Item 1. Legal Proceedings
ITEM
1.
LEGAL
PROCEEDINGS.
The
Company and its subsidiaries are, from time to time, involved in legal proceedings arising in the ordinary course of business. The Company
is currently a party to (or defending) the legal proceedings described in Note 8 (Commitments and Contingencies — Pending Litigation)
to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report, which discussion is
incorporated herein by reference.
Pursuant
to Item 103 of Regulation S-K, the Company is required to disclose in this Item only those material pending legal proceedings, other
than ordinary routine litigation incidental to the business, to which the Company or any of its subsidiaries is a party or of which any
of their property is the subject, and any such proceeding involving a governmental authority where the monetary sanctions, exclusive
of interest and costs, are reasonably expected to exceed $1,000,000. Based on the Company’s assessment, the amounts at issue in
the proceedings described in Note 8 do not exceed 10% of the Company’s consolidated current assets, and the Company has determined
that the proceedings described therein, individually or in the aggregate, do not currently rise to the level of “material”
for purposes of Item 103. Notwithstanding this determination, the Company has elected to provide the more comprehensive descriptions
in Note 8 to assist readers in understanding the Company’s litigation posture.
As
of March 31, 2026, the Company has not recorded a loss accrual with respect to any of the matters described in Note 8, as Management
has determined that any loss is not both probable and reasonably estimable as of that date. Management is unaware of any other material
actions, suits, investigations, or proceedings (public or private) pending or threatened against or affecting the Company, its subsidiaries,
or any of their respective assets, other than the matters described in Note 8 and other than ordinary routine litigation incidental to
the business.
Item
1A.
Risk
Factors.
In
accordance with the requirements of Form 10-Q, the Company, as a smaller reporting company, is not required to disclose this item.
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