14. EMPLOYEE RETENTION CREDIT

The Company filed claims for the Employee Retention Credit (“ERC”) with the Internal Revenue Service in February 2024 under the provisions of the Coronavirus Aid, Relief, and Economic Security Act, as amended. During the first quarter of fiscal 2026, the Company received a refund of approximately $1.3 million, which was recognized as other income in the consolidated statements of operations.

In connection with filing the ERC claims, the Company engaged a third-party service provider under a contingent-fee arrangement. As a result, the Company incurred a service fee of approximately $0.3 million, which was recorded in other income (expense), net.