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Note 8 - Leases

3 Months Ended

Mar. 31, 2025

Operating and Finance Leases [Text Block]

8. Leases

The Company is a party to operating leases for the Company's corporate office in Cupertino, modular offices, and laboratory facilities. We have also entered into several finance leases for mobile equipment and for the Riverbank Industrial Complex. These finance leases have a purchase option at the end of the term that we are reasonably certain we will exercise, so the leases are classified as finance leases. All of our leases have remaining terms of one year to 13 years. We apply an accounting policy election to keep leases with an initial term of 12 months or less off the balance sheet, and recognize those lease payments in the Consolidated Statements of Operations as we incur the expenses.

The Company evaluates leases in accordance with ASC 842 – Lease Accounting. When discount rates implicit in leases cannot be readily determined, we use the applicable incremental borrowing rate at lease commencement to perform lease classification tests on lease components and to measure lease liabilities and right of use (ROU) assets. The incremental borrowing rate used by the Company is based on weighted average baseline rates commensurate with the Company’s secured borrowing rate, over a similar term. At each reporting period when there is a new lease initiated, the rates established for that quarter are used.

The components of lease expense are as follows:

	Three months ended March 31,
	2025		2024
Operating lease cost
Operating lease expense	$	190	$	181
Short term lease expense		45		21
Variable lease expense		23		32
Total operating lease cost	$	258	$	234

Finance lease cost
Amortization of right-of-use assets	$	30	$	30
Interest on lease liabilities		90		86
Total finance lease cost	$	120	$	116

Cash paid for amounts included in the measurement of lease liabilities:

	Three months ended March 31,
	2025		2024
Operating cash flows used in operating leases	$	186	$	169
Operating cash flows used in finance leases		90		86
Financing cash flows used in finance leases	$	9	$	8

Supplemental non-cash flow information related to ROU asset and lease liabilities was as follows for the three months ended March 31, 2025 and 2024:

	Three months ended March 31,
	2025			2024
Operating leases
Accretion of the lease liability	$	77		$	74
Amortization of right-of-use assets		113			105

The weighted average remaining lease term and weighted average discount rate as of March 31, 2025 are as follows:

Weighted Average Remaining Lease Term
Operating leases (in years)		8.0			4.0
Finance leases (in years)		11.9			12.8

Weighted Average Discount Rate
Operating leases		13.7	%		14.1	%
Finance leases		13.3	%		13.3	%

Supplemental balance sheet information related to leases is as follows:

	*March 31, 2025*			*December 31, 2024*
Operating leases
Operating lease right-of-use assets	$	2,124		$	2,237

Other current liability		541			534
Other long term liabilities		1,693			1,809
Total operating lease liabilities		2,234			2,343

Finance leases
Property and equipment, at cost	$	2,889		$	2,889
Accumulated depreciation		(379	)		(349	)
Property and equipment, net		2,510			2,540

Other current liability		243			244
Other long term liabilities		2,722			2,639
Total finance lease liabilities		2,965			2,883

Maturities of operating and finance lease liabilities are as follows:

Twelve months ended March 31,	*Operating leases*			*Finance leases*

2026	$	803		$	159
2027		708			145
2028		713			145
2029		171			145
2030		63			145
Thereafter		1,188			9,960
Total lease payments		3,646			10,699
Less imputed interest		(1,412	)		(7,734	)
Total lease liability	$	2,234		$	2,965

The Company acts as sublessor in certain leasing arrangements, primarily related to land and buildings. Fixed sublease payments received are recognized on a straight-line basis over the sublease term. Sublease income and head lease expense for these transactions are recognized on a net basis on the consolidated financial statements. Sublease income is recorded in the General and Administrative Expense section of the Consolidated Statements of Operations and Comprehensive Loss.

The components of lease income are as follows for the three months ended March 31, 2025 and 2024, respectively:

	*Three months ended March 31,*
	*2025*		*2024*
Lease income	$	683	$	491

Future lease commitments to be received by the Company as of March 31, 2025, are as follows:

Twelve months ended March 31,
2026	$	1,471
2027		1,478
2028		1,313
2029		1,290
2030		1,091
Thereafter		-
Total future lease commitments	$	6,643