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Lease Commitments
 3 Months Ended
Sep. 30, 2016
Leases [Abstract]  
Lease Commitments

10.   Lease Commitments

 

We have operating leases for office space. At September 30, 2016, we have a lease agreement for our manufacturing and office facility in Orlando, Florida (the “Orlando Lease”). The Orlando Lease, which is for a seven-year original term with renewal options, expires April 2022 and expanded our space to 25,847 square feet, including space added in July 2014. Minimum rental rates for the extension term were established based on annual increases of two and one half percent starting in the third year of the extension period. Additionally, there is one 5-year extension option exercisable by us. The minimum rental rates for such additional extension options will be determined at the time an option is exercised and will be based on a “fair market rental rate” as determined in accordance with the lease agreement, as amended.

 

We received $420,014 in a leasehold improvement allowance in fiscal 2015. The improvements were recorded as property and equipment and deferred rent on the consolidated balance sheets. Amortization of leasehold improvements was $80,967 as of September 30, 2016. The deferred rent is being amortized as a credit to lease expense over the term of the lease.

 

At September 30, 2016, we, through our wholly-owned subsidiary, LPOI, have a lease agreement for an office facility in Shanghai, China (the “Shanghai Lease”). The Shanghai Lease commenced in October 2015 and expires October 2017.

 

At September 30, 2016, we, through our wholly-owned subsidiary, LPOIZ, have a lease agreement for a manufacturing and office facility in Zhenjiang, China (the “Zhenjiang Lease”). The Zhenjiang Lease, which is for a five-year original term with renewal options, expires March 2019. 

 

During fiscal 2014 and 2015, we entered into four capital lease agreements, with terms ranging from three to five years, for computer and manufacturing equipment, which are included as part of property and equipment. Assets under capital lease include approximately $547,000 in computer equipment and software and manufacturing equipment, with accumulated amortization of approximately $237,000 as of September 30, 2016. Amortization related to capital lease assets is included in depreciation and amortization expense.

 

Rent expense totaled approximately $120,510 and $152,720 during the three months ended September 30, 2016 and 2015, respectively.

 

The approximate future minimum lease payments under capital and operating leases at September 30, 2016 were as follows:

 

Fiscal year ending June 30,  Capital Leases    Operating Lease 
           
2017  $126,992   $284,000 
2018   167,335    405,000 
2019   39,000    371,000 
2020   6,825    357,000 
2021   —    366,000 
2022 and beyond   —    280,000 
Total minimum payments   340,152   $2,063,000 
           
Less imputed interest   (30,079)     
           
Present value of minimum lease payments included in capital lease obligations   310,073      
Less current portion   166,454      
Non-current portion  $143,619