LEASES

9 Months Ended

Sep. 30, 2024

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 eight 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 Condensed Consolidated Statements of Comprehensive Loss, rent expense is included in operating expenses under general and administrative expenses. The components of the rent expense are as follows for the periods presented below (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Operating lease cost	$	501	$	481	$	1,454	$	1,896
Sublease income	—		(5)		(4)		(13)
Net rent expense	$	501	$	476	$	1,450	$	1,883

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 10% as of September 30, 2024 and December 31, 2023. The weighted average remaining lease term is four years and five years as of September 30, 2024 and December 31, 2023, respectively.

Supplemental cash flow information related to operating leases are as follows for the periods presented below (in thousands):


	Nine Months Ended September 30,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	$	1,560	$	1,998
Non-cash operating activities:
Operating lease assets obtained or removed in exchange for new, modified or terminated operating lease liabilities	$	419	$	(473)

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


	September 30, 2024
2024	$	545
2025	1,866
2026	1,302
2027	1,089
2028	1,023
2029	683
Thereafter	235
Total minimum lease payments	6,743
Less: imputed interest	(1,311)
Total lease liabilities	$	5,432