(

)

Assets Held for Lease

Major components of assets held for lease are:

	November 30, 2018		November 30, 2017
West Union Facility	$	878,079	$	1,118,330
Modular Buildings		992,046		98,834
	$	1,870,125	$	1,217,164

During the

third

quarter of the

2018

fiscal year, the Company discovered mold in its West Union facility. The Company incurred

$235,000

of expense for mold remediation in the

2018

fiscal year. The Company also scrapped approximately

$67,000

of inventory related to mold remediation. Both the remediation cost and inventory scrap have been included in other income (expense) on the consolidated statements of operations. At

November 30, 2018

the Company was leasing

20,000

square feet of the West Union facility to

third

parties for storage purposes. On

December 14, 2018,

this facility and remaining assets was sold for

$900,000.

The Company recognized approximately

$216,000

related to the impairment of this asset in the

2018

fiscal year, which was attributable to the selling price less commissions.

The Company’s Modular Buildings segment enters into leasing arrangements with customers from time-to-time. The Company had

seven

small leased buildings at

November 30, 2018

compared to

one

November 30, 2017.

Rents recognized from assets held for lease included in sales on the consolidated statements of operations during the

2018

fiscal year were

$374,000

compared to

$161,000

in the

2017

fiscal year. Rents recognized from assets held for lease included in other income (expense) on the consolidated statements of operations during the

2018

fiscal year were

$44,000

compared to

$234,000

in the

2017

fiscal year.

Future minimum lease receipts from assets held for lease are as follows:

Year Ending November 30,	Amount
2019		443,294
2020		90,411
Total		533,705