LEASE OBLIGATIONS

6 Months Ended

Dec. 31, 2023

Lease Obligations

LEASE OBLIGATIONS

4. LEASE OBLIGATIONS

In March 2021 the Company entered into a five-year capital lease in the amount of $161,977 for manufacturing equipment. In January 2020, the Company entered into a five-year capital lease for $47,750 for manufacturing equipment. The net book value of fixed assets under capital lease obligations as of December 31, 2023 is $83,535.

On July 1, 2019, the Company entered into a three-year operating lease for its facility in El Paso, Texas, and in February 2022 the Company entered into an extension of the lease for an additional three years through June 2025. Remaining minimum lease payments at December 31, 2023 total $66,087. Total rent expense including base rent and common area expenses was $36,288 and $35,589 during the six months ended December 31, 2023 and 2022, respectively. On October 4, 2021, the Company assumed the remaining term of the Windham, Maine lease as part of the Lighthouse acquisition. The lease expires on July 31, 2025. Remaining minimum lease payments on December 31, 2023 total $209,242. Total rent expense including base rent and common area expenses was $68,864 and 70,034 during the six months ended December 31, 2023 and 2022, respectively. Included in the accompanying balance sheet at December 31, 2023 is a right-of-use asset of $275,329 and current and long-term right-of-use operating lease liabilities of $173,503 and $101,826, respectively.

At December 31, 2023 future minimum lease payments under the capital lease and operating lease obligations are as follows:

Fiscal Year Ending June 30:	Capital Leases		Operating Lease
2024	$	24,309	$	85,330
2025		43,918		178,569
2026		28,028		11,430
2027		–		–
Total Minimum Payments		96,255	$	275,329
Less: amount representing interest		5,846
Present value of minimum lease payments		90,409
Less: current portion		44,519
Lease Obligation, net of current portion	$	45,890

The Company’s operating leases for its Gardner, Massachusetts office, production and storage spaces plus an equipment lease have expired and continue on a month-to-month tenant-at-will basis. Rent expense on these operating leases was $97,581 and $95,511 for the six months ended December 31, 2023 and 2022, respectively.