Right to Use Assets and Liabilities

9 Months Ended

Sep. 30, 2020

Leases [Abstract]

Right to Use Assets and Liabilities

6. Right to Use Assets and Liabilities

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (ROU) assets and operating lease liabilities in the condensed consolidated balance sheets.

ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate ranges from 3.2-6.6%. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Some of the Company’s leases include options to extend or terminate the lease. The Company includes these options in the recognition of the Company’s ROU assets and lease liabilities when it is reasonably certain that the Company will exercise the option.

The Company has operating leases for its corporate office and certain equipment, which expire no later than September 30, 2024. The leases have a weighted average remaining term of 2.2 years.

The components of lease expense were as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Operating lease cost	$	262,045	$	173,446	$	731,477	$	604,731

Supplemental cash flow information related to leases was as follows:

	Nine Months Ended
	September 30,
	2020		2019
Cash paid for amounts included in the measurement of lease    liabilities:
Operating cash flows from operating leases	$	669,183	$	399,610
Supplemental non-cash information:
Right-of-use assets obtained in exchange for new lease    obligations	$	572,413	$	367,868

Maturities of lease liabilities for operating leases as of September 30, 2020, are as follows:

Remainder of 2020	$	189,472
2021		1,124,684
2022		1,108,066
Thereafter		12,041
Total lease payments		2,434,263
Less: imputed interest		(143,026	)
Total	$	2,291,237