LEASES

12 Months Ended

Mar. 31, 2024

Leases

LEASES

NOTE 10 – LEASES

We lease office, manufacturing, and warehouse space in Scottsdale, AZ, Atlanta and Marietta, GA, and Manitowoc, WI under contracts we classify as operating leases. None of our leases are financing leases. The Scottsdale lease has been extended through 2029 and does not include a renewal option. In August of 2021 we extended the lease of our Atlanta offices through May of 2027, accordingly we increased our Right of Use Assets and Operating Lease Liabilities by $501,125 at September 30, 2021. In January of 2022, we extended the lease of our second Manitowoc, WI location and increased our Right of Use Assets and Operating Lease Liabilities by $308,326. We terminated our lease agreement in Marrietta during the year ended March 31, 2024 and decreased our Right of Use Asset and Operating Lease Liabilities by $38,185. We also terminated our lease agreement in our first Manitowoc, WI location during the year ended March 31, 2023. Accordingly, we decreased our Right of Use Assets and Operating Lease Liabilities by $901,076.

As of March 31, 2024 and March 31, 2023, total Right of Use Assets were $2,000,093 and $1,261,634, respectively. The increase of $738,459 as compared to prior year in Right of Use Assets is primarily due to the Scottsdale lease that has been extended through 2029. As of March 31, 2024 and March 31, 2023, total Operating Lease Liabilities were $2,089,487 and $1,374,224, respectively. The current portion of our Operating Lease Liability on March 31, 2024 and March 31, 2023 is $479,651 and $470,734, respectively, and is reported as a current liability. The remaining $1,609,836 of the total $2,089,487 for the year ended March 31, 2024 and the $903,490 of the total $1,374,224 for the year ended March 31, 2023 of the Operating Lease Liability is presented as a long-term liability net of the current portion.

Consolidated lease expense for the year ended March 31, 2024 was $663,826 including $642,105 of operating lease expense and $21,722 of other lease associated expenses such as association dues, taxes, utilities, and other month to month rentals. Consolidated lease expense for the year ended March 31, 2023 was $881,171 including $861,777 of operating lease expense and $19,394 of other lease associated expenses such as association dues, taxes, utilities, and other month to month rentals. Consolidated lease expense for the year ended March 31, 2022 was $1,221,473 including $1,177,589 of operating lease expense and $43,884 of other lease associated expenses such as association dues, taxes, utilities, and other month to month rentals.

The weighted average remaining lease term and weighted average discount rate for operating leases were 4.0 years and 10.0%, respectively at March 31, 2024 and were 3.3 years and 10.0%, respectively at March 31, 2023.

Future minimum lease payments under non-cancellable leases as of March 31, 2024 are as follows:

Years Ended March 31,
2025	$	666,233
2026		665,069
2027		581,574
2028		379,067
2029		258,102
		2,550,045
Less: Amount Representing Interest		(460,558	)
	$	2,089,487