Note 5 - Operating Lease Right-of-use Asset, Net

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

(5) Operating Lease Right-of-Use Assets, Net

The Company determines if an arrangement is a lease at inception by assessing whether it conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company’s operating lease related to a property lease for its laboratory and corporate offices expired in December 2021, and the Company entered into a new lease which expires in January 2027, with an option for the Company to extend a further 36 months after expiration. BioCardia’s lease agreement does not contain any material residual guarantees or material restrictive covenants.

ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The Company’s lease does not provide an implicit rate. The Company used an adjusted historical incremental borrowing rate, based on the information available at the approximate lease commencement date, to determine the present value of lease payments. The net lease asset was adjusted for deferred rent, lease incentives, and prepaid rent. Variable rent expense is made up of expenses for common area maintenance and shared utilities and were not included in the determination of the present value of lease payments. The Company has no finance leases.

The components of lease expense for the year ended December 31, 2021 and 2020, respectively, was as follows (in thousands, except years and percentages):

	December 31,			December 31,
	2021			2020
Straight-line rent expense recognized for operating lease	$	623		$	601
Variable rent expense recognized for operating lease		322			395
Total rent expense	$	945		$	996
Weighted average remaining lease term (in years)		5.1			1.0
Weighted average discount rate		10.74	%		12.05	%

Supplemental cash flow information related to the operating lease was as follows (in thousands):

	December 31,		December 31,
	2021		2020
Cash paid for amounts included in the measurement of lease liabilities	$	686	$	630
Cash lease expense (imputed interest expense component of net income)		43		103
Total rent expense	$	729	$	733

Future minimum lease payments under the operating lease as of December 31, 2021 are as follows (in thousands):

For the years ending December 31,
2022	$	424
2023		471
2024		485
2025		499
2026		514
Thereafter		43
Total undiscounted lease payments		2,436
Less imputed interest		568
Total operating lease liabilities	$	1,868