XML 33 R21.htm IDEA: XBRL DOCUMENT
v3.24.3

Leases | 9 Months Ended
--- | ---
Sep. 30, 2024
Leases |
Leases | 14. Leases Lessee Accounting We determine if an agreement is a lease at inception. We lease office space, data center colocation space, other assets, and office equipment under operating leases. We lease data center equipment, including maintenance contracts and vehicles under finance leases. Operating leases are recorded as right-of-use (“ROU”) assets and lease liabilities on the balance sheet, excluding leases that are less than 12 months. ROU assets represent our right to use the leased asset for the lease term and lease liabilities represent our obligation to make lease payments. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our estimated incremental borrowing rate at the commencement date to determine the present value of lease payments. The operating lease ROU assets also include any lease payments made and exclude lease incentives. The Company’s lease agreements do not contain any variable lease payments, material residual value guarantees or any restrictive covenants. Our lease terms may include options, at our sole discretion, to extend or terminate the lease. We currently lease office space in Tempe, Arizona under a non-cancelable operating lease agreement that expires in 2025. On August 9, 2023, in connection with the sale of our corporate office building and land, we entered into a lease agreement to leaseback the property. The operating lease agreement has an initial term of eighteen full calendar months, with an option to terminate the lease on the last day of the twelfth full calendar month with a ninety-day notice. The operating lease agreement includes fixed fees for property tax, insurance, and common area maintenance (CAM). We account for the lease components and non-lease components such as fixed fee property tax and insurance charges as a single lease component. The CAM charges are considered a separate non-lease component of the lease agreement and are excluded from the measurement of the lease liability. We utilized our incremental borrowing rate of 6.58% to determine the present value of lease payments to determine our lease liability. Rental expense for the three months ended September 30, 2024 and 2023 was approximately $78 and $40, respectively, and for the nine months ended September 30, 2024 and 2023 was $229 and $40, respectively. On July 19, 2024, we entered into a non-cancelable commercial sublease operating agreement to sublease office space in Tempe Arizona, which will be the headquarters for the Company. This sublease commences on October 1, 2024, and continues for thirty-seven (37) months through October 31, 2027. The base monthly rent is as follows: October 1, 2024 – September 30, 2025, $28; October 1, 2025 – September 30, 2026, $29, and October 1, 2026 – October 31, 2027, $30. The Company is entitled to three months of rent abatement, which will be January 2025, January 2026, and January 2027. The location is fully furnished and ready for immediate occupancy. If Operating Costs exceed $20 in a calendar year, then the Company shall be responsible for fifty (50%) percent of the amount exceeding $20. We currently lease office space in Reston, Virginia under a non-cancelable operating lease agreement that expires in 2024. The operating lease contains customary escalation clauses. Rental expense for the three months ended September 30, 2024 and 2023 was approximately $14 and $13, respectively, and for the nine months ended September 30, 2024 and 2023 was $40 and $26, respectively. We currently lease office space in San Diego, California under a non-cancelable operating lease agreement that expires in 2024. Rental expense for the three months ended September 30, 2024 and 2023 was approximately $22 and $21, respectively, and for the nine months ended September 30, 2024 and 2023 was $65 and $63, respectively. We currently lease office space in Overland Park, Kansas under a non-cancelable operating lease agreement that expires in 2027. The operating lease contains customary escalation clauses. Rental expense for the three months ended September 30, 2024 and 2023 was approximately $27 and $55, respectively, and for the nine months ended September 30, 2024 and 2023 was $129 and $144, respectively. We currently lease other assets under multiple operating leases. The leases expire on various dates through 2027 and the interest rates range from 3.00% to 15.74%. The expense is included in cost of product expenses and totaled approximately $20 and $23 for the three months ended September 30, 2024 and 2023, respectively, and for the nine months ended September 30, 2024 and 2023 was $62 and $64, respectively. We currently lease data center colocation space in Grand Rapids, Michigan, Las Vegas, Nevada, Dallas, Texas and Lenexa, Kansas, under non-cancelable operating lease agreements that expire in 2029. Rental expense for the three months ended September 30, 2024 and 2023 was approximately $82 and $83, respectively, and for the nine months ended September 30, 2024 and 2023 was $354 and $257, respectively. We have lease agreements with lease and non-lease components, and we account for the lease and non-lease components as a single lease component. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company leases equipment and support under finance lease agreements which extends through 2029. The Company also leases one vehicle under a financing agreement. The outstanding balance for finance leases was $42 and $98 as of September 30, 2024 and December 31, 2023, respectively. The Company recorded assets classified as property and equipment under finance lease obligations of $486 and $486 as of September 30, 2024 and December 31, 2023, respectively. Related accumulated depreciation totaled $387 and $319 as of September 30, 2024 and December 31, 2023, respectively. The $40 in support contracts were classified as a prepaid expense and are being amortized over the service period of three years. The support contracts expired in September 2024. Amortization expense is included in general and administrative expenses and totaled $0 and $1 for the three months ended September 30, 2024 and 2023, respectively, and for the nine months ended September 30, 2024 and 2023 was $2 and $4, respectively. The interest rates on the finance lease obligations range from 1.37% and 15.74% and interest expense was $0 and $1 for the three months ended September 30, 2024 and 2023, respectively, and for the nine months ended September 30, 2024 and 2023 was $2 and $3, respectively. The maturity of operating leases and finance lease liabilities as of September 30, 2024 are as follows:
Year ending December 31, |  | Operating Leases |  |  | Finance Leases |
2024 remaining |  | $ | 175 |  |  | $ | 19 |
2025 |  |  | 492 |  |  |  | 21 |
2026 |  |  | 562 |  |  |  | 3 |
2027 |  |  | 467 |  |  |  | - |
2028 |  |  | 62 |  |  |  | - |
2029 |  |  | 41 |  |  |  | - |
Total minimum lease payments |  |  | 1,799 |  |  |  | 43 |
Less: amount representing interest |  |  | (94 | ) |  |  | (1 | )
Present value of minimum lease payments |  | $ | 1,705 |  |  | $ | 42 |
Lease term and discount rate |  | September 30, 2024 |
Weighted-average remaining lease term (years) |  |  |
Operating leases |  |  | 3.2 |
Finance leases |  |  | 0.7 |
Weighted-average discount rate |  |  |  |
Operating leases |  |  | 7.4 | %
Finance leases |  |  | 3.2 | %
|  | Nine Months Ended September 30, 2024 |  |  | Nine Months Ended September 30, 2023 |
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |  |  |
Operating cash flows from operating leases |  | $ | 839 |  |  | $ | 470 |
Operating cash flows from finance leases |  |  | 1 |  |  |  | 5 |
Financing cash flows from finance leases |  |  | (56 | ) |  |  | (76 | )
Non-cash investing and financing activities: |  |  |  |  |  |  |  |
Additions to ROU assets obtained from: |  |  |  |  |  |  |  |
New operating lease liabilities |  | $ | 1,334 |  |  | $ | 349 |
New finance lease liabilities |  |  | - |  |  |  | - |

X
- References No definition available. + Details
Name: | us-gaap_LeasesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 842 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/842-20/tableOfContent + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration