As of September 30, 2022, the Company leases office space in Davis, CA, and Dallas, TX, as well as additional buildings, land and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these short-term leases on a straight-line basis. The Company subleases a portion of the Davis office lease to third parties. In May 2022, the Company terminated its lease for office space in Chesterfield, MO effective September 30, 2022. The original lease term was scheduled to expire in May 2024. As a result, the Company paid $47,000 in early termination fees during the nine months ended September 30, 2022. In addition, the Company subleased the facility in Chatsworth, CA to Radiance Beauty as part of the licensing agreement beginning November 1, 2022 for the remainder of the lease term. During the nine months ended September 30, 2022, the Company entered into an agreement to lease office space in Dallas, TX. The new lease commenced in July 2022.

Some leases (the Davis and Dallas offices, a warehouse, and a copy machine) include one or more options to renew, with renewal terms that can extend the lease term from one to six years. The exercise of lease renewal options is at the Company’s sole discretion.

The Company’s lease agreements do not contain any material variable lease payments, material residual value guarantees or material restrictive covenants. Leases consisted of the following (in thousands):


Leases	Classification	September 30, 2022		December 31, 2021
Assets
Operating lease assets	Right of use asset	$	2,073	$	3,081
Total leased assets		$	2,073	$	3,081
Liabilities
Current - Operating	Operating lease liability- current	$	986	$	1,074
Noncurrent - Operating	Operating lease liability- noncurrent		1,269		2,220
Total leased liabilities		$	2,255	$	3,294


Lease Cost	Classification	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
Operating lease cost	SG&A and R&D Expenses	$	271		$	319		$	815		$	955
Short term lease cost (1)	R&D Expenses		(7	)		37			4			67
Short term lease cost	SG&A Expenses		—			14			0			29
Sublease income (2)	SG&A and R&D Expenses		(99	)		(10	)		(276	)		(43	)
Net lease cost		$	165		$	360		$	543		$	1,008

(1)

Short term lease cost consists of field trial lease agreements with a lease term of 12 months or less.

(2)

Sublease income is recorded as a reduction to lease expense.


Lease Term and Discount Rate	September 30, 2022			December 31, 2021
Weighted-average remaining lease term (years)		2.3			2.7
Weighted-average discount rate		6.4	%		6.0	%