XML 22 R12.htm IDEA: XBRL DOCUMENT

Note 5 - Operating Lease Right-of-use Asset, Net

9 Months Ended

Sep. 30, 2023

(5)

Operating Lease Right-of-Use Asset, Net

In December 2021, we entered into a lease related to a property lease for our laboratory and corporate offices, which expires in January 2027, with an option for us to extend a further 36 months after expiration. Our lease agreements do not contain any material residual guarantees or material restrictive covenants. We determine if an arrangement is a lease at inception by assessing whether it conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Right-of-use (ROU) assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Our lease does not provide an implicit rate. We used an adjusted historical incremental borrowing rate, based on the information available at the approximate lease commencement date, to determine the present value of lease payments. Variable rent expense is made up of expenses for common area maintenance and shared utilities and were not included in the determination of the present value of lease payments. We have no finance leases.

Our lease expense was $121,000 and $362,000 for the three and nine months ended September 30, 2023, respectively. Our lease expense for the three and nine months ended September 30, 2022 was $121,000 and $362,000, respectively. The cash paid under the operating lease for base rent for the three and nine months ended September 30, 2023 was $117,000 and $353,000, respectively. The cash paid under the operating lease for base rent for the three and nine months ended September 30, 2022 was $114,000 and $287,000, respectively. On September 30, 2023, the weighted average remaining lease term was 3.59 years, and the weighted average discount rate was 10.74%.

Future minimum lease payments under the operating lease as of September 30, 2023 were as follows (in thousands):

Remainder of 2023	$	118
2024		485
2025		499
2026		514
2027		44
Total undiscounted lease payments	$	1,660
Less imputed interest		262
Total operating lease liabilities	$	1,398