Leases (Tables)

12 Months Ended

Dec. 31, 2021

Operating lease right-of-use assets and lease liabilities as of December 31, 2021 and 2020 are as follows:


Description	Location in Balance Sheet	December 31, 2021 (1)		December 31, 2020 (1)
Non current assets:
Chartered-in contracts greater than 12 months (2)	Operating lease right-of-use assets	$	15,039,060	$	6,207,253
Office leases	Operating lease right-of-use assets	1,978,369		1,333,618
		$	17,017,429	$	7,540,871
Liabilities:
Chartered-in contracts greater than 12 months	Current portion of operating lease liabilities	$	15,039,060	$	6,974,943
Office leases	Current portion of operating lease liabilities	689,047		640,428
Lease liabilities - current portion		$	15,728,107	$	7,615,371


Office leases	Noncurrent portion of operating lease liabilities	1,282,553		686,422
Lease liabilities - non current portion		$	1,282,553	$	686,422

(1) The Operating lease right-of-use assets and Operating lease liabilities represent the present value of lease payments for the remaining term of the lease. The discount rates used ranged from 1.33% to 6.08%. The weighted average discount rate used to calculate the lease liability was 1.67%.

(2) During the second quarter of 2020, the Company determined that there were impairment indicators present for one of our chartered-in vessel contracts and, as a result, we recorded an operating lease impairment of $0.4 million. The operating lease impairment was included as component of Operating income/(loss) in our Consolidated Statements of Operations for the year ended December 31, 2020.

Charter Hire Expense

The table below presents the components of the Company’s lease expenses and sub-lease income on a gross basis earned from chartered-in contracts greater than 12 months for the year ended December 31, 2021 and 2020:


Description	Location in Statement of Operations	For the Year Ended December 31, 2021		For the Year Ended December 31, 2020
Lease expense for chartered-in contracts less than 12 months	Charter hire expenses	$	20,553,368	$	8,731,978
Lease expense for chartered-in contracts greater than 12 months	Charter hire expenses	16,548,324		12,548,246
	Total charter hire expenses	$	37,101,692	$	21,280,224

Lease expense for office leases	General and administrative expenses	$	642,020	$	733,874

Sub lease income from chartered-in contracts greater than 12 months *	Revenues, net	$	25,372,314	$	8,589,156

* The sub-lease income represents only time charter revenue earned on the chartered-in contracts greater than 12 months. There is additional revenue earned from voyage charters on the same chartered-in contracts which is recorded in Revenues, net in our Consolidated Statements of Operations for the years ended December 31, 2021 and 2020. Additionally, there is revenue earned from time charters from chartered-in contracts less than 12 months which is included in Revenues, net in our Consolidated Statements of Operations for the years ended December 31, 2021 and 2020.

Future Minimum Lease Payments

The table below provides the total amount of lease payments on an undiscounted basis on our time chartered-in contracts and office leases greater than 12 months as of December 31, 2021:


Supplemental Disclosure Information	Chartered-in contracts greater than 12 months			Office leases			Total Operating leases
Discount rate upon adoption (1)	5.37		%	5.80		%	5.48		%
Year:
2022	15,096,117			748,243			15,844,360
2023	—			510,074			510,074
2024	—			265,922			265,922
2025	—			265,195			265,195
2026	—			265,195			265,195
2027	—			53,766			53,766
	15,096,117			2,108,395			17,204,512

Present value of lease liability
Lease liabilities - short term	15,039,060			689,047			15,728,107
Lease liabilities - long term	—			1,282,553			1,282,553
Total lease liabilities	15,039,060			1,971,600			17,010,660

Discount based on incremental borrowing rate	$	57,057		$	136,795		$	193,852

(1) Discount rate upon adoption does not include the discount rate on the lease modification on December 25, 2019. The discount rate used for calculation of the right-of-use asset and the related lease liability on December 25, 2019 was 2.806%