10. COMMITMENTS AND CONTINGENCIES

Legal proceeding – The Company is, from time to time, involved in routine legal matters, and audits and inspections by governmental agencies and other third parties which are incidental to the conduct of its business. This includes legal matters such as initiation and defense of proceedings to protect intellectual property rights, liability claims, employment claims, and similar matters. The Company believes the ultimate resolution of any such legal proceedings, audits, and inspections will not have a material adverse effect on its consolidated balance sheets, results of operations or cash flows.

On May 14, 2025, we were named as a defendant in a lawsuit filed in the Superior Court of the State of California in and for the County of Los Angeles Central Judicial District by Amanda Archer and Archer Bytes LLC, a former public relations consultant for the Company. The complaint alleges breach of contract, and other claims and seeks specific damages of $600,000 and unspecified punitive damages. We believe the claims are entirely without merit and intend to vigorously defend the matter.

On April 24, 2025, the Company’s former Chief Executive Officer (the “Former CEO”) commenced ACAS Early Conciliation proceedings (a mandatory step in the UK prior to filing a legal claim) alleging, among other things, unfair dismissal from his position. The Company has not yet been notified that the Former CEO has filed a legal claim with the UK Employment Tribunal.   

Capital commitments – The Company had $6,202,782 purchase obligations as of June 30, 2026, related to purchase orders to factories for the manufacture of finished goods.