diff --git a/.gitignore b/.gitignore
new file mode 100644
index 0000000..552f221
--- /dev/null
+++ b/.gitignore
@@ -0,0 +1,2 @@
+node_modules/
+*.log
diff --git a/README.md b/README.md
index 58848aa..0b08c37 100644
--- a/README.md
+++ b/README.md
@@ -1,3 +1,187 @@
 # shre-embed
 
-Shared embedding + semantic search service for the estate (Qdrant + local Ollama)
\ No newline at end of file
+Shared embedding + semantic search service for the estate. Plain Node.js +
+Express, ESM, no build step. Embeds text via a local **Ollama** instance and
+stores/searches vectors in **Qdrant**.
+
+## Design principle: three-valued observability
+
+Every probe and every upstream-dependent answer in this service distinguishes
+**three** states, never two:
+
+| state | meaning |
+|---|---|
+| `ok` / present | the probe saw the thing and it works / exists |
+| `absent` | the probe **saw the surface** and the thing is genuinely missing (e.g. Ollama reachable but the embed model is not installed) |
+| `unobservable` | the probe **could not see**: dependency down, timeout, auth failure, endpoint missing, HTTP 5xx from the surface |
+
+`unobservable` is **never** collapsed into "absent", "zero results" or
+"healthy". Every result carries its `measurement_surface` (the exact URL that
+was measured) and `observed_at` (ISO timestamp). This exists to prevent a
+recorded estate incident class: healthchecks probing `/` and reporting healthy
+while `/api` was 502, and an MCP tool answering `0` for data that was never
+collectable.
+
+Concretely:
+
+- `/health` returns overall `"ok"` only when **all** dependencies are `ok`;
+  otherwise `"degraded"` with HTTP 503. It never reports plain healthy while a
+  dependency is unobservable.
+- `/v1/embed`, `/v1/index`, `/v1/search` return HTTP 502 with
+  `{"status":"unobservable", "measurement_surface": ..., "observed_at": ...}`
+  when an upstream call fails — a failed search is never presented as an empty
+  result set, and a failed index is never presented as `indexed: 0`.
+
+## Configuration (env, with defaults)
+
+| var | default | notes |
+|---|---|---|
+| `PORT` | `5499` | HTTP listen port (binds 127.0.0.1) |
+| `QDRANT_URL` | `http://127.0.0.1:6333` | Qdrant REST endpoint |
+| `OLLAMA_URL` | `http://127.0.0.1:11436` | **11436, not 11434.** On this Mac, `127.0.0.1:11434` is a known-broken Colima SSH-mux forward that accepts connections (tags respond) but hangs on generation/embedding. Native Ollama listens on `11436`. |
+| `EMBED_MODEL` | `nomic-embed-text` | Ollama embedding model |
+| `PROBE_TIMEOUT_MS` | `2500` | timeout for `/health` dependency probes |
+| `UPSTREAM_TIMEOUT_MS` | `30000` | timeout for embed/index/search upstream calls |
+
+## Run
+
+```sh
+npm install
+npm start          # listens on 127.0.0.1:5499
+npm test           # node:test unit tests; no Qdrant/Ollama required
+```
+
+## Endpoints
+
+### `GET /health`
+
+Three-valued, per-dependency health with exact probed surfaces.
+
+```json
+{
+  "status": "degraded",
+  "service": "shre-embed",
+  "observed_at": "2026-08-22T15:04:05.000Z",
+  "dependencies": {
+    "qdrant": {
+      "status": "ok",
+      "measurement_surface": "http://127.0.0.1:6333/readyz",
+      "observed_at": "2026-08-22T15:04:05.000Z",
+      "http_status": 200,
+      "latency_ms": 3
+    },
+    "ollama": {
+      "status": "unobservable",
+      "measurement_surface": "http://127.0.0.1:11436/api/tags",
+      "observed_at": "2026-08-22T15:04:05.000Z",
+      "reason": "fetch failed: ECONNREFUSED: fetch failed",
+      "latency_ms": 1
+    },
+    "embed_model": {
+      "status": "unobservable",
+      "measurement_surface": "http://127.0.0.1:11436/api/tags",
+      "observed_at": "2026-08-22T15:04:05.000Z",
+      "model": "nomic-embed-text",
+      "reason": "ollama unobservable, model presence not measurable"
+    }
+  }
+}
+```
+
+- HTTP 200 when overall `"ok"`, HTTP 503 when `"degraded"`.
+- `embed_model` demonstrates all three values: `ok` (installed), `absent`
+  (Ollama reachable but model not pulled — a true gap), `unobservable`
+  (Ollama itself could not be seen, so the model's presence is unknowable).
+
+### `POST /v1/embed`
+
+```json
+{ "texts": ["hello", "world"] }
+```
+
+→ `200 {"vectors": [[...],[...]], "model": "nomic-embed-text", "measurement_surface": "http://127.0.0.1:11436/api/embeddings", "observed_at": "..."}`
+
+Each text is embedded via `POST {OLLAMA_URL}/api/embeddings` with
+`{"model": EMBED_MODEL, "prompt": text}`.
+
+### `POST /v1/index`
+
+```json
+{
+  "collection": "notes",
+  "items": [
+    { "id": 1, "text": "alpha", "payload": { "src": "obsidian" } },
+    { "id": 2, "text": "beta" }
+  ]
+}
+```
+
+Embeds every `text`, auto-creates the Qdrant collection if missing (Cosine
+distance, vector size taken from the first embedding), and upserts points with
+`payload` (the original `text` is folded into the payload as `text`).
+
+→ `200 {"indexed": 2, "collection": "notes", "qdrant": {...}, "measurement_surface": ..., "observed_at": ...}`
+
+### `POST /v1/search`
+
+```json
+{ "collection": "notes", "query": "find alpha", "limit": 5 }
+```
+
+Embeds the query, then `POST {QDRANT_URL}/collections/{collection}/points/search`
+with `with_payload: true`. `limit` defaults to 10, capped at 100.
+
+→ `200 {"results": [{"id": "a", "score": 0.91, "payload": {...}}, ...], "collection": ..., "limit": ..., "measurement_surface": ..., "observed_at": ...}`
+
+### Error shape for all `/v1/*` endpoints
+
+- `400 {"error": "..."}` — invalid request body.
+- `502 {"error": "...", "status": "unobservable", "measurement_surface": "<exact upstream URL>", "observed_at": "...", "upstream_http_status": 500}` —
+  the upstream could not be observed; the truthful answer is "unknown", never
+  "empty" or "zero".
+
+## Example launchd plist (documentation only — do NOT install blindly)
+
+The estate convention is `ai.shre.<service>` labels. This is a reference
+template only; deployment goes through the normal ops-from-git flow, not by
+hand-installing this file.
+
+```xml
+<?xml version="1.0" encoding="UTF-8"?>
+<!DOCTYPE plist PUBLIC "-//Apple//DTD PLIST 1.0//EN"
+  "http://www.apple.com/DTDs/PropertyList-1.0.dtd">
+<plist version="1.0">
+<dict>
+  <key>Label</key><string>ai.shre.embed</string>
+  <key>ProgramArguments</key>
+  <array>
+    <string>/usr/local/bin/node</string>
+    <string>/opt/shre/shre-embed/src/server.js</string>
+  </array>
+  <key>WorkingDirectory</key><string>/opt/shre/shre-embed</string>
+  <key>EnvironmentVariables</key>
+  <dict>
+    <key>PORT</key><string>5499</string>
+    <key>QDRANT_URL</key><string>http://127.0.0.1:6333</string>
+    <!-- 11436 = native Ollama. NEVER 11434 (broken Colima forward on this Mac). -->
+    <key>OLLAMA_URL</key><string>http://127.0.0.1:11436</string>
+    <key>EMBED_MODEL</key><string>nomic-embed-text</string>
+  </dict>
+  <key>RunAtLoad</key><true/>
+  <key>KeepAlive</key><true/>
+  <key>StandardOutPath</key><string>/tmp/ai.shre.embed.out.log</string>
+  <key>StandardErrorPath</key><string>/tmp/ai.shre.embed.err.log</string>
+</dict>
+</plist>
+```
+
+## Layout
+
+```
+src/config.js     env config with estate-safe defaults
+src/probe.js      three-valued probe primitives (ok | absent | unobservable)
+src/upstreams.js  Ollama + Qdrant clients (injectable fetch)
+src/app.js        express app factory (createApp(config, {fetchImpl}))
+src/server.js     entrypoint
+test/app.test.js  node:test unit tests, run with zero live dependencies
+```
diff --git a/package-lock.json b/package-lock.json
new file mode 100644
index 0000000..2777d9d
--- /dev/null
+++ b/package-lock.json
@@ -0,0 +1,831 @@
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+      "license": "MIT",
+      "dependencies": {
+        "call-bound": "^1.0.2",
+        "es-errors": "^1.3.0",
+        "get-intrinsic": "^1.2.5",
+        "object-inspect": "^1.13.3"
+      },
+      "engines": {
+        "node": ">= 0.4"
+      },
+      "funding": {
+        "url": "https://github.com/sponsors/ljharb"
+      }
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+    "node_modules/side-channel-weakmap": {
+      "version": "1.0.2",
+      "resolved": "https://registry.npmjs.org/side-channel-weakmap/-/side-channel-weakmap-1.0.2.tgz",
+      "integrity": "sha512-WPS/HvHQTYnHisLo9McqBHOJk2FkHO/tlpvldyrnem4aeQp4hai3gythswg6p01oSoTl58rcpiFAjF2br2Ak2A==",
+      "license": "MIT",
+      "dependencies": {
+        "call-bound": "^1.0.2",
+        "es-errors": "^1.3.0",
+        "get-intrinsic": "^1.2.5",
+        "object-inspect": "^1.13.3",
+        "side-channel-map": "^1.0.1"
+      },
+      "engines": {
+        "node": ">= 0.4"
+      },
+      "funding": {
+        "url": "https://github.com/sponsors/ljharb"
+      }
+    },
+    "node_modules/statuses": {
+      "version": "2.0.2",
+      "resolved": "https://registry.npmjs.org/statuses/-/statuses-2.0.2.tgz",
+      "integrity": "sha512-DvEy55V3DB7uknRo+4iOGT5fP1slR8wQohVdknigZPMpMstaKJQWhwiYBACJE3Ul2pTnATihhBYnRhZQHGBiRw==",
+      "license": "MIT",
+      "engines": {
+        "node": ">= 0.8"
+      }
+    },
+    "node_modules/toidentifier": {
+      "version": "1.0.1",
+      "resolved": "https://registry.npmjs.org/toidentifier/-/toidentifier-1.0.1.tgz",
+      "integrity": "sha512-o5sSPKEkg/DIQNmH43V0/uerLrpzVedkUh8tGNvaeXpfpuwjKenlSox/2O/BTlZUtEe+JG7s5YhEz608PlAHRA==",
+      "license": "MIT",
+      "engines": {
+        "node": ">=0.6"
+      }
+    },
+    "node_modules/type-is": {
+      "version": "1.6.18",
+      "resolved": "https://registry.npmjs.org/type-is/-/type-is-1.6.18.tgz",
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+      "license": "MIT",
+      "dependencies": {
+        "media-typer": "0.3.0",
+        "mime-types": "~2.1.24"
+      },
+      "engines": {
+        "node": ">= 0.6"
+      }
+    },
+    "node_modules/unpipe": {
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+      "resolved": "https://registry.npmjs.org/unpipe/-/unpipe-1.0.0.tgz",
+      "integrity": "sha512-pjy2bYhSsufwWlKwPc+l3cN7+wuJlK6uz0YdJEOlQDbl6jo/YlPi4mb8agUkVC8BF7V8NuzeyPNqRksA3hztKQ==",
+      "license": "MIT",
+      "engines": {
+        "node": ">= 0.8"
+      }
+    },
+    "node_modules/utils-merge": {
+      "version": "1.0.1",
+      "resolved": "https://registry.npmjs.org/utils-merge/-/utils-merge-1.0.1.tgz",
+      "integrity": "sha512-pMZTvIkT1d+TFGvDOqodOclx0QWkkgi6Tdoa8gC8ffGAAqz9pzPTZWAybbsHHoED/ztMtkv/VoYTYyShUn81hA==",
+      "license": "MIT",
+      "engines": {
+        "node": ">= 0.4.0"
+      }
+    },
+    "node_modules/vary": {
+      "version": "1.1.2",
+      "resolved": "https://registry.npmjs.org/vary/-/vary-1.1.2.tgz",
+      "integrity": "sha512-BNGbWLfd0eUPabhkXUVm0j8uuvREyTh5ovRa/dyow/BqAbZJyC+5fU+IzQOzmAKzYqYRAISoRhdQr3eIZ/PXqg==",
+      "license": "MIT",
+      "engines": {
+        "node": ">= 0.8"
+      }
+    }
+  }
+}
diff --git a/package.json b/package.json
new file mode 100644
index 0000000..d317e12
--- /dev/null
+++ b/package.json
@@ -0,0 +1,17 @@
+{
+  "name": "shre-embed",
+  "version": "0.1.0",
+  "description": "Shared embedding + semantic search service for the estate (Qdrant + local Ollama)",
+  "type": "module",
+  "main": "src/server.js",
+  "scripts": {
+    "start": "node src/server.js",
+    "test": "node --test"
+  },
+  "engines": {
+    "node": ">=20"
+  },
+  "dependencies": {
+    "express": "^4.21.2"
+  }
+}
diff --git a/src/app.js b/src/app.js
new file mode 100644
index 0000000..74d2846
--- /dev/null
+++ b/src/app.js
@@ -0,0 +1,181 @@
+import express from "express";
+import { httpProbe, probeResult, OK, ABSENT, UNOBSERVABLE } from "./probe.js";
+import {
+  UpstreamError,
+  embedTexts,
+  ensureCollection,
+  upsertPoints,
+  searchPoints,
+} from "./upstreams.js";
+
+/**
+ * Build the express app. `fetchImpl` is injectable so unit tests run without
+ * Qdrant/Ollama up.
+ */
+export function createApp(config, { fetchImpl = fetch } = {}) {
+  const app = express();
+  app.use(express.json({ limit: "5mb" }));
+
+  const upstreamOpts = {
+    ollamaUrl: config.ollamaUrl,
+    qdrantUrl: config.qdrantUrl,
+    embedModel: config.embedModel,
+    fetchImpl,
+    timeoutMs: config.upstreamTimeoutMs,
+  };
+
+  // ---- health: three-valued, per-dependency, with exact surfaces ----------
+  app.get("/health", async (_req, res) => {
+    const qdrantSurface = `${config.qdrantUrl}/readyz`;
+    const ollamaSurface = `${config.ollamaUrl}/api/tags`;
+
+    let embedModelResult = null;
+    const [qdrant, ollama] = await Promise.all([
+      httpProbe(qdrantSurface, { fetchImpl, timeoutMs: config.probeTimeoutMs }),
+      httpProbe(ollamaSurface, {
+        fetchImpl,
+        timeoutMs: config.probeTimeoutMs,
+        classify: (_res, bodyText) => {
+          // While we can see the tag list, also classify the embed model:
+          // present -> ok, listed-but-missing -> absent (a true gap, distinct
+          // from "could not look").
+          try {
+            const models = JSON.parse(bodyText)?.models ?? [];
+            const found = models.some(
+              (m) => m?.name === config.embedModel || m?.name?.split(":")[0] === config.embedModel
+            );
+            embedModelResult = probeResult(found ? OK : ABSENT, ollamaSurface, {
+              model: config.embedModel,
+            });
+          } catch {
+            embedModelResult = probeResult(UNOBSERVABLE, ollamaSurface, {
+              model: config.embedModel,
+              reason: "tag list unparseable",
+            });
+          }
+          return null; // do not override the reachability verdict
+        },
+      }),
+    ]);
+    if (!embedModelResult) {
+      // Ollama itself was unobservable, so the model's presence is too —
+      // never report it as absent (or fine) when we could not look.
+      embedModelResult = probeResult(UNOBSERVABLE, ollamaSurface, {
+        model: config.embedModel,
+        reason: "ollama unobservable, model presence not measurable",
+      });
+    }
+
+    const deps = { qdrant, ollama, embed_model: embedModelResult };
+    const allOk = Object.values(deps).every((d) => d.status === OK);
+    // Overall is NEVER plain "ok" while any dependency is unobservable/absent.
+    const overall = allOk ? "ok" : "degraded";
+    res.status(allOk ? 200 : 503).json({
+      status: overall,
+      service: "shre-embed",
+      observed_at: new Date().toISOString(),
+      dependencies: deps,
+    });
+  });
+
+  // ---- helpers ------------------------------------------------------------
+  function upstreamErrorBody(err) {
+    return {
+      error: err.message,
+      // The caller must be able to tell "failed" from "answer is empty/zero":
+      status: UNOBSERVABLE,
+      measurement_surface: err.surface,
+      observed_at: new Date().toISOString(),
+      ...(err.httpStatus ? { upstream_http_status: err.httpStatus } : {}),
+    };
+  }
+
+  // ---- POST /v1/embed -----------------------------------------------------
+  app.post("/v1/embed", async (req, res) => {
+    const { texts } = req.body ?? {};
+    if (!Array.isArray(texts) || texts.length === 0 || !texts.every((t) => typeof t === "string")) {
+      return res.status(400).json({ error: "body must be {texts: string[]} with at least one text" });
+    }
+    try {
+      const vectors = await embedTexts(texts, upstreamOpts);
+      res.json({
+        vectors,
+        model: config.embedModel,
+        measurement_surface: `${config.ollamaUrl}/api/embeddings`,
+        observed_at: new Date().toISOString(),
+      });
+    } catch (err) {
+      if (err instanceof UpstreamError) return res.status(502).json(upstreamErrorBody(err));
+      throw err;
+    }
+  });
+
+  // ---- POST /v1/index -----------------------------------------------------
+  app.post("/v1/index", async (req, res) => {
+    const { collection, items } = req.body ?? {};
+    if (typeof collection !== "string" || !collection) {
+      return res.status(400).json({ error: "body must include a non-empty 'collection' string" });
+    }
+    if (
+      !Array.isArray(items) ||
+      items.length === 0 ||
+      !items.every((it) => it && it.id !== undefined && typeof it.text === "string")
+    ) {
+      return res.status(400).json({ error: "body must include items: [{id, text, payload?}] with at least one item" });
+    }
+    try {
+      const vectors = await embedTexts(items.map((it) => it.text), upstreamOpts);
+      await ensureCollection(collection, vectors[0].length, upstreamOpts);
+      const points = items.map((it, i) => ({
+        id: it.id,
+        vector: vectors[i],
+        payload: { ...(it.payload ?? {}), text: it.text },
+      }));
+      const result = await upsertPoints(collection, points, upstreamOpts);
+      res.json({
+        indexed: items.length,
+        collection,
+        qdrant: result?.result ?? result,
+        measurement_surface: `${config.qdrantUrl}/collections/${collection}/points`,
+        observed_at: new Date().toISOString(),
+      });
+    } catch (err) {
+      if (err instanceof UpstreamError) return res.status(502).json(upstreamErrorBody(err));
+      throw err;
+    }
+  });
+
+  // ---- POST /v1/search ----------------------------------------------------
+  app.post("/v1/search", async (req, res) => {
+    const { collection, query, limit } = req.body ?? {};
+    if (typeof collection !== "string" || !collection || typeof query !== "string" || !query) {
+      return res.status(400).json({ error: "body must include non-empty 'collection' and 'query' strings" });
+    }
+    const lim = Number.isInteger(limit) && limit > 0 ? Math.min(limit, 100) : 10;
+    try {
+      const [vector] = await embedTexts([query], upstreamOpts);
+      const result = await searchPoints(collection, vector, lim, upstreamOpts);
+      res.json({
+        results: result.map((r) => ({ id: r.id, score: r.score, payload: r.payload ?? null })),
+        collection,
+        limit: lim,
+        measurement_surface: `${config.qdrantUrl}/collections/${collection}/points/search`,
+        observed_at: new Date().toISOString(),
+      });
+    } catch (err) {
+      if (err instanceof UpstreamError) return res.status(502).json(upstreamErrorBody(err));
+      throw err;
+    }
+  });
+
+  // express error fallthrough (bad JSON etc.)
+  // eslint-disable-next-line no-unused-vars
+  app.use((err, _req, res, _next) => {
+    if (err?.type === "entity.parse.failed") {
+      return res.status(400).json({ error: "invalid JSON body" });
+    }
+    res.status(500).json({ error: "internal error" });
+  });
+
+  return app;
+}
diff --git a/src/config.js b/src/config.js
new file mode 100644
index 0000000..d84caca
--- /dev/null
+++ b/src/config.js
@@ -0,0 +1,16 @@
+// Config via environment with estate defaults.
+//
+// NOTE: default OLLAMA_URL is 127.0.0.1:11436 (native Ollama), NOT 11434.
+// On this Mac, 127.0.0.1:11434 is a known-broken Colima SSH-mux forward that
+// accepts connections (tags respond) but hangs on generation/embedding.
+export function loadConfig(env = process.env) {
+  return {
+    port: Number(env.PORT) > 0 ? Number(env.PORT) : 5499,
+    qdrantUrl: (env.QDRANT_URL || "http://127.0.0.1:6333").replace(/\/+$/, ""),
+    ollamaUrl: (env.OLLAMA_URL || "http://127.0.0.1:11436").replace(/\/+$/, ""),
+    embedModel: env.EMBED_MODEL || "nomic-embed-text",
+    // Per-request timeout for dependency probes and upstream calls (ms).
+    probeTimeoutMs: Number(env.PROBE_TIMEOUT_MS) > 0 ? Number(env.PROBE_TIMEOUT_MS) : 2500,
+    upstreamTimeoutMs: Number(env.UPSTREAM_TIMEOUT_MS) > 0 ? Number(env.UPSTREAM_TIMEOUT_MS) : 30000,
+  };
+}
diff --git a/src/probe.js b/src/probe.js
new file mode 100644
index 0000000..71bf2d9
--- /dev/null
+++ b/src/probe.js
@@ -0,0 +1,67 @@
+// Three-valued observability primitives.
+//
+// Every probe answer is one of THREE states, never two:
+//   "ok"           — the probe saw the thing and it is present/working
+//   "absent"       — the probe SAW the surface and the thing is genuinely missing
+//   "unobservable" — the probe COULD NOT SEE (dependency down, timeout, auth
+//                    failure, endpoint missing). Never collapsed into ok/absent.
+//
+// Every result carries measurement_surface (exactly what was measured) and
+// observed_at (ISO timestamp).
+
+export const OK = "ok";
+export const ABSENT = "absent";
+export const UNOBSERVABLE = "unobservable";
+
+export function probeResult(status, measurementSurface, extra = {}) {
+  return {
+    status,
+    measurement_surface: measurementSurface,
+    observed_at: new Date().toISOString(),
+    ...extra,
+  };
+}
+
+/**
+ * Perform an HTTP GET probe of `url`. Returns a three-valued probeResult:
+ *   - ok            when the response status passes `okWhen` (default: 2xx)
+ *   - unobservable  on network error, timeout, or non-passing HTTP status
+ *     (a 401/404/500 from the surface means we could not observe the truth,
+ *     not that the dependency is healthy or absent).
+ * `classify(response, bodyText)` may optionally downgrade an HTTP-ok response
+ * to ABSENT (e.g. endpoint reachable but required model not installed).
+ */
+export async function httpProbe(url, { fetchImpl = fetch, timeoutMs = 2500, classify } = {}) {
+  const started = Date.now();
+  let res;
+  try {
+    res = await fetchImpl(url, { signal: AbortSignal.timeout(timeoutMs) });
+  } catch (err) {
+    return probeResult(UNOBSERVABLE, url, {
+      reason: `fetch failed: ${err?.cause?.code || err?.name || "error"}: ${err?.message}`,
+      latency_ms: Date.now() - started,
+    });
+  }
+  const latency = Date.now() - started;
+  if (!res.ok) {
+    return probeResult(UNOBSERVABLE, url, {
+      reason: `HTTP ${res.status} from probe surface`,
+      http_status: res.status,
+      latency_ms: latency,
+    });
+  }
+  if (classify) {
+    let bodyText = "";
+    try {
+      bodyText = await res.text();
+    } catch {
+      return probeResult(UNOBSERVABLE, url, {
+        reason: "response body unreadable",
+        latency_ms: latency,
+      });
+    }
+    const classified = classify(res, bodyText);
+    if (classified) return probeResult(classified.status, url, { latency_ms: latency, ...classified.extra });
+  }
+  return probeResult(OK, url, { http_status: res.status, latency_ms: latency });
+}
diff --git a/src/server.js b/src/server.js
new file mode 100644
index 0000000..18f728f
--- /dev/null
+++ b/src/server.js
@@ -0,0 +1,13 @@
+import { loadConfig } from "./config.js";
+import { createApp } from "./app.js";
+
+const config = loadConfig();
+const app = createApp(config);
+
+app.listen(config.port, "127.0.0.1", () => {
+  // eslint-disable-next-line no-console
+  console.log(
+    `shre-embed listening on 127.0.0.1:${config.port} ` +
+      `(qdrant=${config.qdrantUrl} ollama=${config.ollamaUrl} model=${config.embedModel})`
+  );
+});
diff --git a/src/upstreams.js b/src/upstreams.js
new file mode 100644
index 0000000..68e5f13
--- /dev/null
+++ b/src/upstreams.js
@@ -0,0 +1,126 @@
+// Thin clients for Ollama (embeddings) and Qdrant (vector store).
+// All calls take an injected fetchImpl so tests run without either service up.
+//
+// Failures are surfaced as UpstreamError carrying the exact measurement
+// surface (URL) that failed — callers propagate this so an API consumer can
+// always tell "the answer is X" apart from "the answer was unobservable".
+
+export class UpstreamError extends Error {
+  constructor(message, { surface, cause, httpStatus } = {}) {
+    super(message);
+    this.name = "UpstreamError";
+    this.surface = surface;
+    this.httpStatus = httpStatus;
+    if (cause) this.cause = cause;
+  }
+}
+
+async function postJson(url, body, { fetchImpl, timeoutMs }) {
+  let res;
+  try {
+    res = await fetchImpl(url, {
+      method: "POST",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify(body),
+      signal: AbortSignal.timeout(timeoutMs),
+    });
+  } catch (err) {
+    throw new UpstreamError(`request failed: ${err?.message}`, { surface: url, cause: err });
+  }
+  let json;
+  try {
+    json = await res.json();
+  } catch {
+    json = undefined;
+  }
+  if (!res.ok) {
+    throw new UpstreamError(`HTTP ${res.status}: ${JSON.stringify(json)?.slice(0, 300)}`, {
+      surface: url,
+      httpStatus: res.status,
+    });
+  }
+  return json;
+}
+
+/** Embed each text via Ollama's embeddings API. Returns number[][]. */
+export async function embedTexts(texts, { ollamaUrl, embedModel, fetchImpl = fetch, timeoutMs = 30000 }) {
+  const url = `${ollamaUrl}/api/embeddings`;
+  const vectors = [];
+  for (const text of texts) {
+    const json = await postJson(url, { model: embedModel, prompt: text }, { fetchImpl, timeoutMs });
+    if (!Array.isArray(json?.embedding)) {
+      throw new UpstreamError("Ollama response missing 'embedding' array", { surface: url });
+    }
+    vectors.push(json.embedding);
+  }
+  return vectors;
+}
+
+/** Ensure a Qdrant collection exists with the given vector size (Cosine). */
+export async function ensureCollection(collection, vectorSize, { qdrantUrl, fetchImpl = fetch, timeoutMs = 30000 }) {
+  const checkUrl = `${qdrantUrl}/collections/${encodeURIComponent(collection)}`;
+  let res;
+  try {
+    res = await fetchImpl(checkUrl, { signal: AbortSignal.timeout(timeoutMs) });
+  } catch (err) {
+    throw new UpstreamError(`request failed: ${err?.message}`, { surface: checkUrl, cause: err });
+  }
+  if (res.ok) return { created: false };
+  if (res.status !== 404) {
+    throw new UpstreamError(`HTTP ${res.status} checking collection`, { surface: checkUrl, httpStatus: res.status });
+  }
+  let createRes;
+  try {
+    createRes = await fetchImpl(checkUrl, {
+      method: "PUT",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({ vectors: { size: vectorSize, distance: "Cosine" } }),
+      signal: AbortSignal.timeout(timeoutMs),
+    });
+  } catch (err) {
+    throw new UpstreamError(`request failed: ${err?.message}`, { surface: checkUrl, cause: err });
+  }
+  if (!createRes.ok) {
+    throw new UpstreamError(`HTTP ${createRes.status} creating collection`, { surface: checkUrl, httpStatus: createRes.status });
+  }
+  return { created: true };
+}
+
+/** Upsert points into a Qdrant collection. */
+export async function upsertPoints(collection, points, { qdrantUrl, fetchImpl = fetch, timeoutMs = 30000 }) {
+  const url = `${qdrantUrl}/collections/${encodeURIComponent(collection)}/points?wait=true`;
+  let res;
+  try {
+    res = await fetchImpl(url, {
+      method: "PUT",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({ points }),
+      signal: AbortSignal.timeout(timeoutMs),
+    });
+  } catch (err) {
+    throw new UpstreamError(`request failed: ${err?.message}`, { surface: url, cause: err });
+  }
+  let json;
+  try {
+    json = await res.json();
+  } catch {
+    json = undefined;
+  }
+  if (!res.ok) {
+    throw new UpstreamError(`HTTP ${res.status}: ${JSON.stringify(json)?.slice(0, 300)}`, {
+      surface: url,
+      httpStatus: res.status,
+    });
+  }
+  return json;
+}
+
+/** Vector search in a Qdrant collection. Returns scored points with payloads. */
+export async function searchPoints(collection, vector, limit, { qdrantUrl, fetchImpl = fetch, timeoutMs = 30000 }) {
+  const url = `${qdrantUrl}/collections/${encodeURIComponent(collection)}/points/search`;
+  const json = await postJson(url, { vector, limit, with_payload: true }, { fetchImpl, timeoutMs });
+  if (!Array.isArray(json?.result)) {
+    throw new UpstreamError("Qdrant response missing 'result' array", { surface: url });
+  }
+  return json.result;
+}
diff --git a/test/app.test.js b/test/app.test.js
new file mode 100644
index 0000000..333da93
--- /dev/null
+++ b/test/app.test.js
@@ -0,0 +1,313 @@
+import test from "node:test";
+import assert from "node:assert/strict";
+import { once } from "node:events";
+import { loadConfig } from "../src/config.js";
+import { createApp } from "../src/app.js";
+
+// ---------------------------------------------------------------------------
+// Helpers: run the app on an ephemeral loopback port with an injected fetch,
+// so no Qdrant/Ollama needs to be up.
+// ---------------------------------------------------------------------------
+
+const TEST_ENV = {
+  QDRANT_URL: "http://qdrant.test:6333",
+  OLLAMA_URL: "http://ollama.test:11436",
+  EMBED_MODEL: "nomic-embed-text",
+  PROBE_TIMEOUT_MS: "200",
+  UPSTREAM_TIMEOUT_MS: "500",
+};
+
+async function withServer(fetchImpl, fn) {
+  const config = loadConfig(TEST_ENV);
+  const app = createApp(config, { fetchImpl });
+  const server = app.listen(0, "127.0.0.1");
+  await once(server, "listening");
+  const base = `http://127.0.0.1:${server.address().port}`;
+  try {
+    return await fn(base, config);
+  } finally {
+    server.close();
+  }
+}
+
+function jsonResponse(body, status = 200) {
+  return new Response(JSON.stringify(body), {
+    status,
+    headers: { "content-type": "application/json" },
+  });
+}
+
+/** Fake fetch that dispatches on method+url via a routes table. */
+function fakeFetch(routes) {
+  const calls = [];
+  const impl = async (url, init = {}) => {
+    const method = init.method ?? "GET";
+    const key = `${method} ${url}`;
+    calls.push({ key, body: init.body ? JSON.parse(init.body) : undefined });
+    for (const [pattern, handler] of Object.entries(routes)) {
+      if (key === pattern || key.startsWith(pattern)) {
+        return handler({ url, init, body: init.body ? JSON.parse(init.body) : undefined });
+      }
+    }
+    throw new TypeError(`fetch failed: no route for ${key}`);
+  };
+  impl.calls = calls;
+  return impl;
+}
+
+const DIM = 4;
+const vecFor = (text) => [text.length, 1, 2, 3];
+
+function happyRoutes() {
+  return {
+    // health probes
+    "GET http://qdrant.test:6333/readyz": () => new Response("all shards ready", { status: 200 }),
+    "GET http://ollama.test:11436/api/tags": () =>
+      jsonResponse({ models: [{ name: "nomic-embed-text:latest" }, { name: "qwen3:30b-a3b" }] }),
+    // embeddings
+    "POST http://ollama.test:11436/api/embeddings": ({ body }) => jsonResponse({ embedding: vecFor(body.prompt) }),
+    // qdrant collection lifecycle
+    "GET http://qdrant.test:6333/collections/notes": () => jsonResponse({ result: {} }, 404),
+    "PUT http://qdrant.test:6333/collections/notes/points": () =>
+      jsonResponse({ result: { operation_id: 1, status: "completed" } }),
+    "PUT http://qdrant.test:6333/collections/notes": () => jsonResponse({ result: true }),
+    "POST http://qdrant.test:6333/collections/notes/points/search": () =>
+      jsonResponse({
+        result: [
+          { id: "a", score: 0.91, payload: { text: "alpha", src: "t" } },
+          { id: "b", score: 0.42, payload: { text: "beta" } },
+        ],
+      }),
+  };
+}
+
+// ---------------------------------------------------------------------------
+// config
+// ---------------------------------------------------------------------------
+
+test("config defaults: port 5499, qdrant 6333, ollama 11436 (NOT 11434), nomic-embed-text", () => {
+  const c = loadConfig({});
+  assert.equal(c.port, 5499);
+  assert.equal(c.qdrantUrl, "http://127.0.0.1:6333");
+  assert.equal(c.ollamaUrl, "http://127.0.0.1:11436");
+  assert.ok(!c.ollamaUrl.includes("11434"), "must never default to the broken 11434 forward");
+  assert.equal(c.embedModel, "nomic-embed-text");
+});
+
+// ---------------------------------------------------------------------------
+// /health — three-valued
+// ---------------------------------------------------------------------------
+
+test("/health reports ok with surfaces + observed_at when all deps respond", async () => {
+  await withServer(fakeFetch(happyRoutes()), async (base) => {
+    const res = await fetch(`${base}/health`);
+    assert.equal(res.status, 200);
+    const body = await res.json();
+    assert.equal(body.status, "ok");
+    assert.equal(body.dependencies.qdrant.status, "ok");
+    assert.equal(body.dependencies.qdrant.measurement_surface, "http://qdrant.test:6333/readyz");
+    assert.equal(body.dependencies.ollama.status, "ok");
+    assert.equal(body.dependencies.ollama.measurement_surface, "http://ollama.test:11436/api/tags");
+    assert.equal(body.dependencies.embed_model.status, "ok");
+    for (const dep of Object.values(body.dependencies)) {
+      assert.ok(Date.parse(dep.observed_at), "every dep carries observed_at");
+    }
+  });
+});
+
+test("/health reports unobservable (never healthy) when deps are down", async () => {
+  // fetch that always fails = both dependencies down
+  const deadFetch = async () => {
+    throw new TypeError("fetch failed: ECONNREFUSED");
+  };
+  await withServer(deadFetch, async (base) => {
+    const res = await fetch(`${base}/health`);
+    assert.equal(res.status, 503);
+    const body = await res.json();
+    assert.equal(body.status, "degraded");
+    assert.notEqual(body.status, "ok", "must never report plain healthy while a dep is unobservable");
+    assert.equal(body.dependencies.qdrant.status, "unobservable");
+    assert.match(body.dependencies.qdrant.reason, /fetch failed/);
+    assert.equal(body.dependencies.ollama.status, "unobservable");
+    // model presence is ALSO unobservable — not "absent" — when ollama is down
+    assert.equal(body.dependencies.embed_model.status, "unobservable");
+    assert.equal(body.dependencies.qdrant.measurement_surface, "http://qdrant.test:6333/readyz");
+  });
+});
+
+test("/health: dep returning HTTP 500 is unobservable, not ok and not absent", async () => {
+  const routes = happyRoutes();
+  routes["GET http://qdrant.test:6333/readyz"] = () => new Response("boom", { status: 500 });
+  await withServer(fakeFetch(routes), async (base) => {
+    const res = await fetch(`${base}/health`);
+    assert.equal(res.status, 503);
+    const body = await res.json();
+    assert.equal(body.status, "degraded");
+    assert.equal(body.dependencies.qdrant.status, "unobservable");
+    assert.equal(body.dependencies.qdrant.http_status, 500);
+    assert.equal(body.dependencies.ollama.status, "ok");
+  });
+});
+
+test("/health: embed model missing from a REACHABLE ollama is absent (a true gap)", async () => {
+  const routes = happyRoutes();
+  routes["GET http://ollama.test:11436/api/tags"] = () => jsonResponse({ models: [{ name: "qwen3:30b-a3b" }] });
+  await withServer(fakeFetch(routes), async (base) => {
+    const res = await fetch(`${base}/health`);
+    const body = await res.json();
+    assert.equal(body.dependencies.ollama.status, "ok", "ollama itself was observable");
+    assert.equal(body.dependencies.embed_model.status, "absent");
+    assert.equal(body.status, "degraded");
+    assert.equal(res.status, 503);
+  });
+});
+
+// ---------------------------------------------------------------------------
+// /v1/embed
+// ---------------------------------------------------------------------------
+
+test("POST /v1/embed returns one vector per text via ollama", async () => {
+  const f = fakeFetch(happyRoutes());
+  await withServer(f, async (base) => {
+    const res = await fetch(`${base}/v1/embed`, {
+      method: "POST",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({ texts: ["hello", "worlds!"] }),
+    });
+    assert.equal(res.status, 200);
+    const body = await res.json();
+    assert.equal(body.vectors.length, 2);
+    assert.deepEqual(body.vectors[0], vecFor("hello"));
+    assert.deepEqual(body.vectors[1], vecFor("worlds!"));
+    assert.equal(body.measurement_surface, "http://ollama.test:11436/api/embeddings");
+    assert.ok(Date.parse(body.observed_at));
+    const embedCalls = f.calls.filter((c) => c.key.includes("/api/embeddings"));
+    assert.equal(embedCalls.length, 2);
+    assert.equal(embedCalls[0].body.model, "nomic-embed-text");
+  });
+});
+
+test("POST /v1/embed with ollama down returns 502 marked unobservable with surface", async () => {
+  const deadFetch = async () => {
+    throw new TypeError("fetch failed: ECONNREFUSED");
+  };
+  await withServer(deadFetch, async (base) => {
+    const res = await fetch(`${base}/v1/embed`, {
+      method: "POST",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({ texts: ["hello"] }),
+    });
+    assert.equal(res.status, 502);
+    const body = await res.json();
+    assert.equal(body.status, "unobservable");
+    assert.equal(body.measurement_surface, "http://ollama.test:11436/api/embeddings");
+    assert.ok(Date.parse(body.observed_at));
+  });
+});
+
+test("POST /v1/embed validates body", async () => {
+  await withServer(fakeFetch(happyRoutes()), async (base) => {
+    for (const bad of [{}, { texts: [] }, { texts: "hello" }, { texts: [1, 2] }]) {
+      const res = await fetch(`${base}/v1/embed`, {
+        method: "POST",
+        headers: { "content-type": "application/json" },
+        body: JSON.stringify(bad),
+      });
+      assert.equal(res.status, 400);
+    }
+  });
+});
+
+// ---------------------------------------------------------------------------
+// /v1/index
+// ---------------------------------------------------------------------------
+
+test("POST /v1/index embeds, auto-creates missing collection, upserts points", async () => {
+  const f = fakeFetch(happyRoutes());
+  await withServer(f, async (base) => {
+    const res = await fetch(`${base}/v1/index`, {
+      method: "POST",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({
+        collection: "notes",
+        items: [
+          { id: 1, text: "alpha", payload: { src: "t" } },
+          { id: 2, text: "beta" },
+        ],
+      }),
+    });
+    assert.equal(res.status, 200);
+    const body = await res.json();
+    assert.equal(body.indexed, 2);
+    assert.equal(body.collection, "notes");
+    // collection was created with the right vector size
+    const create = f.calls.find((c) => c.key === "PUT http://qdrant.test:6333/collections/notes");
+    assert.ok(create, "collection create issued");
+    assert.equal(create.body.vectors.size, DIM);
+    // points carried vectors and payload (text folded in)
+    const upsert = f.calls.find((c) => c.key.startsWith("PUT http://qdrant.test:6333/collections/notes/points"));
+    assert.equal(upsert.body.points.length, 2);
+    assert.deepEqual(upsert.body.points[0].vector, vecFor("alpha"));
+    assert.deepEqual(upsert.body.points[0].payload, { src: "t", text: "alpha" });
+  });
+});
+
+test("POST /v1/index with qdrant down returns 502 unobservable (never silently indexed:0)", async () => {
+  const routes = happyRoutes();
+  const qdrantDead = ({ url }) => {
+    throw new TypeError("fetch failed: ECONNREFUSED " + url);
+  };
+  routes["GET http://qdrant.test:6333/collections/notes"] = qdrantDead;
+  await withServer(fakeFetch(routes), async (base) => {
+    const res = await fetch(`${base}/v1/index`, {
+      method: "POST",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({ collection: "notes", items: [{ id: 1, text: "alpha" }] }),
+    });
+    assert.equal(res.status, 502);
+    const body = await res.json();
+    assert.equal(body.status, "unobservable");
+    assert.equal(body.measurement_surface, "http://qdrant.test:6333/collections/notes");
+  });
+});
+
+// ---------------------------------------------------------------------------
+// /v1/search
+// ---------------------------------------------------------------------------
+
+test("POST /v1/search embeds the query and returns scored payloads", async () => {
+  const f = fakeFetch(happyRoutes());
+  await withServer(f, async (base) => {
+    const res = await fetch(`${base}/v1/search`, {
+      method: "POST",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({ collection: "notes", query: "find alpha", limit: 2 }),
+    });
+    assert.equal(res.status, 200);
+    const body = await res.json();
+    assert.equal(body.results.length, 2);
+    assert.deepEqual(body.results[0], { id: "a", score: 0.91, payload: { text: "alpha", src: "t" } });
+    const search = f.calls.find((c) => c.key.startsWith("POST http://qdrant.test:6333/collections/notes/points/search"));
+    assert.deepEqual(search.body.vector, vecFor("find alpha"));
+    assert.equal(search.body.limit, 2);
+    assert.equal(search.body.with_payload, true);
+  });
+});
+
+test("POST /v1/search with qdrant down returns 502 unobservable — never an empty result set", async () => {
+  const routes = happyRoutes();
+  routes["POST http://qdrant.test:6333/collections/notes/points/search"] = () => {
+    throw new TypeError("fetch failed: ECONNREFUSED");
+  };
+  await withServer(fakeFetch(routes), async (base) => {
+    const res = await fetch(`${base}/v1/search`, {
+      method: "POST",
+      headers: { "content-type": "application/json" },
+      body: JSON.stringify({ collection: "notes", query: "anything" }),
+    });
+    assert.equal(res.status, 502);
+    const body = await res.json();
+    assert.equal(body.status, "unobservable");
+    assert.ok(!("results" in body), "an unobservable search must not look like an empty result");
+  });
+});