OPERATING LEASE COMMITMENTS

6 Months Ended

Jun. 30, 2014

Notes to Financial Statements

Note 4. OPERATING LEASE COMMITMENTS

The Company leases approximately 37,000 square feet of manufacturing, laboratory and office space in a single-story building located in Franklin, Massachusetts under a lease expiring October 31, 2017.

The Company also leases approximately 7,900 square feet of corporate office space in a multi-story building located in Philadelphia, Pennsylvania under a lease expiring May 31, 2017, with the right to terminate the lease on November 30, 2014 at a cost that the Company has approximated at $43,000.

The Company also leases a corporate apartment in Franklin, Massachusetts under a lease expiring on November 21, 2014, with the right to terminate the lease early upon payment of a termination fee.

Future minimum lease payments for each of the next five years under these operating leases at June 30, 2014 are approximately as follows:

	Franklin		Philadelphia		Total
Year Ending December 31,
2014	$	230,000	$	94,000	$	324,000
2015		457,000		191,000		648,000
2016		468,000		196,000		664,000
2017		389,000		82,000		471,000
2018		—		—		—
Total	$	1,544,000	$	563,000	$	2,107,000

The Company’s facilities lease expense, including accruals for lease incentives, was approximately $142,000 and $99,000 for the three months ended June 30, 2014 and 2013, respectively, and $275,000 and $389,000 for the six months ended June 30, 2014 and 2013, respectively.