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LEASE OBLIGATIONS

3 Months Ended

Sep. 30, 2024

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 September 30, 2024 is $51,776.

On July 1, 2019, the Company entered into a three-year operating lease for its facility in El Paso, Texas, and in February 2022 extended the lease through June 2025. Remaining minimum lease payments at September 30, 2024 total $34,060. Total rent expense including base rent and common area expenses was $16,340 and $15,973 during the three months ended September 30, 2024 and 2023, 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 September 30, 2024 total $112,187. Total rent expense including base rent and common area expenses was $34,432 during both the three months ended September 30, 2024 and 2023. Included in the accompanying balance sheet at September 30, 2024 is a right-of-use asset of $146,247 and current right-of-use operating lease liabilities of $146,247.

At September 30, 2024 future minimum lease payments under the capital lease and operating lease obligations are as follows:


Fiscal Year Ending June 30:	Capital Leases		Operating Lease
2025	$	31,764	$	137,950
2026		28,004		11,478
Total Minimum Payments		59,768		149,428
Less: amount representing interest		2,498		3,181
Present value of minimum lease payments		57,270		146,247
Less: current portion		38,886		146,247
Lease Obligation, net of current portion	$	18,384	$	–

The Company’s four facilities in Gardner, Massachusetts which are used for offices, production and storage spaces are leased primarily on a tenant-at-will basis. Rent expense on these operating leases was $51,797 and $48,799 for the three months ended September 30, 2024 and 2023, respectively.