Item 2. Properties
ITEM 2 — PROPERTIES
We own a 35,000 square foot (approximately) building
at 56 Evergreen Drive in Portland, Maine. We currently use this space for substantially all of our office and laboratory needs and some
of our liquid processing and vaccine manufacturing needs for our USDA-regulated product line. All of our powder filling, gel formulation
and assembly services have been relocated out of this building, and this space continues to be used for all of our vaccine production,
liquid processing and freeze-drying operations. When we originally purchased this building in 1993, its size was 15,000 square feet, including
5,000 square feet of unfinished space on the second floor. In 2001, we completed a construction project that added approximately 5,200
square feet of new manufacturing space on the first floor and approximately 4,100 square feet of storage space on the second floor. In
2007, we built out the 5,000 square feet of unfinished space on the second floor into usable office space. After moving first floor offices
into this new space on the second floor, we modified and expanded the laboratory space on the first floor and added approximately 2,500
additional square feet of storage space on the second floor. During 2009, we added 350 square feet of cold storage space connected to
our first floor production area and added an additional 600 square feet to the second floor storage area. During the first quarter of
2015, we completed construction of a two-story addition connected to our facility to provide us with approximately 7,100 additional square
feet for cold storage, production and warehouse space for our operations.
During the fourth quarter of 2015, we exercised
an option to acquire land at 33 Caddie Lane in Portland, Maine which is near our facility at 56 Evergreen Drive, on which we initiated
construction of our Drug Substance production facility for Re-Tain ®
during the third quarter of 2016. During the fourth quarter of 2017, we obtained a Certificate of Occupancy from the City of Portland
for our 16,202 square foot (9,803 on the first floor and 6,399 on the second floor) Drug Substance production facility. Our FDA-regulated
operations are conducted in this building.
During the first quarter of 2017, we purchased a
4,080 square foot facility adjacent to the Drug Substance production facility for Re-Tain ® .
We are using this warehouse space primarily for storage of inventory, materials and equipment. We intend to modify this facility to conduct
cold storage, assembly and pack & ship services for Re-Tain ® .
During the first quarter of 2017, we entered into
a renewable, two-year lease for approximately 1,350 square feet of office, warehouse and garage space in New York to support our farm
operations. This lease was extended through and terminated at the end of March of 2021. During March of 2021, we entered into a renewable,
two-year lease for approximately 1,300 square feet of office, storage and parking space in New York.
We are renting approximately 960 square feet
in Minnesota for a sales office through at least June 2022. This lease automatically renews for one-year terms unless we or the landlord
give 60-days’ notice of a change.
On September 12, 2019, we entered into a lease
covering approximately 14,300 square feet of office and warehouse space with a lease possession date of November 15, 2019 and a lease
commencement date of February 13, 2020 for some of our USDA-regulated manufacturing operations. We have renovated this space (a Certificate
of Occupancy was issued during the second quarter of 2020) to help us expand our production capacity for the First Defense ®
product line. This space is being used for all of our powder filling, gel formulation and assembly services. The lease term is ten years
with a right to renew for a second ten-year term and a right of first offer to purchase.
We maintain property insurance in amounts that
approximate replacement cost and a modest amount of business interruption insurance. We also maintain access to certain animals, primarily
cows as a source of colostrum used in the production of the First Defense ®
product line, through contractual relationships with commercial dairy farms.