Leases

3 Months Ended

Mar. 31, 2023

Disclosure of Leases [Abstract]

LEASES

9. LEASES

On January 1, 2022, we adopted Accounting Standards Update (“ASU”) 2016-02 and all subsequent amendments, collectively codified in ASC Topic 842, “Leases” (“Topic 842”). The guidance requires modified retrospective adoption, either at the beginning of the earliest period presented or at the beginning of the period of adoption. We elected to apply the guidance at the beginning of the period of adoption and recorded right-of-use (ROU) leased assets of $14,302. In conjunction with this, we recorded lease liabilities, which had been discounted at our incremental borrowing rates, of $15,933. The impact of our adoption of Topic 842 on our current and deferred income taxes was immaterial. The adoption of ASC 842 had no effect on retained earnings.

The Company leases its office facility under a noncancelable operating lease agreement that expires in March 2032. Rent expense for the three months ended March 31, 2023 and 2022 was $534 and $565, respectively.

A summary of the components of lease costs for the Company under ASC 842 for the three months ended March 31, 2022 and March 31, 2021, respectively were as follows:

	March 31,
Lease costs	2023		2022
Operating lease costs	$	534	$	565
Total lease costs	$	534	$	565

Supplemental disclosure of cash flow information related to leases for the three months ended March 31, 2022 and March 31, 2021, respectively were as follows:

	March 31,
	2023		2022
Cash paid for amounts included in the measurement of operating lease liabilities (operating cash flows)	$	488	$	256

The weighted-average remaining lease term and discount rate were as follows:

	March 31,
	2023			2022
Weighted-average remaining lease term (in years)		9			10
Weighted-average discount rate		8.74	%		8.74	%

The following table presents the maturity of the Company’s operating lease liabilities as of March 31, 2023:

Years Ended December 31,
2023, excluding the three months ended March 31, 2023	$	1,674
2024		2,286
2025		2,358
2026		2,430
2027		2,502
Thereafter		11,430
Total future minimum lease payments	$	22,680
Less imputed interest		(7,160	)
Carrying value of lease liabilities	$	15,520