Annual report pursuant to Section 13 and 15(d)

Leases

v3.21.1
Leases
12 Months Ended
Dec. 31, 2020
Leases  
Leases

13. Leases

 

Effective January 1, 2019, the Company adopted ASC 842 using the optional transition method, applying no practical expedients. In accordance with the optional transition method, the Company did not recast the prior period consolidated financial statements. The lease term is the noncancelable period of the lease. There are no termination provisions or renewal periods reasonably certain of exercise or options controlled by the lessor. The Company has determined that its leases, consisting of leases for office and laboratory space without optional terms or variable components, are operating leases. Adoption of the new standard resulted in the recording of operating lease right-of-use assets and associated lease liabilities of $520,399 and $528,253, respectively, as of January 1, 2019 on the consolidated balance sheet with no cumulative impact to accumulated deficit and did not have a material impact on our results of operations or cash flows.

 

The Company conducts its operations from leased facilities in Morrisville, North Carolina, San Antonio, Texas and New Brunswick, New Jersey, the leases for which will expire in 2027,  2023 and 2022. The leases are for general office space and lab space and require the Company to pay property taxes, insurance, common area expenses and maintenance costs.

 

On October 1, 2019, commencement date of our Morrisville, North Carolina lease, a right-of-use asset of $2.0 million and a liability of $1.4 million were recorded on our balance sheet. Total cash paid for operating leases during the year ended December 31, 2020 and 2019 was $0.3 million and $0.7 million and is included within cash flows from operating activities within the consolidated statement of cash flows.

 

The Company leases furniture and specialized lab equipment under finance leases. The related right-of-use assets are amortized on a straight-line basis over the lesser of the lease term or the estimated useful life of the asset. The effective interest rate was 6.17% for the years ended December 31, 2020 and 2019.

 

The Company’s lease cost reflected in the accompanying Statements of Operations and Comprehensive loss as follows:

 

 

 

 

 

 

 

 

 

 

For the Year Ended December 31, 2020

 

For the Year Ended December 31, 2019

Operating lease cost

 

$

435,024

 

$

191,737

Finance lease cost

 

 

 

 

 

 

Amortization of lease assets

 

 

114,201

 

 

5,210

Interest on lease liabilities

 

 

17,972

 

 

954

Total finance lease cost

 

$

132,173

 

$

6,164

 

The weighted average remaining lease term and incremental borrowing rate as of December 31, 2020 and 2019 were as follows:

 

 

 

 

 

 

 

 

 

 

 

For the Year Ended December 31, 2020

 

For the Year Ended December 31, 2019

 

Weighted average remaining lease term

 

 

 

 

 

 

 

Operating leases

 

 

5.9

years

 

7.0

years

Finance leases

 

 

2.0

years

 

3.0

years

Weighted average discount rate

 

 

 

 

 

 

 

Operating leases

 

 

6.49

%

 

6.58

%

Finance leases

 

 

6.17

%

 

6.17

%

 

Maturities of operating and finance lease liabilities as of December 31, 2020 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Leases

    

Finance Leases

    

Total

2021

 

$

369,995

 

$

120,684

 

$

490,679

2022

 

 

360,839

 

 

155,694

 

 

516,533

2023

 

 

244,973

 

 

10,284

 

 

255,257

2024

 

 

231,503

 

 

 -

 

 

231,503

2025

 

 

238,452

 

 

 -

 

 

238,452

Thereafter

 

 

454,820

 

 

 -

 

 

454,820

Total minimum lease payments

 

 

1,900,582

 

 

286,662

 

 

2,187,244

Less: imputed interest

 

 

(320,193)

 

 

(18,295)

 

 

(338,488)

Present value of lease liabilities

 

$

1,580,389

 

$

268,367

 

$

1,848,756

 

Maturities of operating and finance lease liabilities as of December 31, 2019 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

Operating Leases

    

Finance Leases

    

Total

2020

 

$

321,273

 

$

58,980

 

$

380,253

2021

 

 

330,032

 

 

58,980

 

 

389,012

2022

 

 

338,960

 

 

93,990

 

 

432,950

2023

 

 

244,973

 

 

 -

 

 

244,973

2024

 

 

231,503

 

 

 -

 

 

231,503

Thereafter

 

 

693,272

 

 

 -

 

 

693,272

Total minimum lease payments

 

 

2,160,013

 

 

211,950

 

 

2,371,963

Less: imputed interest

 

 

(423,607)

 

 

(20,179)

 

 

(443,786)

Present value of lease liabilities

 

$

1,736,406

 

$

191,771

 

$

1,928,177