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Leases

6 Months Ended

Jun. 30, 2024

Note 11 – Leases

The Company leases its facilities and certain equipment. Fixed rent escalates each year, and the Company is responsible for a portion of the landlords’ operating expenses such as property tax, insurance, and common area maintenance.

The Company’s facility in Louisville, Colorado, is under a noncancelable operating lease with a maturity date in September 2029. In 2022, the Company amended this operating lease to incorporate a prior subleased space into the base lease and extend the term of the lease. The Company has the right to renew this operating lease for an additional five-year period.

On September 1, 2021, the Company entered into an industrial operating lease agreement for its facility in Thornton, Colorado, with the initial term through March 31, 2029. Under this operating lease, the Company has one option to renew for five years, which has been included in the calculation of lease liabilities and right-of-use assets at the adoption date of the lease accounting standard on January 1, 2022, as the exercise of the option was reasonably certain. As the renewal rent has not been negotiated, the Company used an estimated rent rate which approximated the fair market rent at adoption of ASC 842 on January 1, 2022 for the extension period.

The Company has certain equipment leases classified as finance leases as of June 30, 2024.

The Company’s leases do not have any contingent rent payments and do not contain residual value guarantees.

The components of lease expense are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Finance lease costs:
Amortization of right-of-use assets	$	58	$	47	$	116	$	91
Interest on lease liabilities		12		13		26		25
Operating lease costs		290		290		580		580
Total lease expense	$	360	$	350	$	722	$	696

The components of cash flow information related to leases are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Operating outgoing cash flows – finance leases	$	13	$	14	$	27	$	26
Financing outgoing cash flows – finance leases		94		74		186		141
Operating outgoing cash flows – operating leases		292		283		584		567
Right-of-use assets obtained in exchange for new finance lease liabilities:		—		79		—		89
Right-of-use assets obtained in exchange for new operating lease liabilities:		—		—		—		—


	June 30, 2024
Finance lease
Weighted-average remaining lease term – finance leases (in years)	2.47
Weighted-average discount rate – finance leases	6.6	%
Operating lease
Weighted-average remaining lease term – operating leases (in years)	8.75
Weighted-average discount rate – operating leases	6.8	%

As of June 30, 2024, future minimum payments during the next five years and thereafter are as follows:


Fiscal year	Finance Lease		Operating Lease
2024 (remaining six months)	$	212	$	589
2025		310		1,210
2026		179		1,248
2027		85		1,288
2028		16		1,329
2029		—		1,211
Thereafter		—		4,031
Total		802		10,906
Less present value discount		(59)		(2,589)
Total lease liabilities	$	743	$	8,317