NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
March 31, 2021
Note 1. Organization and Significant Accounting
Policies
PAID,
Inc. (“PAID”, the “Company”,
“we”, “us”, or “our”) has
developed AuctionInc, which is a suite of online shipping and tax
management tools assisting businesses with e-commerce storefronts,
shipping solutions, tax calculation, inventory management, and
auction processing. The product has tools to assist with other
aspects of the fulfillment process, but the main purpose of the
product is to provide accurate shipping and tax calculations and
packaging algorithms that provide customers with the best possible
shipping and tax solutions.
BeerRun
Software (“BeerRun”) is a brewery management and
Alcohol and Tobacco Tax and Trade Bureau tax reporting software.
Small craft brewers can utilize the product to manage brewery
schedules, inventory, packaging, sales and purchasing. Tax
reporting can be processed with a single click and is fully
customizable by state or province. The software is designed to
integrate with QuickBooks accounting platforms by using our
powerful sync engine. We currently offer two versions of the
software BeerRun and BeerRun Light which excludes some of the
enhanced features of BeerRun without disrupting the core
functionality of the software. Additional features include Brewpad
and Kegmaster and can be added on to the base product. Craft
brewing is on the rise in the United States, and we feel that there
is a large potential to grow this portion of our
business.
ShipTime Canada
Inc. (“ShipTime”) has developed a SaaS-based
application, which focuses on the small and medium business
segments. This offering allows members to quote, process, generate
labels, dispatch and track courier and LTL shipments all from a
single interface. The application provides customers with a choice
of today’s leading couriers and freight carriers all with
discounted pricing allowing members to save on every shipment.
ShipTime can also be integrated into on-line shopping carts to
facilitate sales via e-commerce. We actively sell directly to small
and medium businesses and through long standing partnerships with
selected associations throughout Canada.
PaidPayments provides commerce solutions to small - and
medium-sized businesses by enabling them to sell their goods and
services, accept payment, and create repeat sales though an online
payment processing solution. The Company has operated as a Payment
Facilitator since 2019, which enables our merchants to get the
benefit of instant boarding and discounted rates. Our platform
provides all aspects required for payment processing, including
merchant boarding, underwriting, fraud monitoring, settlement,
funding to the sub-merchant, and monthly reporting and statements.
The Company controls all of these necessary aspects in the payment
process and is then able to supply a one-step boarding process for
our partners and value-added resellers. This capability also
provides cost advantages, rapid response to market needs,
simplified processes for boarding business and a seamless interface
for our merchant customers.
General Presentation and Basis of Consolidated Financial
Statements
The
accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with accounting principles
generally accepted in the United States of America
(“GAAP”), and with the rules and regulations of the
Securities and Exchange Commission ("SEC") regarding interim
financial reporting. Accordingly, they do not include all of the
information and footnotes required by GAAP for complete financial
statements and should be read in conjunction with the Company's
audited consolidated financial statements and notes thereto
included in the Annual Report on Form 10-K for the year ended
December 31, 2020 that was filed on March 31, 2021.
In the
opinion of management, the Company has prepared the accompanying
unaudited condensed consolidated financial statements on the same
basis as its audited consolidated financial statements, and these
unaudited condensed consolidated financial statements include all
adjustments, consisting of normal recurring adjustments necessary
for a fair presentation of the results of the interim periods
presented. The operating results for the interim periods presented
are not necessarily indicative of the results expected for the full
year 2021.
Liquidity and Management’s Plans
For the
three months ended March 31, 2021, the Company reported cash and
cash equivalents of $2,026,002 and cash flows from operations of
$361,714 and net working capital of $430,246. The Company has
reported an operating loss of $179,333 for the period ended March
31, 2021 and has an accumulated deficit of $69,805,523 at March 31,
2021.
Management believes
that the growth of the PAID platform of services in addition to the
continued profitability of ShipTime’s services will return a
valuable impact on the Company’s success in the future. The
ongoing positive cash flows from operations is a significant
indicator of our successful transition to the new shipping and
eCommerce services. In addition to the existing services provided,
ShipTime will launch products in the United States that are
complementary to the current offerings. The Company also continues
to seek alternate sources of capital to support future
operations.
Although there can
be no assurances, the Company believes that the above management
plans will be sufficient to meet the Company's working capital
requirements through the end of May 2022 and will have a positive
impact on the Company for the foreseeable future.
Principles of Consolidation
The
condensed consolidated financial statements include the accounts of
PAID, Inc. and its wholly owned subsidiaries, PAID Run, LLC and
ShipTime Canada, Inc. All intercompany accounts and transactions
have been eliminated.
Foreign Currency
The
currency of ShipTime, the Company’s international subsidiary,
is in Canadian dollars. Foreign currency denominated assets and
liabilities are translated into U.S. dollars using the exchange
rates in effect at March 31, 2021 and December 31, 2020. Results of
operations and cash flows are translated using the average exchange
rates throughout the period. The effect of exchange rate
fluctuations on translation of assets and liabilities is included
as a separate component of shareholders’ equity in
accumulated other comprehensive income.
Geographic Concentrations
The
Company conducts business in the U.S. and Canada. For customers
headquartered in their respective countries, the Company derived
approximately 99% of its revenues from Canada and 1% from the U.S.
during the three months ended March 31, 2021 compared to 95% from
Canada and 5% from the U.S. during the three months ended March 31,
2020.
At
March 31, 2021, the Company maintained 100% of its property and
equipment net of accumulated depreciation in Canada.
Right of Use Assets
A
right-of-use asset represents a lessee’s right to use a
leased asset for the term of the lease. Our right-of-use assets
generally consist of an operating lease for a
building.
Right-of-use assets
are measured initially at the present value of the lease payments,
plus any lease payments made before a lease began and any initial
direct costs, such as commissions paid to obtain a
lease.
Right-of-use assets
are subsequently measured at the present value of the remaining
lease payments, adjusted for incentives, prepaid or accrued rent,
and any initial direct costs not yet expensed.
Long-Lived Assets
The
Company reviews the carrying values of its long-lived assets for
possible impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. If the
expected future cash flow from the use of the asset and its
eventual disposition is less than the carrying amount of the asset,
an impairment loss is recognized and measured using the fair value
of the related asset. No impairment charges were recognized during
the three months ended March 31, 2021. There can be no assurance,
however, that market conditions will not change or demand for the
Company’s services will continue, which could result in
impairment of long-lived assets in the future.
Revenue Recognition
The
Company generates revenue principally from fees for coordinating
shipping services, sales of shipping calculator subscriptions,
brewery management software subscriptions, merchant processing
services and client services.
Nature of Goods and Services
For
label generation service revenues, the Company recognizes revenue
when a customer has successfully prepared a shipping label and
scheduled a pickup. Customers with pickups after the end of the
reporting period are recorded as contract liabilities on the
condensed consolidated balance sheets. The service is offered to
consumers via an online registration and allows users to create a
shipping label using a credit card on their account (all customers
must have a valid credit card on file to process shipments on the
ShipTime platform).
For
shipping calculator revenues and brewery management software
revenues, the Company recognizes subscription revenue on a monthly
basis. Shipping calculator customers’ renewal dates are
based on their date of installation and registration of the
shipping calculator line of products. The timing of the revenue
recognition and cash collection may vary within a given quarter and
the deposits for future services are recorded as contract
liabilities on the condensed consolidated balance sheets. Brewery
management software subscribers are billed monthly at the first of
the month. All payments are made via credit card for the following
month.
Merchant
processing revenue consists of fees a seller pays us to process
their payment transactions and is recognized upon authorization of
a transaction. Revenue is recognized net of estimated refunds,
which are reversals of transactions initiated by sellers. We act as
the merchant of record for our sellers, which puts us in their
shoes with respect to card networks and puts the risk for refunds
and chargebacks on us. The gross transaction fees collected from
sellers is recognized as revenue as we are the primary obligor to
the seller and are responsible for processing the payment, have
latitude in establishing pricing with respect to the sellers and
other terms of service, have sole discretion in selecting the third
party to perform the settlement, and assume the credit risk for the
transaction processed.
Revenue Disaggregation
The
Company operates in five reportable segments (see
below).
Performance Obligations
At
contract inception, an assessment of the goods and services
promised in the contracts with customers is performed and a
performance obligation is identified for each distinct promise to
transfer to the customer a good or service (or bundle of goods or
services). To identify the performance obligations, the Company
considers all of the goods or services promised in the contract
regardless of whether they are explicitly stated or are implied by
customary business practices. Revenue is recognized when the
performance obligation has been met, which is when the customer has
successfully prepared a shipping label and scheduled a pickup for
shipping coordination and label generation services. The Company
considers control to have transferred at that time because the
Company has a present right to payment at that time, the Company
has provided the shipping label, and the customer is able to direct
the use of, and obtain substantially all of the remaining benefits
from the shipping label.
For
arrangements under which the Company provides a subscription for
shipping calculator services and brewery management software, the
Company satisfies its performance obligations over the life of the
subscription, typically twelve months or less.
Customers of
PaidPayments receive a merchant identification number which allows
them to process credit card transactions. Once the transaction is
approved, the funds are disbursed in an overnight feed and the
Company has met its performance obligation.
The
Company has no shipping and handling activities related to
contracts with customers.
Revenues are
recognized net of any taxes collected from customers, which are
subsequently remitted to government authorities.
Significant Payment Terms
Pursuant to the
Company’s contracts with its customers, amounts are collected
up front primarily through credit/debit card transactions.
Accordingly, the Company determined that its contracts with
customers do not include extended payment terms or a significant
financing component.
Variable Consideration
In some
cases, the nature of the Company’s contracts may give rise to
variable consideration, including rebates and cancellations or
other similar items that generally decrease the transaction
price.
Variable
consideration is estimated at the most likely amount that is
expected to be earned. Estimated amounts are included in the
transaction price to the extent it is probable that a significant
reversal of cumulative revenue recognized will not occur when the
uncertainty associated with the variable consideration is resolved.
Estimates of variable consideration and determination of whether to
include estimated amounts in the transaction price are based
largely on an assessment of the anticipated performance and all
information (historical, current and forecasted) that is reasonably
available.
Revenues are
recorded net of variable consideration, such as rebates, refunds,
and cancellations.
Warranties
The
Company’s products and services are provided on an “as
is” basis and no warranties are included in the contracts
with customers. Also, the Company does not offer separately priced
extended warranty or product maintenance contracts.
Contract Assets
Typically, the
Company has already collected revenue from the customer at the time
it has satisfied its performance obligation. Accordingly, the
Company has only a small balance of accounts receivable, totaling
$244,393 and $171,785 as of March 31, 2021 and December 31, 2020,
respectively. Generally, the Company does not have material amounts
of contract assets since revenue is recognized as control of goods
is transferred or as services are performed.
Contract Liabilities (Deferred Revenue)
Contract
liabilities are recorded when cash payments are received in advance
of the Company’s performance (including rebates). Contract
liabilities were $10,258 and $9,046 at March 31, 2021 and December
31, 2020, respectively. During the three months ended March 31,
2021, the Company recognized revenues of $9,046, related to
contract liabilities outstanding at the beginning of the
year.
Earnings (Loss) Per Common Share
Basic
earnings (loss) per share represent income (loss) available to
common shareholders divided by the weighted-average number of
common shares outstanding during the period. Diluted earnings
(loss) per share reflects additional common shares that would have
been outstanding if dilutive potential common shares had been
issued, as well as any adjustment to income (loss) that would
result from the assumed issuance. The potential common shares that
may be issued by the Company relate to outstanding stock options
and have been excluded from the computation of diluted earnings
(loss) per share because they would reduce the reported loss per
share and therefore have an anti-dilutive effect.
For the
three months ended March 31, 2021 and 2020, there were
approximately 36,000 and 48,000, respectively, of potentially
dilutive shares excluded from the diluted loss per share
calculation, as their effect would be anti-dilutive.
The
Company computes its income (loss) applicable to common
shareholders by adding/subtracting dividends on preferred stock,
including undeclared or unpaid dividends if cumulative, and any
deemed dividends or discounts on redeemed preferred stock from its
reported net income (loss) and reports the same on the face of the
condensed consolidated statements of operations and comprehensive
loss.
Segment Reporting
The
Company reports information about segments of its business in its
annual consolidated financial statements and reports selected
segment information in its quarterly reports issued to
shareholders. The Company also reports on its entity-wide
disclosures about the products and services it provides and reports
revenues and its major customers. The Company’s five
reportable segments are managed separately based on fundamental
differences in their operations. At March 31, 2021, the Company
operated in the following five reportable segments:
b.
Shipping
calculator services;
c.
Brewery
management software;
d.
Merchant
processing services;
e.
Shipping
coordination and label generation services; and
The
Company evaluates performance and allocates resources based upon
operating income. The accounting policies of the reportable
segments are the same as those described in this summary of
significant accounting policies. The Company’s chief
operating decision maker is the Chief Executive Officer/Chief
Financial Officer.
The
following table compares total revenue for the periods
indicated.
|
|
|
|
|
Client
services
|
$1,283
|
$99
|
Shipping calculator
services
|
5,863
|
8,322
|
Brewery management
software
|
19,200
|
37,106
|
Merchant processing
services
|
12,525
|
92,910
|
Shipping
coordination and label generation services
|
3,473,902
|
2,536,885
|
Total
revenues
|
$3,512,773
|
$2,675,322
|
The
following table compares total loss from operations for the periods
indicated.
|
|
|
|
|
Client
services
|
$969
|
$99
|
Shipping calculator
services
|
2,011
|
4,751
|
Brewery management
software
|
11,632
|
(4,882)
|
Merchant processing
services
|
4,622
|
36,496
|
Shipping
coordination and label generation services
|
(81,827)
|
(45,798)
|
Corporate
operations
|
(116,740)
|
(103,408)
|
Total loss from
operations
|
$(179,333)
|
$(112,742)
|
Subsequent Events
The
Company has evaluated subsequent events through the filing date of
this Form 10-Q, and has determined that no subsequent events have
occurred that would require recognition in the condensed
consolidated financial statements or disclosure in the notes
thereto, other than as disclosed herein.
Recent Accounting Pronouncements
In December
2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740):
“Simplifying the Accounting for Income Taxes” to
identify, evaluate, and improve areas of GAAP for which costs and
complexity can be reduced while maintaining or improving the
usefulness of the information provided to users of financial
statements. The amendments for ASU No. 2019-12 simplify the
accounting for income taxes by removing certain exceptions to the
general principles in Topic 740. The amendments also improve
consistent application of and simplify GAAP for other areas of
Topic 740 by clarifying and amending existing guidance. The
Company’s adoption of ASU No. 2019-12 in January 2021 had no
impact on its consolidated financial position, results of
operations, cash flows or disclosures.
Note 2. Accrued Expenses
Accrued
expenses are comprised of the following:
|
March 31,
2021
(unaudited)
|
|
Payroll and related
costs
|
$18,997
|
$25,319
|
Royalties
|
47,803
|
47,803
|
Accrued cost of
revenues
|
361,323
|
170,928
|
Sales
tax
|
31,902
|
31,902
|
Other
|
979
|
302
|
Total
|
$461,004
|
$276,254
|
Note 3. Intangible Assets
The
Company holds several patents for the real-time calculation of
shipping costs for items purchased through online auctions using a
zip code as a destination location indicator. It includes shipping
charge calculations across multiple carriers and accounts for
additional characteristics of the item being shipped, such as
weight, special packaging or handling, and insurance costs. These
patents help facilitate rapid and accurate estimation of shipping
costs across multiple shipping carriers and also include real-time
calculation of shipping.
In
addition, the Company has various other intangibles from past
business combinations.
At
March 31, 2021, intangible assets consisted of the
following:
|
|
|
|
|
|
Gross carrying
amount
|
$16,000
|
$851,610
|
$627,626
|
$4,994,308
|
$6,489,544
|
Accumulated
amortization
|
(16,000)
|
(720,904)
|
(627,626)
|
(1,562,693)
|
(2,927,223)
|
|
$-
|
$130,706
|
$-
|
$3,431,615
|
$3,562,321
|
At
December 31, 2020, intangible assets consisted of the
following:
|
|
|
|
|
|
Gross carrying
amount
|
$16,000
|
$839,816
|
$620,094
|
$4,928,102
|
$6,404,012
|
Accumulated
amortization
|
(16,000)
|
(668,929)
|
(620,094)
|
(1,465,569)
|
(2,770,592)
|
|
$-
|
$170,887
|
$-
|
$3,462,533
|
$3,633,420
|
Amortization
expense of intangible assets for the three months ended March 31,
2021 and 2020 was $121,395 and $114,543, respectively.
Note 4. Commitments and Contingencies
Legal Matters
In the
normal course of business, the Company periodically becomes
involved in litigation and disputes. During 2020, the Company was
notified of a dispute related to its non-renewal of the employment
agreement with Mr. Allan Pratt, the Company's former CEO, in which
Mr. Pratt appears to be treating it as a termination which would
trigger a two-year severance payment. As of March 31, 2021, in the
opinion of management, the Company had no pending litigation and
disputes that would have a material adverse effect on the Company's
consolidated financial position, results of operations, or cash
flows.
Indemnities and Guarantees
The
Company has made certain indemnities and guarantees, under which it
may be required to make payments to a guaranteed or indemnified
party, in relation to certain actions or transactions. The Company
indemnifies its directors, officers, employees and agents, as
permitted under the laws of the State of Delaware. In connection
with its facility leases, the Company has agreed to indemnify its
lessors for certain claims arising from the use of the facilities.
The duration of the guarantees and indemnities varies and is
generally tied to the life of the agreements. These guarantees and
indemnities do not provide for any limitation of the maximum
potential future payments the Company could be obligated to make.
Historically, the Company has not been obligated nor incurred any
payments for these obligations and, therefore, no liabilities have
been recorded for these indemnities and guarantees in the
accompanying condensed consolidated balance sheets.
Note 5. Shareholders’ Equity
Preferred Stock
The
Company’s amended Certificate of Incorporation authorizes the
issuance of 20,000,000 shares of blank-check preferred stock at
$0.001 par value. The Board of Directors will be authorized to fix
the designations, rights, preferences, powers and limitations of
each series of the preferred stock.
The
Company filed a Certificate of Designations effective on December
30, 2016 which sets aside 5,000,000 shares of Preferred Stock as
Series A Preferred Stock. The Series A Preferred Stock carries a
coupon payment obligation of 1.5% of the liquidation value per
share ($3.03) per year in cash or additional Series A Preferred
Stock, calculated by taking the 30-day average closing price for a
share of common stock for the month immediately preceding the
coupon payment date which is made annually. For the year ended
December 31, 2020, the annual coupon was $28,532. The Series A
Preferred Stock has no voting or conversion rights. If purchased,
redeemed, or otherwise acquired (other than conversion), the
preferred stock may be reissued. The Company paid the 2018 and 2019
coupon payments totaling $358,638 by issuing 126,727 preferred
shares and a cash payment of $26,252 for the 2020 coupon payment
for the three months ended March 31, 2020. In 2020, all 4,565,305
shares of Series A Preferred Stock were exchanged for common stock
(see below). As of March 31, 2021 and December 31, 2020, there are
no outstanding shares of Series A Preferred Stock.
Common Stock
In
February 2020, ShipTime Canada amended its rights to exchange one
share of ShipTime Canada stock from 45 PAID common shares and 311
PAID preferred shares to 356 PAID common shares. The Company made
available to its ShipTime Canada exchangeable preferred
shareholders the one-time option to convert existing book entry
preferred shares and exchangeable rights to preferred shares into
PAID common shares. As a result, certain ShipTime exchangeable
shareholders exercised their rights to receive 1,461,078 shares of
PAID Series A Preferred Stock for 1,461,078 shares of PAID common
stock. At the same time, the Company made available to its Series A
Preferred Stock shareholder the option to exchange existing Series
A preferred shares for PAID common shares. The exchange was offered
on a one-to-one basis. Shareholders holding 1,015,851 shares of
Series A Preferred Stock exchanged such shares for 1,015,851 shares
of PAID common stock. Furthermore, because of the amended exchange
rights, the Company reflected an additional exchange of PAID Series
A Preferred Stock shares totaling 2,089,298 to PAID common shares,
representing the additional amount of PAID common shares that will
be issued to the ShipTime shareholders upon the exchange. During
2020, two shareholders sold 500 ShipTime exchangeable shares which
were subsequently exchanged for 178,000 common shares. In total,
the Company has reserved for future issuance of 2,213,608 shares of
PAID common stock with respect to the remaining 6,218 exchangeable
shares to be issued as a result of the ShipTime acquisition which
are considered issued and outstanding as of March 31, 2021 for
financial reporting purposes.
During
2020, the Company issued 274,120 shares of PAID common stock as a
result of the exercise of an investor warrant for 770 ShipTime
exchangeable shares. The Company received gross proceeds of $35,636
in connection with the warrant exercise. On March 29, 2021, the
Company's Board of Directors authorized the issuance of 1,050,000
bonus shares of PAID common stock to the interim CEO/CFO for
services rendered during 2019 and 2020. This bonus was valued at
$2,005,500 based on the closing price of the Company's common stock
at March 29, 2021 and is recorded in accrued common stock bonus in
shareholders’ equity at December 31, 2020. These shares were
issued on March 31, 2021. On March 29, 2021, the
Board of Directors approved the issuance of 250,000 shares of PAID
common stock valued at $1.91 per share to W. Austin Lewis IV as it
relates to his 2021 employment agreement, of which 125,000 of the
shares are subject to repurchase at the award value of $1.91 per
share if Mr. Lewis terminates employment prior to January 1, 2022,
as defined in the employment agreement. These shares were
issued on March 31, 2021. The value of the shares that are
subject to repurchase will be recognized ratably as share-based
compensation expense over the next nine months. Unrecognized
compensation expense related to these shares is
$238,750.
Share-based Incentive Plans
On
March 23, 2018, the Board of Directors voted to approve the 2018
Stock Option Plan which reserves 450,000 non-qualified stock
options to be granted to employees. The Company has three
additional stock option plans that include both incentive and
non-qualified stock options to be granted to certain eligible
employees, non-employee directors, or consultants of the Company.
On November 10, 2020, the board voted to increase the 2018 Stock
Option Plan from 450,000 options to 900,000 options. For the year
ended December 31, 2020, the Company granted 105,000 stock options
to employees, consultants and directors. The 2020 options have
vesting periods of immediately and over a three-year period, they
expire if not exercised within ten years from grant date, and the
exercise price is $2.885 per share. During 2020, as a result of the
termination of several employees, the Company recorded 61,948
expired options and an additional 20,459 that were cancelled.
During 2021, the Company issued 10,000 stock options to one
employee. These options have a three-year vesting schedule with
one-third vesting immediately, one-third vesting in 18 months and
the final one-third vesting in 36 months, they expire if not
exercised in ten years from the grant date, and their exercise
price is $1.91 per share.
For the
three-month periods ended March 31, 2021 and 2020, the Company
recorded $263,613 and ($20,789), respectively, of share-based
compensation expense related to the vesting of applicable options
granted in 2021 and prior years and the issuance of shares in the
first quarter of 2021 for employment compensation.
Note 6. Leases
We have
an operating lease for our corporate offices in Canada and finance
leases for furniture and equipment. Our leases have remaining lease
terms of two months to twenty-nine months, and our primary
operating leases include options to extend the leases for four
years. Future renewal options that are not likely to be executed as
of the balance sheet date are excluded from right-of-use assets and
related lease liabilities.
We
report operating leased assets, as well as operating lease current
and noncurrent obligations on our balance sheets for the right to
use the building in our business. Our finance leases represent
furniture and office equipment; we report the furniture and
equipment, as well as finance lease current and noncurrent
obligations on our balance sheet.
Generally, interest
rates are stated in our leases for equipment. When no interest rate
is stated in a lease, however, we review the interest rates
implicit in our recent finance leases to estimate our incremental
borrowing rate. We determine the rate implicit in a lease by using
the most recent finance lease rate, or other method we think most
closely represents our incremental borrowing rate.
The
components of lease expense were as follows:
|
Three Months
Ended
March 31,
2021
|
Three Months
Ended
March 31,
2020
|
Operating lease
cost
|
$10,095
|
$9,707
|
|
|
|
Finance lease
cost:
|
|
|
Amortization of
leased assets
|
$2,741
|
$2,428
|
Interest on lease
liabilities
|
57
|
281
|
Total finance lease
cost
|
$2,798
|
$2,709
|
Supplemental cash
flow information related to leases was as follows:
|
Three Months Ended
March 31, 2021
|
Three Months Ended
March 31, 2020
|
Cash paid for
amounts included in leases:
|
|
|
Operating cash
flows from operating leases
|
$10,395
|
$9,880
|
Operating cash
flows from finance leases
|
$57
|
$281
|
Financing cash
flows from finance leases
|
$1,417
|
$2,316
|
|
|
|
Right-of-use assets
obtained in exchange for lease obligations:
|
|
|
Operating
leases
|
$-
|
$-
|
Finance
leases
|
$-
|
$-
|
Supplemental
balance sheet information related to leases was as
follows:
|
|
|
Operating
leases:
|
|
|
Operating lease
right-of-use assets
|
$86,723
|
$93,457
|
Current portion of
operating lease obligations
|
$34,889
|
$33,118
|
Operating lease
obligations, net of current portion
|
53,009
|
61,794
|
Total operating
lease liabilities
|
$87,898
|
$94,912
|
|
|
|
Finance
leases:
|
|
|
Property and
equipment, at cost
|
$54,825
|
$54,066
|
Accumulated
depreciation
|
(52,083)
|
(48,659)
|
Property and
equipment, net
|
$2,742
|
$5,407
|
|
|
|
Current portion of
finance lease obligations
|
$1,457
|
$2,844
|
Finance lease
obligations, net of current portion
|
-
|
-
|
Total finance lease
liabilities
|
$1,457
|
$2,844
|
|
|
|
Weighted Average
Remaining Lease Term
|
|
|
Operating
lease
|
|
|
Finance
leases
|
|
|
|
|
|
Weighted Average
Discount Rate
|
|
|
Operating
lease
|
9.0%
|
9.0%
|
Finance
leases
|
9.7%
|
9.7%
|
A
summary of future minimum payments under non-cancellable operating
lease commitment as of March 31, 2021 is as follows:
Years ending
December 31,
|
|
2021
|
32,042
|
2022
|
40,869
|
2023
|
25,274
|
Total lease
liabilities
|
$98,185
|
Less
amount representing interest
|
(10,287)
|
Total
|
87,898
|
Less
current portion
|
(34,889)
|
|
$53,009
|
The
following is a schedule of minimum future rentals on the
non-cancelable finance leases as of March 31, 2021:
Year ending
December 31,
|
|
2021
|
1,480
|
Total minimum
payments required:
|
1,480
|
Less amount
representing interest:
|
(23)
|
Present value of
net minimum lease payments:
|
1,457
|
Less current
portion
|
(1,457)
|
|
$-
|