Leases

12 Months Ended

Dec. 31, 2023

Note 3: Leases

The Company has an operating lease for office space for its corporate headquarters in Seattle, Washington which expires on November 30, 2027. The Company’s prior lease agreement with respect to office space in Seattle, Washington, as amended, was terminated by the Company effective on March 31, 2023. In the first quarter of 2023, we paid approximately $671.0 thousand as provided in the lease for the early termination. The Company also has an operating lease for office space in Wichita, Kansas, which continues until December 2025 with an option to extend the term for two additional periods of three years each. The Company has the option to terminate this lease pursuant to certain terms as specified in the lease without any termination fees if notice is provided. The Company recognizes our operating lease agreements in accordance with ASC 842 and recognizes rent expense on a straight-line basis over the lease term with any lease incentives amortized as a reduction of rent expense over the lease term.

Lease cost recognized in the Company’s Consolidated Statements of Operations and other information is summarized as follows:


	Years Ended December 31,
(In Thousands)	2022			2023
Operating lease cost	$	1,943		$	1,067
Short-term operating lease cost		202			182
Total operating lease cost		2,145			1,249
Other information:
Weighted-average remaining lease term - operating leases	1.2 years			3.6 years
Weighted-average discount rate - operating leases (1)		4.6	%		6.7	%

(1) The discount rate used to compute the present value of the total lease liabilities as of December 31, 2022 and 2023 was based on the Company’s estimated incremental borrowing rate of similar secured borrowings available to the Company as of the commencement date of lease.

Assets under finance leases, which primarily represent computer equipment, are included in Other assets, net, with the related liabilities included in Lease liability current, and Finance lease, noncurrent on the Company's Consolidated Balance Sheets.

As of December 31, 2023 the Company’s operating and financing lease liabilities were as follows:


(In Thousands)	Operating Leases			Finance Leases
Gross future lease payments	$	1,836		$	757
Less: imputed interest		(157	)		(95	)
Present value of total lease liabilities		1,679			662
Less: current portion of lease liabilities		(462	)		(210	)
Total long-term lease liabilities	$	1,217		$	452

In the fourth quarter of 2023, we entered into a rental agreement for utilization of our financed server equipment. We retain our primary obligation under the original financing terms.