NOTE 9 – COMMITMENT AND CONTINGENCIES

Leases

The Company entered into a non-cancellable operating lease of a manufacturing facility located in 249 E. Gardena Blvd., Gardena, CA commencing January 1, 2015 and ending on February 28, 2019. The base rent of the facility at the commencement date was $29,648 per month, which annually increases by 3%. Rent expense for the three months ended September 30, 2018 and 2017 was $97,192 and $94,361, respectively. Rent for the nine months ended September 30, 2018 and 2017 was $291,575 and $283,082, respectively.

During the three months ended September 30, 2018, the Company entered into a non-cancellable operating lease of a manufacturing facility located in 400 W. Gardena Blvd., Gardena, CA commencing July 1, 2018 and ending on September 30, 2023. Possession of the property was delayed to August 21, 2018 due to the landlord requiring more time to vacate the property. The base rent of the facility at the commencement date is $22,838 per month, which annually increases by 3%. Rent expense for the three months ended September 30, 2018 was $8,104. 

Legal Proceedings

From time to time, the Company may be involved in general commercial disputes arising in the ordinary course of our business. The Company is not currently involved in legal proceedings that could reasonably be expected to have material adverse effect on its business, prospects, financial condition or results of operations.