PREPAID EXPENSES AND OTHER

Prepaid expenses and other current assets consisted of the following:

	December 31,		September 30,
	2018		2018
Deposits for inventory	$	330,690	$	1,366,069
Leashold improvement receivable		180,103		1,132,017
Prepaid insurance		114,346		162,822
Prepaid maintenance agreement		46,875		93,750
Dues and subscriptions		51,619		92,097
Other		230,258		244,646
	$	953,891	$	3,091,401

Deposits for inventory

Deposits for inventory consisted of cash payments to vendors for inventory to be delivered in the future.

Leasehold improvement receivable

Leasehold improvement receivable represents amounts owed to the Company by its landlord for costs incurred to renovate and prepare the Company’s new facility for use. The lease provided an allowance for tenant improvements of

$1,588,214.

(See Note

13,

Commitments and Contingencies, for additional information about this lease). As of

December 31, 2018,

$180,103

has

not

been received by the Company.

Prepaid Insurance

Prepaid insurance consisted of premiums paid for health, commercial and corporate insurance. These premiums are amortized on a straight-line basis over the term of the agreements.

Prepaid maintenance agreement

March

31,

2011,

prepaid expenses included

$1,500,000

paid to a

third

party service provider in connection with the Company’s obligations under a sales contract to a foreign military service to provide repair and maintenance services over an

eight

- year period for products sold thereunder. The total prepaid expense is being amortized on a straight-line basis at an annual rate of

$187,500

over the

eight

-year contract period to correspond with the revenues for these services and is being recognized as a component of cost of sales. Accordingly, as of

December 31, 2018,

$46,875

of the total prepayment was classified as a current asset. As of

September 30, 2018,

$93,750

of the total prepayment was classified as a current asset.