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Note 3 - Leases

6 Months Ended

Jun. 30, 2020

Lessee, Operating and Finance Leases [Text Block]

NOTE 3 - LEASES

The Company leases certain vehicles, real property and office equipment under lease agreements. The Company evaluates each lease to determine its appropriate classification as an operating lease or finance lease for financial reporting purposes. The majority of our operating leases are non-cancelable operating leases for production and office space in Hobro, Aarhus and Copenhagen, Denmark as well as in White Bear Lake, Minnesota.

During the six months ended June 30, 2020, cash paid for amounts included for the measurement of lease liabilities was $521,716 and the company recorded operating lease expense of $577,765.

Supplemental balance sheet information related to leases as of June 30, 2020 and December 31, 2019 was as follows

	June 30, 2020			December 31, 2019
Operating leases:
Operating lease right-of-use	$	4,776,456		$	5,053,614

Operating lease liabilities - current	$	957,971		$	999,685
Operating lease liabilities – long-term		3,951,093			4,141,855
Total operating lease liabilities	$	4,909,064		$	5,141,540

Finance leases:
Property and equipment, at cost	$	1,366,488		$	1,362,272
Accumulated depreciation		(1,178,583	)		(1,156,145	)
Property and equipment, net	$	187,905		$	206,127

Finance lease liabilities - current	$	35,589		$	34,772
Finance lease liabilities – long-term		154,832			172,273
Total finance lease liabilities	$	190,421		$	207,045

Weighted average remaining lease term:
Operating leases		10.2			10.2
Finance leases		5.0			5.5

Weighted average discount rate:
Operating leases		6.3	%		6.4	%
Finance leases		3.9	%		3.9	%

Maturities of lease liabilities at June 30, 2020 were as follows:

	Operating lease			Finance lease
2020 (remaining 6 months)	$	529,443		$	21,210
2021		885,165			42,421
2022		805,270			40,848
2023		761,361			36,211
2024		610,822			37,156
Thereafter		3,041,218			32,650
Total payment under lease agreements		6,633,279			210,496
Less imputed interest		(1,724,215	)		(20,075	)
Total lease liability	$	4,909,064		$	190,421