NOTE

– LEASES

We lease our office and manufacturing facility under a non-cancelable operating lease, which expires on

June 30, 2028.

The Company The following is a maturity analysis of the annual undiscounted cash flows of the operating lease liabilities as of

June 30, 2020:

For the Years Ending June 30,
2021	$	101,875
2022		101,875
2023		101,875
2024		106,875
2025		106,875
Thereafter		320,625
		840,000
Less: Amount attributable to imputed interest		(150,403	)
Net liability at June 30, 2020	$	689,597

Weighted average remaining lease term (in years)		8.0
Weighted average discount rate		5.00	%

Rent and real estate tax expense for all facilities for the years ended

June 30, 2020

and

2019

was approximately

$18,000

and

$18,000,

respectively, and are reported as a component of cost of sales and selling, general and administrative expenses in the accompanying statement of operations. The Company paid in

$25,468

in lease payments during the

three

months ending

June 30, 2020.

During

September 2016

the Company leased equipment with a cost of approximately

$129,000,

under provisions of various long-term financing leases whereby the minimum lease payments have been capitalized. Accumulated depreciation at

June 30, 2020

is approximately

$94,000.

The leases expire over various years through

2021.

Depreciation of the leased assets is included in depreciation and amortization expense. The lease obligations are secured by the leased assets.