Leases

12 Months Ended

Sep. 30, 2024

NOTE 9 – LEASES

The Company leases certain equipment under

non-cancelable

operating leases. Future minimum rental payments under these leases at September 30, 2024 are immaterial. Total rental expense for both of the fiscal years ended September 30, 2024 and

2023 was $47,000.

On August 28, 2020, the Company entered into a three-year operating lease for property related to the manufacturing and warehousing. The lease term was for the period beginning on September 1, 2020 through August 31, 2023.

In accordance with ASU

2016-02

–

Leases (Topic 842)

, the Company recorded a

right-of-use

(“ROU”) asset totaling

$970,000 and related lease liabilities at inception. In March 2023, the Company extended the lease term through August 31, 2024. In accordance with ASU

2016-02,

the Company recorded a ROU asset totaling $352,000 and related lease liabilities upon extension. In March 2024, the Company extended the lease term through August 31, 2025. In accordance with ASU

2016-02,

the Company recorded a ROU asset totaling $361,000 and related lease liabilities upon extension.

For the year ended September 30, 2024, operating lease costs were $432,000 and cash payments related to these operating leases were $463,000. For the year ended September 30, 2023, operating lease costs were $429,000 and cash payments related to these operating leases were $458,000.

Other information concerning the Company’s operating lease accounted for under ASC 842 guidelines as of September 30, 2024 and September 30, 2023, is as follows:


	September 30, 2024			September 30, 2023
Operating lease ROU asset included in other long-term assets	$	330,000		$	328,000
Current operating lease liability	$	330,000			328,000
Weighted average remaining lease term (in years)		0.92			0.51
Weighted average discount rate used in calculating ROU asset		5.0	%		4.5	%

Future annual minimum lease payments as of September 30, 2024 are as follows:


Fiscal Year	Annual Lease Payments
2025	$	338,000
Less interest		(8,000	)

Present value of lease liabilities	$	330,000