FONAR Launches New Branding as the World's Only Upright(TM) Multi-Position(TM) MRI; Will Capitalize on New Department of Defense Contract.

MELVILLE, N.Y. -- FONAR Corporation (NASDAQ: FONR), The Inventor of MR Scanning(TM), announced today the rebranding of the FONAR Upright(TM) MRI as the FONAR Upright(TM) Multi-Position(TM) MRI. Based on user feedback, the tremendous value of FONAR's unique product, while it scans patients in the usual recumbent position, is its added ability to scan patients and snap the picture of the patient in their position of pain, whether they experience pain standing, sitting, or bending. This breakthrough Multi-Position(TM) versatility transcends the limitations of the conventional single-position-recumbent MRI's in accuracy of diagnosis by its ability to see the full extent of the patient's pathology which single-position conventional MRIs cannot. As a result, it will lead to fewer failed back surgeries and, by helping surgeons get the surgery right the first time, it is expected to significantly lower insurance costs. These multiple advantages make it a more attractive purchase than a single-position MRI.

FONAR management commenced the rebranding campaign at this time to capitalize on the growth opportunities available to it resulting from the recently announced Department of Defense (DoD) contract.

FONAR's rebranding effort focuses on its product's Multi-Position(TM) uniqueness in a market that is otherwise crowded with single-position scanners.

Beyond Upright(TM) imaging - as the former branding had implied - FONAR's Upright(TM) Multi-Position(TM) MRI performs scans with patients in the standard recumbent (lying flat) position plus numerous other weight-bearing positions, such as in flexion, extension, rotation and lateral bending. Similarly, the device can scan cardiovascular patients and those suffering from cerebrovascular insufficiency in the upright positions most likely to engender symptoms. It diagnoses, for example, the important Chiari malformation of the brain wherein patients suffer from sudden blackouts and/or paralyses because the brain falls when the patients are upright and becomes temporarily entrapped in the opening at the base of the skull (foramen magnum). It is an important syndrome. Only the FONAR Upright(TM) Multi-Position(TM) MRI is able to see the entrapment of the upright brain within the foramen magnum. It also likewise readily diagnoses and evaluates, by its power to do upright weight-bearing flexion and extension, the cervical whiplash injury, a common consequence of automobile accidents.

The FONAR Upright(TM) Multi-Position(TM) MRI is the first and only whole-body MRI that performs imaging in a full array of weight-bearing positions, as well as in the recumbent position, so it offers purchasers multiple alternatives to the single-position scanner.

The new branding is being launched to help point out these advantages and spur preference for the Upright(TM) Multi-Position(TM) MRI in contrast to the single-position MRI.

"As a neurosurgeon I have had patients scanned on MRI machines from nearly every manufacturer. None of these scanners give me more value for the money than what I get from the FONAR Upright(TM) Multi-Position(TM) MRI," said Michael H. Brisman, M.D., F.A.C.S., and a Board Certified Neurosurgeon. "The FONAR Upright(TM) Multi-Position(TM) MRI is far more suggestive of an appropriate name for a scanner that has revolutionized the industry and which goes way beyond single-position imaging machines." In 2005, Dr. Brisman was appointed Chief of the Division of Neurosurgery and Co-Director of the Neuroscience Institute at Winthrop University Hospital in Mineola, New York. He is also a co-owner of a FONAR Upright(TM) Multi-Position(TM) MRI at Great Neck Standup MRI, Great Neck, New York. For more information go to: www.neurosurgeryli.com/drbrisman.html

In addition to traditional diagnostic necessities, FONAR's Upright(TM) Multi-Position(TM) MRI addresses a serious need for proper medical evaluation of the approximately 900,000 patients each year in the U.S. who undergo back surgery. The failure rate of this surgery is such that the medical profession has been forced to set aside a specific acronym, FBSS (Failed Back Surgery Syndrome), to identify the high failure rate associated with back surgery. For example there is no acronym for failed brain surgery or failed heart surgery.

Back surgery, spinal injuries and weight dependent orthopedic injuries (knee, foot, hip) are of particular importance to DoD. From the U.S. Army's foot soldiers carrying heavy back packs to the U.S. Air Force's pilots crouched in cockpits to those injured in battle only FONAR's Upright(TM) Multi-Position(TM) MRI addresses the many needs of active and retired military personnel. These include making available to military surgeons the ability to visualize the patient's fully weight-loaded spine in multiple-positions as compared to the single-position of conventional MRI's so that the high failure rate of back surgery can be minimized for military personnel.

In addition, making available the ability to see the pathologies of other weight-bearing orthopedic structures from a multitude of weight-bearing positions is important to DoD. No other single-position MRI product on the market can provide the multi-position weight-bearing MRI images that military surgeons need to optimize their outcomes for military patients.

As announced last week, FONAR's Upright(TM) Multi-Position(TM) MRI is available for the first time under Federal contract to DoD. The contract from the Defense Supply Center Philadelphia (DSCP), part of the Defense Logistics Agency (DLA) of the U.S. Department of Defense (DoD) is for purchase of the FONAR Upright(TM) Multi-Position(TM) MRI by all U.S. military hospitals, clinics and other Federal agencies around the world, including the Department of Veterans Affairs (VA). The DLA supplies the U.S. Army, U.S. Navy, U.S. Air Force, U.S. Marine Corps, VA Hospitals and other Federal Agencies and Clinics.

"It is timely that we are renaming our flagship product at the moment in time that we are opening a new market to FONAR through the Department of Defense contract," said Raymond Damadian, president and founder of FONAR. "The key ingredient to our success in capitalizing on this new opportunity is effective execution by our sales force."

FONAR's sales department, energized by their recent successes in the U.S. hospital market, recognizes that the same features and benefits of multi-position MR imaging that are capturing sales in the domestic hospital market are applicable even more so to surgeons in DoD's military and VA hospitals.

FONAR Sales is therefore currently assembling its military hospital sales initiative, allocating resources, designating appropriate geographical representation and compiling its selling materials for military application in order to extend its recent selling success in the domestic hospital market to DoD's military hospitals.

In the U.S., FONAR employs 20 regional sales representatives. The team has already begun calling upon potential DoD customers. In addition, there are highly experienced sales support and management personnel stationed at the Company's corporate headquarters in Melville, New York that are assigned to the sales and implementation of the DoD contract.

DoD affiliates will be given special attention at all major industry and trade shows that FONAR routinely participates in together with exhibits dedicated to the military applications of FONAR MRI scanners.

Finally, the Company is exploring the use of distributors to work in concert with its sales and marketing teams. This is of particular importance for MRI scanner sales to U.S. military installations remote from FONAR sales personnel and foreign-based U.S. military hospitals. Where appropriate, FONAR intends to enter into strategic marketing relationships with distributors that provide extended reach to American military installations.

About FONAR

FONAR(R) was incorporated in 1978, making it the first, oldest and most experienced MRI manufacturer in the industry. FONAR introduced the world's first commercial MRI in 1980, and went public in 1981. Since its inception, FONAR has installed hundreds of MRI scanners worldwide. Their stellar product line includes the FONAR Upright(TM) Multi-Position(TM) MRI (also known as the Upright(TM) MRI and the Stand-Up(TM) MRI), the only whole-body MRI that performs Multi-Position(TM) Imaging (mpMRI(TM)) and scans patients in numerous weight-bearing positions, i.e. standing, sitting, in flexion and extension, as well as the conventional lie-down position. The FONAR Upright(TM) Multi-Position(TM) MRI often sees the patient's problem that other scanners cannot because they are single-position, lie-down only. With nearly one half million patients scanned, the patient-friendly FONAR Upright(TM) Multi-Position(TM) MRI has a near zero claustrophobic rejection rate by patients. A radiologist said, "FONAR Upright(TM) MRI - No More Claustrophobia - The Tunnel Is Gone." As another FONAR customer states, "If the patient is claustrophobic in this scanner, they'll be claustrophobic in my parking lot." Approximately 85% of patients are scanned sitting while they watch a 42" flat screen TV. FONAR's latest MRI scanner is the FONAR 360, a room-size recumbent scanner that optimizes openness while facilitating physician access to the patient. FONAR is headquartered on Long Island, New York, and has approximately 400 employees.

The Inventor of MR Scanning(TM), True Flow(TM) MRI, Stand-Up(TM) MRI, FONAR Upright(TM) MRI, Position(TM) MRI, Multi-Position(TM) MRI, mpMRI(TM) and The Proof is in the Picture(TM) are trademarks of FONAR(R) Corporation.

Be sure to visit FONAR's Web site for Company product and investor information: www.fonar.com

This release may include forward-looking statements from the company that may or may not materialize. Additional information on factors that could potentially affect the company's financial results may be found in the company filings with the Securities and Exchange Commission.