NOTE 5 – SOFTWARE LICENSING OBLIGATION

In October 2023, the Company entered into a software licensing agreement with Oracle America, Inc (“Oracle”) for its NetSuite Enterprise Resource Planning (ERP) software (“NetSuite”). The Company agreed to license NetSuite for 36 months and utilize Oracle’s professional services to assist in the implementation of NetSuite. The cost of the license fee was $102,000 and professional services were fixed at $34,000, for an aggregate cost of $136,000. Per the payment terms, no payments were due during the first six months, and thirty monthly payments of $4,513 are due from April 1, 2024 through September 1, 2026.

The Company recorded the $42,000 cost as a deferred software licensing asset and liability on the accompanying condensed balance sheet. The deferred software licensing asset is being amortized over the license period. The deferred software licensing balance was $59,000 at December 31, 2024. During the six months ending June 30, 2025, the Company recorded amortization expense of $17,000, resulting in a deferred software licensing balance of $42,000 as of June 30, 2025.

During the six months ending June 30, 2025, the Company made payments of $28,000, leaving a software license obligation balance was $58,000, of which the current portion was $54,000, leaving a long-term software license obligation of $4,000 as of June 30, 2025.

Future payments under the software license obligation are as follows:

 SCHEDULE OF SOFTWARE LICENSE OBLIGATION