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LEASES

9 Months Ended

Sep. 30, 2021

LEASES

7. LEASES

NOTE 7. LEASES

In April 2018, we entered into a 10-year lease agreement for a new 9,000-square-foot facility that contains office, warehouse, lab and research and development space in Frederick, Maryland.  The lease agreement was scheduled to commence on December 1, 2018 or when the property was ready for occupancy. The agreement provided for annual rent of $143,460, an escalation clause that increases the rent 3% year over year, a landlord tenant improvement allowance of $405,000 and additional landlord work as discussed in the lease agreement. We took occupancy of the property on December 17, 2018 and the lease was amended in March 2019 to provide for a 4-month rent holiday and a commencement date of April 1, 2019. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term.

The balances for our operating lease where we are the lessee are presented as follows within our condensed consolidated balance sheet:

Operating leases:		September 30, 2021 (Unaudited)				December 31, 2020
Assets:
Operating lease right-of-use asset		$	595,874			$	631,527
Liabilities:
Current Portion of Long-Term Operating Lease		$	89,059			$	81,223
Long-Term Operating Lease, Net of Current Portion			885,252				953,190
		$	974,311			$	1,034,413

The components of lease expense are as follows and are included within general and administrative expense on our condensed consolidated statement of operations:

		For the Three Months Ended September 30, 2021 (Unaudited)				For the Three Months Ended September 30, 2020 (Unaudited)
Operating lease expense		$	39,329			$	39,329

		For the Nine Months Ended September 30, 2021 (Unaudited)				For the Nine Months Ended September 30, 2020 (Unaudited)
Operating lease expense		$	117,986			$	117,986

Other information related to leases where we are the lessee is as follows:

		September 30, 2021 (Unaudited)				December 31, 2020
Weighted-average remaining lease term:
Operating leases		7.50 years				8.25 years
Discount rate:
Operating leases			7.00	%			7.00	%

Supplemental cash flow information related to leases where we are the lessee is as follows:

		For the Three Months Ended September 30, 2021 (Unaudited)				For the Three Months Ended September 30, 2020 (Unaudited)
Cash paid for amounts included in the measurement of lease liabilities:		$	38,049			$	36,940

		For the Nine Months Ended September 30, 2021 (Unaudited)				For the Nine Months Ended September 30, 2020 (Unaudited)
Cash paid for amounts included in the measurement of lease liabilities:		$	113,049			$	109,747

As of September 30, 2021, the maturities of our operating lease liability are as follows:

Year Ended:		Operating Lease
October 1 – December 31, 2021		$	38,049
December 31, 2022			155,621
December 31, 2023			160,290
December 31, 2024			165,098
December 31, 2025			170,051
Thereafter			575,131
Total minimum lease payments			1,264,241
Less:  Interest			289,930
Present value of lease obligations			974,311
Less: Current portion			89,059
Long-term portion of lease obligations		$	885,252

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- References

No definition available.

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- Definition

The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/otherTransitionRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 840
-URI http://asc.fasb.org/topic&trid=2208923

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