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Leases
9 Months Ended
Sep. 30, 2020
Lessee Disclosure [Abstract]  
Leases

9. Leases

 

 

Operating Leases

 

As of September 30, 2020, the Company leases office space in Davis, CA, Phoenix, AZ, and Molokai, HI, 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. During the nine months ended September 30, 2020, the Company entered into three lease amendments that provide for additional office space in Davis, CA, and extend the term through April 2025, with one option to renew for an additional five-year term. The Company expects to exercise its options to renew, and in accordance with ASC 842, accounted for the amendment and expected renewal as a lease modification and remeasured the operating lease liability, resulting in an additional $3.8 million operating lease liability and right of use asset. The Company also entered into a lease amendment for additional parcels of land in Molokai, HI, modified the Molokai office space lease to extend the term by 12 months, and entered into new lease agreements for office equipment, collectively resulting in an additional $0.1 million of operating lease liabilities and right of use assets. During the three months ended September 30, 2020, the Company also entered into a lease amendment for the land and greenhouse in Woodland, CA, modified the Woodland lease to extend the term by 4 years collectively, and entered into a new lease for the premises and equipment related to the purchase of ISI in Oregon with a three-year term, resulting in an additional $0.5 million of operating lease liabilities and right of use assets. There are no finance leases or material leases that have not yet commenced as of September 30, 2020.

Some leases (the Davis office, warehouse, greenhouse 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

 

Balance Sheet Line Item

 

September 30, 2020

 

 

December 31, 2019

 

Assets

 

 

 

 

 

 

 

 

 

 

Operating lease assets

 

Right of use asset

 

$

6,013

 

 

$

1,963

 

Total leased assets

 

 

 

$

6,013

 

 

$

1,963

 

Liabilities

 

 

 

 

 

 

 

 

 

 

Current - Operating

 

Operating lease liability- current

 

$

700

 

 

$

611

 

Noncurrent - Operating

 

Operating lease liability- noncurrent

 

 

5,574

 

 

 

1,497

 

Total leased liabilities

 

 

 

$

6,274

 

 

$

2,108

 

 

Lease Cost

 

Classification

 

For the Three

Months Ended

September 30, 2020

 

 

For the Three

Months Ended

September 30, 2019

 

 

For the Nine

Months Ended

September 30, 2020

 

 

For the Nine

Months Ended

September 30, 2019

 

Operating lease cost

 

SG&A and R&D Expenses

 

$

261

 

 

$

177

 

 

$

745

 

 

$

529

 

Short term lease cost (1)

 

R&D Expenses

 

 

109

 

 

 

45

 

 

 

303

 

 

 

138

 

Short term lease cost

 

SG&A Expenses

 

 

 

 

 

 

 

 

3

 

 

 

 

Sublease income (2)

 

SG&A and R&D Expenses

 

 

(12

)

 

 

(13

)

 

 

(34

)

 

 

(40

)

Net lease cost

 

 

 

$

358

 

 

$

209

 

 

$

1,017

 

 

$

627

 

 

(1)

Short term lease cost included in R&D expenses consists primarily of field trial lease agreements with a lease term of 12 months or less.

(2)

Sublease income is recorded as a credit to lease expense.

 

Lease Term

and Discount Rate

 

September 30, 2020

 

 

December 31, 2019

 

Weighted-average remaining

   lease term (years)

 

 

5.8

 

 

 

2.6

 

Weighted-average discount rate

 

 

6.6

%

 

 

7.0

%