NOTE 6 - LEASES

On December 10, 2021, we entered into a lease for approximately 500 square feet of office space at 146 Main Street in Worcester, Massachusetts, with the option to renew annually. The annual renewal date is January 1^st. Our current lease payment is $986 per month. The lease allows for a 2% increase effective at the beginning of each renewal period. The lease payment will be $1,006 per month during calendar year 2026.

Operating lease payments are included in cash outflows from operating activities on our consolidated statements of cash flows.

Operating lease expenses were $3 thousand and $3 thousand for the three months ended December 31, 2025 and 2024, respectively.

We have made an accounting policy election not to apply the recognition requirements of ASC Topic 842 (Leases) to short-term leases (leases with a term of one year or less at the commencement date of the lease). Lease expense for short-term lease payments is recognized on a straight-line basis over the lease term. We do not have any long-term operating leases or financing leases as of December 31, 2025.

We expect to pay approximately $12 thousand over the next 12 months for the Worcester lease.