Leases

6 Months Ended

Jun. 30, 2021

Leases

Leases

4. Leases

The Company’s leases are primarily comprised of real estate leases for the use of office space, with certain lease arrangements that contain equipment. The Company determines whether an arrangement contains a lease at inception. Lease assets and liabilities are recognized upon commencement of the lease based on the present value of the future minimum lease payments over the lease term. The lease term includes options to extend the lease when it is reasonably certain that the Company will exercise that option. Substantially all of the leases are long-term operating leases for facilities with fixed payment terms between 1.5 and 12.8 years.

The table below presents supplemental information related to operating leases:

Six Months Ended June 30, 2021
Operating cash flows for operating leases	$	1,938,629
Noncash lease liabilities arising from obtaining operating leased assets during the period	$	-
Weighted-average remaining lease term		10.80
Weighted-average discount rate		13.59	%

The Company generally utilizes its incremental borrowing rate based on information available at the commencement of the lease in determining the present value of future payments since the implicit rate for most of the Company’s leases is not readily determinable.

Variable lease expense includes rental increases that are not fixed, such as those based on amounts paid to the lessor based on cost or consumption, such as maintenance and utilities.

Operating lease costs recognized for the three months ended June 30, 2021 and 2020 were $906,838 and $1,062,181, respectively. Operating lease costs recognized for the six months ended June 30, 2021 and 2020 were $1,815,303 and $2,100,085, respectively.

Maturities of operating lease liabilities as of June 30, 2021 are summarized as follows:

Years Ending December 31,
2021 (remaining six months of the year)	$	1,866,224
2022		3,525,158
2023		3,528,696
2024		3,526,406
2025		3,740,591
Thereafter		23,822,981
Minimum lease payments		40,010,056
Less imputed interest		(19,559,730	)
Present value of operating lease liabilities	$	20,450,326
Current portion of operating lease liabilities	$	953,635
Long-term portion of operating lease liabilities		19,496,691
Total operating lease liabilities	$	20,450,326