15. Subsequent Events

On July 24, 2026, the Company received a cash payment of approximately $0.7 million from U.S. Customs and Border Protection as a refund of previously paid IEEPA tariffs with interest. The refund has been recorded as a benefit to Cost of Sales to offset previous charges and has no impact on fiscal Q1 2027.

On September 4, 2026, the Company received a second cash payment of approximately $1.0 million from U.S. Customs and Border Protection as a refund of previously paid IEEPA tariffs with interest. The refund has been recorded as a benefit to Cost of Sales to offset previous charges and has no impact on fiscal Q1 2027.

On September 9, 2026, the Lender notified the Company that the Company’s audited financial statements and related compliance certificate for the fiscal year ended March 31, 2026 had not been delivered to the Lender by June 30, 2026, the 90-calendar-day deadline required under Sections 9(b) and 9(d) of the Loan Agreement (Note 9), which constituted a default under the Loan Agreement. The Lender waived this default, and any Default or Event of Default arising from it, on a one-time basis limited solely to this default, and required the Company to deliver such audited financial statements and compliance certificate to the Lender on or before October 15, 2026, which the Company satisfied with its filing of the Annual Report on Form 10-K on September 28, 2026. The waiver letter stated that it is not an agreement of forbearance, does not waive any other past, present or future default, and expressly reserves all of the Lender’s other rights, powers, privileges and remedies under the Loan Agreement and the other Loan Document.

The Company borrowed an additional $115,000 from the Stauss Family Administrative Trust during August 2026.

The Company has evaluated all subsequent events through the date these financial statements were issued. Except for the events described above, no other material subsequent events requiring disclosure or adjustment were identified.