Leases

6 Months Ended

Jun. 30, 2024

NOTE 13 – LEASES

The Company leases office and research facilities and office equipment under operating leases which expire through 2032. The Company’s leases have remaining lease terms of one to eight years, some of which may include options to extend the leases for five years or longer, and some of which may include options to terminate the leases within the next five years or less. Leases with an initial term of 12 months or less are not recorded on the Consolidated Balance Sheets; expense for these leases is recognized on a straight-line basis over the lease term. Variable lease payments are expensed as incurred and are not included within the lease liability and right-of-use assets calculation. As a practical expedient, the Company elected, for all office and facility leases, not to separate non-lease components (e.g., common-area maintenance costs) from lease components (e.g., fixed payments including rent) and instead to account for each separate lease component and its associated non-lease components as a single lease component.

As most of the leases do not provide an implicit rate, the Company generally, for purposes of discounting lease payments, uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date.

The components of operating lease costs were as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Fixed lease cost	$	511	$	539	$	1,023		1,110
Variable lease cost		207		146		482		297
Total operating lease cost	$	718	$	685	$	1,505	$	1,407

Other information related to leases was as follows (in thousands, except lease term and discount rate):


	Three Months Ended June 30,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	551	$	609
ROU assets obtained in exchange for new lease liabilities:
Operating leases	$	—	$	—


	June 30, 2024			December 31, 2023
Weighted-average remaining lease term (years):
Operating leases		7.93			8.35
Weighted-average discount rate:
Operating leases		8.5	%		8.5	%

Future minimum lease payments and related lease liabilities as of June 30, 2024 were as follows (in thousands):


	Operating Lease Payments (1)
2024 (remaining 6 months)	$	162
2025		568
2026		2,069
2027		2,132
2028		1,887
Thereafter		7,772
Total lease payments		14,590
Less: imputed interest		(4,796	)
Present value of lease liabilities:	$	9,794

Less: current obligations under leases (accrued liabilities)		382
Noncurrent operating lease liabilities	$	9,412

(1) Future minimum lease payments exclude short-term leases as well as payments to landlords for variable common area maintenance, insurance and real estate taxes.