NOTE H  COMMITMENTS AND CONTINGENCIES Operating Leases The Company leases office space under an operating lease in Stony Brook, New York for its corporate headquarters. The lease is for a 30,000 square foot building. The term of the lease commenced on June 15, 2013 and expired on May 31, 2016, with the option to extend the lease for two additional three-year periods. The Company has exercised its option to extend the lease for one additional three-year period ending May 31, 2019. The base rent during the additional three-year period is $458,098 per annum. In addition to the office space, the Company also has 1,500 square feet of laboratory space. The term of the lease commenced on November 1, 2015 and expired on October 31, 2018. Effective November 20, 2017, the Company renewed this lease for one additional year, ending October 31, 2018. This lease is currently month to month. The Company set up a satellite testing facility in Ahmedabad, India during fiscal 2018. On November 17, 2017, it leased 1,108 square feet for a three-year term beginning November 1, 2017. The base rent is approximately $6,500 per annum. Total rent expense for the three month periods ended December 31, 2018 and 2017 were $129,193 and $133,216, respectively. Employment Agreement The Company has an employment agreement with Dr. James Hayward, its Chief Executive Officer (CEO) effective July 1, 2016. The initial term was through June 30, 2017, with automatic one-year renewal periods. As of June 30, 2018, the employment contract renewed for an additional year. Under the agreement, the CEO will be eligible for a special cash incentive bonus of up to $800,000, $300,000 of which will be payable if and when annual revenue reaches $8 million and $100,000 of which would be payable for each $2 million of annual revenue in excess of $8 million. The CEOs annual salary under the agreement was $400,000. Effective May 7, 2016, the CEOs annual salary was voluntarily reduced by $100,000. Effective May 20, 2017, the CEOs annual salary was voluntarily reduced by an additional $50,000. Accordingly, his current annual base salary as of December 31, 2018 is $250,000. Effective March 15, 2018, the Compensation Committee of the Companys Board of Directors, approved a bonus of $121,125 that would be payable to the CEO when the Company reaches $3,000,000 in revenues for two consecutive quarters or $12,000,000 in revenues for a fiscal year, provided that the CEO is still employed by the Company on such date (the Revenue Bonus). Effective May 2, 2018, the Compensation Committee of the Companys Board of Directors, increased the amount of the Revenue Bonus to $403,623. The accrual for the Revenue Bonus of $397,812 is recorded to long term accrued liabilities on the balance sheet as of December 31, 2018. Effective December 27, 2018, the compensation committee approved a bonus opportunity of $150,000 for the calendar year-ended December 31, 2019 that would be payable to the CEO under the same terms as described above. Litigation From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. When the Company is aware of a claim or potential claim, it assesses the likelihood of any loss or exposure. If it is probable that a loss will result and the amount of the loss can be reasonably estimated, the Company will record a liability for the loss. In addition to the estimated loss, the recorded liability includes probable and estimable legal costs associated with the claim or potential claim. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm the Companys business. There is no pending litigation involving the Company at this time.