NOTE 11 – COMMITMENTS AND CONTINGENCIES

The Company accounts for contingencies in accordance with ASC 450, Contingencies. A liability is recorded when it is probable that a loss has been incurred and the amount can be reasonably estimated. If a loss is reasonably possible but not probable, or if the amount cannot be estimated, the nature of the contingency and an estimate of the possible loss, if determinable, is disclosed. Remote contingencies are generally not disclosed unless related to guarantees. The Company is not currently party to any material legal proceedings and is not aware of any material loss contingencies requiring accrual or disclosure as of March 31, 2026.

Lease Obligations

The Company leases property and equipment under operating leases, typically with terms greater than 12 months, and determine if an arrangement contains a lease at inception. In general, an arrangement contains a lease if there is an identified asset and we have the right to direct the use of and obtain substantially all of the economic benefit from the use of the identified asset. We record an operating lease liability at the present value of lease payments over the lease term on the commencement date. The related right of use (‘‘ROU”) operating lease asset reflects rental escalation clauses, as well as renewal options and/or termination options. The exercise of lease renewal and/or termination options is at our discretion and is included in the determination of the lease term and lease payment obligations when it is deemed reasonably certain that the option will be exercised. When available, we use the rate implicit in the lease to discount lease payments to present value; however, certain leases do not provide a readily determinable implicit rate. Therefore, we must estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement.

The Company classifies our leases as buildings, vehicles or computer and office equipment and do not separate lease and non-lease components of contracts for any of the aforementioned classifications. In accordance with applicable guidance, we do not record leases with terms that are less than one year on the Consolidated Balance Sheets.

None of our lease agreements contain material restrictive covenants or residual value guarantees.

Buildings

The Company entered into an 84eighty-four month lease for 3,577 square feet of newly constructed office, laboratory, and warehouse space located in Edina, Minnesota in May 2017, which was renewed for an additional thirty months resulting in the lease expiration in November 2026. The base rent has annual increases of 2% and the Company is responsible for its proportional share of common space expenses, property taxes, and building insurance. This lease is terminable by the landlord if damage causes the property to no longer be utilized as an integrated whole and by the Company if damage causes the facility to be unusable for a period of 45 days. In January 2020, the Company entered into a lease amendment to extend the lease term through November of 2026 in exchange for receipt of a loan of $42,500 recorded to note payable. The monthly base rent as of March 31, 2026, and 2025 was $2,434 and $2,386, respectively.

The Company entered into a 63sixty-three month lease for 2,400 square feet of office space located in Edina, Minnesota in January 2022. This lease will expire in March 2027. The base rent has annual increases of 2.5% and the Company is responsible for its proportional share of common space expenses, property taxes, and building insurance. The monthly base rent as of March 31, 2026 and 2025 was $2,950 and $2,879, respectively.

On January 10, 2023, the Company entered into a new lease agreement for approximately 14,000 square feet of production and warehouse space with a commencement date of April 1, 2023, which is when the control and right of use for this asset took place. The initial monthly base rent is $8,420 and has annual increases of 2.5%. The Company is also responsible for its proportional share of common space expenses, property taxes, and building insurance. The lease will terminate on June 30, 2033, and the Company has a renewal option for a period of five years. The monthly base rent as of March 31, 2026 and 2025 was $0 and $8,631, respectively.

Lease Termination

The Company terminated its January 10, 2023 ten-year lease agreement on the 14,000 square foot production and warehouse space effective June 30, 2025. As consideration for the early termination of the lease, the Company paid the Landlord the unamortized portion of lease commissions, unamortized rent abatement, legal fees, termination fee, management fee and unamortized tenant improvements. In addition, the Company was responsible for paying all costs to release a mechanical lien attached to the property, including the costs related to the lien along with all legal fees and other costs incurred by the landlord. The Company also paid a fee equal to six months of base rent, common area maintenance, and real estate taxes for the unrented office area consisting of 3,794 rentable square feet as part of the termination of the lease. Total fees incurred for the termination of the lease for the years ended March 31, 2026 and 2025 were $314,768 and $0, respectively. On June 30, 2025, the Company recorded the derecognition of the right-of-use asset and lease liability of $890,979.

Vehicles and Other Operating Leases

The Company leased vehicles for certain members of its field sales organization during the three months ended June 30, 2024, under a vehicle fleet program whereby the noncancelable lease was for a term of 48 months. During the year ended March 31, 2025, all the leased vehicles under the vehicle fleet program were sold and the Company recognized a loss of $1,018 on the sale of the leased vehicles, reported in other income (expense). As a result of the sale, the Company recorded the derecognition of the right-of-use asset and lease liability of $53,168.

Operating vehicle lease expense for the years ended March 31, 2026, and 2025, was $0 and $42,658, respectively.

The following is a maturity analysis of the approximate annual undiscounted cash flows of the operating lease liabilities as of March 31, 2026:

SCHEDULE OF MATURITY OF ANNUAL UNDISCOUNTED OPERATING LEASE LIABILITY

In compliance with ASC 842, the Company recognized, based on the extended lease terms to November 7, 2026, and March 2027, a weighted average incremental borrowing rate of 3.20%, an operating lease right-of-use assets for approximately $54,711 and corresponding and equal operating lease liabilities for the leases. As of March 31, 2026, the present value of future base rent lease payments based on the remaining lease term of 0.4 years, are as follows:

 SCHEDULE OF BASE RENT LEASE PAYMENTS

As of March 31, 2026 and 2025, operating lease right-of-use assets and operating lease liabilities were classified as follows:

  SCHEDULE OF LEASE CURRENT AND NON-CURRENT ASSETS AND LIABILITIES

Employment Agreements

The Company has employment agreements with its executive officers. As of March 31, 2026, these agreements contain severance benefits ranging from one month to six months if terminated without cause.

Legal Proceedings

From time to time, the Company may be involved in legal proceedings arising in the ordinary course of business. In June 2026, a former employee filed a whistleblower retaliation complaint with the Occupational Safety and Health Administration (OSHA) under Sarbanes-Oxley Act (SOX), 18 U.S.C. § 1514A. The claimant alleges they were wrongfully terminated after reporting alleged governance and honesty in shareholder relations.

The Company is cooperating with OSHA’s ongoing investigation, denies all allegations and intends to vigorously defend against these allegations. At this preliminary stage, the outcome is uncertain. Although the Company cannot predict the ultimate outcome of this matter, based on currently available information, management does not believe that the ultimate resolution will have a material adverse effect on the Company’s consolidated financial position, results of operations, or cash flows.