Operating Leases

12 Months Ended

Dec. 31, 2021

The Company’s corporate headquarters in Newport Beach, California is leased under a five-year non-cancelable operating lease, which expires on January 31, 2025. Lease payments increase each year on February 1 based on an annual rent escalation clause. The Company may, under certain circumstances, terminate the lease on the 36-month anniversary of the lease commencement date by providing a written notice 12 months prior to such anniversary and paying a termination fee equal to six months basic rent plus certain other expenses. The Company has an option to extend the term of the lease for an additional 60 months, which is not recognized as part of its ROU assets and lease liabilities.

The Company’s lease agreement does not contain any residual value guarantees or material restrictive covenants. The payments associated with the renewal will only be included in the measurement of the lease liability and ROU assets if the exercise of the renewal option is determined to be reasonably certain. The Company considers the timing of the renewal period and other economic factors such as the financial implications of a decision to extend or not to extend a lease in determining if the renewal option is reasonably certain to be exercised.

The components of operating lease expense are as follows:


	Year Ended December 31,
	2021		2020
Fixed operating lease expense	$	1,065	$	1,080
Variable operating lease expense	64		40
Short-term operating lease expense	—		168
	$	1,129	$	1,288

The weighted-average remaining lease term and discount rate are as follows:


	As of December 31,
	2021	2020
Weighted-average remaining lease term (years)	3.1	4.1
Weighted-average discount rate	9.4%	9.4%

Operating lease expenses were included in the selling, general and administrative expenses in the accompanying statements of operations and comprehensive loss. Operating lease right-of-use assets and related current and noncurrent operating lease liabilities are presented in the accompanying balance sheets.

The following table presents the future minimum payments under the operating lease agreements with non-cancelable terms as of December 31, 2021:


Fiscal year
2022	1,265
2023	1,320
2024	1,377
2025	115
Total operating lease payments	4,077
Less: imputed interest	(556)
Present value of operating lease liabilities	$	3,521