XML 27 R14.htm IDEA: XBRL DOCUMENT

LEASES

3 Months Ended

Mar. 31, 2022

NOTE 7: LEASES

The Company leases manufacturing, research and administrative facilities under operating leases. The Company evaluates its contracts to determine if an arrangement is a lease at inception and classify it as a finance or operating lease. Currently, all of the Company’s leases are classified as operating leases. Leased assets and corresponding liabilities are recognized based on the present value of the lease payments over the lease term. The lease terms may include options to extend when it is reasonably certain that the Company will exercise that option.

Topic ASC 842 requires the Company to recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. Right-of-use assets are recorded in other assets on the Company’s condensed consolidated balance sheets. Current and non-current lease liabilities are recorded in other accruals within current liabilities and other non-current liabilities, respectively, on its condensed consolidated balance sheets. Costs associated with operating leases are recognized on a straight-line basis within operating expenses over the term of the lease.

As of March 31, 2022, the Company had total operating lease liabilities of approximately $11.7 million and right-of-use assets of approximately $9.6 million, which were included in the condensed consolidated balance sheet.

Such leases do not require any contingent rental payments, impose any financial restrictions, or contain any residual value guarantees. Certain of the Company’s leases include renewal options and escalation clauses; renewal options have not been included in the calculation of the lease liabilities and right-of-use assets as the Company is not reasonably certain to exercise the options. Variable expenses generally represent the Company’s share of the landlord’s operating expenses. The Company does not act as a lessor or have any leases classified as financing leases.

The following summarizes quantitative information about the Company’s operating leases for the three months ended March 31, 2022 and 2021, respectively:


	For the Three Months Ended
	March 31,
	2022		2021
Operating lease expense summary:
Operating lease expense	$	425,000	$	425,000
Short-term lease expense		3,000		—
Variable lease expense		179,000		133,000
Total	$	607,000	$	558,000

The weighted-average remaining lease term as of March 31, 2022 and December 31, 2021 was approximately 8.2 years and 8.4 years, respectively. The weighted-average discount rate used to determine the operating lease liability as of March 31, 2022 and December 31, 2021 was approximately 5.7%.

Maturities of our operating leases, excluding short-term leases, are as follows:


Nine months ending December 31, 2022	$	961,000
Year ended December 31, 2023		1,542,000
Year ended December 31, 2024		1,826,000
Year ended December 31, 2025		1,874,000
Year ended December 31, 2026		1,775,000
Thereafter		6,997,000
Total		14,975,000
Less present value discount		(3,255,000)
Operating lease liabilities included in the Condensed Consolidated Balance Sheet at March 31, 2022	$	11,720,000

For the Three Months Ended

March 31,

Other information:

Operating cash flows - operating leases