LEASES

9 Months Ended

Sep. 30, 2024

The Company leases its executive offices, retail showrooms, office and operational locations under operating leases. The fixed, non-cancelable terms of our real estate leases are generally 5-10 years. Certain lease agreements include options to renew or terminate the lease, which are not reasonably certain to be exercised and therefore are not factored into the determination of lease payments. Most of the real estate leases require payment of real estate taxes, insurance and certain common area maintenance costs in addition to future minimum lease payments.

In May 2024, the Company entered into a sublet of a portion of leased office space to a third party for the remaining lease term. Sublease income is recognized on a straight-line basis over the sublease agreement.

Total operating lease costs were as follows (in thousands):


		Three Months Ended September 30,				Nine Months Ended September 30,
	Classification	2024		2023		2024		2023
Operating lease costs	Selling, general and administrative expense	$	1,997	$	1,789	$	5,780	$	5,141
Operating lease costs	Cost of sales	69		$	—	205		—
Variable lease costs	Selling, general and administrative expense	437		343		1,255		936
Variable lease costs	Cost of sales	34		—		102		—
Sublease income	Selling, general and administrative expense	(52)		—		(88)		—
Total lease costs		$	2,485	$	2,132	$	7,254	$	6,077

The maturity analysis of the operating lease liabilities as of September 30, 2024 was as follows (in thousands):


	Amount
For the remainder of the year ending December 31, 2024	$	1,522
Years ending December 31,
2025	9,031
2026	8,844
2027	7,511
2028	6,532
2029	5,710
Thereafter	13,263
Total minimum lease payments(1)	52,413
Less: imputed interest	(9,427)
Net present value of operating lease liabilities	42,986
Less: current portion	(5,930)
Long-term portion	$	37,056

(1) Future minimum lease payments exclude $1.6 million of future payments required under a signed lease agreement that has not yet commenced. The operating lease will commence after September 30, 2024 with a lease term of five years.

As of September 30, 2024, future minimum tenant operating receipts remaining under the third party sublease were $0.5 million with a remaining sublease term of 2.2 years.

The weighted-average remaining lease term and weighted-average discount rate on long-term leases was as follows:


	Nine Months Ended September 30,
	2024		2023
Weighted-average remaining lease term - operating leases	6.6 years		7.3 years
Weighted-average discount rate - operating leases	5.9	%	5.5	%

Cash paid for amounts included in the measurement of lease liabilities was $5.9 million and $4.5 million for the nine months ended September 30, 2024 and 2023, respectively.