XML 23 R13.htm IDEA: XBRL DOCUMENT
v3.21.1

LEASES | 3 Months Ended
--- | ---
Mar. 31, 2021
LEASES [Abstract] |
LEASES |
NOTE 7 | LEASES
The Company adopted ASC 842, Leases on December 31, 2020 using the modified transition method without retrospective application to comparative periods. The Company elected the package of three practical expedients allowed for under the transition guidance. Accordingly, the Company did not reassess: (1) whether any expired or existing contracts are/or contain leases; (2) the lease classification for any expired or existing leases; or (3) initial direct costs for any existing leases. The Company has also elected not to recognize right of use assets (“ROU assets”) and lease liabilities for short-term leases that have a term of 12 months or less. The Company’s material operating leases consist of corporate office, as well as laboratory space. The office space is situated at 654 Madison Ave in New York, NY and expires on November 30, 2026. The laboratory space situated in Brooklyn, New York. Effective on July 1, 2019, the laboratory lease was amended to increase the space rented under the laboratory lease, rent increases 3% on January 1 of each lease year. The laboratory lease expires on December 31, 2025. The leases have remaining terms of 5 - 6 years. Brooklyn determines if an arrangement meets the criteria of a lease at inception, at which time it also performs an analysis to determine whether the lease qualifies as operating or financing. The Company does not currently have any finance leases. Operating lease liabilities represent the present value of lease payments not yet paid. ROU assets represent Brooklyn’s right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepaid or accrued lease payments, initial direct costs, lease incentives and impairment of operating lease assets. As the rate implicit in the lease is not readily determinable, the Company used its incremental borrowing rates based on the information available at the lease commencement date in determining the present value of lease payments. To determine the present value of lease payments not yet paid, the Company estimates secured borrowing rates corresponding to the maturities of the leases. The Company has elected the practical expedient to not separate non-lease components from the lease components to which they relate and instead account for each as a single lease component, for all underlying asset classes. Some leasing arrangements require variable payments that are dependent on usage or may vary for other reasons, such as payments for insurance, tax payments and other miscellaneous costs. The variable portion of lease payments is not included in the ROU assets or lease liabilities. Rather, variable payments, other than those dependent upon an index or rate, are expensed when the obligation for those payments is incurred and are included in lease expenses. Accordingly, all expenses associated with a lease contract are accounted for as lease expenses. Operating leases are included in right of use assets - operating leases and operating lease liabilities, current and long-term, in the balance sheet. Lease expense for operating leases is recognized on a straight-line basis over the lease term and is included in selling, administrative and other operating costs in the statements of operations. In accordance with provisions of ASC 842 Leases (“ASC 842”), we treated the sublease as a separate lease as we were not relieved of the primary obligation under the original lease. The Company continue to account for the original Manhattan facility, as a lessee, in the same manner as prior to the commencement date of the sublease. The Company accounted for the sublease as a lessor of the lease. The sublease is classified as an operating lease as it did not meet the criteria of a Sale-Type or Direct Financing lease. The Company recognize operating lease expense and lease payments from the sublease, on a straight-line basis, in its statements of operations over the lease terms. During the three months ended March 31, 2021, the net operating lease expenses are as follows:
|  | Three Months Ended March 31, 2021 |
Operating lease expense |  | $ | 150,865 |
Sublease income |  |  | (21,045 | )
Variable lease expense |  |  | 9,002 |
Total |  | $ | 138,822 |
The table below provides supplemental information related to operating leases for the three months ended:
|  | Three Months Ended March 31, 2021 |
Cash paid within operating cash flow |  | $ | 154,641 |
Weighted average remaining lease term (years) |  |  | 5.25 |
Weighted average discount rate |  |  | 14.5 | %
Maturities of operating lease liabilities as of March 31, 2021:
For the Three Months Ending March 31, |  | Amount |
Remaining of 2021 |  | $ | 428,878 |
2022 |  |  | 588,918 |
2023 |  |  | 606,864 |
2024 |  |  | 624,172 |
2025 |  |  | 641,981 |
Thereafter |  |  | 105,674 |
Future lease payments |  |  | 2,996,487 |
Less: Imputed interest |  | $ | 882,265 |
Total operating lease liabilities |  |  | 2,114,222 |
Sublease Agreement On April 18, 2019, the Company entered into a sublease agreement with Nezu Asia Capital Management, LLC (“the Tenant”), whereby the Tenant agreed to sublease approximately 999 square feet of space currently rented by the Company in New York, NY, for an initial term of 8 years, commencing on May 15, 2019. The term of the sublease expires on October 31, 2026 with no option to extend the sublease term. Rent payments provided by the Tenant under the sublease agreement began on September 1, 2019. The sublease agreement stipulates an annual rent increase of 2.25%. The Tenant also is responsible for paying to the Company all tenant energy costs, annual operating costs, and annual tax costs attributable to the subleased space during the term of the sublease. Future lease payments as of March 31, 2021 from the sublease agreement are as follows:
For the Three Months Ending March 31, |  | Amount |
Remaining of 2021 |  | $ | 60,655 |
2022 |  |  | 82,419 |
2023 |  |  | 84,194 |
2024 |  |  | 86,010 |
2025 |  |  | 87,867 |
Thereafter |  |  | 74,590 |
Total |  | $ | 475,735 |
The Company received sublease payments $20,027 during the three months ended March 31, 2020.

X
- References No definition available. + Details
Name: | us-gaap_LeasesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration