Leases

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

Leases

Note 6: Leases

The Company has two operating leases, one for an office space and another for an office space and manufacturing facility; and two finance leases for an office equipment and plant equipment. As of March 31, 2020, the leases have remaining terms between one year and less than five years. The operating leases do not include an option to extend beyond the life of the current term. There are no short-term leases, and the lease agreements do not require material variable lease payments, residual value guarantees or restrictive covenants.

The tables below present the operating and financing lease assets and liabilities recognized on the condensed consolidated balance sheets as of March 31, 2020 and December 31, 2019:

Right-of Use Assets	March 31, 2020		December 31, 2019
Operating Leases	$	1,757,324	$	1,867,205
Financing Leases		5,227		6,347
	$	1,762,551	$	1,873,552

Lease Liabilities, Current	March 31, 2020		December 31, 2019
Operating Leases	$	447,728	$	440,127
Financing Leases		4,539		4,494
	$	452,267	$	444,621
Lease Liabilities, Non-Current
Operating Leases	$	1,363,664	$	1,479,458
Financing Leases		386		1,538
	$	1,364,050	$	1,480,996
Total Lease Liabilities		1,816,317		1,925,617

The amortizable lives of operating and financing leased assets are limited by the expected lease term.

The Company's leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating and financing lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. The Company used incremental borrowing rates as of January 1, 2019 for leases that commenced prior to that date.

The Company's weighted average remaining lease term and weighted average discount rate for operating and financing leases as of March 31, 2020 and December 31, 2019 are:

March 31, 2020	Operating			Financing
Weighted Average Remaining Lease Term		3.71 Years			1.17 Years
Weighted Average Discount Rate		3.95	%		3.95	%

December 31, 2019	Operating			Financing
Weighted Average Remaining Lease Term		3.96 Years			1.42 Years
Weighted Average Discount Rate		3.95	%		3.95	%

The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under non-cancelable leases with terms of more than one year to the total lease liabilities recognized on the condensed consolidated balance sheets as of March 31, 2020:

Year Ending December 31,	Operating		Financing
Remainder of 2020	$	381,260	$	3,489
2021		520,993		1,550
2022		534,295		—
2023		515,257		—
Undiscounted Future Minimum Lease Payments		1,951,805		5,039
Less: Difference between undiscounted lease payments and discounted lease liabilities		140,413		114
Total Lease Liabilities	$	1,811,392	$	4,925
Short-Term Lease Liabilities	$	447,728	$	4,539
Long-Term Lease Liabilities	$	1,363,664	$	386

Operating lease expense was approximately $128,000 and $135,000 for the three months ended March 31, 2020 and 2019, respectively. Operating lease costs are included within selling, general and administrative expenses on the condensed consolidated statements of operations.

Financing lease costs for the three months ended March 31, 2020 and 2019 included approximately $1,000 and $17,000, respectively, in right-of-use asset amortization and approximately $100 and $1,000, respectively, of interest expense. Financing lease costs are included within selling, general and administrative expenses on the condensed consolidated statements of operations. 

Cash paid for amounts included in the measurement of operating lease liabilities were approximately $127,000 and $131,000 for the three months ended March 31, 2020 and 2019, respectively. Cash paid for amounts included in the measurement of financing lease liabilities were approximately $1,000 and $18,000 for the three months ended March 31, 2020 and 2019, respectively.