Note 9 — Commitments and Contingencies

Rental Payments under Non-cancelable Operating Leases

Optex Systems Holdings leases its office and manufacturing facilities for the Optex Systems, Inc, Richardson address and the Applied Optics Center Dallas address, under non-cancellable operating leases.

The leased facility under Optex Systems Inc. at 1420 Presidential Drive, Richardson, Texas consists of 49,100 square feet of space and expires March 31, 2021. Pursuant to the terms of the most recent amendment to the Richardson site facilities lease, there was no base rent payment due from January 1, 2014 through March 31, 2014, with payments beginning April 2014, and annual rental payment increases occurring each year beginning in 2016. As of September 27, 2015 the unamortized deferred rent was $106 thousand as compared to $91 thousand as of September 28, 2014. Deferred rent expense is amortized monthly over the life of the lease.

The leased facility under the Applied Optics Center at 9839 and 9827 Chartwell Drive, Dallas, Texas, consists of 56,633 square feet of space at the premises. The term of the lease expires September 30, 2016, and there are four renewal options available to the tenant, each with a renewal term duration of five years.

Approximately 12,000 square feet covered under the Applied Optics Center lease, is subleased under a separate Memorandum of Understanding dated October 27, 2014, to L-3 Communications Mobile Vision Inc. The sublease term is for November, 2014 through September, 2016. The sublease is treated as a reduction in the company facilities rental CAM and expenses in the statement of operations.

As of September 27, 2015, the remaining minimum lease and estimated common area maintenance (CAM) payments under the non-cancelable office and facility space leases are as follows:

Total facilities rental and CAM expenses for both facility lease agreements as of the twelve months ended September 27, 2015 was $589 thousand. Total expense under facility lease agreements as of the twelve months ended September 28, 2014 $337 thousand.