LEASE OBLIGATIONS

12 Months Ended

Dec. 31, 2023

LEASE OBLIGATIONS [Abstract]

LEASE OBLIGATIONS

12. LEASE OBLIGATIONS

The Company leases certain properties and equipment for its ADMA BioCenters and ADMA BioManufacturing subsidiaries, which leases provide the right to use the underlying assets and require lease payments through the respective lease terms which expire at various dates through 2033. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company determines if an arrangement is an operating lease at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet and lease expense for such leases are recognized on a straight-line basis over the lease term. All other leases are recorded on the balance sheet with assets representing the right to use the underlying asset for the lease term and lease liabilities representing the obligation to make lease payments arising from the lease. Right-to-use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term and include options to extend or terminate the lease when they are reasonably certain to be exercised. The present value of the lease payments is determined using the Company’s incremental borrowing rate as of the lease commencement date.  For the lease liabilities recognized during the years ended December 31, 2023 and 2022, the Company used discount rates of 13% to 16%  to determine the present value of its lease obligations. The Company’s operating lease expense is recognized on a straight-line basis over the lease term and is reflected in Plasma center operating expenses and Selling, general and administrative expenses in the accompanying consolidated statements of operations. Aggregate lease expense for the Company’s operating leases for the years ended December 31, 2023, 2022 and 2021 was $2.4 million, $2.1 million and $1.4 million, respectively. Aggregate cash paid on these leases for the years ended December 31, 2023, 2022 and 2021 was $2.4 million, $1.8 million and $1.4 million, respectively.

During the year ended December 31, 2023, the Company recognized one additional right-to-use asset and corresponding lease liability in the amount of $0.1 million for office equipment leased for the Boca Facility. During the year ended December 31, 2022, the Company recognized additional right-to-use assets and corresponding lease liabilities aggregating to approximately $4.0 million in connection with two new property leases where the Company has opened additional plasma collection facilities, a property lease for the storage of raw materials inventory and a property lease for the building that the Company utilizes as its corporate headquarters (see Note 9). Including a finance lease the Company entered into in June 2018, the Company has aggregate lease liabilities of $10.8 million and $11.6 million as of December 31, 2023 and 2022, respectively, which are comprised primarily of the leases for the Company’s plasma collection centers.  The Company’s operating leases have a weighted average remaining term of 7.6 years. Scheduled payments under the Company’s lease obligations are as follows (in thousands):

Year ended December 31, 2024	$	2,397
2025		2,420
2026		2,157
2027		2,041
2028		2,088
Thereafter		6,151
Total payments		17,254
Less: imputed interest		(6,430	)
Current portion		(1,045	)
Balance at December 31, 2023	$	9,779