Annual report pursuant to Section 13 and 15(d)

Note 9 - Leases

v3.20.4
Note 9 - Leases
12 Months Ended
Dec. 31, 2020
Notes to Financial Statements  
Lessee, Operating Leases [Text Block]
9.
Leases
 
Lessee:
 
The following information pertains to those operating lease agreements where the Company is the lessee.
 
On
February 1, 2017,
the Company entered into a sublease agreement (the “Sublease”) for approximately
12,400
square feet of building space for the relocation of the Company's corporate headquarters to Englewood, Colorado (the “Sublease Premises”), which was effective as of
January 26, 2017.
The lease term commenced on
June 1, 2017
and will terminate in
May 2021.
The Company relocated its corporate headquarters from Sunnyvale, California to Englewood, Colorado in
June 2017.
 
The monthly base rent under the Sublease is equal to
$20.50
per rentable square foot of the Sublease Premises during the
first
year. The monthly base rent is equal to
$21.12
and
$21.75
per rentable square foot during the
second
and
third
years, respectively. In connection with the execution of the Sublease, the Company also agreed to pay a security deposit of approximately
$22,000.
The Company was also provided an allowance of approximately
$88,000
for certain tenant improvements relating to the engineering, design and construction of the Sublease Premises which has been reimbursed. 
 
 
In
September 2018,
the Company entered into a
36
-month noncancelable operating lease agreement for office equipment.  The lease commenced on
September 20, 2018.  
The monthly lease payment is approximately
$3,000.
 
 
After the adoption of ASU
842
– Leases on
January 1, 2019,
operating lease rentals are expensed on a straight-line basis over the life of the lease beginning on the date the Company takes possession of the property. At lease inception, the Company determines the lease term by assuming the exercise of those renewal options that are reasonably assured. The lease term is used to determine whether a lease is financing or operating and is used to calculate straight-line rent expense. Additionally, the depreciable life of leasehold improvements is limited by the expected lease term. Leases with an initial term of
12
months or less are
not
recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term.
 
The following table reflects the Company's lease assets and lease liabilities at
December 31, 2020
and
2019.
(in thousands):
 
   
December 31,
   
December 31,
 
   
2020
   
2019
 
                 
Assets:
               
Operating lease right-of-use assets
  $
130
    $
395
 
                 
Liabilities:
               
Current operating lease liabilities
  $
132
    $
268
 
Noncurrent operating lease liabilities
   
-
     
132
 
    $
132
    $
400
 
 
The operating lease right-of-use assets are included in other assets on the consolidated balance sheets. The operating lease liabilities are included in accrued liabilities and other noncurrent liabilities on the consolidated balance sheets.
 
The operating lease expense for the years ended
December 31, 2020
and
2019
was
$300,000
and
$301,000,
respectively.
 
As of
December 31, 2020,
the maturity of operating lease liabilities was as follows (in thousands):
 
Year Ending December 31,
 
 
 
 
2021
  $
137
 
Total lease payments
   
137
 
Less: Amount representing interest
   
(5
)
Present value of lease liabilities
  $
132
 
 
The weighted average remaining lease term was approximately
5
months as of
December 31, 2020.
The weighted average discount rate for the year ended
December 31, 2020
was
12.5%.
 
Lessor:
 
The following information pertains to those operating lease agreements where the Company is the lessor.
 
As of
December 31, 2020,
minimum future rentals from customers on non-cancellable operating leases of Viveve Systems are as follows (in thousands):
 
Year Ending December 31,
 
 
 
 
2021
  $
345
 
Thereafter
   
-
 
Total
  $
345
 
 
As of
December 31, 2020,
the Company included rental program equipment related to these operating leases agreements with a net value of
$841,000
in property and equipment, net. The depreciation expense for rental program equipment for the years ended
December 31, 2020
and
2019
is
$462,000
and
$121,000,
respectively.