Company: ECIA
Filing Date: 2025-08-15
Form Type: 10-Q
Source: 0001079973-25-001326
Chunk: 9

Company: ENCISION INC
Filing Date: 2025-08-15
Form: 10-Q
Item: Item 8
Chunk 9
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 assets
also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives
received. The Company uses the incremental borrowing rate based on the information available at the commencement date to determine the
lease liabilities, as the leases do not provide an implicit rate. Lease expense is recognized on a straight-line basis over the lease
term.

Effective August 28, 2023, the Company extended our
noncancelable lease agreement through October 31, 2026, and further extended it through October 31, 2028, for the facilities at 6797 Winchester
Circle, Boulder, Colorado. Lease expense was $384,184 for the fiscal year ended March 31, 2025, and $357,503 for the fiscal year ended
March 31, 2024. Lease expense for the three months ended June 30, 2025 is $94,875. 

The minimum
future lease payment by fiscal year as of June 30, 2025, is as follows:

    Schedule of minimum future lease payment

    Fiscal Year

    Amount

    2026

    146,278

    2027

    422,441

    2028

    458,393

    2029

    282,954

    Total

    $
    1,310,066

On August 4, 2020, the Company received $150,000 in
loan funding from the U.S. Small Business Administration (“SBA”) under the Economic Injury Disaster Loan (“EIDL”)
program administered by the SBA, which program was expanded pursuant to the CARES Act. The EIDL is evidenced by a promissory note dated
August 1, 2021, in the original principal amount of $150,000 with the SBA, the lender. Under the terms of the Note, interest accrues on
the outstanding principal at the rate of 3.75% per annum. The term of the Note is thirty years, though it may be payable sooner upon an
event of default under the Note.

On November 2, 2022, the company entered into a loan
and security agreement with Pathward, N.A. (Formerly Crestmark Bank). The loan is due on demand and has no financial covenants. Under
the agreement, the company was provided with a line of credit that is not to exceed the lesser of $1,000