Note 8 - Commitments and Contingencies

9 Months Ended

12 Months Ended

Sep. 30, 2020

Dec. 31, 2019

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

Note

Commitments and Contingencies

Leases

We currently operate

one

facility located in the United States and

one

facility located in China under leases which are both classified as operating leases.

Our corporate offices and primary research facilities are located in Germantown, Maryland, where we lease approximately

1,500

square feet. This lease provides for monthly payments of approximately

$5,600

per month. This lease has an initial term of

months and expires on

December 31, 2020.

We did

not

establish a right of use (“ROU”) asset or lease liability for this short-term lease.

We also lease approximately

11,300

square feet of research facility in the People's Republic of China. This lease commenced in

September 2019,

provides for minimum lease payments of approximately

$4,400

per month, expires in

September 2024

and provides us with a future

first

right of refusal for extending the lease beyond its expiration. This lease currently represents our lone long-term operating lease.

Our long-term operating lease and related sublease for our San Diego facility both terminated in

August 2019.

We recognized other income of approximately

$86,100

from this sublease for the

nine

months ended

September 30, 2019.

We recognized total rent expense of approximately

$91,100

and

$164,500

in the

nine

months ended

September 30, 2020

and

2019,

respectively. Included in the expense is approximately

$50,700

and

$83,900

in the

nine

months ended

September 30, 2020

and

2019,

respectively relating to our short-term leases. Lease costs, net of sublease income, for the

nine

months ended

September 30

consisted of the following:

	2020		2019
Operating lease cost	$	91,100	$	141,300
Variable lease cost		–		23,200
Sublease income		–		(86,100	)
Total net lease cost	$	91,100	$	78,400

September 30, 2020,

we have approximately

$181,800

of ROU assets included in Disposal Group Assets Held for Sale and approximately

$159,400

of lease liability included in Disposal Group Liabilities Associated with Assets Held for Sale in our condensed consolidated balance sheets.

Future payments under our lone long-term operating lease as of

September 30, 2020

are as follows:

Future undiscounted cash flows:
2020	*	$	12,200
2021			55,900
2022			57,600
2023			59,400
2024			14,000
Total			199,100
Discount factor			(39,700	)
Lease liability			159,400
Less current liability			(37,100	)
Non-current lease liability		$	122,300

* reflects the remaining

months of

2020

Other

From time to time, we are parties to legal proceedings that we believe to be ordinary, routine litigation incidental to the business. We are currently

not

a party to any litigation or legal proceeding.

Note

Commitments and Contingencies

Leases

We currently operate

one

facility located in the United States and

one

facility located in China under leases which are both classified as operating leases.

Our corporate offices and primary research facilities are located in Germantown, Maryland, where we lease approximately

1,500

square feet. This lease provides for monthly payments of approximately

$5,700

per month. This lease had an initial term of

months and expired on

December 31, 2019.

We are currently operating on a month-to-month lease as we negotiate an extension. We did

not

establish a right of use (“ROU”) asset or lease liability for this short-term lease.

We also lease approximately

11,300

square feet of research facility in the People's Republic of China. This lease commenced in

September 2019,

provides for minimum lease payments of approximately

$4,400

per month, expires in

September 2024

and provides us with a future

first

right of refusal for extending the lease beyond its expiration. This lease currently represents our lone long-term operating lease. This new lease obligation resulted in us obtaining an ROU asset of approximately

$205,000.

Our long-term operating lease and related sublease for our San Diego facility both terminated in

August 2019.

We recognized other income of approximately

$86,100

from this sublease for the year ended

December 31, 2019.

We recognized total rent expense of approximately

$194,200

and

$164,000

in the years ended

December 31, 2019

and

2018,

respectively. Included in the

2019

expense is approximately

$67,700

relating to our short-term leases. Lease costs, net of sublease income, for the year ended

December 31, 2019

consisted of the following:

Operating lease cost			$171,000
Variable lease cost			23,200
Sublease income			(86,100)
Total net lease cost			$108,100

In the year ended

December 31, 2019,

we established approximately

$204,300

of ROU assets as the result of entering into new lease arrangements.

December 31, 2019,

we have approximately

$201,700

of ROU assets included in ROU and Other Assets and approximately

$180,900

of lease liability the current portion of which is included in Short-term Notes and Other Current Liabilities and the long-term portion of which is included in Lease Liability, Net of Current Portion in our consolidated balance sheets. The lease liability was calculated using a discount rate of

12.75%.

Maturities of our lone long-term operating lease as of

December 31, 2019

were as follows:

Future undiscounted cash flows:
2020	$	53,503
2021		54,539
2022		56,190
2023		58,027
2024		13,650
Total		235,909
Discount factor		(54,997	)
Lease liability		180,912
Less current liability		(32,369	)
Non-current lease liability	$	148,543

Other

From time to time, we are parties to legal proceedings that we believe to be ordinary, routine litigation incidental to the business. We are currently

not

a party to any litigation or legal proceeding.