LEASES

12 Months Ended

Dec. 31, 2022

NOTE 7 - LEASES

We have entered into office space lease agreements, which qualify as operating leases under ASU No. 2016-02, “Leases (Topic 842)”. Under such leases, the lessors receive annual minimum (base) rent. The leases have original terms (excluding extension options) ranging from one year to ten years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

We record base rent expense under the straight-line method over the term of the lease. In the accompanying Consolidated Statements of Comprehensive Income (Loss), rent expense is included in operating expenses under general and administrative expenses. The components of the rent expense for the years ended December 31, 2022 and 2021, are as follows (in thousands):


	2022		2021
Operating lease cost	$	2,326	$	2,171
Sublease income	(89)		(43)
Net rent expense	$	2,237	$	2,128

For purposes of calculating the operating lease assets and lease liabilities, extension options are not included in the lease term unless it is reasonably certain we will exercise the option, or the lessor has the sole ability to exercise the option. The weighted average discount rate of our operating leases is 8% as of December 31, 2022 and December 31, 2021, respectively. The weighted average remaining lease term is five years and five years as of December 31, 2022 and December 31, 2021, respectively.

Supplemental cash flow information related to operating leases for the years ended December 31, 2022 and 2021 are as follows (in thousands):


	2022		2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	$	2,326	$	2,338
Non-cash operating activities:
Operating lease assets obtained in exchange for new operating lease liabilities	$	1,317	$	1,240

Future minimum commitments over the life of all operating leases, which exclude variable rent payments, are as follows (in thousands):


2023	$	2,474
2024	2,154
2025	1,765
2026	1,313
2027	1,121
Thereafter	1,643
Total minimum lease payments	10,470
Less: imputed interest	(2,151)
Total lease liabilities	$	8,319