Leases

9 Months Ended

Sep. 30, 2024

9. Leases

The Company leases its corporate headquarters of 21,020 rentable square feet in accordance with a non-cancellable 89-month operating lease agreement as amended and effective in January 2017, with an option to extend for an additional 60 months. On September 20, 2023, the Company entered into an amendment to its corporate headquarters lease agreement to exercise the extension option for an additional 60 months through June 30, 2029 (the "Amended Lease"), with an option to further extend for an additional 60 months. The Company also leases an additional office space of 6,003 rentable square feet in accordance with a non-cancellable 90-month operating lease agreement entered into in April 2017, with an option to extend for an additional 60 months. The extension option is not included in the determination of the lease term as it is not reasonably certain to be exercised.

For the three and nine months ended September 30, 2024 and 2023, a summary of the Company’s lease information is shown below:


	Three Months Ended September 30,					Nine Months Ended September 30,
(In thousands)	2024		2023			2024		2023
Lease cost:
Operating lease costs	$	194	$	168		$	583	$	504
Other information:
Cash paid for operating leases	$	199	$	192		$	589	$	573
Right-of-use assets obtained in exchange for operating lease liabilities(1)	$	-	$	1,919		$	-	$	1,919
Weighted average discount rate for operating leases(2)		-		10	%		-		10	%

(1)

The Amended Lease resulted in an addition of $1,919 to right-of-use assets and operating lease liabilities, as of September 20, 2023 (the "Remeasurement Date").

(2)

The Company used 10%, its estimated incremental borrowing rate for similar secured assets, as the discount rate for the Amended Lease to determine the present value of the lease payments because the implicit rate in each lease is not readily determinable. The discount rate was calculated on the basis of information available as of the Remeasurement Date.

As of September 30, 2024, the weighted average remaining operating lease term was 4.5 years.

As of September 30, 2024, scheduled future maturities and present value of the operating lease liabilities are as follows:


(In thousands)
Year	September 30, 2024
Remainder of 2024		201
2025		580
2026		519
2027		535
2028		551
2029 and thereafter		279
Total maturities	$	2,665
Present value included in condensed consolidated balance sheet:
Current portion of operating lease liabilities	$	469
Noncurrent operating lease liabilities		1,680
Total operating lease liabilities	$	2,149
Difference between the maturities and the present value of operating lease liabilities	$	516