15. OPERATING LEASE

On July 4, 2025, the Company entered into a facility lease commencing on July 4, 2025 and expiring on July 3, 2028, for approximately 6,600 square meters of industrial space in Hangzhou, China. The lease term is 36 months and includes a three-month rent-free period from July 4, 2025 through October 3, 2025, during which only property management fees and utilities are payable. Base rent is $27 per month. The lease is denominated in Renminbi (“RMB” or “yuan”), and the lease liability and right-of-use asset are initially measured in RMB and translated into U.S. dollars for consolidated financial reporting purposes in accordance with ASC830. On July 3, 2026, the Company terminated this facility lease and wrote off the related operating lease right-of-use asset and lease liability in accordance with ASC 842. In addition, the Company paid a total of $149 for early termination fees in accordance with the termination agreement, and the Company has no further obligations under this facility lease.

In accordance with ASC 842, other information related to leases was as follows:

As of September 30, 2026, the Company had no outstanding operating lease right-of-use assets or lease liabilities. Accordingly, no future minimum lease payments remained under the terminated lease.