Leases

9 Months Ended

Sep. 30, 2025

5. Leases

In connection with the sale of a portion of our corporate campus as further discussed in Note 4, we leased the property pursuant to a master lease for an initial term extending through September 30, 2030, with two five-year extensions. The extension options are not recognized as part of the right-of-use asset and lease liability. We record the right to use the underlying asset for the operating lease term as an asset and our obligation to make lease payments as a liability, based on the present value of the lease payments over the initial lease term. At September 30, 2025, the weighted average remaining lease term was 5 years and the weighted average discount rate was 3.75%.

Because the rate implicit in the lease is not readily determinable, we used our incremental borrowing rate to determine the present value of lease payments. Information related to our right-of-use asset and related lease liability were as follows:


	September 30,		December 31,
(in thousands)	2025		2024
	(unaudited)
Operating right-of-use asset, net		4,809	$	5,454

Operating lease liability, current portion	$	884	$	839
Operating lease liability, net of current portion		4,203		4,869
	$	5,087	$	5,708

Operating lease expense is recognized on a straight-line basis over the lease term. Our operating lease expense was $268 and $266 for the three months ended September 30, 2025 and 2024, respectively, and $801 and $796 for the nine months ended September 30, 2025 and 2024, respectively. At September 30, 2025, and for the subsequent years ending December 31, future maturity is as follows:


(in thousands)
2025 (remaining)	$	264
2026		1,064
2027		1,093
2028		1,123
2029		1,154
Thereafter		883
Future lease payments, gross		5,581
Less: Imputed interest		(494	)
Total operating lease liability	$	5,087