Sidus Space Inc. Leases Disclosure
Note 11. Leases
Operating lease
We have a noncancelable operating lease entered in November 2016 for our warehouse space that expired in July 2021 and had renewal options to May 2024 The monthly “Base Rent” was $10,392 and the Base Rent was increased by 2.5% each year. In May 2023 the Company exercised its option and extended the lease to May 31, 2024.
In May 2021, we entered into a new lease agreement which included both our office and warehouse space that expired May 31, 2024. The Company had the option to terminate the lease after 12 months and 24 months from the commencement date. The office facility monthly “Base Rent” was $11,855 and the Base Rent was increased by 2.5% each year.
We have a new lease contract entered June 1, 2024 which includes both our office facility and warehouse space that expires May 31, 2025. The monthly “Base Rent” is $11,876 and $12,767.
We recognized total lease expense, primarily related to our operating leases, on a straight-line basis in accordance with ASC 842.
As of December 31, 2024 and 2023, the Company recorded a refundable security deposit of $10,000 for its warehouse space and is included in other assets on the balance sheet.
The operating lease expense were as follows:
| Years ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Lease cost | ||||||||
| Operating lease cost | $ | 384,237 | $ | 353,329 | ||||
Supplemental balance sheet information related to operating leases was as follows:
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Operating lease right-of-use assets at inception | $ | 284,861 | $ | 1,276,515 | ||||
| Accumulated amortization | (163,316 | ) | (1,160,942 | ) | ||||
| Total operating lease right-of-use assets | $ | 121,545 | $ | 115,573 | ||||
| Operating lease liabilities - current | $ | 121,544 | $ | 119,272 | ||||
| Total operating lease liabilities | $ | 121,544 | $ | 119,272 | ||||
| Right-of-use assets obtained in exchange for new operating lease liability | 284,861 | |||||||
| Weighted-average remaining lease term — operating leases (year) | 0.41 | 0.42 | ||||||
| Weighted-average discount rate — operating leases | 8.25 | % | 4.73 | % | ||||
Future minimum lease payments under operating leases that have initial noncancelable lease terms in excess of one year at December 31, 2024, were as follows:
| Total | ||||
| Year Ended December 31, | ||||
| 2025 | $ | 123,216 | ||
| Thereafter | ||||
| 123,216 | ||||
| Less: Imputed interest | (1,672 | ) | ||
| Operating lease liabilities | $ | 121,544 | ||
Sublease
On August 1, 2021, the Company entered into a Sublease Agreement with its related party and a principal shareholder (“Sublandlord”), whereby the Company shall sublease certain offices, rooms and shared use of common spaces located at 150 Sykes Creek Parkway, Merritt Island, FL. The Lease is a month-to-month lease and may be terminated with 30 days’ notice to the Sublandlord. The monthly rent shall be $4,570 from inception through January 31, 2022, $4,707 from February 1, 2022 to January 31, 2023 and $4,847 from February 1, 2023 to January 31, 2024. On February 1, 2024, the Company extended the month-to-month Sublease agreement. The monthly rent shall be $4,618.03 from February 1, 2024 to January 31, 2025, $4,756.57 from February 1, 2025 to January 31,2026 and $4,899.27 from February 1, 2026 to January 31, 2027. A common area maintenance fee (CAM) will be charged in addition to the monthly rent. During the years ended December 31, 2024 and 2023, the Company recorded $79,005 and $58,024 directly related to this short-term month to month lease to lease expenses.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2024 | Mar 31, 2025 | Showing above |
| 2023 | Mar 27, 2024 | |
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.