{"url_path":"/sec/aimd/10-k/2026/item-13","section_key":"item-13","section_title":"Item 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-03-30","source_url":"https://www.sec.gov/Archives/edgar/data/1014763/0001493152-26-013579-index.html","accession_number":"0001493152-26-013579","cik":"0001014763","ticker":"AIMD","issuer_name":"Ainos, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1014763/0001493152-26-013579-index.html","primary_entity_key":"0001014763","primary_entity_name":"Ainos, Inc."},"word_count":1562,"has_tables":true,"body_markdown":"** **\n\n**ITEM\n13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.**\n\n \n\n**Certain\nRelationships and Related Party Transactions**\n\n \n\nIn\naddition to the executive officer and director compensation arrangements discussed above under Item 11 “Executive Compensation”,\nsince January 1, 2025, the following are the only transactions or series of similar transactions to which we were or will be a party\nin which the amount involved exceeds $120,000 and in which any director, nominee for director, executive officer, beneficial holder of\nmore than 5% of our common stock or any member of their immediate family or any entity affiliated with any of the foregoing persons had\nor will have a direct or indirect material interest, other than equity and other compensation, termination, change of control and other\narrangements, which are described under “Executive Compensation.”\n\n** **\n\n**Purchase\nof intangible assets and equipment**\n\n \n\n**Patent\nlicense agreement**\n\n** **\n\nOn\nAugust 6, 2024, the Company entered into a patent license agreement (the “License Agreement”) with TCNT, as an effort to\nbolster the Company’s AI Nose and point-of-care testing (POCT) technologies while preserving cash. As of August 5, 2024, prior\nto TCNT entering into the License Agreement, TCNT controlled, via its majority interest in Ainos KY which is a party to certain voting\nagreements, approximately 38% of the voting power of the Company. Pursuant to the License Agreement, TCNT has agreed to assign and grant,\nand the Company has agreed to accept, an exclusive, irrevocable, and perpetual license of certain invention patents and patent applications\nrelated to gas sensors and medical devices (the “Licensed Patents”), in exchange for 1,100,000 shares (adjusted for the 1-for-5\nreverse stock split of the Company’s common stock on June 30, 2025) of the Common Stock, at a price per share of 1.05 times the\nhighest closing sale price of the Common Stock during the 30-trading day period preceding the effective date of the License Agreement.\nThe License Agreement shall remain in effect until terminated by mutual written agreement of the parties, or until the expiration of\nthe Licensed Patents, or all claims for alleged infringement of the Licensed Patents are barred by applicable laws. Following the issuance\nof the 1.1 million shares of stock, TCNT controls the Company through its majority interest in Ainos KY and its direct ownership in the\nCompany.\n\n \n\n**Working\nCapital Advances**\n\n \n\nAinos\nKY provided $800,000 in cash in exchange for a promissory note to support working capital of the Company in March 2022 (the “KY\nNote”). The Company paid off $530,000 of the KY Note during the year ended December 31, 2023. The KY Note bears an interest rate\nof 1.85% per annum. On August 17, 2023, the Company entered into extension agreements with Ainos KY to extend the maturity of the KY\nNote to March 31, 2025.\n\n \n\nOn\nOctober 7, 2024, the Company paid off the remaining note payable principal amount of $270,000 with accrued interest to Ainos KY, the\ncontrolling shareholder of the Company.\n\n \n\nOn\nMay 3, 2024, the Company entered into a Convertible Note and Warrant Purchase Agreement with the ASE, a shareholder of Ainos KY, for\nthe issuance of convertible promissory notes with 6% compound interest in the aggregate principal amount of $9,000,000 (collectively,\nthe “Notes”) convertible into shares of common stock, par value $0.01 per share, of the Company, payable three (3) years\nfrom May 3, 2024 as well as the issuance of warrants for the purchase of up to 100,000 shares (adjusted for the 1-for-5 reverse stock\nsplit of the Company’s common stock on June 30, 2025) of common stock at a price per share of $22.50, exercisable until May 3,\n2029. As of December 31, 2025, the Company received the full amount of the payment.\n\n \n\nThe\nproceeds of the KY Note and ASE Note (see Note 5) were used for working capital advances. The total interest expense incurred in relation\nto the notes for the year ended December 31, 2025 were $689,803 compared to $469,887 for the year ended December 31, 2024. As of December\n31, 2025 and December 31, 2024, unpaid accrued interest expenses were $1,229,843 and $540,039, respectively.\n\n \n\n50\n\n \n\n \n\n**Product\nDevelopment Agreement with TCNT**\n\n \n\nPursuant\nto a five-year Product Development Agreement (the “Product Development Agreement”) with TCNT, effective August 1, 2021, the\ndevelopment expenses incurred were $340,314 and $413,324 for the years ended December 31, 2025 and 2024, respectively.\n\n \n\nOn\nJanuary 9, 2024, the Company and TCNT entered into an addendum to the Product Development Agreement (the “Addendum Agreement”)\nin connection with the scope of co-development and certain terms. For products defined in the Addendum agreement, TCNT will provide facilities,\nequipment, mass production process technology, ISO9001 and ISO13485 related management, as well as mass production support. The procurement\nof parts and raw materials, rental fees, and utility expenses are excluded. The Company will pay a total fee of NT$5 million (US$162,840)\nfor five-years of development commencing from January 2024. The Company prepaid the full amount of the fee on January 10, 2024 at TCNT’s\nrequest. Under the Product Development Agreement, the Company advance payment of $92,014 and $120,869 to TCNT as of December 31, 2025\nand 2024, respectively. In addition, TCNT will provide non-exclusive use of certain patents related to VOC and POCT technologies for\na monthly fee of $95,000 (plus 5% indirect tax), with negotiable payment terms for six months from January 2024 to June 2024.\n\n \n\nAs\npart of the Second Addendum Agreement entered on July 8, 2024, TCNT provided non-exclusive use of certain patents related to VOC and\nPOCT technologies for a monthly fee of $95,000 (plus 5% indirect tax), with negotiable payment terms for extend another three months\nfrom July 2024 to September 2024.\n\n \n\nAs\npart of the Third Addendum Agreement entered into on October 16, 2024, TCNT will provide exclusive use of certain patents related to\nVOC, POCT and nitrogen-oxygen separation machine technologies for a monthly fee of $50,000 (plus 5% indirect tax) for twelve months from\nOctober 16, 2024, with negotiable payment terms.\n\n \n\nAs\npart of the Fourth Addendum Agreement entered into on October 15, 2025, the Company and TCNT entered into the fourth addendum to the\nProduct Development Agreement (the “Fourth Addendum Agreement”) to amend the fee for the exclusive use of patents of $50,000\nper month (plus 5% sales tax) for a two-year period starting from October 16, 2025, instead of one year starting from October 16, 2024.\nThe parties may negotiate payment terms and subsequent licensing methods thereafter.\n\n \n\nThe\nCompany paid license fees to TCNT during the year ended December 31, 2025 amounting to $600,000 (plus 5% indirect tax) compared to $1,005,000\n(plus 5% indirect tax) during the year ended December 31, 2024.\n\n \n\n**Manufacturing\nService Agreement with TCNT for the AI Nose hardware products**\n\n \n\nOn\nNovember 14, 2025, the Company entered into a manufacturing service agreement with TCNT to manufacture AI Nose hardware products. A deposit\nequal to 50% of the contract price was prepaid by the Company totaling $53,063 for the year ended December 31, 2025.\n\n \n\n**AI\nNose subscription-based order with ASE Technology Holding**\n\n \n\nOn\nAugust 6, 2025, the Company entered into a three-year subscription-based agreement with ASE Technology Holding Co., Ltd. (“ASEH”),\na related party, with a total contract value of approximately $2.1 million. Pursuant to the agreement, the Company will deploy approximately\n1,400 AI Nose units at select ASEH manufacturing facilities. The agreement provides for the delivery of AI Nose hardware and related\nsubscription-based services. ASEH prepaid approximately $350,000, representing 50% of the first-year contract consideration, which was\nreceived by the Company during the year ended December 31, 2025.\n\n \n\n**Controlling\nShareholder**\n\n \n\nTaiwan\nCarbon Nano Technology Corporation (the “TCNT”) holds majority share of Ainos KY, which holds majority voting power of the\nCompany as of December 31, 2025.\n\n \n\n51\n\n \n\n \n\n**Under\nCommon Control**\n\n \n\nScentAI\nInc. (“ScentAI”) is a wholly owned subsidiary of the Company.\n\n \n\nThe\nCompany issued 1,160,000 shares of its common stock in exchange for 116,000,000 newly issued shares of ScentAI in 2025. Both entities\nare under the same ultimate controlling party before and after the transaction.\n\n \n\n**Director\nIndependence**\n\n \n\nWe\nare a “controlled company” as defined in Rule 5615(c)(1) of the Nasdaq Listing Rules because more than 50% of our voting\npower is held by Ainos KY through direct shareholding and voting agreement dated January 1, 2026 by and among Ainos KY, Chun-Hsien Tsai,\nTing Chuan Lee, Chun-Jung Tsai, Chung-Yi Tsai, Chih-Heng Lu, Taiwan Carbon Nano Technology Corporation (“TCNT”), and Hsin-Liang\nLee and a voting agreement dated May 3, 2024 between Ainos KY and ASE Test, Inc. As a “controlled company,” we are exempt\nfrom the requirements of Rule 5605(b), (d) and (e) of the Nasdaq listing standards that would otherwise require us to have (i) a majority\nof independent directors on the Board, (ii) compensation and nominating committees composed solely of independent directors, (iii) the\ncompensation of executive officers determined by a majority of the independent directors or a compensation committee composed solely\nof independent directors, and (iv) director nominees selected or recommended to the Board for selection, either by a majority of the\nindependent directors, or a nominating committee composed solely of independent directors. Consequently, we are exempt from independent\ndirector requirements of Rule 5605(b), (d) and (e) of the Nasdaq Listing Rules, except for the requirements under subsection (b)(2) thereof\npertaining to executive sessions of independent directors and those under subsection (c) thereof pertaining to the Audit Committee. Currently,\nwe have an Audit Committee and Compensation Committee composed solely of independent directors."}