On January 3, 2017, the Company executed a non-cancellable operating lease for its principal office with the lease commencing February 1, 2017 for a five (5) year term. The Company paid a security deposit of $29,297. The lease required the Company to pay its proportionate share of direct costs estimated to be 22.54% of the total property, a fixed monthly direct cost of $6,201 for each month during the term of the lease, and monthly rental pursuant to the lease terms. This lease expired during February 2022.

 

In December 2019, the Company entered a lease for office space located at 8669 Research Drive,  Irvine, CA, 92618 to replace the Company’s then current corporate headquarters. The lease commenced on December 1, 2019 with no rent due until April 1, 2020. From April 1, 2020 through March 31, 2025, base rent is due on the first of each month in the amount of $25,200 escalating annually on December 1 of each year to $29,480 beginning December 1, 2023. The Company paid an initial amount of $68,128 comprising the rent for April 2020, a security deposit and the amount due for property taxes, insurance and association fees.

 

In addition, the Company entered into two leases for additional space in Irvine, CA. The leases commenced March 1, 2022 and June 1, 2022. Base rent is initially $16,250 and $48,379 with escalations contained in the lease through February 28, 2027 and May 31, 2027.

 

The Company also leases space in the United Kingdo. The lease expires January 1, 2027, with monthly payments of approximately $41,000.

 

Supplemental balance sheet information related to leases is as follows as of September 30, 2023:

 

As the leases do not provide an implicit rate, the Company used an incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments, which is reflective of the specific term of the leases and economic environment of each geographic region.

 

Anticipated future lease costs are as follows:

 

 

The Company recorded rent expense of $1,442,730 and $691,107 for the nine months ended September 30, 2023 and 2022, respectively. The Company recorded rent expense of $430,839 and $233,200 for the three months ended September 30, 2023 and 2022, respectively.