Modular Medical, Inc. Leases Disclosure
NOTE 3 – LEASES
Thornmint Road, San Diego, CA
The 48-month lease term commenced February 1, 2023, and the lease provides for an initial base monthly rent of $36,000 with annual rent increases of approximately 4%. In addition to the minimum lease payments, the Company is responsible for property taxes, insurance and other certain operating costs. A discount rate of 8%, which approximated the Company’s incremental borrowing rate, was used to measure the lease asset and liability. The Company obtained a right-of-use asset of approximately $1,560,000 in exchange for its obligations under the operating lease.
Future minimum payments under the facility operating lease, as of March 31, 2025, are listed in the table below (in thousands).
| Fiscal year ending March 31, | ||||
| 2026 | 470 | |||
| 2027 | 405 | |||
| Total future lease payments | 875 | |||
| Less: Imputed interest | (59 | ) | ||
| Present value of lease liabilities | $ | 816 | ||
Cash paid for amounts included in the measurement of lease liabilities was approximately $452,000 and $476,000 for the years ended March 31, 2025 and 2024, respectively. Rent expense was approximately $449,000 for each of the years ended March 31, 2025 and 2024.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jun 20, 2025 | Showing above |
| 2024 | Jun 21, 2024 | |
| 2023 | Jun 26, 2023 | |
| 2022 | Jun 28, 2022 | |
| 2021 | Jun 29, 2021 | |
| 2020 | Jun 29, 2020 | |
| 2019 | Jun 27, 2019 | |
| 2017 | Oct 11, 2017 | |
| 2016 | Sep 26, 2016 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.