COMMITMENTS

12 Months Ended

Jun. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

NOTE 13 - COMMITMENTS

Leasing Activities

Operating Leases

Operating lease expense recognized during the year ended June 30, 2018 and June 30, 2017 was $150,797 and $67,888, respectively. Operating lease expense is included in operating expenses in the consolidated statements of operations.

In December 2017, the Company entered into a seven-year office lease agreement to replace the Company’s former headquarters, which was sold on January 31, 2018. Monthly rent for the first twelve months of the lease is $13,845 and increases by approximately 1.5% for each succeeding 12-month period. Refer to Note 1 of the Notes to Consolidated Financial Statements for further detail related to the sale of the Company’s headquarters.

As of June 30, 2018, and June 30, 2017, the carrying value of the right of use asset was $1,087,249 and $150,214, respectively, and is separately stated on the consolidated balance sheets. The related short-term and long-term liabilities as of June 30, 2018 were $197,616 and $889,633 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 consolidated balance sheets.

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

	June 30, 2018			June 30, 2017
Weighted-average remaining lease term (in years)
Operating leases		6.05			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 consolidated balance sheets as of June 30, 2018:

2019	$	248,148
2020		210,260
2021		172,317
2022		174,873
2023		177,429
Thereafter		285,846
Total undiscounted lease payments		1,268,873
Present value adjustment		(181,624	)
Net operating lease liabilities	$	1,087,249

Short-term Leases

The Company leases facilities in Honolulu, Hawaii, Milwaukee and Madison, 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 $54,300 and $79,179 was recognized during the years ended June 30, 2018 and June 30, 2017, respectively. Short-term rent expense is included in operating expenses in the consolidated statements of operations.