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LEASES

12 Months Ended

Mar. 31, 2022

NOTE 14 – LEASES

After we settled certain default amounts, Stadco became party to an amended building and property operating lease and recorded a right of use asset and liability of $6.6 million. Monthly base rent for the property is $78,233 per month, with a 20% discount through November 30, 2022. The term of the lease will expire on June 30, 2030, and the lessee has no right of renewal beyond the expiration date. The lease contains customary default provisions allowing the Landlord to terminate the lease if the lessee fails to remedy a breach of its obligations under the lease within the period specified in the lease, or upon certain events of bankruptcy or seizure or attachment of the lessee’s assets or interest in the lease. The lease also contains other customary provisions for real property leases of this type.

In December 2019, we signed a one-year operating lease for office space which expired in December 2020 and was amortized on a straight-line basis. We leased the office month-to-month until December 31, 2021 and have not renewed the lease. Lease cost was approximately $4,000 per year.

The following table lists our right-of-use assets and liabilities on our consolidated balance sheets at:


	March 31, 2022		March 31, 2021
Finance lease:
Right of use asset – operating lease	$	6,649,744	$	—
Right of use asset – finance leases		125,032		45,663
Amortization		(391,161)		—
Right of use asset, net	$	6,383,615	$	45,663
Lease liability – operating lease	$	6,374,691	$	—
Lease liability – finance leases		72,908		45,663
Total lease liability	$	6,447,599	$	45,663

Other supplemental information regarding our leases is contained in the following tables:


Components of lease expense for the year ended:	March 31, 2022		March 31, 2021
Operating lease amortization	$	363,206	$	3,788
Finance lease amortization	$	27,955	$	10,875
Finance lease interest	$	1,851	$	1,275


Weighted average lease term and discount rate at:	March 31, 2022		March 31, 2021
Lease term (years) – operating lease	8.25		—
Lease term (years) – finance lease	2.48		5.00
Lease rate – operating lease	4.5	%	—
Lease rate – finance lease	3.9	%	3.2	%


Supplemental cash flow information related to leases for the year ended:	March 31, 2022		March 31, 2021
Cash used in operating activities	$	448,206	$	5,063
Cash used in financing activities	$	508,806	$	22,460

Maturities of lease liabilities at March 31, 2022 for the next five years and thereafter:


2023	$	882,581
2024		954,970
2025		948,701
2026		948,701
2027		938,801
Thereafter		2,972,872
Total lease payments	$	7,646,626
Less: imputed interest		1,199,027
Total	$	6,447,599