests, were $ 3,610,000 , and lease liabilities were $ 4,343,000 .

The following table summarizes the maturities of the Company's lessee operating lease liabilities as of March 31, 2026 :

As of June 30, 2026 , operating ROU assets, net of unfavorable leasehold interests, were $ 3,571,000 , and lease liabilities were $ 4,307,000 .

The following table summarizes the maturities of the Company's lessee operating lease liabilities as of June 30, 2026 :

Year ending December 31,

Operating Leases

2026 (excluding the three-months ended March 31, 2026)

2026 (excluding the six-months ended June 30, 2026)

Total lease payments

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( 2,773,000 )

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Operating lease cost

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Weighted-average remaining lease term - Operating leases in years

12.59 14.45 12.59 14.45

Weighted-average discount rate - Operating leases

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The Company calculates diluted shares using the treasury stock method.

Because the Company reported a loss for the three -month periods ended March 31, 2026 and 2025 , the potentially dilutive effects of approximately 2,000 of the Company’s stock options and 211,000 of the Company’s unvested restricted stock awards, and 38,000 of the Company’s stock options and 173,000 of the Company’s unvested restricted stock awards were not considered for the reporting periods, respectively.

The weighted average common shares outstanding for basic earnings per share for the three -month periods ended March 31, 2026 and 2025 included approximately 123,000 and 123,000 , respectively, of the Company's restricted stock awards that are fully vested but are deferred for issuance.

The following table sets forth the computation of basic and diluted earnings per share for the three -month periods ended March 31, 2026 and 2025 :

Three Months Ended March 31,

Because the Company reported a loss for the three and six -month periods ended June 30, 2026 and 2025 , the potentially dilutive effects of Company’s stock options and unvested restricted stock awards are not considered for the reporting periods.

The weighted average common shares outstanding for basic earnings per share for the three and six -month periods ended June 30, 2026 and 2025 included the Company's restricted stock awards that are fully vested but are deferred for issuance.

The following table sets forth the options and unvested restricted stock awards not considered for reporting, and, the restricted stock awards that are fully vested, but deferred for issuance for the three and six -month periods ended June 30, 2026 and 2025 :

Three Months Ended June 30,

Six Months Ended June 30,

Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount - options

- 8,000 - 16,000

Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount - unvested RSUs

90,000 253,000 90,000 253,000

Fully vested RSUs deferred for issuance, included in weighted average shares outstanding for basic EPS

123,000 123,000 123,000 123,000

The following table sets forth the computation of basic and diluted earnings per share for the three and six -month periods ended June 30, 2026 and 2025 :

Three Months Ended June 30,

Six Months Ended June 30,

Net loss attributable to American Shared Hospital Services

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A small change in estimated annual pretax income can produce a significant variance in the annualized effective income tax rate given the expected amount of these items.

As a result, the Company has computed its provision for income taxes for the three -month periods ended March 31, 2026 and 2025 by applying the actual effective tax rates to income or reported within the condensed consolidated financial statements through those periods.

The provision for income taxes for the three -month period ended March 31, 2026 , included a non-recurring adjustment for unrecognized tax benefits related to foreign taxes of $ 31,000 .

For the three -month period ended March 31, 2025 , the Company recorded a $ 71,000 adjustment for unrecognized tax benefits related to foreign taxes.

On July 4, 2025, President Donald Trump signed the One Big Beautiful Bill Act (“OBBBA”) into law, which is considered the enactment date under U.S.

As a result, the Company has computed its provision for income taxes for the three and six -month periods ended June 30, 2026 and 2025 by applying the actual effective tax rates to income or reported within the condensed consolidated financial statements through those periods.

The provision for income taxes for the six -month period ended June 30, 2026 , included a non-recurring adjustment for unrecognized tax benefits related to foreign taxes of $ 31,000 .

For the six -month period ended June 30, 2025 , the Company recorded a $ 71,000 adjustment for unrecognized tax benefits related to foreign taxes.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, which is considered the enactment date under U.S.

This legislation introduces several provisions affecting businesses, including the permanent extension of certain expiring elements of the Tax Cuts and Jobs Act, modifications to the international tax framework, and favorable tax treatment for certain other business provisions.

Key corporate tax provisions include existing 21% corporate income tax rate made permanent, the restoration of 100% bonus depreciation, immediate expensing for domestic research and experimental expenditures, changes to Section 163 (j) interest limitations, updates to Global Intangible Low Tax Income (GILTI) and Foreign- Derived Intangible Income (FDII) rules, amendments to energy credits, and expanded Section 162 (m) aggregation requirements.

Key corporate tax provisions include existing 21% corporate income tax rate made permanent, the restoration of 100% bonus depreciation, immediate expensing for domestic research and experimental expenditures, changes to Section 163 (j) interest limitations, updates to Global Intangible Low-Taxed Income (GILTI) and Foreign- Derived Intangible Income (FDII) rules, amendments to energy credits, and expanded Section 162 (m) aggregation requirements.

The OBBBA contains multiple effective dates, with some provisions applicable beginning in 2026.

The legislation does not impact the Company’s prior years’ financial statements.

As of March 31, 2026 , the Company had commitments to purchase and install two Esprit and two LINAC systems.

The Esprit upgrades and one LINAC installation are anticipated to occur in late 2026 or later at existing customer sites.

As of June 30, 2026 , the Company had commitments to purchase and install two Esprit and two LINAC systems.

The Esprit upgrades and one LINAC installation are anticipated to occur in the second half of 2026 or later at existing customer sites.

The remaining LINAC is reserved for a future customer site.

Total Gamma Knife and LINAC commitments as of March 31, 2026 were $ 7,884,000 .

There are no deposits on the condensed consolidated balance sheets related to these commitments as of March 31, 2026 and December 31, 2025 , nor are there any penalties if the Company decides to not execute on these commitments.

Total Gamma Knife and LINAC commitments as of June 30, 2026 were $ 7,884,000 .

There are no deposits on the condensed consolidated balance sheets related to these commitments as of June 30, 2026 and December 31, 2025 , nor are there any penalties if the Company decides to not execute on these commitments.

Although the Company’s current intent is to finance substantially all of these commitments, there can be no assurance that financing will be available for the Company’s current or future projects, or at terms that are acceptable to the Company.

However, the Company currently has cash on hand of $ 5,223,000 .

March 31, 2026 , the Company had commitments to service and maintain its Gamma Knife, LINAC, and PBRT equipment.

However, as of June 30, 2026 , the Company had cash on hand of $ 6,761,000 (inclusive of restricted cash).

June 30, 2026 , the Company had commitments to service and maintain its Gamma Knife, LINAC, and PBRT equipment.

The service commitments are carried out via contracts with Mevion, Elekta, Solutech, and Mobius Imaging, LLC.

3 unchanged sentences

Total service commitments as of

March 31, 2026 were

June 30, 2026 were

$ 5,764,000 .

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Since the Company purchases its Gamma Knife units from Elekta, there are significant related party transactions with Elekta, such as equipment purchases, commitments to purchase and service equipment, and costs to maintain the equipment.

The following table summarizes related party activity for the three -month periods ended March 31, 2026 and 2025 :

Three Months Ended March 31,

The following table summarizes related party activity for the three and six -month periods ended June 30, 2026 and 2025 :

Three Months Ended June 30,

Six Months Ended June 30,

Equipment purchases and de-install costs

4 unchanged sentences

$ 705,000 $ 2,062,000 $ 963,000 $ 3,620,000

The Company also had commitments to purchase and install two Esprit units, and two LINACs, and to service the related equipment totaling $ 10,464,000 as of March 31, 2026 .

Related party liabilities on the condensed consolidated balance sheets consist of the following as of March 31, 2026 and December 31, 2025 :

The Company also had commitments to purchase and install two Esprit units, and two LINACs, and to service the related equipment totaling $ 10,174,000 as of June 30, 2026 .

Related party liabilities on the condensed consolidated balance sheets consist of the following as of June 30, 2026 and December 31, 2025 :

Accounts payable, asset retirement obligation and other accrued liabilities

$ 2,081,000 $ 1,887,000

Subsequent Events

The Company has evaluated subsequent events through August 13, 2026, and identified the following:

Amendment and Forbearance Agreement

On July 22, 2026 ( the “Third Amendment Effective Date”), the Loan Parties and Fifth Third entered into a Third Amendment to Credit Agreement and Forbearance Agreement (the “Third Amendment”).

In the Third Amendment, Fifth Third agreed to forbear from exercising certain rights and remedies in respect of certain Events of Default under the Credit Agreement (the “Designated Events of Default”), including the Specified Events of Default identified in a notice delivered to the Loan Parties on May 29, 2026, beginning on July 22, 2026 until June 30, 2027 ( the “Standstill Period”), subject to certain forbearance termination events.

Fifth Third also agreed that the minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant covenants are not applicable during the Standstill Period.

The Third Amendment imposes a variety of obligations and restrictions on the Loan Parties, including a prohibition from requesting any revolving loan advances, requires the Loan Parties to make defined payments in accordance with the terms of the Third Amendment, including to make monthly payments of interest on the Term Loan beginning on the Third Amendment Effective Date until the maturity date and quarterly payments of $ 125,000 of principal on the Term Loan beginning on October 10, 2026, and to make monthly payments of interest only on the Delayed Draw Term Loan beginning on the Third Amendment Effective Date until the maturity date, and quarterly payments of $ 75,000 of principal on the Delayed Draw Term Loan beginning on October 10, 2026.

The Third Amendment imposes other covenants and obligations on the Loan Parties, including that the Company pursue a sale of all or a portion of the assets of the Company and its subsidiaries, achieve certain milestones with respect to a prospective sale, and pay certain fees to the Lender if such milestones are not achieved.

The Third Amendment provides that all obligations under the Credit Agreement are due and payable at the end of the Standstill Period.

Promissory Note and Warrant

Also on July 22, 2026, the Company entered into a Note and Warrant Purchase Agreement (the “Purchase Agreement”) and a Promissory Note and Security Agreement (the “Note”), with RCS/TIG Holdings LLC, a Delaware limited liability company (the “Subordinated Lender”).

The Subordinated Lender is controlled by the Executive Chairman of the Board of the Company.

The principal amount of the Note is $ 2,000,000 and bears interest at an annual rate of 10 %.

All interest accrued and payable is capitalized and added to the outstanding principal amount of the Note.

All unpaid principal and any unpaid and accrued interest is due and payable on July 21, 2027 ( the “Maturity Date”).

There are no prepayment fees associated with the Note.

The Note is secured by a lien on substantially all of the assets of the Company, which lien is subordinated to the lien of the Lender.

The Subordinated Lender’s ability to exercise its rights under the Note are limited by an Intercreditor and Subordination Agreement between the Lender and the Subordinated Lender.

In accordance with the Purchase Agreement, the Company issued a warrant to the Subordinated Lender (the “Warrant”) that is exercisable through July 21, 2027 to purchase up to 220,000 shares of the Company’s common stock at an exercise price of $ 1.45 per share (which is equal to the average closing price of the Company’s common stock for the five consecutive trading days immediately preceding July 22, 2026).

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

14 unchanged sentences

The medical equipment leasing segment, which we also refer to as the Company’s leasing segment, operates by fee-per-use contracts or revenue sharing contracts where the Company shares in the revenue and operating costs of the equipment.

The Company leases seven Gamma Knife systems and one PBRT system as of March 31, 2026, where a contract exists between the hospital and the Company.

The Company leases seven Gamma Knife systems and one PBRT system as of June 30, 2026, where a contract exists between the hospital and the Company.

The Company acquired 60% of the equity interests of the RI Companies, which operate three single-unit radiation therapy facilities in Rhode Island.

6 unchanged sentences

Reimbursement

The Centers for Medicare and Medicaid ( “ CMS ” ) has established a 2026 delivery code reimbursement rate of approximately $7,525 ($7,645 in 2025) for a Medicare Gamma Knife treatment.

The Centers for Medicare and Medicaid ( “ CMS ” ) established a 2026 delivery code reimbursement rate of approximately $7,525 ($7,645 in 2025) for a Medicare Gamma Knife treatment.

The approximate CMS reimbursement rates for delivery of PBRT for a simple treatment without compensation for 2026 is $565 ($578 in 2025) and $1,277 ($1,276 in 2025) for simple with compensation, intermediate and complex treatments, respectively.

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The Company recognizes revenues under ASC 842 and ASC 606.

The Company had seven domestic Gamma Knife units, two international Gamma Knife units, three domestic LINAC units, one international LINAC unit, and one PBRT system in operation in the United States as of March 31, 2026, and ten domestic Gamma Knife units, two international Gamma Knife units, three domestic LINAC units, and one PBRT system in operation in the United States as of March 31, 2025.

Five of the Company’s seven domestic Gamma Knife customers are under fee-per-use contracts, and two customers are under revenue sharing arrangements.

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The operating costs are recorded as other direct operating costs in the condensed consolidated statements of operations.

For the three-month period ended March 31, 2026, the Company recognized leasing revenue of approximately $3,020,000 compared to $2,991,000 for the same period in the prior year.

For the three-month period ended March 31, 2026, $1,956,000 of the ASC 842 revenues were for PBRT services compared to $1,642,000, for the same period in the prior year.

For the six-month period ended June 30, 2026, the Company recognized leasing revenue of approximately $3,545,000 and $6,565,000 compared to $3,571,000 and $6,562,000 for the same periods in the prior year, respectively.

For the six-month period ended June 30, 2026, $2,346,000 and $4,302,000 of the ASC 842 revenues were for PBRT services compared to $1,921,000 and $3,563,000 for the same periods in the prior year, respectively.

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The Company also concluded the three radiation therapy facilities are part of its direct patient services segment, see further discussion at Note 1 - Basis of Presentation to the condensed consolidated financial statements.

Accounts receivable balances under ASC 606 at March 31, 2026 and January 1, 2026 were $8,484,000 and $8,138,000, respectively.

Accounts receivable balances under ASC 606 at March 31, 2025 and January 1, 2025 were $6,120,000 and $6,073,000, respectively.

For the three-month periods ended March 31, 2026, the Company recognized direct patient services revenues of approximately $4,064,000 compared to $3,121,000 for the same period in the prior year.

Accounts receivable balances under ASC 606 at June 30, 2026 and January 1, 2026 were $7,466,000 and $8,138,000, respectively.

Accounts receivable balances under ASC 606 at June 30, 2025 and January 1, 2025 were $6,657,000 and $6,073,000, respectively.

For the three and six-month periods ended June 30, 2026, the Company recognized direct patient services revenues of approximately $4,885,000 and $8,949,000 compared to $3,500,000 and $6,621,000 for the same periods in the prior year, respectively.

Impairment of Long-lived Assets

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Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance.

The Company adopted ASU 2025-05 for the period-ended March 31, 2026 and concluded it did not have a material impact to its condensed consolidated financial statements.

The Company adopted ASU 2025-05 during the three-month period ended March 31, 2026, and concluded it did not have a material impact to its condensed consolidated financial statements.

Accounting Pronouncements Issued and N ot Y et Adopted

3 unchanged sentences

disclose a qualitative description of the amounts remaining in relevant expense captions that are not necessarily disaggregated quantitatively, and 4.

disclose the total amount of selling expenses, in annual reporting periods, an entity’s definition of selling expense.

disclose the total amount of selling expenses, in annual reporting periods, including an entity’s definition of selling expense.

ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.

1 unchanged sentence

The Company is currently evaluating ASU 2024-03 to determine the impact it may have on its consolidated financial statements.

First Quarter 2026 Results

Revenues increased by $972,000 to $7,084,000 for the three-month period ended March 31, 2026 compared to $6,112,000 for the same period in the prior year.

Revenues from the Company’s leasing segment increased by $29,000 to $3,020,000 for the three-month period ended March 31, 2026 compared to $2,991,000 for the same period in the prior year.

The increase in leasing revenue was due to a higher number of Gamma Knife and PBRT procedures compared to the same period in the prior year.

Revenues from the Company’s direct patient services segment increased by $943,000 to $4,064,000 for the three-month period ended March 31, 2026 compared to $3,121,000 for the same period in the prior year.

Second Quarter and Six-Month Period 2026 Results

Revenues increased by $1,359,000 and $2,331,000 to $8,430,000 and $15,514,000 for the three and six-month periods ended June 30, 2026, compared to $7,071,000 and $13,183,000 for the same periods in the prior year, respectively.

Revenues from the Company’s leasing segment decreased by $26,000 and increased by $3,000 to $3,545,000 and $6,565,000 for the three and six-month periods ended June 30, 2026, compared to $3,571,000 and $6,562,000 for the same periods in the prior year, respectively.

The decrease in leasing revenue for the three-month period ended June 30, 2026 was due to a lower number of Gamma Knife procedures compared to the same period in the prior year.

Leasing revenue for the six-month period ended June 30, 2026, was consistent with the comparable period.

Revenues from the Company’s direct patient services segment increased by $1,385,000 and $2,328,000 to $4,885,000 and $8,949,000 for the three and six-month periods ended June 30, 2026, compared to $3,500,000 and $6,621,000 for the same periods in the prior year, respectively.

The increase in direct patient services revenue was due to a higher number of procedures at the RI facilities and the Company’s radiation therapy facility in Puebla.

Radiation therapy revenues generated from the three stand-alone facilities acquired through the RI Acquisition and the radiation therapy facility in Puebla were $2,920,000 for the three-month period ended March 31, 2026, compared to $2,374,000 for the same period in the prior year.

Radiation therapy procedures for the three stand-alone facilities acquired through the RI Acquisition and the radiation therapy facility in Puebla were 6,311 for the three-month period ended March 31, 2026, compared to 6,726 for the same period in the prior year.

Revenues generated from the Company’s PBRT system increased by $314,000 to $1,956,000 for the three-month period ended March 31, 2026 , compared to $1,642,000 for the same period in the prior year, respectively.

The increase for the three-month period ended March 31, 2026 , was driven by higher procedure volumes.

The number of PBRT fractions increased by 172 to 1,003 for the three-month period ended March 31, 2026 compared to 831 for the same period in the prior year.

The increase in PBRT volumes for the three-month period ended March 31, 2026 was due to what the Company believes are normal, cyclical fluctuations.

Gamma Knife revenue increased by $112,000 to $2,208,000 for the three-month period ended March 31, 2026 compared to $2,096,000 for the same period in the prior year.

The increase for the three-month period ended March 31, 2026 was due to increased procedure volume from the direct patient services segment, offset by lower procedure volume from the leasing segment.

The number of Gamma Knife procedures increased by 21 to 229 for the three-month period ended March 31, 2026 compared to 208 for the same period in the prior year.

Gamma Knife procedures from the Company’s leasing segment decreased 10.1% for the three-month period ended March 31, 2026 due to the expiration of one customer contract in April 2025.

Gamma Knife procedures from the Company’s direct patient services segment, which are the two international Gamma Knife locations, increased 44% for the three-month period ended March 31, 2026, compared to the same period in the prior year.

Radiation therapy revenues generated from the three stand-alone facilities acquired through the RI Acquisition and the radiation therapy facility in Puebla were $3,370,000 and $6,291,000 for the three and six-month periods ended June 30, 2026, compared to $2,541,000 and $4,915,000 for the same periods in the prior year, respectively.

Radiation therapy procedures for the three stand-alone facilities acquired through the RI Acquisition and the radiation therapy facility in Puebla were 6,715 and 12,645 for the three and six-month periods ended June 30, 2026, compared to 6,311 and 12,291 for the same periods in the prior year, respectively.

Revenues generated from the Company’s PBRT system increased by $425,000 and $739,000 to $2,346,000 and $4,302,000 for the three and six-month periods ended June 30, 2026 , compared to $1,921,000 and $3,563,000 for the same periods in the prior year, respectively.

The increase for the three and six-month periods ended June 30, 2026 , was driven by higher procedure volumes and higher average reimbursement.

The number of PBRT fractions increased by 107 and 279 to 1,221 and 2,224 for the three and six-month periods ended June 30, 2026 compared to 1,114 and 1,945 for the same periods in the prior year, respectively.

The increase in PBRT volumes for the three and six-month periods ended June 30, 2026 was due to what the Company believes are normal, cyclical fluctuations.

Gamma Knife revenue increased by $105,000 and $216,000 to $2,714,000 and $4,921,000 for the three and six-month periods ended June 30, 2026 compared to $2,609,000 and $4,705,000 for the same periods in the prior year, respectively.

The increase for the three and six-month periods ended June 30, 2026 was due to increased procedure volume from the direct patient services segment, offset by lower procedure volume from the leasing segment.

The number of Gamma Knife procedures increased by 31 and 52 to 295 and 524 for the three and six-month periods ended June 30, 2026, compared to 264 and 472 for the same periods in the prior year, respectively.

Gamma Knife procedures from the Company’s leasing segment decreased 11.3% and 11.1% for the three and six-month periods ended June 30, 2026, primarily due to the expiration of one customer contract in April 2025.

Gamma Knife procedures from the Company’s direct patient services segment, which are the two international Gamma Knife locations, increased 46.7% and 45.4% for the three and six-month periods ended June 30, 2026, compared to the same periods in the prior year, respectively.

The Company completed the equipment upgrade in Peru to a Gamma Knife Esprit in June 2025.

Following the upgrade, there was an increase in volume driven by shorter treatment times.

The Company’s facility in Ecuador also experienced a 49% increase in volumes for the three-month period ended March 31, 2026 compared to same period in the prior year.

The patient populations in Peru and Ecuador are primarily insured by local government therefore volumes can be impacted by local legislation changes or social and economic factors.

Both facilities were impacted by local factors during the first quarter of 2025.

Total costs of revenue increased by $626,000 to $5,796,000 for the three-month period ended March 31, 2026 compared to $5,170,000 for the same period in the prior year.

Maintenance and supplies and other direct operating costs, related party, increased by $200,000 to $1,061,000 for the three-month period ended March 31, 2026 compared to $861,000 for the same period in the prior year.

The increase in maintenance and supplies and other direct operating costs, related party, for the three-month period ended March 31, 2026 , was due to maintenance for the LINAC in Puebla, Mexico that was previously under warranty, maintenance for the LINAC equipment in Rhode Island, and the PBRT maintenance contract, which increases on an annual basis.

Depreciation and amortization decreased by $156,000 to $1,289,000 for the three-month period ended March 31, 2026 compared to $1,445,000 for the same period in the prior year.

The decrease in depreciation and amortization for the three-month period ended March 31, 2026 was due to the expiration of one Gamma Knife customer contract in April 2025, depreciation on the Gamma Knife equipment in Peru that was replaced during the second quarter of 2025, and assets in Rhode Island that became fully depreciated.

Other direct operating costs increased by $582,000 to $3,446,000 for the three-month period ended March 31, 2026 compared to $2,864,000 for the same period in the prior year.

The increase in other direct operating costs for the three-month period ended March 31, 2026 was primarily due to operating costs at the RI facilities, which are part of the Company’s direct patient services segment and have higher operating costs compared to facilities in the Company’s leasing segment.

Selling and administrative expense increased by $102,000 to $1,910,000 for the three-month period ended March 31, 2026 compared to $1,808,000 for the same period in the prior year.

The increase in selling and administrative expense for the three-month period ended March 31, 2026 was primarily due to audit, tax and consulting fees, offset by lower legal fees.

Interest expense decreased by $131,000 to $302,000 for the three-month period ended March 31, 2026 compared to $433,000 for the same period in the prior year.

The decrease in interest expense for the three-month period ended March 31, 2026 was due to a lower average principal balance on the Company’s debt compared to the same period in the prior year.

Interest and other income, net, decreased by $10,000 to $54,000 for the three-month period ended March 31, 2026 compared to $64,000 for the same period in the prior year.

The decrease for the three-month period ended March 31, 2026 was due to lower interest income received on the Company’s cash, driven primarily by lower average cash balances compared to the same period in the prior year.

Income tax expense increased by $415,000 to an expense of $92,000 for the three-month period ended March 31, 2026 compared to an income tax benefit of $323,000 for the same period in the prior year.

Income tax expense for the three-month period ended March 31, 2026 , included a non-recurring adjustment for unrecognized tax benefits related to foreign taxes of $31,000 , which offset income tax expense for the same period, compared to $71,000 for the three-month period ended March 31, 2025.

Excluding this adjustment, income tax expense for the three-month period ended March 31, 2026 increased $375,000.

The increase in income tax expense for the three-month period ended March 31, 2026 was due to profits generated at the Compan y’s direct patient services segment in foreign jurisdictions .

Both facilities were impacted by local factors during the first and second quarters of 2025.

Total costs of revenue increased by $1,556,000 and $2,182,000 to $6,997,000 and $12,793,000 for the three and six-month periods ended June 30, 2026 , compared to $5,441,000 and $10,611,000 for the same periods in the prior year, respectively.

Maintenance and supplies and other direct operating costs, related party, increased by $117,000 and $317,000 to $973,000 and $2,034,000 for the three and six-month periods ended June 30, 2026 compared to $856,000 and $1,717,000 for the same periods in the prior year, respectively.

The increase in maintenance and supplies and other direct operating costs, related party, for the three and six-month periods ended June 30, 2026 , was due to maintenance for the LINAC in Puebla, Mexico that was previously under warranty, maintenance for the LINAC equipment in Rhode Island, and the PBRT maintenance contract, which increases on an annual basis.

Depreciation and amortization decreased by $156,000 and $312,000 to $1,341,000 and $2,630,000 for the three and six-month periods ended June 30, 2026 compared to $1,497,000 and $2,942,000 for the same periods in the prior year, respectively.

The decrease in depreciation and amortization for the three and six-month periods ended June 30, 2026 was due to the expiration of one Gamma Knife customer contract in April 2025, a change in estimate for the useful life of the PBRT equipment, and assets in Rhode Island that became fully depreciated.

These decreases were partially offset by higher depreciation on the Gamma Knife equipment in Peru that was upgraded during the second quarter of 2025.

During the first quarter of 2026, the Company amended its lease for the PBRT equipment with Orlando Health.

The amendment extended the lease an additional seven years, beginning April 6, 2026.

Following the amendment, the Company changed its remaining estimate for the useful life for the PBRT equipment.

The net effect of this change in estimate for the three and six-month periods ended June 30, 2026 , was a decrease in net income of approximately $52,000 or $0.01 per diluted share, for both periods.

This change in estimate will also impact future periods.

Other direct operating costs increased by $1,595,000 and $2,177,000 to $4,683,000 and $8,129,000 for the three and six-month periods ended June 30, 2026 compared to $3,088,000 and $5,952,000 for the same periods in the prior year, respectively.

The increase in other direct operating costs for the three and six-month periods ended June 30, 2026 was primarily due to operating costs at the RI facilities, which are part of the Company’s direct patient services segment and have higher operating costs compared to facilities in the Company’s leasing segment.

The Company also increased the estimate for allowance for credit losses for the RI Facilities by $909,000 for the three and six-month periods ended June 30, 2026 ,which contributed to the increase compared to the same periods of the prior year, respectively.

Selling and administrative expense increased by $296,000 and $398,000 to $2,042,000 and $3,952,000 for the three and six-month periods ended June 30, 2026 compared to $1,746,000 and $3,554,000 for the same periods in the prior year, respectively.

The increase in selling and administrative expense for the three and six-month periods ended June 30, 2026 was primarily due to legal fees incurred to negotiate the Third Amendment to the Credit Agreement.

See Note 10 - Subsequent Event for further information.

Interest expense decreased by $127,000 and $258,000 to $301,000 and $603,000 for the three and six-month periods ended June 30, 2026 , compared to $428,000 and $861,000 for the same periods in the prior year, respectively.

The decrease in interest expense for the three and six-month periods ended June 30, 2026 was due to a lower average principal balance on the Company’s debt compared to the same periods in the prior year, respectively.

Interest and other income, net, increased by $2,000 and decreased by $8,000 to $47,000 and $101,000 for the three and six-month periods ended June 30, 2026 compared to $45,000 and $109,000 for the same periods in the prior year, respectively.

Interest and other income, net, for the three-month period ended June 30, 2026 was comparable to the same period of the prior year.

Interest and other income, net, decreased for the six-month period ended June 30, 2026 due to lower interest income received on the Company’s cash, driven primarily by lower average cash balances compared to the same period in the prior year.

Income tax expense increased by $156,000 and $571,000 to expense of $135,000 and $227,000 for the three and six-month periods ended June 30, 2026 , compared to an income tax benefit of $21,000 and $344,000 for the same periods in the prior year, respectively.

Income tax expense for the six-month period ended June 30, 2026, included a non-recurring adjustment for unrecognized tax benefits related to foreign taxes of $31,000 , which offset income tax expense for the same period, compared to $71,000 for the six-month period ended June 30, 2025.

Excluding this adjustment, income tax expense for the six-month period ended June 30, 2026 increased $531,000 compared to the prior period.

The increase in income tax expense for the three and six-month periods ended June 30, 2026 was due to profits generated at the Compan y’s direct patient services segment in foreign jurisdictions .

The Company’s direct patient services segment conducts operations in the United States and certain foreign jurisdictions.

Net loss attributable to non-controlling interests increased by $63,000 to a loss of $350,000 for the three-month period ended March 31, 2026 compared to $287,000 for the same period in the prior year.

Net loss attributable to non-controlling interests increased by $286,000 and $349,000 to a loss of $484,000 and $834,000 for the three and six-month periods ended June 30, 2026 , compared to $198,000 and $485,000 for the same periods in the prior year, respectively.

Net income or loss attributable to non-controlling interests represents net income or loss earned by the 40% non-controlling interest in the Rhode Island facilities, the 19% non-controlling interest in GKF, and net income or loss of the non-controlling interests in various subsidiaries controlled by GKF.

The change in net income or loss attributable to non-controlling interests reflects the relative profitability of the three Rhode Island facilities and GKF and its subsidiaries.

Net loss attributable to American Shared Hospital Services decreased by $13,000 to a net loss of $612,000, or $0.09 per diluted share for the three-month period ended March 31, 2026 compared to a net loss of $625,000, or $0.10 per diluted share for the same period in the prior year.

Net loss for the three-month period ended March 31, 2026 decreased primarily due to increased revenues compared to the same period in the prior year.

The Company incurred a net loss for three-month period ended March 31, 2026 , due to losses incurred by the direct patient services segments, driven by higher operating costs for these facilities.

The change in net income or loss attributable to non-controlling interests reflects the relative profitability or loss of the three Rhode Island facilities and GKF and its subsidiaries.

Net loss attributable to American Shared Hospital Services increased by $234,000 and $221,000 to a net loss of $514,000, or $0.07 per diluted share and a net loss of $1,126,000, or $0.17 for the three and six-month periods ended June 30, 2026 compared to a net loss of $280,000, or $0.04 per diluted share and a net loss of $905,000 or $0.14 per diluted share for the same periods in the prior year, respectively.

Net loss for the three and six-month periods ended June 30, 2026 increased primarily due to legal fees incurred to negotiate the Third Amendment to the Credit Agreement and the increase for credit allowances for the RI Facilities of $909,000 .

Liquidity and Capital Resources

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In general, the Company’s principal sources of liquidity are cash and cash equivalents on hand.

The Company had cash, cash equivalents and restricted cash of $5,223,000 at March 31, 2026 compared to $3,712,000 at December 31, 2025.

The Company’s cash position increased by $1,511,000 during the first three months of 2026 driven by cash provided by operating activities of $2,149,000.

The Company had cash, cash equivalents and restricted cash of $6,761,000 at June 30, 2026 compared to $3,712,000 at December 31, 2025.

The Company’s cash position increased by $3,049,000 during the first six months of 2026 driven by cash provided by operating activities of $4,385,000.

This increase was offset by payment for the purchase of property and equipment of $99,000, payments on long-term debt of $1,112,000, and distributions to non-controlling interests of $125,000.

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The Company has scheduled interest and principal payments under its debt obligations of approximately $10,907,000 during the next 12 months .

Of this amount, there was an aggregate of $7,605,000 due on April 9, 2026 for the Term Loan and DDTL.

Of this amount, there was an aggregate of $7,605,000 due on April 9, 2026 for the Term Loan and DDTL (although subsequent to June 30, 2026, the maturity date was extended to June 30, 2027).

For a further discussion of these obligations, see “Long-Term Debt” below.

Working Capital

The Company had a working capital deficit at March 31, 2026 of $5,446,000 compared to a working capital deficit of $5,724,000 at December 31, 2025.

The $278,000 decrease in working capital deficit was primarily due to increasing cash and a decrease in the current portion of long-term debt, net, offset in part by an increase in accounts payable and related party payables.

I f the Company is unable to negotiate an extension to the Credit Agreement, the Company’s liquidity will be adversely impacted and the Company’s ability to satisfy all of its commitments over the next twelve months in accordance with their current terms would be jeopardized.

The Company had a working capital deficit at June 30, 2026 of $5,056,000 compared to a working capital deficit of $5,724,000 at December 31, 2025.

The $668,000 decrease in working capital deficit was primarily due to an increase in cash offset in part by an increase in other accrued liabilities and related party payables.

I f the Company is unable to negotiate an extension to the Credit Agreement beyond June 30, 2027, the Company’s liquidity will be adversely impacted and the Company’s ability to satisfy all of its commitments over the next twelve months in accordance with their current terms would be jeopardized.

See additional discussion in the “Long-Term Debt” and “Commitments” sections below.

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The Company has secured financing for its projects from several lenders and anticipates that it will be able to secure financing on future projects from these or other lending sources, but there can be no assurance that financing will continue to be available on acceptable terms.

Furthermore, if the Company’s payment obligations under the Credit Agreements become accelerated due to the events of default under such agreements, the Company would not have sufficient cash on hand, cash flow from operations, and other cash resources to satisfy such accelerated payment obligations, which raises substantial doubt about the Company’s ability to continue as a going concern.

Furthermore, if the Company’s payment obligations under the Credit Agreements were to be accelerated due to any new or uncured events of default under such agreements, the Company would not have sufficient cash on hand, cash flow from operations, and other cash resources to satisfy such accelerated payment obligations, which raises substantial doubt about the Company’s ability to continue as a going concern.

See additional discussion in the “Long-Term Debt” and “Going-Concern Consideration” sections below.

Long-Term Debt

Fifth Third Credit Agreement

On April 9, 2021, the Company along with certain of its domestic subsidiaries (collectively, the “Loan Parties”) entered into a five year $22,000,000 credit agreement (the “Credit Agreement”) with Fifth Third Bank, N.A.

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The third loan facility provides for a $7,000,000 revolving line of credit (the “Revolving Line”) available for future projects and general corporate purposes.

The facilities have a five-year maturity, which matured on April 9, 2026, and carry a floating interest rate based on the Secured Overnight Financing Rate (“SOFR”) plus 3.0% (6.86% as of March 31, 2026) and are secured by a lien on substantially all of the assets of the Loan Parties and guaranteed by ASHS, Orlando and ASRS.

The facilities have a five-year maturity, which matured on April 9, 2026, and carry a floating interest rate based on the Secured Overnight Financing Rate (“SOFR”) plus 3.0% (6.74% as of June 30, 2026) and are secured by a lien on substantially all of the assets of the Loan Parties and guaranteed by ASHS, Orlando and ASRS.

There was $7,075,000 due on April 9, 2026 for the Term Loan and DDTL.

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Pursuant to the First Amendment, advances under the Credit Agreement bear interest at a floating rate per annum equal to SOFR plus 3.00%, subject to a SOFR floor of 0.00%.

The long-term debt on the condensed consolidated balance sheets related to the Term Loan, DDTL, Revolving Line, Supplemental Term Loan and Second Supplemental Term Loan was $15,895,000 and $16,197,000 as of March 31, 2026 and December 31, 2025, respectively.

The Company did not capitalize any debt issuance as of March 31, 2026 and December 31, 2025, related to the issuance of the Supplemental Term Loan and Second Supplemental Term Loan.

The long-term debt on the condensed consolidated balance sheets related to the Term Loan, DDTL, Revolving Line, Supplemental Term Loan and Second Supplemental Term Loan was $15,427,000 and $16,197,000 as of June 30, 2026 and December 31, 2025, respectively.

The Company did not capitalize any debt issuance as of June 30, 2026 and December 31, 2025, related to the issuance of the Supplemental Term Loan and Second Supplemental Term Loan.

The Credit Agreement contains customary covenants and representations, including without limitation, a minimum fixed charge coverage ratio of 1.25 and maximum funded debt to EBITDA ratio of 3.0 to 1.0 (tested on a trailing twelve-month basis at the end of each fiscal quarter), an obligation that the Company maintain $5,000,000 of unrestricted cash, reporting obligations, limitations on dispositions, changes in ownership, mergers and acquisitions, indebtedness, encumbrances, distributions, investments, transactions with affiliates and capital expenditures.

The Financial Covenant Defaults under the Credit Agreement remain uncured as of March 31, 2026, and, as a result, the Loan Parties are not in compliance with the Credit Agreement as of such date.

Due to the Financial Covenant Defaults described above, Fifth Third may exercise any of its rights, powers, privileges, and remedies under the Credit Agreement, the other Loan Documents, and applicable law, including the right to accelerate the Borrowers’ payment obligations under the Credit Agreement.

To date, Fifth Third has not accelerated the obligations of the Loan Parties under the Credit Agreement or other Loan Documents.

As noted above, the Credit Agreement matured on April 9, 2026 and is secured by a lien on substantially all of the assets of the Loan Parties and is guaranteed by ASHS.

The Loan Parties did not satisfy all outstanding obligations under the Credit Agreement on the maturity date.

ASHS is currently in discussions with Fifth Third regarding a waiver and an amendment to extend the maturity date of the Credit Agreement.

However, there can be no assurances regarding the outcome of such discussions.

On September 30, 2025, the Company received a limited waiver from Fifth Third with respect to compliance with the maximum funded debt to EBITDA ratio covenant in the Credit Agreement as of June 30, 2025 and with respect to the delivery of items following the closing of the Second Amendment.

On December 16, 2025 and May 29, 2026, the Loan Parties received a notice from the Lender (the “Notice”) asserting that certain Events of Default had occurred under the Credit Agreement, including that the Company was not in compliance with the minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant as of December 31, 2025 and as of March 31, 2026 and that the Company failed to pay outstanding obligations under the Credit Agreement when the Term Loan and DDTL matured on April 9, 2026 (such alleged defaults being collectively referred to as the “Specified Events of Default”).

In December 2025, Fifth Third notified the Company that, among other things, it had suspended the Revolving Loan Commitment with respect to additional Revolving Loan Advances.

The default rate added two percent per annum to the existing interest rate in effect for amounts outstanding under the Credit Agreement.

These Specified Events of Default were uncured as of June 30, 2026.

As a result, the Loan Parties were not in compliance with the Credit Agreement as of such date.

On July 22, 2026 (the “Third Amendment Effective Date”), the Loan Parties and Fifth Third entered into a Third Amendment to Credit Agreement and Forbearance Agreement (the “Third Amendment”).

In the Third Amendment, Fifth Third agreed to forbear from exercising certain rights and remedies in respect of certain events of default under the Credit Agreement (the “Designated Events of Default”), including the Specified Events of Default identified in a notice delivered to the Loan Parties on May 29, 2026, beginning on the Third Amendment Effective Date until June 30, 2027 (the “Standstill Period”), subject to certain forbearance termination events.

Fifth Third also agreed that the minimum fixed-charge coverage ratio, the maximum funded debt-to-EBITDA ratio, and the Minimum Cash Covenant covenants are not applicable during the Standstill Period.

The Third Amendment imposes a variety of obligations and restrictions on the Loan Parties, including a prohibition from requesting any revolving loan advances, requires the Loan Parties to make defined payments in accordance with the terms of the Third Amendment, including to make monthly payments of interest on the Term Loan beginning on the Third Amendment Effective Date until the maturity date and quarterly payments of $125,000 of principal on the Term Loan beginning on October 10, 2026, and to make monthly payments of interest only on the Delayed Draw Term Loan beginning on the Third Amendment Effective Date until the maturity date, and quarterly payments of $75,000 of principal on the Delayed Draw Term Loan beginning on October 10, 2026.

The Third Amendment provides that all obligations under the Credit Agreement are due and payable at the end of the Standstill Period.

DFC Loan Agreement

The loan entered into with United States International Development Finance Corporation (“DFC”) in connection with the acquisition of GKCE in June 2020 (the “DFC Loan”) was obtained through the Company’s wholly-owned subsidiary, HoldCo and is guaranteed by GKF.

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The amount outstanding under the second tranche of the DFC Loan is payable in 16 quarterly installments with a fixed interest rate of 7.49%.

The long-term debt on the condensed consolidated balance sheets related to the DFC Loan was

$1,149,000 as of

March 31, 2026 and

December 31, 2025, respectively.

The long-term debt on the condensed consolidated balance sheets related to the DFC Loan was $821,000 and $1,149,000 as of June 30, 2026 and December 31, 2025, respectively.

On March 28, 2024, HoldCo received a waiver and amendment from DFC for certain covenants as of December 31, 2023 and through December 31, 2024 and amended other covenants and definitions permanently.

On March 28, 2024, HoldCo received a waiver and amendment from DFC that waived certain covenants as of December 31, 2023 and through December 31, 2024 and amended other covenants and definitions permanently.

On March 3, 2025, the Company received an additional waiver from DFC for certain covenants as of December 31, 2024 and through December 31, 2025.

HoldCo was not in compliance with the cash to debt covenant at March 31, 2026 .

HoldCo was not in compliance with the cash to debt covenant at March 31, 2026 and at June 30, 2026 .

The Company notified DFC of this non-compliance and is in discussions for an extended waiver or amendment to the DFC Loan.

3 unchanged sentences

However, prior to the parties entering into the Third Amendment, Fifth Third did not deliver any notice to the Loan Parties asserting that an Event of Default has occurred nor sought to exercise any remedies under the Credit Agreement.

As long as the Company remains in default under the Credit Agreements, Fifth Third and DFC could accelerate all payment obligations under the Credit Agreements.

During a period in which the Company is in default under the Credit Agreements, Fifth Third and DFC could accelerate all payment obligations under the Credit Agreements.

As a result, these conditions raise substantial doubt about the Company’s ability to continue as a going concern.

RCS/TIG Holdings LLC Promissory Note

On July 22, 2026, the Company entered into a Note and Warrant Purchase Agreement (the “Purchase Agreement”) and a Promissory Note and Security Agreement (the “Note”), with RCS/TIG Holdings LLC, a Delaware limited liability company (the “Subordinated Lender”).

The Subordinated Lender is controlled by the Executive Chairman of the Board of the Company.

The principal amount of the Note is $2,000,000 and bears interest at an annual rate of 10%.

All interest accrued and payable is capitalized and added to the outstanding principal amount of the Note.

All unpaid principal and any unpaid and accrued interest is due and payable on July 21, 2027 (the “Maturity Date”).

There are no prepayment fees associated with the Note.

The Note is secured by a lien on substantially all of the assets of the Company, which lien is subordinated to the lien of the Lender.

The Subordinated Lender’s ability to exercise its rights under the Note are limited by an Intercreditor and Subordination Agreement between the Lender and the Subordinated Lender.

In November and December 2024, GKCE obtained two loans with banks locally in Ecuador (the “GKCE Loans”).

1 unchanged sentence

The Company did not capitalize any debt issuance costs related to the GKCE Loans.

Total long-term debt on the condensed consolidated balance sheets related to the GKCE Loans was $47,000 and $53,000 as of March 31, 2026 and December 31, 2025, respectively.

As of March 31, 2026, long-term debt on the condensed consolidated balance sheets was $16,843,000.

Total long-term debt on the condensed consolidated balance sheets related to the GKCE Loans was $39,000 and $53,000 as of June 30, 2026 and December 31, 2025, respectively.

As of June 30, 2026, long-term debt, net, on the condensed consolidated balance sheets was $16,216,000.

See Note 3 - Long Term Debt to the condensed consolidated financial statements for additional information.

As of March 31, 2026, the Company had commitments to purchase and install two Esprit and two LINAC systems.

As of June 30, 2026, the Company had commitments to purchase and install two Esprit and two LINAC systems.

The Esprit upgrades and one LINAC installation are anticipated to occur in the second half of 2026 or later at existing customer sites.

The remaining LINAC is reserved for a future customer site.

Total Gamma Knife and LINAC commitments as of March 31, 2026 were $7,884,000.

There are no deposits on the condensed consolidated balance sheets related to these commitments as of March 31, 2026 , nor are there any penalties if the Company decides to not execute these commitments.

Total Gamma Knife and LINAC commitments as of June 30, 2026 were $7,884,000.

There are no deposits on the condensed consolidated balance sheets related to these commitments as of June 30, 2026 , nor are there any penalties if the Company decides to not execute these commitments.

The Company’s current intent is to finance substantially all of these commitments.

1 unchanged sentence

However, the Company currently has cash on hand of $6,761,000 and is actively engaged with financing resources to fund these projects.

As of March 31, 2026, the Company had commitments to service and maintain its Gamma Knife, LINAC, and PBRT equipment.

As of June 30, 2026, the Company had commitments to service and maintain its Gamma Knife, LINAC, and PBRT equipment.

The service commitments are carried out via contracts with Mevion, Elekta, Solutech and Mobius Imaging, LLC.

The Company’s commitment to purchase one LINAC system also includes a 5-year agreement to service the equipment, respectively.

Total service commitments as of March 31, 2026 were $5,705,000.

Total service commitments as of June 30, 2026 were $5,764,000.

The Gamma Knife and certain other service contracts are paid monthly, as service is performed.

5 unchanged sentences

The following table summarizes related party activity for the three-month periods ended March 31, 2026 and 2025:

Three Months Ended March 31,

The following table summarizes related party activity for the three and six-month periods ended June 30, 2026 and 2025:

Three Months Ended June 30,

Six Months Ended June 30,

Equipment purchases and de-install costs

1 unchanged sentence

Total related party transactions

The Company also had commitments to purchase and install two Esprit units and two LINACs, and service the related equipment totaling $10,464,000 as of March 31, 2026.

Related party liabilities on the condensed consolidated balance sheets consist of the following as of March 31, 2026 and December 31, 2025

The Company also had commitments to purchase and install two Esprit units and two LINACs, and service the related equipment totaling $10,174,000 as of June 30, 2026.

Related party liabilities on the condensed consolidated balance sheets consist of the following as of June 30, 2026 and December 31, 2025

Accounts payable, asset retirement obligation and other accrued liabilities

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements