UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~March 31,~~June 30, 2023

o☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _______________

Commission file number:

0-22923

INTERNATIONAL ISOTOPES INC.

(Exact name of registrant as specified in its charter)

Texas

74-2763837

(State or other jurisdiction of

incorporation or organization)

(IRS Employer Identification No.)

4137 Commerce Circle

Idaho Falls,, Idaho,, 83401

(Address of principal executive offices, including zip code)

(208)524-5300

(~~Registrant’s~~Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ý☒ Yes¨ ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ý☒ Yes¨ ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨☐	Accelerated filer ¨☐
Non-accelerated ~~Filer~~ýfiler ☒	Smaller reporting company x☒

	Emerging growth company ¨☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ¨☐ Yes ý☒ No

As of ~~May 2,~~August 10, 2023, the number of shares of common stock, $0.01 par value, outstanding was ~~517,852,831~~.518,029,510.

Table of Contents

INTERNATIONAL ISOTOPES INC.

~~Form~~FORM 10-Q

For The Quarter Ended ~~March 31,~~June 30, 2023

TABLE OF CONTENTS

		Page No.
PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements
	Unaudited Condensed Consolidated Balance Sheets at ~~March 31,~~June 30, 2023 and December 31, 2022	4 3
	Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022	5 4
	Unaudited Condensed Consolidated Statements of Cash Flows for the ~~Three~~Six Months Ended ~~March 31,~~June 30, 2023 and 2022	6 5
	Unaudited Condensed Consolidated Statement of Stockholder’s (Deficit) Equity for the Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022	7 6
	Notes to Unaudited Condensed Consolidated Financial Statements	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	18
Item 4.	Controls and Procedures	23 25

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	24 26
Item 1A.	Risk Factors	24 26
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	24 26
Item 6.	Exhibits	25 27
Signatures		26 28

Table of Contents

~~Part~~PART I ––~~Financial Information~~FINANCIAL INFORMATION

~~Item~~ITEM 1. ~~Financial Statements~~FINANCIAL STATEMENTS

INTERNATIONAL ISOTOPES INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(unaudited)

	March 31,			December 31,			*June 30,*			*December 31,*
	2023			2022			*2023*			*2022*
Assets
Current assets
Cash and cash equivalents	$	3,281,161		$	2,375,817		$	3,274,125		$	2,375,817
Accounts receivable		1,555,786			1,596,886			1,289,936			1,596,886
Inventories		614,498			744,793			701,411			744,793
Prepaids and other current assets		372,418			1,023,129			220,930			1,023,129
Total current assets		5,823,863			5,740,625			5,486,402			5,740,625

Long-term assets
Restricted cash		848,451			840,049			858,268			840,049
Property, plant and equipment, net		2,036,801			2,024,486			2,010,374			2,024,486
Capitalized lease disposal costs, net		223,470			228,125			218,814			228,125
Financing lease right-of-use asset		11,119			12,621			9,616			12,621
Operating lease right-of-use asset		2,280,134			2,311,082			2,248,642			2,311,082
Goodwill		1,384,255			1,384,255			1,384,255			1,384,255
Patents and other intangibles, net		3,662,129			3,703,353			3,620,905			3,703,353
Total long-term assets		10,446,359			10,503,971			10,350,874			10,503,971
Total assets	$	16,270,222		$	16,244,596		$	15,837,276		$	16,244,596

Liabilities and Stockholders' Equity
Current liabilities
Accounts payable	$	420,218		$	382,392		$	541,874		$	382,392
Accrued liabilities		1,369,325			1,472,504			1,119,693			1,472,504
Unearned revenue		911,657			879,365			835,854			879,365
Current portion of operating lease right-of-use liability		133,804			131,572			136,075			131,572
Current portion of financing lease liability		4,006			5,513			2,996			5,513
Current portion of related party notes payable, net of debt discount		620,000			620,000			620,000			620,000
Current installments of notes payable		10,258			23,348			10,415			23,348
Total current liabilities		3,469,268			3,514,694			3,266,907			3,514,694

Long-term liabilities
Accrued long-term liabilities		103,125			112,500			93,750			112,500
Related party notes payable, net of current portion and debt discount		1,000,000			1,000,000			1,000,000			1,000,000
Notes payable, net of current portion		31,773			34,406			29,100			34,406
Asset retirement obligation		955,387			942,378			968,577			942,378
Financing lease liability, net of current portion		2,077			2,832			1,309			2,832
Operating lease right-of-use liability, net of current portion		2,197,944			2,232,244			2,163,061			2,232,244
Mandatorily redeemable convertible preferred stock		4,063,000			4,063,000			4,063,000			4,063,000
Total long-term liabilities		8,353,306			8,387,360			8,318,797			8,387,360
Total liabilities		11,822,574			11,902,054			11,585,704			11,902,054

Stockholders' equity
Common stock, $0.01 par value; 750,000,000 shares authorized; 517,852,831 and 514,889,916 shares issued and outstanding respectively		5,178,528			5,148,899
Common stock, $0.01 par value; 750,000,000 shares authorized; 517,941,366 and 514,889,916 shares issued and outstanding respectively								5,179,414			5,148,899
Additional paid in capital		125,878,017			125,654,486			125,944,357			125,654,486
Accumulated deficit		(126,608,897	)		(126,460,843	)		(126,872,199	)		(126,460,843	)
Total equity		4,447,648			4,342,542			4,251,572			4,342,542
Total liabilities and stockholders' equity	$	16,270,222		$	16,244,596		$	15,837,276		$	16,244,596

See accompanying notes to condensed consolidated financial statements.

Table of Contents

INTERNATIONAL ISOTOPES INC. AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Operations


	Three months ended March 31,						*Three months ended June 30,*						*Six months ended June 30,*
	2023			2022			*2023*			*2022*			*2023*			*2022*

Sale of product	$	3,089,535		$	2,807,441		$	3,112,165		$	2,434,808		$	6,201,700		$	5,242,249
Cost of product		1,309,499			1,130,698			1,269,552			1,034,278			2,579,051			2,164,976
Gross profit		1,780,036			1,676,743			1,842,613			1,400,530			3,622,649			3,077,273

Operating costs and expenses:
Salaries and contract labor		975,183			933,249			944,179			801,972			1,919,361			1,735,221
General, administrative and consulting		827,983			913,123			943,870			863,025			1,771,852			1,776,148
Research and development		124,442			206,414			183,024			87,642			307,468			294,056
Total operating expenses		1,927,608			2,052,786			2,071,073			1,752,639			3,998,681			3,805,425

Net operating loss		(147,572	)		(376,043	)		(228,460	)		(352,109	)		(376,032	)		(728,152	)

Other income (expense):
Other income		63,412			1,802,800			37,518			225,768			100,930			2,028,568
Interest income		19,086			45			9,856			680			28,942			725
Interest expense		(82,980	)		(171,757	)		(82,216	)		(146,387	)		(165,196	)		(318,144	)
Total other income (expense)		(482	)		1,631,088			(34,842	)		80,061			(35,324	)		1,711,149
Net income (loss)	$	(148,054	)	$	1,255,045		$	(263,302	)	$	(272,048	)	$	(411,356	)	$	982,997

Net income per common share - basic:	$	—		$	—
Net income per common share - diluted:	$	—		$	—
Net loss per common share - basic:							$	—		$	—		$	—		$	—
Net loss per common share - diluted:							$	—		$	—		$	—		$	—

Weighted average common shares outstanding - basic		515,566,825			503,472,428			517,926,610			510,499,497			516,746,718			506,985,962
Weighted average common shares outstanding - diluted		515,566,825			509,768,082			517,926,610			510,499,497			516,746,718			512,569,114

See accompanying notes to condensed consolidated financial statements.

Table of Contents

INTERNATIONAL ISOTOPES INC. AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Cash Flows


	Three months ended March 31						*Six months ended June 30,*
	2023			2022			*2023*			*2022*
Cash flows from operating activities
Net income (loss)	$	(148,054	)	$	1,255,045		$	(411,356	)	$	982,997
Adjustments to reconcile net income (loss) to net cash used by operating activities
Depreciation and amortization		87,268			119,118			175,398			203,551
Accretion of obligation for lease disposal costs		13,009			12,316			26,199			24,801
Accretion of beneficial conversion feature and discount		—			82,244			—			146,311
Equity based compensation		159,878			181,957			224,846			237,474
Gain on sale of property, plant and equipment		—			(1,797,978	)		—			(1,797,978	)
Right-of-use asset amortization		(1,120	)		829			(2,240	)		(291	)
Changes in operating assets and liabilities:
Accounts receivable		41,100			(610,652	)		306,950			(448,147	)
Inventories		130,295			35,620			43,382			(18,870	)
Prepaids and other current assets		650,711			211,924			802,199			384,774
Accounts payable and accrued liabilities		15,932			(394,242	)		(121,419	)		(807,805	)
Unearned revenues		32,292			45,942			(43,511	)		142,131
Net cash provided by (used in) operating activities		981,311			(857,877	)		1,000,448			(951,052	)

Cash flows from investing activities:
Proceeds from sale of property, plant and equipment		—			4,000,000			—			4,000,000
Purchase of property, plant and equipment		(52,202	)		(51,100	)		(66,522	)		(55,200	)
Net cash provided by (used in) investing activities		(52,202	)		3,948,900			(66,522	)		3,944,800

Cash flows from financing activities:
Proceeds from sale of stock and exercise of options and warrants		2,622			66,997			4,880			70,973
Payments on financing lease		(2,262	)		(2,062	)		(4,040	)		(4,172	)
Principal payments on notes payable		(15,723	)		(494,159	)		(18,239	)		(509,257	)
Net cash used in financing activities		(15,363	)		(429,224	)		(17,399	)		(442,456	)

Net increase in cash, cash equivalents, and restricted cash		913,746			2,661,799			916,527			2,551,292
Cash, cash equivalents, and restricted cash at beginning of period		3,215,866			1,305,603			3,215,866			1,305,603
Cash, cash equivalents, and restricted cash at end of period	$	4,129,612		$	3,967,402		$	4,132,393		$	3,856,895

Supplemental disclosure of cash flow activities:
Cash paid for interest	$	113,855		$	44,818		$	157,826		$	46,894

Supplemental disclosure of noncash financing and investing transactions
Decrease in accrued interest and increase in equity for conversion of dividends to stock	$	90,660		$	204,480		$	90,660		$	204,480
Increase in equity and decrease in liability for the conversion of preferred stock							$	—		$	675,000

Reconciliation of cash, cash equivalents, and restricted cash as shown in the condensed consolidated statements of cash flows is presented in the table below:

		March 31,		March 31,	*June 30,*		*June 30,*
		2023		2022	*2023*		*2022*
Cash and cash equivalents	$	3,281,161	$	3,136,639	$	3,274,125	$	3,025,513
Restricted cash included in long-term assets		848,451		830,763		858,268		831,382
Total cash, cash equivalents, and restricted cash shown in statement of cash flows	$	4,129,612	$	3,967,402	$	4,132,393	$	3,856,895

See accompanying notes to condensed consolidated financial statements.

Table of Contents

INTERNATIONAL ISOTOPES INC. AND SUBSIDIARIES

Condensed Consolidated Statement of Stockholders' (Deficit) Equity

Three and Six Months Ended ~~March 31,~~June 30, 2023

(Unaudited)

													*Common stock*
	Common stock																*Additional*
				Additional									*Shares*		*Common*		*Paid-in*			*Accumulated*			*Total*
	Shares	Common		Paid-in			Accumulated			Total			*Outstanding*		*Stock*		*Capital*			*Deficit*			*(Deficit) Equity*
	Outstanding	Stock		Capital			Deficit			(Deficit) Equity
Balance, December 31, 2022	514,889,916	$	5,148,899	$	125,654,486		$	(126,460,843	)	$	4,342,542

Balance, January 1, 2023														514,889,916	$	5,148,899	$	125,654,486		$	(126,460,843	)	$	4,342,542
Shares issued under employee stock purchase plan	102,855		1,028		1,594			—			2,622			191,390		1,914		2,966			—			4,880

Stock grant	343,560		3,436		(3,436	)		—			—			343,560		3,436		(3,436	)		—			—

Stock in lieu of dividends on convertible preferred C	2,266,500		22,665		67,995			—			90,660			2,266,500		22,665		67,995			—			90,660

Shares issued for issuance of RSUs	250,000		2,500		(2,500	)		—			—			250,000		2,500		(2,500	)		—			—

Stock based compensation	—		—		159,878			—			159,878			—		—		224,846			—			224,846

Net (loss) income	—		—		—			(148,054	)		(148,054	)		—		—		—			(411,356	)		(411,356	)
Balance, March 31, 2023	517,852,831	$	5,178,528	$	125,878,017		$	(126,608,897	)	$	4,447,648
Balance, June 30, 2023														517,941,366	$	5,179,414	$	125,944,357		$	(126,872,199	)	$	4,251,572

	*Common stock*
					*Additional*
	*Shares*		*Common*		*Paid-in*		*Accumulated*			*Total*
	*Outstanding*		*Stock*		*Capital*		*Deficit*			*(Deficit) Equity*
Balance, April 1, 2023		517,852,831	$	5,178,528	$	125,878,017	$	(126,608,897	)	$	4,447,648
Shares issued under employee stock purchase plan		88,535		886		1,372		—			2,258
Stock based compensation		—		—		64,968		—			64,968
Net (loss) income		—		—		—		(263,302	)		(263,302	)
Balance, June 30, 2023		517,941,366	$	5,179,414	$	125,944,357	$	(126,872,199	)	$	4,251,572

Table of Contents

INTERNATIONAL ISOTOPES INC. AND SUBSIDIARIES

Condensed Consolidated Statement of Stockholders' (Deficit) Equity

Three and Six Months Ended ~~March 31,~~June 30, 2022

(Unaudited)

	Common stock											*Common stock*
				Additional												*Additional*
	Shares	Common		Paid-in			Accumulated			Total		*Shares*		*Common*		*Paid-in*			*Accumulated*			*Total*
	Outstanding	Stock		Capital			Deficit			(Deficit) Equity		*Outstanding*		*Stock*		*Capital*			*Deficit*			*(Deficit) Equity*
Balance, December 31, 2021	502,584,176	$	5,025,842	$	124,469,034		$	(126,764,081	)	$	2,730,795

Balance, January 1, 2022													502,584,176	$	5,025,842	$	124,469,034		$	(126,764,081	)	$	2,730,795
Shares issued under employee stock purchase plan	67,945		679		4,518			—			5,197		119,910		1,199		7,974			—			9,173

Stock grant	187,231		1,872		(1,872	)		—			—		187,231		1,872		(1,872	)		—			—

Stock in lieu of dividends on convertible preferred C	2,271,980		22,720		181,760			—			204,480		2,271,980		22,720		181,760			—			204,480

Shares issued for exercise of employee stock options	611,111		6,111		(6,111	)		—			—		611,111		6,111		(6,111	)		—			—

Warrant exercise	515,000		5,150		56,650			—			61,800		515,000		5,150		56,650			—			61,800

Conversion of preferred B stock													8,437,500		84,375		590,625			—			675,000
Stock based compensation	—		—		181,957			—			181,957		—		—		237,474			—			237,474

Net (loss) income	—		—		—			1,255,045			1,255,045		—		—		—			982,997			982,997
Balance, March 31, 2022	506,237,443	$	5,062,374	$	124,885,936		$	(125,509,036	)	$	4,439,274
Balance, June 30, 2022													514,726,908	$	5,147,269	$	125,535,534		$	(125,781,084	)	$	4,901,719

	Common stock
					Additional
	*Shares*		*Common*		*Paid-in*		*Accumulated*			*Total*
	*Outstanding*		*Stock*		*Capital*		*Deficit*			*(Deficit) Equity*
Balance, April 1, 2022		506,237,443	$	5,062,374	$	124,885,936	$	(125,509,036	)	$	4,439,274
Shares issued under employee stock purchase plan		51,965		520		3,456		—			3,976
Conversion of preferred B stock		8,437,500		84,375		590,625					675,000
Stock based compensation		—		—		55,517		—			55,517
Net (loss) income		—		—		—		(272,048	)		(272,048	)
Balance, June 30, 2022		514,726,908	$	5,147,269	$	125,535,534	$	(125,781,084	)	$	4,901,719

See accompanying notes to the condensed consolidated financial statements

~~Common Stock~~

~~Additional Paid-in Capital~~

~~Accumulated Deficit~~

Table of Contents

INTERNATIONAL ISOTOPES INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements

~~March 31,~~June 30, 2023

~~(1)~~ (1) The Company and Basis of Presentation

International Isotopes Inc. (INIS) was incorporated in Texas in November 1995. The accompanying unaudited condensed consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (GAAP) and include all operations and balances of INIS and its wholly owned subsidiaries, including RadQual, LLC (RadQual) and TI Services, LLC (TI Services). TI Services is headquartered in Youngstown, Ohio and was formed with RadQual in December 2010 to distribute products and services for nuclear medicine, nuclear cardiology, and Positron Emission Tomography (PET) imaging. RadQual is a global supplier of molecular imaging quality control and calibration devices, and is headquartered in Idaho Falls, Idaho. INIS, and its wholly-owned subsidiaries (including RadQual and TI Services) are collectively referred to herein as the “Company,” “we,” “our” or “us.”

Nature of Operations – The Company manufactures a full range of nuclear medicine calibration and reference standards, generic sodium iodide ~~I-131~~I-131 drug product, cobalt teletherapy sources, and a varied selection of radiochemicals for medical research, and clinical applications. For 2023, the Company’s business consists of four business segments: Nuclear Medicine Standards, Cobalt Products, Radiochemical Products, and Fluorine Products. The Company’s headquarters and all operations, with the exception of TI Services, are located in Idaho Falls, Idaho.

With the exception of certain unique products, the Company’s normal operating cycle is considered to be one year. Due to the time required to produce some cobalt products, the Company’s operating cycle for those products is considered to be two to three years. Accordingly, preliminary payments received on cobalt contracts, where shipment will not take place for greater than one year, have been recorded as unearned revenue and, depending upon estimated ship dates, classified under either current or long-term liabilities on the Company’s condensed consolidated balance sheets. These unearned revenues are being recognized as revenue in the periods during which the cobalt shipments take place. All assets expected to be realized in cash or sold during the normal operating cycle of business are classified as current assets.

~~Principles of Consolidation~~

Principles of Consolidation – The accompanying unaudited condensed consolidated financial statements are presented in conformity with GAAP and include all operations and balances of INIS and its wholly-owned subsidiaries including RadQual and TI Services. See Note 4 “Investment and Business Consolidation” for additional information. All significant intercompany accounts and transactions have been eliminated in consolidation.

~~Interim Financial Information~~

Interim Financial Information – The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Accordingly, the accompanying unaudited condensed consolidated financial statements do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments and reclassifications considered necessary in order to make the financial statements not misleading and for a fair and comparable presentation have been included and are of a normal recurring nature. Operating results for the three and six months ended ~~March 31,~~June 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023 or any future periods. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form ~~10-K~~10-K for the year ended December 31, 2022 filed with the SEC on April 6, 2023, as amended on May 3, 2023.

~~Recent Accounting Pronouncements~~

Recent Accounting Pronouncements – In August 2020, the Financial Accounting Standards Board issued ASU ~~2020-06~~2020-06 Debt – Debt with Conversion and Other Options (Subtopic ~~470-20)~~470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic ~~815-40)~~815-40). The update simplifies accounting related to convertible debt instruments. The standard is effective for fiscal years beginning after December 15, 2023 including interim periods within those fiscal years. The Company is currently evaluating the effect this standard will have on its financial statements.

Table of Contents

~~(2)~~ (2) Current Developments and Liquidity

Business Condition – Since inception, the Company has incurred substantial losses. During the ~~three~~six months ended ~~March 31,~~June 30, 2023, the Company reported a net loss of $~~148,054~~$411,356 and net cash provided in operating activities of $~~981,311~~.$1,000,448. During the ~~three~~six months ended ~~March 31,~~June 30, 2022, the Company reported net income of $~~1,255,045~~$982,997 and net cash used in operating activities of $~~857,877~~.$951,052.

During the three and six months ended ~~March 31,~~June 30, 2023, the Company continued its focus on its strongest long-standing core business segments which consist of its radiochemical products, cobalt products, and nuclear medicine standards, and in particular, the pursuit of new business opportunities within those segments.

Additionally, the Company holds a Nuclear Regulatory Commission (NRC) construction and operating license for the depleted uranium facility in, as well as the property agreement with, Lea County, New Mexico, where the plant is intended to be constructed. The NRC license for the de-conversion facility is a forty ~~(40)~~ (40) year operating license and is the first commercial license of this type issued in the United States. There are no other companies with a similar license application under review by the NRC. Therefore, the NRC license represents a significant competitive barrier, and the Company considers it a valuable asset.

The Company expects that cash from operations, equity or debt financing, and its current cash balance will be sufficient to fund operations for the next twelve months. Future liquidity and capital funding requirements will depend on numerous factors, including commercial relationships, technological developments, market factors, available credit, and management of redeemable convertible preferred stock. There is no assurance that additional capital and financing will be available on acceptable terms to the Company or at all.

~~(3)~~ (3) Net Income (Loss) Per Common Share - Basic and Diluted

For the three and six months ended ~~March 31,~~June 30, 2023, the Company had ~~26,037,500~~26,012,500 stock options outstanding, 7,000,000 restricted stock units outstanding and 4,063 outstanding shares of Series C redeemable convertible preferred stock (Series C Preferred Stock), each of which were not ~~included in the computation of diluted income (loss) per common share because they would be anti-dilutive.~~

~~Stock Options~~

~~Warrants~~

~~For the three months ended March 31, 2022, the Company had~~ ~~26,567,500~~ ~~stock options outstanding,~~ ~~2,925,000~~ ~~warrants outstanding,~~ ~~4,063~~ ~~outstanding shares of Series C Preferred Stock, and~~ ~~675~~ ~~outstanding shares of Series B redeemable convertible preferred stock (Series B Preferred Stock), each of which were not~~ included in the computation of diluted income (loss) per common share because they would be anti-dilutive.

For the six months ended June 30, 2022, the Company had 12,700,000 stock options outstanding, and 4,063 outstanding shares of Series C Preferred Stock, each of which were not included in the computation of diluted income per common share because they would be anti-dilutive. The Company used the treasury stock method in calculating weighted average common shares diluted.

For the three months ended June 30, 2022, the Company had 26,134,500 stock options outstanding, and 4,063 outstanding shares of Series C Preferred Stock, each of which were not included in the computation of diluted income (loss) per common share because they would be anti-dilutive. The Company used the treasury stock method in calculating weighted average common shares diluted.

The table below shows the calculation of diluted shares:

~~Net Income (Loss) Per Common Share - Schedule of Weighted Average Number of Shares~~


	3 Months Ended				*3 Months Ended*				*6 Months Ended*
	March 31		March 31		*June 30,*		*June 30,*		*June 30,*		*June 30,*
	2023		2022		*2023*		*2022*		*2023*		*2022*
Weighted average common shares outstanding - basic		515,566,825		503,472,428		517,926,610		510,499,497		516,746,718		506,985,962

Effects of dilutive shares
Stock Options		—		6,295,654		—		—		—		5,583,152
Warrants		—		—
Series B Preferred Stock Series B Preferred Stock		—		—
Series C Preferred Stock Series C Preferred Stock		—		—
Series C Preferred Stock						—		—		—		—
Weighted average common shares outstanding - diluted		515,566,825		509,768,082		517,926,610		510,499,497		516,746,718		512,569,114

The table below summarizes common stock equivalents outstanding at ~~March 31,~~June 30, 2023 and ~~2022:~~2022:

~~Net Income (Loss) Per Common Share - Basic and Diluted - Schedule of Common Stock Equivalents Outstanding~~


	March 31,				*June 30,*
	2023		2022		*2023*		*2022*
Stock options		26,037,500		26,567,500		26,012,500		26,134,500
Warrants		—		2,925,000
Shares of Series B Preferred Stock		—		337,500
Restricted Stock Units						7,000,000		—
Shares of Series C Preferred Stock		40,630,000		40,630,000		40,630,000		40,630,000
		66,667,500		70,460,000		73,642,500		66,764,500

Table of Contents

~~(4)~~ (4) Investment and Business Consolidation

In 2021, the Company acquired all of the remaining membership interests of RadQual, making RadQual a wholly-owned subsidiary of the Company. As TI Services is a 50/50 joint venture between the Company and RadQual, TI Services is also a wholly-owned subsidiary of the Company.

~~(5)~~ (5) Inventories

At ~~March 31,~~June 30, 2023 and December 31, 2022, the Company held inventories of $~~614,498~~$701,411 and $~~744,793~~,$744,793, respectfully.

Inventories consisted of work in process for the following business segments:

~~Inventories - Schedule of Inventory, Current~~

	March 31, 2023		December 31, 2022		*June 30, 2023*		*December 31, 2022*
Radiochemical Products	$	32,675	$	23,011	$	77,018	$	23,011
Cobalt Products		188,028		189,255		184,782		189,255
Nuclear Medicine Products		393,795		532,527		439,611		532,527
	$	614,498	$	744,793	$	701,411	$	744,793

The Company has contracted with several customers for the sale of some of ~~this~~the cobalt product material and has collected advance payments for project management, up-front handling, and other production costs from those customers. The advance payments from customers were recorded as unearned revenue which are recognized in the Company’s condensed consolidated financial statements as cobalt products are completed and shipped. For the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022, the Company recognized approximately $~~1,500~~$1,500 and $~~10,600~~$26,949, respectively, of revenue in its condensed consolidated statements of operations for customer orders filled during the period under these cobalt contracts. For the three months ended June 30, 2023 and 2022, the Company recognized approximately $0 and $16,311, respectively, of revenue in its condensed consolidated statements of operations for customer orders filled during the period under these cobalt contracts.

~~(6)~~ (6) Stockholders’ Equity, Options, and Warrants

Employee Stock Purchase Plan

The Company has an employee stock purchase plan pursuant to which employees of the Company may participate to purchase shares of common stock at a discount. During the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022, the Company issued ~~102,855~~191,390 and ~~67,945~~119,910 shares of common stock, respectively, to employees under the employee stock purchase plan for proceeds of $~~2,622~~$4,880 and $~~5,197~~,$9,173, respectively. As of ~~March 31,~~June 30, 2023~~2,438,555~~, 2,350,020 shares of common stock remain available for issuance under the employee stock purchase plan.

Stock-Based Compensation Plans

2015 Incentive Plan - In April 2015, the Company’s Board of Directors approved the International Isotopes Inc. 2015 Incentive Plan (as amended, the 2015 Plan), which was subsequently approved by the Company’s shareholders in July 2015. The 2015 Plan was amended and restated in July 2018 to increase the number of shares authorized for issuance under the 2015 Plan by an additional 20,000,000 shares. The 2015 Plan provides for the grant of incentive and non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and units, and other stock or cash-based awards. At ~~March 31,~~June 30, 2023, there were ~~28,016,374~~20,788,574 shares available for issuance under the 2015 Plan.

Employee/Director Grants - The Company accounts for issuances of stock-based compensation to employees by recognizing, as compensation expense, the cost of employee services received in exchange for equity awards. The compensation expense is based on the grant date fair value of the award. Stock option compensation expense is recognized over the period during which an employee is required to provide service in exchange for the award (the vesting period).

Non-Employee Grants - The Company accounts for its issuances of stock-based compensation to non-employees by recognizing compensation expense based on the grant date fair value of the award. Stock option compensation expense is recognized over the vesting period for the award.

~~Employees~~

Table of Contents

Option awards outstanding as of ~~March 31,~~June 30, 2023, and changes during the ~~three~~six months ended ~~March 31,~~June 30, 2023, were as follows:

~~Stockholders’ Equity, Options and Warrants - Schedule of Share-Based Compensation Stock Option Activity~~

															*Weighted*
													*Weighted*		*Average*
													*Average*		*Remaining*		*Aggregate*
Fixed Options	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value		*Shares*			*Exercise Price*		*Contractual Life*		*Intrinsic Value*
Outstanding at December 31, 2022		24,993,500		$	0.07						24,993,500		$	0.05
Granted		3,000,000			0.04						3,025,000			0.04
Exercised		—			—						—			—
Expired		(750,000	)		0.07						(1,000,000	)		0.09
Forfeited		(1,206,000	)		0.09						(1,006,000	)		0.08
Outstanding at March 31, 2023		26,037,500			0.05		6.3	$	—
Exercisable at March 31, 2023		18,930,000		$	0.04		5.3	$	—
Outstanding at June 30, 2023											26,012,500			0.05		6.1	$	860,550
Exercisable at June 30, 2023											19,117,500		$	0.05		5.1	$	686,630

The intrinsic value of outstanding and exercisable shares is based on the closing price of the Company’s common stock on the OTCQB of $~~0.03~~$0.08 per share on ~~March 31,~~June 30, 2023, the last trading day of the three months ended ~~March 31, 2023.~~June 30, 2023.

As of ~~March 31,~~June 30, 2023, there was $~~194,297~~$161,069 of unrecognized compensation expense related to stock options that will be recognized over a weighted-average period of ~~2.00~~1.87 years.

Total stock-based compensation expense for the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022 was $~~159,878~~$224,846 and $~~181,957~~,$237,474, respectively.

~~Minimum~~Total stock-based compensation expense for the three months ended June 30, 2023 and 2022 was $64,968 and $55,517, respectively.

~~Maximum~~

During the ~~three~~six months ended ~~March 31,~~June 30, 2023, the Company granted an aggregate of ~~3,000,000~~3,025,000 qualified stock options to 31 of its employees. These options vest over a five-year period with the first vesting at the date of grant and expiration at ~~ten-year~~ten-year anniversary for all grants. The exercise price for these ~~all~~ granted options was $~~0.04~~$0.04 and $0.06 per share. The options issued during the ~~three~~six months ended ~~March 31,~~June 30, 2023 have a fair value of $~~78,498~~,$79,532, as estimated on the date of issue using the Black-Scholes options pricing model with the following weighted-average assumptions: risk free interest rate of ~~4.15~~%3.94% to ~~4.26~~%4.26%, expected dividend yield rate of 0%0%, expected volatility of ~~68.65~~%68.65% to ~~72.83~~%74.16% and an expected life between 5 and 7 years.

On March 3, 2023, the Compensation Committee of our Board of Directors approved the re-pricing of an aggregate of 12,450,000 outstanding stock options held by executive officers and members of the Board, which had original exercise prices of either $0.06, $0.09 or $0.11 per share. The Compensation Committee lowered the exercise price per share to $0.04 for each option, which was the fair market value of the Company’s stock on March 3, 2023.

On March 3, 2023, the Compensation Committee of our Board of Directors approved the cancellation of 1,000,000 outstanding stock options held by a member of the Board in exchange for the grant of 750,000 restricted stock units. The restricted stock units vest over a ~~three-year~~three-year period beginning on the grant date.

On May 8, 2023, pursuant to an executive employment agreement entered into with its newly appointed President, the Company granted 6,500,000 restricted stock units (“RSUs”) to its President. 1,500,000 RSUs vest on April 17, 2024, 2,000,000 RSUs vest on April 17, 2025, and 3,000,000 RSUs vest on April 17, 2026. Under the same compensation terms, subject to approval by the Board, a special equity grant of 2,500,000 fully-vested RSUs would be granted upon a promotion of the Company's President to Chief Executive ~~Officer~~Officer.

Pursuant to an employment agreement with its Chief Executive Officer, the Company awarded 560,000 fully vested shares of common stock to its Chief Executive Officer in February 2023 under the 2015 Plan. The number of shares awarded was based on a $~~28,000~~$28,000 stock award using a price of $~~0.05~~$0.05 per share. The employment agreement provides that the number of shares issued will be based on the average closing price of common stock for the 20 trading days prior to issue date but not less than ~~$0.05~~$0.05 per share. Compensation expense recorded pursuant to this stock grant was $~~22,400~~,$22,400, which was determined by multiplying the number of shares awarded by the closing price of the common stock on February 28, 2022, which was $~~0.04~~$0.04 per share. The Company withheld 216,440 shares of common stock to satisfy payroll tax obligations in connection with this issuance. The net shares issued on February 28, 2023 totaled ~~343,560~~.343,560.

~~Warrants~~

~~There were no warrants outstanding at March 31, 2023~~

~~Warrants outstanding at March 31, 2022 were~~ ~~2,925,000~~ ~~Class N Warrants which were immediately exercisable at an exercise price~~

Table of $~~0.10~~ ~~per share and expired on May 12, 2022.~~

~~On February 14, 2022,~~ ~~515,000~~ ~~Class M Warrants were exercised at an exercise price of $0.12~~ ~~per share, for a total proceeds of $61,800. On February 17, 2022 the~~ ~~3,625,000~~ ~~remaining unexercised Class M Warrants expired.~~

Contents

Preferred Stock

At ~~March 31,~~June 30, 2023, there were ~~no outstanding shares of Series B Preferred Stock.~~

~~At March 31, 2023, there were~~ 4,063 shares of the Series C Preferred Stock outstanding with a mandatory redemption date of February 2025at $~~1,000~~$1,000 per share in either cash or shares of common stock, at the option of the holder. Holders of the Series C Preferred Stock do not have any voting rights except as required by law and in connection with certain events as set forth in the Statement of Designation of the Series C Preferred Stock. The Series C Preferred Stock accrues dividends at a rate of 6% per annum, payable annually on February 17th of each year. The Series C Preferred Stock are convertible at the option of the holders at any time into shares of the ~~Company's~~Company common stock at an initial conversion price equal to $0.10 per share, subject to adjustment. If the volume-weighted average closing price of the Company’s common stock over a period of 90 consecutive trading days is greater than ~~$0.25~~$0.25 per share, the Company may redeem all or any portion of the outstanding Series C Preferred Stock at the original purchase price per share plus any accrued and unpaid dividends, payable in shares of common stock.

During the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022, dividends paid to holders of the Series C Preferred Stock totaled $~~243,780~~$243,780 for both ~~years~~.years. Some holders of the Series C Preferred Stock elected to settle their dividend payments with shares of the Company’s common stock in lieu of cash. For the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022, the Company issued an aggregate of 2,266,500 and 2,271,980 shares of common stock, respectively, in lieu of dividend payments in the aggregate of $~~90,660~~$90,660 and $~~204,480~~,$204,480, respectively, with the remaining dividend payable settled in cash of $~~153,120~~$153,120 and $~~39,300,~~$39,300, respectively.

~~(7)~~ (7) Debt

In December 2013, the Company entered into a promissory note agreement with its then Chairman of the Board and one of our major shareholders, pursuant to which we borrowed $~~500,000~~$500,000 (the 2013 Promissory Note). The 2013 Promissory Note is secured and bears interest at 6%6% per annum and was originally due June 30, ~~2014~~. 2014. According to the terms of the 2013 Promissory Note, at any time, the lenders may settle any or all of the principal and accrued interest with shares of our common stock. In December 2019, the 2013 Promissory Note was modified to extend the maturity date to December 31, 2021,, with all remaining terms unchanged. In January 2022, the 2013 Promissory Note was modified to extend the maturity date to December 31, 2023,, with all remaining terms unchanged. At ~~March 31,~~June 30, 2023, the principal balance of the 2013 Promissory Note was $~~500,000~~$500,000 and accrued interest payable on the 2013 Promissory Note was $~~279,234~~.$286,734. Interest expense recorded for the ~~three~~six months ended ~~March 31,~~June 30, 2022, was $~~7,500~~.$15,000.

In April 2018, we borrowed $~~120,000~~$120,000 from our Chief Executive Officer and Chairman of the Board pursuant to a promissory note (the 2018 Promissory Note). The 2018 Promissory Note accrues interest at 6%6% per annum, which is payable upon maturity of the 2018 Promissory Note. The 2018 Promissory Note was originally unsecured and originally matured on August 1, ~~2018~~. 2018. At any time, the holder of the 2018 Promissory Note may elect to have any or all of the principal and accrued interest settled with shares of our common stock based on the average price of the shares over the previous 20 trading days. In June 2018, the 2018 Promissory Note was modified to extend the maturity date to March 31, 2019with all other provisions remaining unchanged. In February 2019, the 2018 Promissory Note was modified to extend the maturity date to July 31, 2019with all other provisions remaining unchanged. In July 2019, the 2018 Promissory Note was modified to extend the maturity date to January 31, 2020with all other provisions remaining unchanged. In December 2019, the 2018 Promissory Note was modified to extend the maturity date to December 31, 2021,, the note was also modified to become secured by company assets, with all other provisions remaining unchanged. In December 2021, the 2018 Promissory Note was modified to extend the maturity date to December 31, 2023,, with all remaining terms unchanged. At ~~March 31,~~June 30, 2023, accrued interest on the 2018 Promissory Note totaled $~~35,570~~.$37,370.

In December 2019 and February 2020, the Company borrowed an aggregate of $~~1,000,000~~$1,000,000 from four of the Company’s major shareholders pursuant to a promissory note (the 2019 Promissory Note). The 2019 Promissory Note bears an interest rate of 4%4% annually and was originally due December 31, ~~2022~~. 2022. According to the terms of the 2019 Promissory Note, at any time, the lenders may settle any or all of the principal and accrued interest with shares of the Company’s common stock based on the average closing price of the Company’s common stock for the 20 days preceding the payment. In connection with the 2019 Promissory Note, the lenders were issued warrants totaling 30,000,000 warrants to purchase shares of the Company’s common stock at $~~0.045~~$0.045 per share

~~(the~~ (the Class O Warrants). The fair value of these Class O Warrants issued totaled $~~446,079~~$446,079 and was recorded as a debt discount and was amortized over the life of the 2019 Promissory Note. The Company calculated a beneficial conversion feature of $~~315,643~~$315,643 which was accreted to interest expense over the life of the 2019 Promissory Note. In December 2022, the 2019 Promissory Note was modified to extend the maturity date to December 31, 2024, with all remaining terms unchanged. At ~~March 31,~~June 30, 2023, the balance of the 2019 Promissory Note was $~~1,000,000~~$1,000,000 and the accrued interest on the 2019 Promissory Note totaled $~~129,131~~.$139,131.

Table of Contents

~~(8)~~ (8) Commitments and Contingencies

Dependence on Third Parties

The production of High Specific Activity Cobalt is dependent upon the U.S. Department of Energy (DOE), and its prime operating contractor, which controls the Advanced Test Reactor (ATR) and laboratory operations at the ATR located outside of Idaho Falls, Idaho. In October 2014, the Company signed a ~~ten-year~~ten-year contract with the DOE for the irradiation of cobalt targets for the production of ~~cobalt-60.~~cobalt-60. The Company will be able to purchase cobalt targets for a fixed price per target with an annual 5% escalation in price. The contract term is October 1, 2014 through September 30, 2024, however, the contract may be extended beyond that date. Also, the DOE may end the contract if it determines termination is necessary for the national defense, security or environmental safety of the United States. If this were to occur, all payments made by the Company, for partially irradiated undelivered cobalt material, would be refunded.

Sales of our most predominant radiochemical products are dependent upon a few key suppliers. An interruption in production by any of these individual suppliers could have an immediate negative impact upon radiochemical sales until material could be purchased from alternate suppliers including obtaining regulatory approval to use material from alternative suppliers if necessary.

The Nuclear Medicine Reference and Calibration Standard products sold by the Company are dependent upon certain radioisotopes that are supplied to the Company through agreements with several suppliers. A loss of any of these suppliers could adversely affect operating results by causing a delay in production or a possible loss of sales.

Contingencies

Because all the Company’s business segments involve the handling or use of radioactive material, the Company is required to have an operating license from the NRC and specially trained staff to handle these materials. The Company has amended this operating license numerous times to increase the amount of material permitted within the Company’s facility. Although this license does not currently restrict the volume of business operations performed or projected to be performed in the upcoming year, additional processing capabilities and license amendments could be implemented that would permit processing of other reactor-produced radioisotopes by the Company. The financial assurance required by the NRC to support this license has been provided for with a surety bond held with North American Specialty Insurance Company which is supported by a restricted money market account held with Merrill Lynch in the amount of $~~830,763~~.$858,268.

In August 2011, the Company received land from Lea County, New Mexico, pursuant to a Project Participation Agreement (PPA), whereby the land was deeded to the Company for no monetary consideration. In return, the Company committed to construct a uranium de-conversion and Fluorine Extraction Process facility on the land. In order to retain title to the property, the Company was to begin construction of the de-conversion facility no later than December 31, 2014, and complete Phase I of the project and have hired at least 75 persons to operate the facility no later than December 31, 2015, although commercial operations need not have begun by that date. In 2015, the Company negotiated a modification to the PPA that extended the start of construction date to December 31, 2015, and the hiring milestone to December 31, 2016. Those dates were also not met. The Company has been in discussions with commercial companies possibly interested in purchasing rights to this project. Should those discussions come to fruition the Company plans to negotiate a second modification to the PPA agreement to further extend the commitment dates. If the Company is not successful in reaching an amendment to extend the performance dates in the PPA., then it may, at its sole option, either purchase or re-convey the property to Lea County, New Mexico. The purchase price of the property would be $776,078, plus interest at the annual rate of 5.25% from the date of the closing to the date of payment. The Company has not recorded the value of this property as an asset and will not do so until such time that sufficient progress on the project has been made to meet the Company’s obligations under the agreements for permanent transfer of the title.

Table of Contents

~~(9)~~ (9) Revenue Recognition

Revenue from Product Sales

The following tables present the Company’s revenue disaggregated by business segment and geography, based on management’s assessment of available data:

~~Revenue Recognition - Summary of Sales from Contracts with Customers Disaggregated by Business Segment and Geography~~

	*Three Months Ended June 30, 2023*									*Three Months Ended June 30, 2022*
			*Outside*		*Total*		*% of Total*					*Outside*		*Total*		*% of Total*
	*U.S.*		*U.S.*		*Revenues*		*Revenues*			*U.S.*		*U.S.*		*Revenues*		*Revenues*
Radiochemical Products	$	1,605,313	$	130,730	$	1,736,043		56	%	$	1,266,249	$	113,790	$	1,380,039		57	%
Cobalt Products		395,395		52,863		448,258		14	%		89,946		9,200		99,146		4	%
Nuclear Medicine Products		732,524		195,340		927,864		30	%		744,154		211,469		955,623		39	%
Fluorine Products		—		—		—		0	%		—		—		—		0	%
	$	2,733,232	$	378,933	$	3,112,165		100	%	$	2,100,349	$	334,459	$	2,434,808		100	%

U.S.	Three Months Ended March 31, 2023									Three Months Ended March 31, 2022
Outside U.S.	U.S.		Outside U.S.		Total Revenues		% of Total Revenues			U.S.		Outside U.S.		Total Revenues		% of Total Revenues
																			*Six Months Ended June 30, 2023*									*Six Months Ended June 30, 2022*
																					*Outside*		*Total*		*% of Total*					*Outside*		*Total*		*% of Total*
																			*U.S.*		*U.S.*		*Revenues*		*Revenues*			*U.S.*		*U.S.*		*Revenues*		*Revenues*
Radiochemical Products	$	1,625,116	$	137,280	$	1,762,396		57	%	$	1,510,322	$	115,601	$	1,625,923		58	%	$	3,230,429	$	268,010	$	3,498,439		56	%	$	2,776,571	$	229,391	$	3,005,962		57	%
Cobalt Products		142,158		16,150		158,308		5	%		166,556		5,350		171,906		6	%		537,553		69,013		606,566		10	%		256,502		14,550		271,052		5	%
Nuclear Medicine Products		871,588		297,243		1,168,831		38	%		840,382		169,230		1,009,612		36	%		1,604,112		492,583		2,096,695		34	%		1,584,536		380,699		1,965,235		38	%
Fluorine Products		—		—		—		0	%		—		—		—		0	%		—		—		—		0	%		—		—		—		0	%
	$	2,638,862	$	450,673	$	3,089,535		100	%	$	2,517,260	$	290,181	$	2,807,441		100	%	$	5,372,094	$	829,606	$	6,201,700		100	%	$	4,617,609	$	624,640	$	5,242,249		100	%

The Company’s revenue consists primarily of calibration and reference standards manufactured for use in the nuclear medicine industry, distribution of radiochemicals including sodium iodide ~~I-131~~I-131 drug product, and cobalt source manufacturing. With the exception of certain unique products, the Company’s normal operating cycle is considered to be one year. Due to the time required to produce some cobalt products, the Company’s operating cycle for those products is considered to be two to three years. Accordingly, preliminary payments received on cobalt contracts, where shipment will not take place for greater than one year, have been recorded as unearned revenue on the Company’s condensed consolidated balance sheets and classified under current or long-term liabilities, depending upon estimated ship dates. For the ~~three~~six months ended ~~March 31,~~June 30, 2023, the Company reported current unearned revenue of $~~911,657~~.$835,854. For the period ended December 31, 2022, the Company reported current unearned revenue of $~~879,365~~. $879,365. These unearned revenues will be recognized as revenue in the periods during which the cobalt shipments take place.

Contract Balances

The Company records a receivable when it has an unconditional right to receive consideration after the performance obligations are satisfied. As of ~~March 31,~~June 30, 2023, and December 31, 2022, accounts receivable totaled $~~1,555,786~~$1,289,936 and $~~1,596,886~~,$1,596,886, respectively. For the ~~three~~six months ended ~~March 31,~~June 30, 2023, the Company did not incur material impairment losses with respect to its receivables.

~~(10)~~ (10) Leases

The Company leases office and warehouse space under operating leases. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments under the lease. Operating lease, right-of-use assets, and liabilities are recognized at the lease commencement date based on the present value of lease payments over the reasonably certain lease term. The implicit rates with the Company’s operating leases are generally not determinable and the Company uses its incremental borrowing rate at the lease commencement date to determine the present value of its lease payments. The determination of the Company’s incremental borrowing rate requires judgement. The company determines its incremental borrowing rate for each lease using its then-current borrowing rate. Certain of the Company’s leases include options to extend or terminate the lease. The Company establishes the number of renewal options periods used in determining the operating lease term based upon its assessment at the inception of the operating lease. The option to renew the lease may be automatic, at the option of the Company, or mutually agreed to between the landlord and the Company. Once the facility lease term has begun, the present value of the aggregate future minimum lease payments is recorded as a right-of-use asset. Lease expense is recognized on a straight-line basis over the term of the lease.

Table of Contents

Three Months Ended March 31,
2023 2022
Operating lease costs $ 75,366 $ 69,828
Short-term operating lease costs 2,040 3,382
Financing lease expense:
Amortization of right-of-use assets 2,249 2,062
Interest on lease liabilities 161 349
Total financing lease expense 2,410 2,411
Total lease expense $ 79,816 $ 75,621

Right-of-use assets obtained in exchange for new operating lease liabilities $ — $ —
Right-of-use assets obtained in exchange for new financing lease liabilities $ — $ —

Weighted-average remaining lease term (years) - operating leases 11.8 12.8
Weighted-average remaining lease term (years) - financing leases 1.0 2.0
Weighted-average discount rate - operating leases 6.75 % 6.75 %
Weighted-average discount rate - financing leases 7.68 % 8.54 %

	*Six Months Ended June 30,*
	*2023*			*2022*
Operating lease costs	$	150,732		$	141,605
Short-term operating lease costs		3,600			2,713
Financing lease expense:
Amortization of right-of-use assets		4,550			4,172
Interest on lease liabilities		270			649
Total financing lease expense		4,820			4,821
Total lease expense	$	159,152		$	149,139

Right-of-use assets obtained in exchange for new operating lease liabilities	$	—		$	—
Right-of-use assets obtained in exchange for new financing lease liabilities	$	—		$	—

Weighted-average remaining lease term (years) - operating leases		11.6			12.6
Weighted-average remaining lease term (years) - financing leases		1.4			1.8
Weighted-average discount rate - operating leases		6.75	%		6.75	%
Weighted-average discount rate - financing leases		6.75	%		8.41	%

The future minimum payments under these operating lease agreements are as follows:

~~Leases - Schedule~~

	*Operating Leases*			*Financing Leases*
2023 (excluding the six-months ended June 30, 2023)	$	143,554		$	1,598
2024		287,108			2,929
2025		287,108			—
2026		287,108			—
2027		287,108			—
Thereafter		2,025,192			—
Total minimum lease obligations		3,317,178			4,527
Less-amounts representing interest		(1,018,042	)		(222	)
Present value of minimum lease obligations		2,299,136			4,305
Current maturities		(136,075	)		(2,996	)
Lease obligations, net of current maturities	$	2,163,061		$	1,309

Table of ~~Future Minimum Payments of Lease Liabilities~~

Operating Leases Financing Leases
2023 (excluding the three-months ended March 31, 2023) $ 215,331 $ 4,008
2024 287,108 2,929
2025 287,108 —
2026 287,108 —
2027 287,108 —
Thereafter 2,025,193 —
Total minimum lease obligations 3,388,956 6,937
Less-amounts representing interest (1,057,208 ) (854 )
Present value of minimum lease obligations 2,331,748 6,083
Current maturities (133,804 ) (4,006 )
Lease obligations, net of current maturities $ 2,197,944 $ 2,077

Contents

~~(11)~~ (11) Segment Information

The Company has four reportable segments which include: Nuclear Medicine Standards, Cobalt Products, Radiochemical Products, and Fluorine Products.

Information regarding the operations and assets of these reportable business segments is contained in the following table:

~~Segment Information - Schedule~~

	*Three months ended June 30,*				*Six months ended June 30,*
Sale of Product	*2023*		*2022*		*2023*		*2022*
Radiochemical Products	$	1,736,043	$	1,380,039	$	3,498,439	$	3,005,962
Cobalt Products		448,258		99,146		606,566		271,052
Nuclear Medicine Standards		927,864		955,623		2,096,695		1,965,235
Fluorine Products		—		—		—		—
Total Segments		3,112,165		2,434,808		6,201,700		5,242,249
Corporate revenue		—		—		—		—
Total Consolidated	$	3,112,165	$	2,434,808	$	6,201,700	$	5,242,249

	*Three months ended June 30,*				*Six months ended June 30,*
Depreciation and Amortization	*2023*		*2022*		*2023*		*2022*
Radiochemical Products	$	6,665	$	7,415	$	13,824	$	49,345
Cobalt Products		13,142		12,140		25,976		24,281
Nuclear Medicine Standards		28,900		28,587		58,109		57,233
Fluorine Products		28,970		26,095		57,940		52,190
Total Segments		77,677		74,237		155,849		183,049
Corporate depreciation and amortization		10,453		10,196		19,549		20,502
Total Consolidated	$	88,130	$	84,433	$	175,398	$	203,551

	*Three months ended June 30,*						*Six months ended June 30,*
Segment Income (Loss)	*2023*			*2022*			*2023*			*2022*
Radiochemical Products	$	717,455		$	505,630		$	1,484,567		$	2,976,293
Cobalt Products		53,640			(42,332	)		27,395			(55,407	)
Nuclear Medicine Standards		9,728			(26,144	)		138,513			11,572
Fluorine Products		(21,895	)		(42,343	)		(51,134	)		(74,173	)
Total Segments		758,928			394,811			1,599,341			2,858,285
Corporate loss		(1,022,230	)		(666,859	)		(2,010,697	)		(1,875,288	)
Net Income	$	(263,302	)	$	(272,048	)	$	(411,356	)	$	982,997

	*Three months ended June 30,*				*Six months ended June 30,*
Expenditures for Segment Assets	*2023*		*2022*		*2023*		*2022*
Radiochemical Products	$	—	$	—	$	—	$	—
Cobalt Products		6,165		—		6,165		—
Nuclear Medicine Standards		—		—		3,130		51,100
Fluorine Products		—		4,100		—		4,100
Total Segments		6,165		4,100		9,295		55,200
Corporate purchases		8,155		—		57,227		—
Total Consolidated	$	14,320	$	4,100	$	66,522	$	55,200

	*June 30,*		*December 31,*
Segment Assets	*2023*		*2022*
Radiochemical Products	$	837,771	$	1,075,252
Cobalt Products		324,755		406,629
Nuclear Medicine Standards		2,661,330		2,744,394
Fluorine Products		5,032,308		5,147,325
Total Segments		8,856,164		9,373,600
Corporate assets		6,981,112		6,870,996
Total Consolidated	$	15,837,276	$	16,244,596

Table of ~~Segment Reporting Information by Segment~~

~~Operating Segments~~

~~Corporate Allocation~~

Three months ended March 31,
Sale of Product 2023 2022
Radiochemical Products $ 1,762,396 $ 1,625,923
Cobalt Products 158,308 171,906
Nuclear Medicine Standards 1,168,831 1,009,612
Fluorine Products — —
Total Segments 3,089,535 2,807,441
Corporate revenue — —
Total Consolidated $ 3,089,535 $ 2,807,441

Three months ended March 31,
Depreciation and Amortization 2023 2022
Radiochemical Products $ 7,159 $ 41,930
Cobalt Products 12,834 12,141
Nuclear Medicine Standards 29,209 28,646
Fluorine Products 28,970 26,095
Total Segments 78,172 108,812
Corporate depreciation and amortization 9,096 10,306
Total Consolidated $ 87,268 $ 119,118

Three months ended March 31,
Segment Income (Loss) 2023 2022
Radiochemical Products $ 767,112 $ 2,470,663
Cobalt Products (26,245 ) (13,075 )
Nuclear Medicine Standards 128,785 37,716
Fluorine Products (29,239 ) (31,830 )
Total Segments 840,413 2,463,474
Corporate loss (988,467 ) (1,208,429 )
Net Income $ (148,054 ) $ 1,255,045

Three months ended March 31,
Expenditures for Segment Assets 2023 2022
Radiochemical Products $ —   $ —
Cobalt Products —   —
Nuclear Medicine Standards 3,130 51,100
Fluorine Products —   —
Total Segments 3,130 51,100
Corporate purchases 49,072 —
Total Consolidated $ 52,202 $ 51,100

March 31, December 31,
Segment Assets 2023 2022
Radiochemical Products $ 836,861 $ 1,075,252
Cobalt Products 429,829 406,629
Nuclear Medicine Standards 1,369,939 2,744,394
Fluorine Products 5,118,357 5,147,325
Total Segments 7,754,986 9,373,600
Corporate assets 8,515,236 6,870,996
Total Consolidated $ 16,270,222 $ 16,244,596

Contents

~~(12)~~ (12) Subsequent Events

~~The~~On July 12, 2023, Steve T. Laflin gave notice that he is stepping down as Chief Executive Officer of the Company, ~~has evaluated subsequent events from~~effective September 1, 2023 at the ~~balance sheet date through~~end of the ~~date~~term of his employment agreement. In addition, on July 12, 2023, Shahe Bagderjian, President of the ~~financial statements were issued and determined that there were no material items~~Company, was appointed to ~~disclose.~~replace Mr. Laflin as Chief Executive Officer, effective September 1, 2023.

Table of Contents

ITEM 2. ~~MANAGEMENT’S~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q (the ~~“Quarterly Report”~~“Quarterly Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, including statements regarding industry prospects and future results of operations or financial position, made in this Quarterly Report are forward-looking statements. Words such as ~~“anticipates,~~“anticipates,” ~~“believes,~~“believes,” ~~“should,~~“should,” ~~“expects,~~“expects,” ~~“future,~~“future,” ~~“intends”~~“intends” and similar expressions identify forward-looking statements. Forward-looking statements reflect ~~management’s~~management’s current expectations, plans or projections, and are inherently uncertain. Actual results could differ materially from management's expectations, plans or projections. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report. Certain risks and uncertainties that could cause our actual results to differ significantly from ~~management’s~~management’s expectations are described in the risk factors set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Securities and Exchange Commission (SEC) on April 6, 2023, as amended on May 3, 2023, and in the other reports we file with the SEC. These factors describe some but not all of the factors that could cause actual results to differ significantly from ~~management’s~~management’s expectations. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers are urged, however, to review the risks and other factors set forth in the reports that we file from time to time with the SEC.

BUSINESS OVERVIEW

International Isotopes Inc., its wholly-owned subsidiaries (including RadQual, LLC and TI Services, LLC) (collectively, the ~~Company, we, our,~~"Company", "we", "our", or ~~us)~~"us") manufacture a full range of nuclear medicine calibration and reference standards, manufacture a range of cobalt products, and distribute sodium iodide I-131 as a generic drug. We own 100% interest of RadQual, LLC (RadQual), a global supplier of molecular imaging quality control and calibration devices. As TI Services, LLC is a 50/50 joint venture between the Company and RadQual, TI Services, LLC is also a wholly-owned subsidiary of the Company.

Our business consists of four business segments:

Nuclear Medicine Standards. Our Nuclear Medicine Standards segment consists of the manufacture of sources and standards associated with Single Photon Emission Computed Tomography (SPECT) and Positron Emission Tomography (PET) imaging. These sources are used for indication of patient positioning for SPECT imaging, SPECT camera operational testing, and calibration of dose measurement equipment. Revenue from nuclear medicine products includes consolidated sales from TI Services, LLC (TI Services), a 50/50 joint venture that we formed with RadQual in December 2010 to distribute our products, as well as consolidated sales from RadQual. Our nuclear medicine standards products include a host of specially designed items used in the nuclear medicine industry. In addition to the manufacture of these products, we have developed a complete line of specialty packaging for the safe transport and handling of these products.

Cobalt Products. Our Cobalt Products segment includes the production of bulk cobalt (cobalt-60), fabrication of cobalt capsules for radiation therapy and various industrial applications, and recycling of expended cobalt sources. We are the only company in the U.S. that can provide all these unique services. There has been a significant increase in regulation by the Nuclear Regulatory Commission (NRC) in recent years that has created a significant barrier to new entrants into this market. The Company has a contract in place with the U.S. Department of Energy (DOE) for the production of high specific activity cobalt in the Advanced Test Reactor (ATR) in Idaho. This agreement will be in effect until October 2024.

Radiochemical Products. Our Radiochemical Products segment includes production and distribution and FDA approved generic sodium iodide I-131 drug product for the treatment of hyperthyroidism and carcinoma of the thyroid. We are the only U.S. Company distributing this generic drug product. This segment also includes distribution of certain other radiochemical products and contract manufacturing of radiopharmaceutical products for our customers.

Table of Contents

Fluorine Products. We established the Fluorine Products segment in 2004 to support production and sale of the gases that we expected to produce using our Fluorine Extraction Process (FEP) in conjunction with the operation of the proposed depleted uranium de-conversion facility in Lea County, New Mexico. Near the end of 2013, due to changes in the nuclear industry, we placed further engineering work on this project on hold. We continue to hold discussions with potential future customers seeking this type of service, however, further development activity within this segment will be deferred until market and industry conditions change to justify resuming design and construction of the facility. In the meantime, the Company expects to continue to incur some costs associated with the maintenance of licenses and other necessary project investments, and to continue to keep certain agreements in place that will support resumption of project activities at the appropriate time.

RESULTS OF OPERATIONS

Three Months Ended ~~March 31,~~June 30, 2023,Compared to Three Months Ended ~~March 31,~~June 30, 2022

Revenue for the three months ended ~~March 31,~~June 30, 2023 was ~~$3,089,535~~$3,112,165 as compared to ~~$2,807,441~~$2,434,808 for the same period in 2022, an overall increase of ~~$282,094,~~$677,357, or approximately ~~10%~~28%. This increase in revenue was the result of increased revenue in our radiochemical and ~~nuclear medicine standards~~cobalt products segments offset by decreased revenues in our ~~cobalt products~~nuclear medicine standards segment, as discussed in more detail below.

The following table presents a period-to-period comparison of total revenue by segment for the three months ended ~~March 31,~~June 30, 2023 and 2022:

											For the three-		For the three-
											months ended		months ended
	For the three- months ended March 31,		For the three- months ended March 31,								June 30,		June 30,
Sale of Product	2023		2022		$ change			% change			2023		2022		$ change			% change
Radiochemical Products	$	1,762,396	$	1,625,923	$	136,473			8	%	$	1,736,043	$	1,380,039	$	356,004			26	%
Cobalt Products		158,308		171,906		(13,598	)		-8	%		448,258		99,146		349,112			352	%
Nuclear Medicine Standards		1,168,831		1,009,612		159,219			16	%		927,864		955,623		(27,759	)		-3	%
Fluorine Products		—		—		—			0	%		—		—		—			—	%
Total Consolidated	$	3,089,535	$	2,807,441	$	282,094			10	%	$	3,112,165	$	2,434,808	$	677,357			28	%

Cost of sales increased to ~~$1,309,499~~$1,269,552 for the three months ended ~~March 31,~~June 30, 2023 from ~~$1,130,698~~$1,034,278 for the same period in 2022. This is an increase of ~~$178,801,~~$235,274, or approximately ~~16%~~23%. The increase in cost of sales in the three-month comparison was primarily due to the increased sales activity in our radiochemical and ~~nuclear medicine standards~~cobalt products segments, as discussed in detail below. Gross profit for the three months ended ~~March 31,~~June 30, 2023 was ~~$1,780,036,~~$1,842,613, compared to ~~$1,676,743~~$1,400,530 for the same period in 2022. This represents an increase in gross profit of ~~$103,293,~~$442,083, or approximately 6%32%.

The following table presents cost of sales and gross profit data for each of our business segments for the three months ended ~~March 31,~~June 30, 2023 and 2022:

													For the three-						For the three-
													months ended			% of			months ended			% of
	For the three- months ended March 31,			% of Total Sales			For the three- months ended March 31,			% of Total Sales			June 30,			Total Sales			June 30,			Total Sales
	2023			2023			2022			2022			2023			2023			2022			2022
Total Sales	$	3,089,535					$	2,807,441					$	3,112,165					$	2,434,808
Cost of Sales
Radiochemical Products	$	630,338			20	%	$	562,365			20	%	$	597,063			19	%	$	506,522			21	%
Cobalt Products		90,961			3	%		56,511			2	%		246,398			8	%		26,014			1	%
Nuclear Medicine Standards		588,200			19	%		511,822			18	%		426,091			14	%		501,742			21	%
Fluorine Products		—			—			—			—			—			—	%		—			—	%
Total Segments		1,309,499			42	%		1,130,698			40	%		1,269,552			41	%		1,034,278			42	%

Gross Profit	$	1,780,036					$	1,676,743					$	1,842,613					$	1,400,530
Gross Profit %		58	%					60	%					59	%					58	%

Table of Contents

Operating expense ~~decreased~~increased approximately 6%18% to ~~$1,927,608~~$2,071,073 for the three months ended ~~March 31,~~June 30, 2023, from ~~$2,052,786~~$1,752,639 for the same period in 2022. This ~~decrease~~increase of ~~$125,178~~$318,434 is ~~primarily~~ due to an ~~approximate~~18% increase in Salaries and Contract Labor Expenses, 9% ~~decrease~~increase in General, Administrative, and Consulting Expenses and a ~~40% decrease~~109% increase in Research and Development costs. The ~~decrease~~increase in Salaries and Contract Labor Expenses is primarily due to increased costs of salaries and benefits for employees. The increase in General, Administrative, and Consulting Expenses is primarily the result of ~~decreased depreciation expenses and~~increased legal and professional expenses during the three months ended ~~March 31,~~June 30, 2023, as compared to the same period in 2022. The ~~40% decrease~~109% increase in Research and Development cost is due to ~~decreased~~increased expenses related to product development during the three months ended ~~March 31,~~June 30, 2023, as compared to the same period in 2022.

The following table presents a comparison of total operating expense for the three months ended ~~March 31,~~June 30, 2023 and 2022:

For the three-
months ended
March 31,

For the three-
months ended
March 31,

Operating Costs and Expenses: 2023 2022 % change $ change
Salaries and Contract Labor $ 975,183 $ 933,249 4% % $ 41,934
General, Administrative and Consulting 827,983 913,123 -9% % (85,140 )
Research and Development 124,442 206,414 -40% % (81,972 )
Total operating expenses $ 1,927,608 $ 2,052,786 -6% % $ (125,178 )

	For the three-		For the three-
	months ended		months ended
	June 30,		June 30,
Operating Costs and Expenses:	2023		2022		% change			$ change
Salaries and Contract Labor	$	944,179	$	801,972		18	%	$	142,207
General, Administrative and Consulting		943,870		863,025		9	%		80,845
Research and Development		183,024		87,642		109	%		95,382
Total operating expenses	$	2,071,073	$	1,752,639		18	%	$	318,434

Other income was ~~$63,412~~$37,518 for the three months ended ~~March 31,~~June 30, 2023, as compared to ~~$1,802,800~~$225,768 for the same period in 2022. This is a decrease of ~~$1,739,388,~~$188,250, or approximately ~~96%~~83%, primarily due to $200,000 in income from a ~~$1,797,978 gain on sale~~sublease of ~~assets to Pharmalogic Idaho, LLC~~our facility in the three months ended ~~March 31,~~June 30, 2022. ~~In February 2022,~~As part of this sublease agreement, we ~~entered into an asset purchase agreement with Pharmalogic Idaho, LLC, pursuant to which we sold certain assets for $4.0 million in cash.~~ ~~The sold assets consisted primarily of manufacturing equipment~~received $200,000 once relocation and ~~a sublease acquired by the Company in connection with the previously announced termination of the manufacturing and supply agreement with another company.~~build-out costs were completed.

Interest expense for the three months ended ~~March 31,~~June 30, 2023 was ~~$82,980,~~$82,216, compared to ~~$171,757~~$146,387 for the same period in 2022. This is a decrease of ~~$88,777,~~$64,171, or approximately ~~52%~~44%. The decrease in interest expense is due to decreased accretion of beneficial conversion feature and discount and decreased interest due for outstanding debt. Interest expense includes dividends accrued on our Series C Preferred Stock. As discussed below, we issued Series C Preferred Stock in February 2017 and May 2017. For the three months ended ~~March 31,~~June 30, 2023 and 2022, we accrued dividends payable of $61,695 and $60,945 respectively, which have been recorded as interest expense. See Note 7 “Debt” to our unaudited consolidated financial statements in this Quarterly Report for additional information about our indebtedness and the associated interest expense.

Our net loss for the three months ended ~~March 31,~~June 30, 2023, was ~~$148,054,~~$263,302, compared to net ~~income~~loss of ~~$1,255,045,~~$272,048, for the same period in 2022. This is a decrease in net ~~income~~loss of ~~$1,403,099~~$8,746 that is largely the ~~result of the approximate $1.8 million gain on sale of assets for the three months ended March 31, 2022. This decrease in gain on sale of assets is partially offset by the increase in income as a~~ result of the increase in revenue in our radiochemical products and ~~nuclear medicine standards~~cobalt products segments partially offset ~~and~~by the decrease in operating expenses for the three months ended ~~March 31,~~June 30, 2023, as compared to the same period in 2022.

Radiochemical Products. Revenue from the sale of radiochemical products for the three months ended ~~March 31,~~June 30, 2023 was ~~$1,762,396,~~$1,736,043, compared to ~~$1,625,923~~$1,380,039 for the same period in 2022. This is an increase of ~~$136,473,~~$356,004, or approximately 8%26% during the three months ended ~~March 31,~~June 30, 2023. The increase is the result of continued increased sales of our generic sodium iodide I-131 drug product. We expect continued sales growth for our Radiochemical products going forward, primarily from the sale of our generic sodium iodide I-131 drug product.

Gross profit of radiochemical products for the three months ended ~~March 31,~~June 30, 2023 was ~~$1,132,058,~~$1,138,980, compared to ~~$1,063,558,~~$873,517, for the same period in 2022, and gross profit percentages were approximately ~~64%~~66% and ~~65%~~63% for the three months ended ~~March 31,~~June 30, 2023 and 2022, respectively. Cost of sales for radiochemical products increased to ~~$630,338~~$597,063 for the three months ended ~~March 31,~~June 30, 2023, as compared to ~~$562,365~~$506,522 for the same period in 2022. This is an increase of ~~$67,973,~~$90,541, or approximately ~~12%~~18%, and was primarily the result of increased sales of product. Operating expense for this segment ~~decreased~~increased to ~~$364,946~~$421,525 for the three months ended ~~March 31,~~June 30, 2023, compared to ~~$390,873~~$367,887 for the same period in 2022. This ~~decrease~~increase in operating expense of ~~$25,927,~~$53,638, or approximately 7%15%, was primarily due to ~~decreased~~increased costs for ~~advertising expense~~research and ~~professional services. As discussed above, other income from the radiochemical products segment in the three months ended March 31, 2022 included a $1,797,978 gain on sale of~~ ~~manufacturing equipment and a sublease acquired by the Company in connection with the previously announced termination of the manufacturing and supply agreement with another company.~~ development for this segment. This segment reported net income of ~~$767,112~~$717,455 for the three months ended ~~March 31,~~June 30, 2023, as compared to net income of ~~$2,470,663~~$505,630 for the same

period in 2022. The ~~decrease~~increase in net income of ~~$1,703,551~~$211,825 is the result of ~~the difference in the gain on sale of assets but somewhat offset by the~~ increases in revenue and ~~decreases in operating expenses.~~gross profit.

Table of Contents

Cobalt Products. Revenue from the sale of cobalt products for the three months ended ~~March 31,~~June 30, 2023 was ~~$158,308,~~$448,258, compared to ~~$171,906,~~$99,146, for the same period in 2022. This represents ~~a decrease~~an increase of ~~$13,598,~~$349,112, or approximately 8%352%. The ~~decrease~~increase was primarily due to the timing of cobalt sealed source manufacturing sales. Large value sales of high activity cobalt sources occur at various times throughout the year. Frequently the timing of these sales can have a significant impact on period comparisons.

Cost of sales for the three months ended ~~March 31,~~June 30, 2023, was ~~$90,961,~~$246,398, as compared to ~~$56,511,~~$26,014, for the same period in 2022. Gross profit for cobalt products for the three months ended ~~March 31,~~June 30, 2023 was ~~$67,347~~$201,860 compared to ~~$115,395~~$73,132 for the same period in 2022. This is ~~a decrease~~an increase of ~~$48,048,~~$128,728, or approximately ~~42%~~176% and is attributable to ~~decreased~~increased source manufacturing for the three months ended ~~March 31,~~June 30, 2023. Operating expense in this segment ~~decreased~~increased to ~~$93,591~~$148,220 for the three months ended ~~March 31,~~June 30, 2023, from ~~$128,470~~$115,464 for the same period in 2022. This is ~~a decrease~~an increase of ~~$34,879,~~$32,756, or approximately ~~27%~~28%. This ~~decrease~~increase in operating expenses for the three months ended ~~March 31,~~June 30, 2023 is due to ~~decreased~~increased equipment and labor expenses. Our net ~~loss~~income for cobalt products was ~~$26,245~~$53,640 for the three months ended ~~March 31,~~June 30, 2023, as compared to a net loss of ~~$13,075~~$42,332 for the same period in 2022. The increase in net ~~loss~~income of ~~$13,170,~~$95,972, or approximately ~~100%~~227%, was attributable to the ~~decreased~~increased activity in cobalt sealed source manufacturing. ~~We expect increased sales activity in this segment during the remainder of 2023.~~

Nuclear Medicine Standards. Revenue from nuclear medicine products for the three months ended ~~March 31,~~June 30, 2023, was ~~$1,168,831,~~$927,864, compared to ~~$1,009,612~~$955,623 for the same period in 2022. This represents ~~an increase~~a decrease in revenue of ~~$159,219,~~$27,759, or approximately ~~16%~~3%.

Cost of sales for our nuclear medicine standards segment for the three months ended ~~March 31,~~June 30, 2023, was ~~$588,200,~~$426,091, as compared to ~~$511,822~~$501,742 for the same period in 2022. The ~~increase~~decrease in cost of sales in the period-to-period comparison of ~~$76,378,~~$75,651, or 15%, was due to ~~increased~~decreased sales and improved gross profit during the three-month period ended ~~March 31,~~June 30, 2023, as compared to the same period in 2022. Gross profit for our nuclear medicine standards segment for the three months ended ~~March 31,~~June 30, 2023 was ~~$580,631~~$501,773 compared to ~~$497,790~~$453,881 for the same period in 2022, and gross profit percentages were approximately ~~50%~~54% and ~~49%~~47% for the three months ended ~~March 31,~~June 30, 2023 and 2022, respectively. This is an increase in gross profit of ~~$82,841,~~$47,892, or approximately ~~16%~~11%.

Operating expense for this segment for the three months ended ~~March 31,~~June 30, 2023 ~~decreased~~increased to ~~$451,846,~~$492,045, from ~~$460,074~~$480,025 for the same period in 2022. This is ~~a decrease~~an increase of ~~8,228,~~$12,020, or approximately 2%3%, and is the result of ~~a decrease in waste disposal fees.~~increased labor costs. Net income for this segment for the three months ended ~~March 31,~~June 30, 2023 was ~~$128,785,~~$9,728, compared to ~~$37,716~~a net loss of $26,144 for the same period in 2022. This is an increase in net income of ~~$91,069,~~$35,872, or approximately ~~241%~~137% and is the ~~direct~~ result of increased ~~revenue.~~gross profit.

Fluorine Products. For the three months ended ~~March 31,~~June 30, 2023 and ~~March 31,~~June 30, 2022, we had no revenue for our fluorine products segment.

During the three months ended ~~March 31,~~June 30, 2023, we incurred ~~$29,239~~$21,895 of expense related to items in support of future planning and design for the proposed de-conversion facility, as compared to ~~$31,830~~$42,343 for the same three-month period in 2022. The decrease in expenses is due to decreased professional costs during the three months ended June 30, 2023

We established the Fluorine Products segment in 2004 to support production and sale of the gases produced using our FEP. The project has been placed on hold since 2013 and we will continue to limit our expenditures to essential items such as maintenance of the NRC license, land use agreements, communication with our prospective FEP product customers, and interface with the State of New Mexico and Lea County officials until such time that we decide to resume the project.

Six Months Ended June 30, 2023, Compared to Six Months Ended June 30, 2022

Revenue for the six months ended June 30, 2023 was $6,201,700 as compared to $5,242,249 for the same period in 2022, an overall increase of $959,451, or approximately 18%. This increase in revenue was the result of increased revenue in all business segments as discussed in more detail below.

The following table presents a period-to-period comparison of total revenue by segment for the six months ended June 30, 2023 and 2022:

	For the six-		For the six-
	months ended		months ended
	June 30,		June 30,
Sale of Product	2023		2022		$ change		% change
Radiochemical Products	$	3,498,439	$	3,005,962	$	492,477		16	%
Cobalt Products		606,566		271,052		335,514		124	%
Nuclear Medicine Standards		2,096,695		1,965,235		131,460		7	%
Fluorine Products		—		—		—		100	%
Total Consolidated	$	6,201,700	$	5,242,249	$	959,451		18	%

Cost of sales increased to $2,579,051 for the six months ended June 30, 2023 from $2,164,976 for the same period in 2022. This is an increase of $414,075, or approximately 19%. The increase in cost of sales in the six-month comparison was primarily due to the increased sales activity in all our business segments, as discussed in detail below. Gross profit for the six months ended June 30, 2023 was $3,622,649, compared to $3,077,273 for the same period in 2022. This represents an increase in gross profit of $545,376, or approximately 18%.

Table of Contents

The following table presents cost of sales and gross profit data for each of our business segments for the six months ended June 30, 2023 and 2022:

	For the six-						For the six-
	months ended			% of			months ended			% of
	June 30,			Total Sales			June 30,			Total Sales
	2023			2023			2022			2022
Total Sales	$	6,201,700					$	5,242,249
Cost of Sales
Radiochemical Products	$	1,227,401			20	%	$	1,068,887			20	%
Cobalt Products		337,359			5	%		82,525			2	%
Nuclear Medicine Standards		1,014,291			16	%		1,013,564			19	%
Fluorine Products		—			—	%		—			—	%
Total Segments		2,579,051			42	%		2,164,976			41	%

Gross Profit	$	3,622,649					$	3,077,273
Gross Profit %		58	%					59	%

Operating expense increased approximately 5% to $3,998,681 for the six months ended June 30, 2023, from $3,805,425 for the same period in 2022. This increase of $193,256 is primarily due to an approximate 11% increase in Salaries and Contract Labor Expenses and a 5% increase in Research and Development costs. The increase in Salaries and Contract Labor Expenses is primarily the result of increased costs of salaries and benefits for employees during the six months ended June 30, 2023, as compared to the same period in 2022. The 5% increase in Research and Development cost is due to increased expenses related to product development during the six months ended June 30, 2023, as compared to the same period in 2022.

The following table presents a comparison of total operating expense for the six months ended June 30, 2023 and 2022:

	For the six-		For the six-
	months ended		months ended
	June 30,		June 30,
Operating Costs and Expenses:	2023		2022		% change			$ change
Salaries and Contract Labor	$	1,919,361	$	1,735,221		11	%	$	184,140
General, Administrative and Consulting		1,771,852		1,776,148		0	%		(4,296	)
Research and Development		307,468		294,056		5	%		13,412
Total operating expenses	$	3,998,681	$	3,805,425		5	%	$	193,256

Other income was $100,930 for the six months ended June 30, 2023, as compared to $2,028,568 for the same period in 2022. This is a decrease of $1,927,638, or approximately 95%, primarily due to a $1,797,978 gain on sale of assets to Pharmalogic Idaho, LLC in the six months ended June 30, 2022. In February 2022, we entered into an asset purchase agreement with Pharmalogic Idaho, LLC, pursuant to which we sold certain assets for $4.0 million in cash. The sold assets consisted primarily of manufacturing equipment and a sublease acquired by the Company in connection with the previously announced termination of the manufacturing and supply agreement with another company.

Interest expense for the six months ended June 30, 2023 was $165,196, compared to $318,144 for the same period in 2022. This is a decrease of $152,948, or approximately 48%. The decrease in interest expense is due to decreased accretion of beneficial conversion feature and discount and decreased interest due for outstanding debt. Interest expense includes dividends accrued on our Series C Preferred Stock. As discussed below, we issued Series C Preferred Stock in February 2017 and May 2017. For the six months ended June 30, 2023 and 2022, we accrued dividends payable of $122,640 and $121,890 respectively, which have been recorded as interest expense. See Note 7 “Debt” to our unaudited consolidated financial statements in this Quarterly Report for additional information about our indebtedness and the associated interest expense.

Our net loss for the six months ended June 30, 2023, was $411,356, compared to net income of $982,997, for the same period in 2022. This is a decrease in net income of $1,394,353 that is largely the result of the approximate $1.8 million gain on sale of assets for the six months ended June 30, 2022. This decrease in gain on sale of assets is partially offset by the increase in income as a result of the increase in revenue in all our businesses segments for the six months ended June 30, 2023, as compared to the same period in 2022.

Table of Contents

Radiochemical Products. Revenue from the sale of radiochemical products for the six months ended June 30, 2023 was $3,498,439, compared to $3,005,962 for the same period in 2022. This is an increase of $492,477, or approximately 16% during the six months ended June 30, 2023. The increase is the result of continued increased sales of our generic sodium iodide I-131 drug product. We expect continued sales growth for our Radiochemical products going forward, primarily from the sale of our generic sodium iodide I-131 drug product.

Gross profit of radiochemical products for the six months ended June 30, 2023 was $2,271,038, compared to $1,937,075, for the same period in 2022, and gross profit percentages were approximately 65% and 64% for the six months ended June 30, 2023 and 2022, respectively. Cost of sales for radiochemical products increased to $1,227,401 for the six months ended June 30, 2023, as compared to $1,068,887 for the same period in 2022. This is an increase of $158,514, or approximately 15%, and was primarily the result of increased sales of product. Operating expense for this segment increased to $786,471 for the six months ended June 30, 2023, compared to $758,760 for the same period in 2022. This increase in operating expense of $27,711, or approximately 4%, was primarily due to increased costs for research and development costs within the segment. As discussed above, other income from the radiochemical products segment in the six months ended June 30, 2022 included a $1,797,978 gain on sale of manufacturing equipment and a sublease acquired by the Company in connection with the previously announced termination of the manufacturing and supply agreement with another company. This segment reported net income of $1,484,567 for the six months ended June 30, 2023, as compared to net income of $2,976,293 for the same period in 2022. The decrease in net income of $1,491,726 is the result of the difference in the gain on sale of assets but somewhat offset by the increases in revenue and gross profit.

Cobalt Products. Revenue from the sale of cobalt products for the six months ended June 30, 2023 was $606,566, compared to $271,052, for the same period in 2022. This represents an increase of $335,514, or approximately 124%. The increase was primarily due to the timing of cobalt sealed source manufacturing sales. Large value sales of high activity cobalt sources occur at various times throughout the year. Frequently the timing of these sales can have a significant impact on period comparisons.

Cost of sales for the six months ended June 30, 2023, was $337,359, as compared to $82,525, for the same period in 2022. Gross profit for cobalt products for the six months ended June 30, 2023 was $269,207 compared to $188,527 for the same period in 2022. This is an increase of $80,680, or approximately 43% and is attributable to increased source manufacturing for the six months ended June 30, 2023. Operating expense in this segment decreased to $241,812 for the six months ended June 30, 2023, from $243,934 for the same period in 2022. This is a decrease of $2,122, or approximately 1%. This decrease in operating expenses for the six months ended June 30, 2023 is due to decreased expenses for supplies. Our net income for cobalt products was $27,395 for the six months ended June 30, 2023, as compared to a net loss of $55,407 for the same period in 2022. The increase in net income of $82,802, or approximately 149%, was attributable to the increased activity in cobalt sealed source manufacturing.

Nuclear Medicine Standards. Revenue from nuclear medicine products for the six months ended June 30, 2023, was $2,096,695, compared to $1,965,235 for the same period in 2022. This represents an increase in revenue of $131,460, or approximately 7%.

Cost of sales for our nuclear medicine standards segment for the six months ended June 30, 2023, was $1,014,291, as compared to $1,013,564 for the same period in 2022. The increase in cost of sales in the period-to-period comparison of $727 was less than 1%. Gross profit for our nuclear medicine standards segment for the six months ended June 30, 2023 was $1,082,404 compared to $951,671 for the same period in 2022, and gross profit percentages were approximately 52% and 48% for the six months ended June 30, 2023 and 2022, respectively. This is an increase in gross profit of $130,733, or approximately 14%.

Operating expense for this segment for the six months ended June 30, 2023 increased to $943,891, from $940,099 for the same period in 2022. This is an increase of $3,792, or less than 1%. Net income for this segment for the six months ended June 30, 2023 was $138,513, compared to $11,572 for the same period in 2022. This is an increase in net income of $126,941, or approximately 1,097% and is the direct result of increased gross profit in the six months ended June 30, 2023.

Fluorine Products. For the six months ended June 30, 2023 and 2022, we had no revenue for our fluorine products segment.

During the six months ended June 30, 2023, we incurred $51,134 of expense related to items in support of future planning and design for the proposed de-conversion facility, as compared to $74,173 for the same six-month period in 2022. The decrease in expenses is due to decreased professional costs during the six months ended June 30, 2023.

LIQUIDITY AND CAPITAL RESOURCES

At ~~March 31,~~June 30, 2023, we had cash and cash equivalents of ~~$3,281,161~~$3,274,125 as compared to $2,375,817 at December 31, 2022. This is an increase of ~~$905,344~~$898,308 or approximately 38%. For the ~~three~~six months ended ~~March 31,~~June 30, 2023, net cash provided by operating activities was ~~$981,311~~$1,000,448 and for the ~~three~~six months ended ~~March 31,~~June 30, 2022, net cash used in operating activities was ~~$857,877.~~$951,052. The increase in cash provided by operating activities was a result of cash from operations and the receipt of other current assets. The increase in cash and cash equivalents at period end in the period-to-period comparison is the result of cash provided by operating activities.

Table of Contents

Inventories at ~~March 31,~~June 30, 2023 totaled ~~$614,498,~~$701,411, and inventories at December 31, 2022 totaled $744,793. Our inventory consists of work in process material for our Radiochemical Products, Cobalt Products, and Nuclear Medicine Products segments.

Cash used in investing activities was ~~$52,202~~$66,522 for the ~~three~~six months ended ~~March 31,~~June 30, 2023, and cash provided by investing activities was ~~$3,948,900~~$3,944,800 for the same period in 2022. The cash used in the ~~three~~six months ended ~~March 31,~~June 30, 2023 was for the purchase of equipment. The cash provided by investing activities in the ~~three~~six months ended ~~March 31,~~June 30, 2022 was for the sale of assets for ~~$4,000,000.~~$4,000,000 somewhat offset by purchases of equipment.

Financing activities used cash of ~~$15,363,~~$17,399, during the ~~three~~six months ended ~~March 31,~~June 30, 2023, and cash used by financing activities for the same period in 2022 was ~~$429,224.~~$442,456. During the ~~three~~six months ended ~~March 31,~~June 30, 2023, cash paid for interest was ~~$113,855~~$157,826 and during the same ~~three-month~~six-month period in 2022, cash paid for interest was ~~$44,818.~~$46,894. Additionally, during the ~~three~~six months ended ~~March 31,~~June 30, 2023, we received ~~$2,622~~$4,880 in proceeds from the sale of our common stock through our Employee Stock Purchase Plan, as compared to ~~$5,829~~$9,805 in proceeds from the sale of our common stock through our Employee Stock Purchase Plan and $61,168 for exercise of warrants for the same period in 2022. During the ~~three~~six months ended ~~March 31,~~June 30, 2023, principal payments on notes payable ~~was $15,723,~~were $18,239, as compared to ~~$494,159~~$509,257 for the same period in 2022, primarily as a result of debt repayments in the ~~three~~six months ended ~~March 31,~~June 30, 2022.

In February 2023, the Company paid its sixth annual dividend on the Series C Preferred Stock. Dividends payable totaled $243,780 at ~~March 31, 2023.~~that time. Some holders of the Series C Preferred Stock elected to settle their dividend payments with shares of the Company’s common stock in lieu of cash. The Company issued 2,266,500 shares of common stock in lieu of a dividend payment of $90,660. The remaining $153,120 of dividend payable was settled with cash.

Total increase in cash for the ~~three-month~~six-month period ended ~~March 31,~~June 30, 2023, was ~~$913,746~~$916,527 compared to a cash increase of ~~$2,661,799~~$2,551,292 for the same period in 2022.

We expect that cash from operations, cash raised via equity financing, and our current cash balance will be sufficient to fund operations for the next twelve months. Our future liquidity and capital funding requirements will depend on numerous factors, including commercial relationships, technological developments, market factors, available credit, and preferred stock shareholders. There is no assurance that additional capital and financing will be available on acceptable terms to the Company or at all.

~~At March 31, 2023, there were no outstanding warrants to purchase our common stock.~~

Debt

In December 2013, we entered into a promissory note agreement with our then Chairman of the Board and one of our major shareholders, pursuant to which we borrowed $500,000 (the 2013 Promissory Note). The 2013 Promissory Note is secured and bears interest at 6% per annum and was originally due June 30, 2014. According to the terms of the 2013 Promissory Note, at any time, the lenders may settle any or all of the principal and accrued interest with shares of our common stock. In June 2014, pursuant to a modification, the maturity date was extended to December 31, 2017. In February 2017, the 2013 Promissory Note was further modified to extend the maturity date to December 31, 2020, with all remaining terms unchanged. In December 2019, the 2013 Promissory Note was further modified to extend the maturity date to December 31, 2021, with all remaining terms unchanged. In January 2022, the 2013 Promissory Note was modified to extend the maturity date to December 31, 2023, with all remaining terms unchanged. At ~~March 31,~~June 30, 2023, accrued interest payable on the 2013 Promissory Note totaled ~~279,234.~~$286,734.

In April 2018, we borrowed $120,000 from our Chief Executive Officer and Chairman of the Board pursuant to a promissory note (the 2018 Promissory Note). The 2018 Promissory Note accrues interest at 6% per annum, which is payable upon maturity of the 2018 Promissory Note. The 2018 Promissory Note was originally unsecured and originally matured on August 1, 2018. At any time, the holder of the 2018 Promissory Note may elect to have any or all of the principal and accrued interest settled with shares of our common stock based on the average price of the shares over the previous 20 trading days. Pursuant to an amendment to the 2018 Promissory Note in June 2018, the maturity date was extended to March 31, 2019 with all other provisions remaining unchanged. Pursuant to a second amendment to the 2018 Promissory Note in February 2019, the maturity date was extended to July 31, 2019 with all other provisions remaining unchanged. Pursuant to a third amendment to the 2018 Promissory Note in July 2019, the maturity date was extended to January 31, 2020 with all other provisions remaining unchanged. Pursuant to a fourth amendment to the 2018 Promissory Note in December 2019, the maturity date was extended to December 31, 2021, the note was modified to become secured by company assets, with all other provisions remaining unchanged. In December 2021, the 2018 Promissory Note was modified to extend the maturity date to December 31, 2023,

with all remaining terms unchanged. At ~~March 31,~~June 30, 2023, accrued interest on the 2018 Promissory Note totaled ~~$35,570.~~$37,370.

Table of Contents

In December 2019 and February 2020, we borrowed an aggregate of $1,000,000 from our Chief Executive Officer, Chairman of the Board, former Chairman of the Board, and one of our major shareholders pursuant to a promissory note (the 2019 Promissory Note). The 2019 Promissory Note bears an interest rate of 4% annually and was originally due December 31, 2022. According to the terms of the 2019 Promissory Note, at any time, the lenders may settle any or all of the principal and accrued interest with shares of the Company’s common stock based on the average closing price of the Company’s common stock for the 20 days preceding the payment. In December 2022, the 2019 Promissory Note was modified to extend the maturity date to December 31, 2024, with all remaining terms unchanged. At ~~March 31,~~June 30, 2023, accrued interest on the 2019 Promissory Note totaled ~~$129,131.~~

In April 2021, we borrowed $250,000 from its Chief Executive Officer and Chairman of the Board pursuant to a promissory note (the 2021 Promissory Note). The 2021 Promissory Note accrued interest at 6% per annum, which was payable upon maturity of the 2021 Promissory Note. The 2021 Promissory Note was originally secured and was to mature on December 31, 2022. At any time, the holders of the 2021 Promissory Note were able to elect to have any or all of the principal and accrued interest settled with shares of our common stock at a conversion price of $0.11 per share. On March 31, 2022, the Company paid in full the 2021 Promissory Note. The payment included $250,000 in principal payments and $14,500 in interest paid.$139,131.

CRITICAL ACCOUNTING POLICIES

From time-to-time, management reviews and evaluates certain accounting policies that are considered to be significant in determining our results of operations and financial position.

A description of the Company’s critical accounting policies that affect the preparation of the Company’s financial statements is set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on April 6, 2023, as amended on May 3, 2023.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act), that are designed to ensure that material information relating to us is made known to the officers who certify our financial reports and to other members of senior management and the Board of Directors. These disclosure controls and procedures are designed to ensure that information required to be disclosed in our reports that are filed or submitted under the Exchange Act are recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness, as of ~~March 31,~~June 30, 2023, of our disclosure controls and procedures. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of ~~March 31,~~June 30, 2023.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended ~~March 31,~~June 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

PART II– –OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

A discussion of legal matters is found in Note 8, “Commitments and Contingencies”, in the accompanying notes to the unaudited condensed consolidated financial statements included in Part I - Item 1. Financial Statements of this Quarterly Report.

ITEM 1A. RISK FACTORS

There have been no material changes or updates to the risk factors previously disclosed in Item 1A. “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2022.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

Table of Contents

ITEM 6. EXHIBITS

Exhibit No.

Description

3.1

~~3.1~~

Restated Certificate of Formation, as amended (incorporated by reference to Exhibit 3.1 of the Company’s Quarterly Report on Form 10-Q for quarter ended June 30, 2010).

3.2	Statement of Designation of the Series C Convertible Redeemable Preferred Stock of International Isotopes Inc. (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on February 24, 2017).

3.3	Certificate of Amendment to Statement of Designation of the Series C Convertible Redeemable Preferred Stock International Isotopes Inc., dated February 16, 2022 (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on February 22, 2022).

3.4	Certificate of Amendment to Statement of Designation of the Series C Convertible Redeemable Preferred Stock International Isotopes Inc., dated December 28, 2022 (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed December 28, 2022).

3.5	Bylaws (incorporated by reference to Exhibit 3.2 of the Company's Registration Statement on Form SB-2 filed on May 1, 1997 (Registration No. 333-26269)).

10.1 †	~~Modification #3 to the Amended and Restated~~Executive Employment Agreement, dated ~~February 22, 2023,~~December 23, 2022, between the Company and ~~Stephen Laflin~~Shahe Bagerdjian (as amended) ~~(incorporated~~(incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed ~~February 28,~~May 10, 2023).

31.1*	Certification by the Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*

Certification by the Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**

Certification by the Chief Executive Officer furnished pursuant to 18 U.S.C. Section 1350 adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**

Certification by the Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350 adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*

Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH*

Inline XBRL Taxonomy Extension Schema Document

101.CAL*

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*

Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE*

Inline XBRL Taxonomy Extension Presentation Linkbase Document

104	Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101).

~~_______________~~

* Filed herewith.

** Furnished herewith.

† Constitutes a management contract or compensatory plan or arrangement.

Table of Contents

25 SIGNATURES

~~SIGNATURES~~

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: ~~May 15,~~August 11, 2023	International Isotopes Inc.


	By:	/s/ Steve T. Laflin
		Steve T. Laflin
		Chief Executive Officer


	By:	/s/ W. Matthew Cox
		W. Matthew Cox
		Chief Financial Officer

	Operating Leases			Financing Leases
2023 (excluding the three-months ended March 31, 2023)	$	215,331		$	4,008
2024		287,108			2,929
2025		287,108			—
2026		287,108			—
2027		287,108			—
Thereafter		2,025,193			—
Total minimum lease obligations		3,388,956			6,937
Less-amounts representing interest		(1,057,208	)		(854	)
Present value of minimum lease obligations		2,331,748			6,083
Current maturities		(133,804	)		(4,006	)
Lease obligations, net of current maturities	$	2,197,944		$	2,077