XML 30 R19.htm IDEA: XBRL DOCUMENT v3.23.3
LEASES
 9 Months Ended
Sep. 30, 2023
Leases  
LEASES

9. LEASES

 

We lease our office space and certain equipment under finance and operating leases. Our leases have remaining lease terms of one to ten years. Our office lease agreement includes both lease and non-lease components, which are accounted for separately. Our finance leases contain options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless we are reasonably certain to exercise the purchase option.

 

In September 2021, we entered into an office lease with Redmond East Office Park LLC, a Washington limited liability company, pursuant to which we will lease approximately 16,681 square feet of space located in Redmond, Washington that we will use primarily for general office space. The lease provides for an initial term of 128 months that commenced November 1, 2021. Pursuant to the lease, annual base rent was approximately $500,000 for the first year and is subject to annual increases of 3.0%. In addition to base rent, we pay additional rent comprised of our proportionate share of any operating expenses, real estate taxes, and management fees. We have the option to extend the term for one ten-year renewal period, provided that the rent would be subject to market adjustment at the beginning of the renewal term. The total minimum lease payments related to this lease is $6.4 million.

 

In September 2021, we entered into a second office lease with Redmond East Office Park LLC, pursuant to which we will lease approximately 36,062 square feet of space located in Redmond, Washington that we will use primarily for product testing and lab space. The lease provides for an initial term of 120 months that commenced on December 1, 2022. Pursuant to the lease, annual base rent will be approximately $1.1 million for the first year and is subject to annual increases of 3.0%. In addition to base rent, we will pay additional rent comprised of our proportionate share of any operating expenses, real estate taxes, and management fees. We have the option to extend the term for one ten-year renewal period, provided that the rent would be subject to market adjustment at the beginning of the renewal term. The total minimum lease payments related to this lease are $13.0 million. During the quarter ended June 30, 2023, we received a payment of $3.0 million as an incentive to terminate our previous building lease. The gain is recorded as other income in our statement of operations.

 

In April 2022, we entered into an office lease with Universal-Investment-Gesellschaft mbH, a German investment company, pursuant to which we lease approximately 3,533 square feet of space located in Nuremberg, Germany that we use primarily for product testing for engineering and development activities. The lease provides for a term of 60 months that commenced May 1, 2022. Pursuant to the lease, annual base rent is approximately $76,000 per year. The total minimum lease payments related to this lease is approximately $380,000.

 

 

In September 2022, we entered into a second office lease with Universal-Investment-Gesellschaft mbH, a German investment company, pursuant to which we lease approximately 3,810 square feet of space located in Nuremberg, Germany that we use primarily for general office space for business development activities. The lease provides for a term of 60 months that commenced November 15, 2022. Pursuant to the lease, annual base rent is approximately $92,000 per year. The total minimum lease payments related to this lease is approximately $461,000.

 

In connection with our January 2023 acquisition of assets from Ibeo, we assumed three leases in Hamburg, Germany. One lease is with IntReal International Real Estate Kapitalverwaltungsgesellschaft and covers approximately 5,511 square feet of space for IT network equipment through December 31, 2026. Pursuant to the lease, annual base rent is approximately $65,000 per year. The total remaining minimum lease payments related to this lease are approximately $259,000. During the quarter ended March 31, 2023, we recorded a right-of-use asset in the amount of $234,000 on our balance sheet. A second lease is with Neuer Holtigbaum and covers approximately 32,529 square feet of office space and long-range laser testing space through August 2023. During the quarter ended September 30 2023, we amended this lease and extended until August 2024. The total remaining minimum lease payments related to this lease are approximately $190,000. The third lease is with BG BAU Berufsgenossenschaft der Bauwirtschaft and covers approximately 13,127 square feet of garage space to house our test and demonstration vehicles through July 31, 2024. The total remaining minimum lease payments related to this lease are approximately $146,000.

 

The components of lease expense were as follows:

 

(in thousands)  2023   2022   2023   2022 
   Three Months Ended   Nine Months Ended 
   September 30,   September 30, 
(in thousands)  2023   2022   2023   2022 
Operating lease expense  $667   $365   $1,949   $865 
Finance lease expense:                    
Amortization of leased assets   6    6    19    19 
Interest on lease liabilities   -    1    1    2 
Total finance lease expense   6    7    20    21 
Total lease expense  $673   $372   $1,969   $886 

 

Supplemental cash flow information related to leases was as follows:

 

(in thousands)  2023   2022 
   Nine Months Ended 
   September 30, 
(in thousands)  2023   2022 
Cash paid for amounts included in measurement of lease liabilities:        
Operating cash flows from operating leases  $1,813    938 
Operating cash flows from finance leases   1    2 
Financing cash flows from finance leases   19    20 

 

 

Supplemental balance sheet information related to leases was as follows:

 

   September 30,   December 31, 
(in thousands)  2023   2022 
Operating leases          
Operating lease right-of-use assets  $14,223   $14,579 
           
Current portion of operating lease liability   2,432    1,846 
Operating lease liability, net of current portion   13,027    13,829 
Total operating lease liabilities  $15,459   $15,675 
           
Finance leases          
Property and equipment, at cost  $112   $112 
Accumulated depreciation   (93)   (80)
Property and equipment, net  $19   $32 
           
Current portion of finance lease obligations  $2   $21 
Finance lease obligations, net of current portion   -    - 
Total finance lease liabilities  $2   $21 
           
Weighted Average Remaining Lease Term          
Operating leases   8.7 years    9.6 years 
Finance leases   0.1 years    0.8 years 
           
Weighted Average Discount Rate          
Operating leases   4.6%   4.6%
Finance leases   5.6%   6.3%

 

As of September 30, 2023, maturities of lease liabilities were as follows:

 

(in thousands)  Operating   Finance 
Years Ended December 31,  leases   leases 
2023  $642   $2 
2024   2,340        - 
2025   2,003    - 
2026   2,023    - 
Thereafter   11,631    - 
Total minimum lease payments   18,639    2 
Less: amount representing interest   (3,180)   - 
Present value of capital lease liabilities  $15,459   $2