NOTE 13 - COMMITMENTS

Leasing Activities

Operating Leases

Operating lease expense recognized during the three months ended September 30, 2017 and September 30, 2016 was $21,264 and $14,524, respectively. Operating lease expense is included in operating expenses in the condensed consolidated statements of operations. As of September 30, 2017 and June 30, 2017, the carrying value of the right of use asset was $130,747 and $150,214, respectively, and is separately stated on the condensed consolidated balance sheets. The related short-term and long-term liabilities as of September 30, 2017 were $60,475 and $70,272 and as of June 30, 2017 were $65,004 and $85,210, respectively. The short-term and long-term liabilities are included in “Accrued expenses” and “Other long-term liabilities,” respectively, in the condensed consolidated balance sheets.

Information regarding the weighted-average remaining lease term and the weighted-average discount rate for operating leases are summarized below:

	September 30, 2017			June 30, 2017
Weighted-average remaining lease term (in years) Operating leases		2.20			2.37
Weighted-average discount rate Operating leases		5.0	%		5.0	%

The table below reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease liabilities recorded in the condensed consolidated balance sheet as of September 30, 2017:

2018	$	48,769
2019		64,297
2020		24,955
2021		-
2022		-
Thereafter		-
Total undiscounted lease payments		138,021
Present value adjustment		(7,274)
Net operating lease liabilities	$	130,747

Short-term Leases

The Company leases facilities in Honolulu, Hawaii, Milwaukee, Wisconsin and Shanghai, China from unrelated parties under lease terms that will expire over the next twelve months. Monthly rent for the twelve-month rental periods is between $400 and $2,010 per month. Rent expense of $8,922 and $23,761 was recognized during the three months ended September 30, 2017 and September 30, 2016. Short-term rent expense is included in operating expenses in the condensed consolidated statement of operations.