Quarterly report pursuant to Section 13 or 15(d)

Leasing Arrangements

v3.19.3
Leasing Arrangements
9 Months Ended
Sep. 30, 2019
Leases [Abstract]  
Leasing Arrangements
Leasing Arrangements

Operating Leases

We lease our laboratory, research facility and administrative office space under various operating leases. We also lease scientific equipment under various finance leases. Following the Business Disposals, we have assigned our office leases in North Carolina and New Jersey to Buyer.

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities, and operating lease liabilities, non-current on our unaudited condensed consolidated balance sheets. Finance leases are included in fixed assets, net of accumulated depreciation and obligations under finance leases.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Our incremental borrowing rate was determined by adjusting our secured borrowing interest rate for the longer-term nature of our leases. Our variable lease payments primarily consist of maintenance and other operating expenses from our real estate leases. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. The operating lease ROU asset also includes any lease payments made and excludes lease incentives incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

We have lease agreements with lease and non-lease components. We have elected to account for these lease and non-lease components as a single lease component. We are also electing not to apply the recognition requirements to short-term leases of twelve months or less and instead will recognize lease payments as expense on a straight-line basis over the lease term.

The components of lease expense were as follows for the three and nine months ended September 30, 2019 for continuing operations (in thousands):

 
 
Three months ended September 30, 2019
 
Nine months ended
September 30, 2019
Operating lease cost
 
$
43

 
$
130

Short-term lease cost
 
14

 
68

Variable lease cost
 
29

 
74

 
 
$
86

 
$
272


Supplemental cash flow related to leases of our continuing operations was as follows for the three and nine months ended September 30, 2019 (in thousands):

 
 
Three months ended September 30, 2019
 
Nine months ended
September 30, 2019
Cash paid amounts included in the measurement of lease liabilities:
 
 
 
 
Operating cash flows used for operating leases
 
$
54

 
$
164


Other supplemental information related to leases of our continuing operations was as follows at September 30, 2019:

Weighted average remaining lease term (in years)
 
 
Operating leases
 
1.24

 
 
 
Weighted average discount rate
 
 
Operating leases
 
7.97
%


We did not enter into any new operating leases that met scope during the three and nine months ended September 30, 2019.

At September 30, 2019, future estimated minimum lease payments under non-cancelable operating leases were as follows (in thousands):

2019 (remaining 3 months)
 
$
56

2020
 
191

2021
 
11

Total minimum lease payments
 
258

Less amount representing interest
 
22

Total
 
$
236

Leasing Arrangements
Leasing Arrangements

Operating Leases

We lease our laboratory, research facility and administrative office space under various operating leases. We also lease scientific equipment under various finance leases. Following the Business Disposals, we have assigned our office leases in North Carolina and New Jersey to Buyer.

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities, and operating lease liabilities, non-current on our unaudited condensed consolidated balance sheets. Finance leases are included in fixed assets, net of accumulated depreciation and obligations under finance leases.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Our incremental borrowing rate was determined by adjusting our secured borrowing interest rate for the longer-term nature of our leases. Our variable lease payments primarily consist of maintenance and other operating expenses from our real estate leases. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. The operating lease ROU asset also includes any lease payments made and excludes lease incentives incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

We have lease agreements with lease and non-lease components. We have elected to account for these lease and non-lease components as a single lease component. We are also electing not to apply the recognition requirements to short-term leases of twelve months or less and instead will recognize lease payments as expense on a straight-line basis over the lease term.

The components of lease expense were as follows for the three and nine months ended September 30, 2019 for continuing operations (in thousands):

 
 
Three months ended September 30, 2019
 
Nine months ended
September 30, 2019
Operating lease cost
 
$
43

 
$
130

Short-term lease cost
 
14

 
68

Variable lease cost
 
29

 
74

 
 
$
86

 
$
272


Supplemental cash flow related to leases of our continuing operations was as follows for the three and nine months ended September 30, 2019 (in thousands):

 
 
Three months ended September 30, 2019
 
Nine months ended
September 30, 2019
Cash paid amounts included in the measurement of lease liabilities:
 
 
 
 
Operating cash flows used for operating leases
 
$
54

 
$
164


Other supplemental information related to leases of our continuing operations was as follows at September 30, 2019:

Weighted average remaining lease term (in years)
 
 
Operating leases
 
1.24

 
 
 
Weighted average discount rate
 
 
Operating leases
 
7.97
%


We did not enter into any new operating leases that met scope during the three and nine months ended September 30, 2019.

At September 30, 2019, future estimated minimum lease payments under non-cancelable operating leases were as follows (in thousands):

2019 (remaining 3 months)
 
$
56

2020
 
191

2021
 
11

Total minimum lease payments
 
258

Less amount representing interest
 
22

Total
 
$
236