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Note 14 - Leases

9 Months Ended

Sep. 30, 2024

14. Leases

The Company leases its Corvallis, Oregon, facilities and office space under an operating lease, which was signed on November 3, 2017 and commenced on January 1, 2018. The initial term of this lease was to expire on December 31, 2019 after which the Company had two successive renewal options; one for two years and the other for three years. In the second quarter of 2019, the Company exercised the first renewal option, which extended the lease expiration date to December 31, 2021. In the second quarter of 2021, the Company exercised the second renewal option, which extended the lease expiration date to December 31, 2024. In the second quarter of 2024, the Company entered into an additional addendum, which extended the lease expiration date to December 31, 2026. In connection with this additional addendum, the Company recorded an increase to operating lease right-of-use assets and operating lease liabilities of approximately $0.5 million in the second quarter of 2024.

On May 26, 2017, the Company and M&F entered into the New HQ Lease, a ten-year office lease agreement, pursuant to which the Company agreed to lease 3,200 square feet in New York, New York. The Company is utilizing premises leased under the New HQ Lease as its corporate headquarters. The Company has no leases that qualify as finance leases.

Operating lease costs totaled $0.2 million and $0.1 million for the three months ended September 30, 2024 and 2023, respectively. Operating lease costs totaled $0.5 million and $0.4 million for the nine months ended September 30, 2024 and 2023, respectively. Cash paid for amounts included in the measurement of lease liabilities from operating cash flows was $0.2 million for each of the three months ended September 30, 2024 and 2023. Cash paid for amounts included in the measurement of lease liabilities from operating cash flows was $0.5 million for each of the nine months ended September 30, 2024 and 2023. As of September 30, 2024, the weighted-average remaining lease term of the Company’s operating leases was 2.48 years while the weighted-average discount rate was 9.95%.

Future cash flows under operating leases as of September 30, 2024 are expected to be as follows:

2024	$	113,547
2025		683,213
2026		686,190
2027		165,916
Total undiscounted cash flows under leases		1,648,866
Less: Imputed interest		(142,042	)
Present value of lease liabilities	$	1,506,824

As of September 30, 2024, approximately $1.0 million of the lease liability is included in Other liabilities on the condensed consolidated balance sheet with the current portion included in accrued expenses.