NOTE 13 – LEASES

The Company leases office facilities in Boca Raton, Florida, Seattle, Washington and Toronto, Ontario, Canada under non-cancelable operating lease agreements. The leases require monthly payments ranging from $4,000 to $10,000 and expire on various dates through April 2028. In addition to minimum rent, the Company is required to pay a proportionate share of operating expenses under these leases.

In June 2022, the Company entered into a lease, for the Boca Raton office facilities, which became effective on January 1, 2024, after completion of leasehold improvements. The lease term was for 98 months, and monthly rental payments range from $38,000 to $48,000 over the life of the lease. In June 2025, the Company terminated the existing lease. The Company is treating the transaction as a lease extinguishment. The lease included a termination penalty of $550,000, payable in two installments of $275,000, paid June 10, 2025, and the second paid on August 31, 2025. The Company subsequently entered a new lease for new office space, which became effective on May 1, 2025. The new lease term is for 36 months, and monthly rental payments of approximately $10,000 over the life of the lease.

As of March 31, 2026 and December 31, 2025, the following amounts were presented on the Company’s consolidated balance sheets in accordance with ASC 842 - Lease Accounting (in thousands):

For the three months ended March 31, 2026, and 2025, the Company’s operating lease cost was $64,000 and $160,000, respectively. Other information pertaining to capitalized assets and liabilities under the leasing standard is as follows (in thousands):

As of March 31, 2026, the Company’s lease liabilities mature as follows (in thousands):