NOTE 4 — LEASES

In October 2023, the Company entered into an addendum to the lease agreement for its office in Bend, Oregon. The addendum provided for a 36-month extension, resulting in a new expiration date in February 2027. The average base rent payable over the remaining lease term is approximately $9,000 per month. Upon execution of the addendum, the Company re-measured the Bend, Oregon operating lease liability at approximately $352,000 using a discount rate of 10.0%, and the related right-of-use asset was recognized for approximately $346,000.

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In April 2022, the Company entered into a lease agreement for its corporate headquarters facility in Redwood City, California. The space consists of approximately 9,300 square feet and provided for total base rent payments of approximately $2.9 million through the expected expiration of the lease in October 2027. Prior to occupancy, the landlord was required to make improvements to the facility that were completed in October 2022, triggering the commencement of the lease. The lease provided for a six-month rent abatement period beginning upon commencement of the lease term. In addition, the lease provided an allowance of approximately $0.1 million that was utilized by the Company for the purchase of furniture and equipment. The average base rent payable in cash over the 60-month lease term is approximately $48,000 per month. Upon commencement of the lease, the Company recognized a right-of-use asset for approximately $2.3 million, and a related operating lease liability for approximately $2.2 million.

As of June 30, 2026 and 2025, the carrying values of all of the Company’s right-of-use assets and the related operating lease liabilities were as follows (in thousands):

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For the fiscal years ended June 30, 2026 and 2025, operating lease expense is included under the following captions in the accompanying consolidated statements of operations (in thousands):

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In addition to base rent expense, the Company’s facility leases require variable payments, including the proportionate share of the real estate taxes, building insurance and common area maintenance costs related to the facilities. These variable payments are excluded from the determination of operating lease liabilities and amounted to an aggregate of $0.1 million for each of the fiscal years ended June 30, 2026 and 2025.

As of June 30, 2026, the weighted-average remaining lease term under operating leases was 1.3 years, and the weighted-average discount rate used to determine the operating lease liabilities was 7.0%. As of June 30, 2025, the weighted-average remaining lease term under operating leases was 2.3 years, and the weighted-average discount rate used to determine the operating lease liabilities was 7.1%.

Future Lease Payments

Future payments under all operating lease agreements as of June 30, 2026 are as follows (in thousands):

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