NOTE 10 — Commitments and Contingencies

Purchase Commitments

There are no noncancelable purchase orders as of June 30, 2026 or December 31, 2025 for continuing operations. The company stopped issuing purchase commitments in 2025 in anticipation of the closing of the asset sale.

Royalty payments

For its discontinued operations, the Company is required to pay per unit royalties to wireless essential patent holders.

General litigation

The Company is involved in various legal proceedings arising in the normal course of business. The Company does not believe that the ultimate resolution of these other matters will have a material adverse effect on its consolidated financial position, results of operations, or cash flows.

Indemnification

Under the terms of the asset purchase agreement, the Company has indemnification obligations for representations and warranties made by the Company. The $1,500 receivable for cash held back on the balance sheet can be used to cover indemnification obligations. There is no maximum indemnification exposure. The Company has reduced the carrying value of the receivable to $1,248 because $252 of the balance was used to cover severance liabilities that were paid by the buyer subsequent to the closing date. At the end of each period, we will adjust the carrying value of the receivable to reflect our estimate of the value of indemnity claims made by the buyer.

For discontinued operations, under the terms of its agreements with wireless carriers and other partners, the Company has agreed to provide indemnification for intellectual property infringement claims related to the Company’s products sold by them to their end customers. From time to time, the Company receives notices from these wireless carriers and other partners of a claim for infringement of intellectual property rights potentially related to their products. These infringement claims have been settled, dismissed, or have not been further pursued by the customers.