LEASES

12 Months Ended

Dec. 31, 2024

The Company leases certain office spaces, research and development laboratory facilities, and office equipment with remaining lease terms ranging from approximately one to 14 years. These leases require monthly lease payments that may be subject to annual increases throughout the lease term. Certain of these leases also include renewal options, which allows the Company to, at its election, renew or extend the lease for a fixed period of time. These optional periods have not been considered in the determination of the ROU assets or lease liabilities associated with these leases when the Company did not consider it reasonably certain it would exercise the options.

The Company has continued to execute on its multi-year strategy to reset its real estate footprint. During the year ended December 31, 2024, the Company took full possession of the remaining phases of its west Salt Lake City, Utah facility. The Company has completed the transition of its corporate support operations and certain laboratory operations from its legacy facilities in Salt Lake City to its new facility in west Salt Lake City. The Company plans to complete the transition of its remaining laboratory facilities to its next generation laboratory facilities in early 2025. Additionally, during 2024, the Company amended the lease for its west Salt Lake City facility to include approximately 63,000 additional square feet of laboratory space in anticipation of future operating needs. The lease has a term of 12 years and ends coterminous with the rest of the lease. The amendment is expected to commence in fiscal year 2026 with future rent payments totaling $18.2 million. During the year ended December 31, 2023, the Company assigned the lease for its previous corporate headquarters to a third party.

As a result, the operating ROU asset and operating lease liability associated with the lease was removed from the Company's Condensed Consolidated Balance Sheets. As of December 31, 2024, the Company has accrued $3.8 million for the remaining future payments under the lease assignment agreement, which was included in Accrued liabilities in the Consolidated Balance Sheets.

Also during the year ended December 31, 2023, the Company modified the remaining lease term of certain other Salt Lake City, Utah facilities reducing the associated ROU asset and lease liability by $6.4 million.

The Company performed evaluations of its contracts and determined the majority of its identified leases are operating leases. For the year ended December 31, 2024, the Company incurred $21.0 million in operating lease costs which are included in Operating expenses in the Consolidated Statements of Operations in relation to these operating leases. Of such lease costs, $5.0 million was variable lease expense, which was not included in the measurement of the Company's operating ROU assets and lease liabilities. The variable rent expense is comprised primarily of the Company's proportionate share of operating expenses, property taxes, and insurance and is classified as lease expense due to the Company's election to not separate lease and non-lease components. For the year ended December 31, 2023, the Company incurred $25.9 million in lease costs which are included in Operating expenses in the Consolidated Statements of Operations in relation to these operating leases. Of such lease costs, $3.5 million was variable lease expense, which was not included in the measurement of the Company's operating ROU assets and lease liabilities. The Company's finance leases are immaterial.

As of December 31, 2024, the maturities of the Company’s operating lease liabilities were as follows:


Year Ended (in millions):
2025	$	18.9
2026	12.3
2027	12.3
2028	12.4
2029	12.1
Thereafter	73.7
Total future lease payments	141.7
Less: amounts representing interest	41.0
Present value of future lease payments	100.7

Less: current maturities of operating lease liabilities	(12.8)
Noncurrent operating lease liabilities	$	87.9

As of December 31, 2024, the weighted average remaining lease term is 9.3 years and the weighted average discount rate used to determine the operating lease liability was 6.5%.

As the implicit rate in the Company's leases is generally unknown, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future lease payments. When calculating the Company’s incremental borrowing rates, the Company gives consideration to its credit risk, term of the lease, total lease payments and adjusts for the impacts of collateral, as necessary. The lease term used may reflect any option to extend or terminate the lease when it is reasonably certain the Company will exercise such options. Lease expenses for the Company's operating leases are recognized on a straight-line basis over the lease term.