COMMITMENT AND CONTINGENCIES |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||
| COMMITMENT AND CONTINGENCIES |
NOTE 11 – COMMITMENT AND CONTINGENCIES
Leases
The Company entered into a non-cancellable operating lease of a manufacturing facility located in Gardena, CA, which commenced on January 1, 2015 with initial term of 4 years. The base rent of the facility at the commencement date was $29,648 per month, which annually increased by 3%. In March 2019, the lease was amended to extend the lease term for another 4 years through February 2023 (“extension agreement”). The base rent of the extension agreement lease will be $31,652 in the first year, $34,457 the second, $35,835 the third, and 37,261 in the fourth year. The extension agreement is a “Net Lease” requiring the Company to pay real property taxes associated to this facility.
On July 20, 2017, the Company entered into a three-month lease agreement of a warehouse facility located in Gardena, CA with a monthly rent of $10,200. The agreement renews on a month-to-month basis and may be terminated upon providing 30-day written notice. Commencing in October 2017, the Company is under a month-to-month lease term under this lease agreement.
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 years ended December 31, 2018 and 2017 was $388,766 and $377,443, respectively.
The future minimum annual rental payments required under the non-cancelable operating leases described above as of January 1, 2019 are as follows:
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. |