LEASES

6 Months Ended

Jun. 30, 2022

9. LEASES:

The Company has entered into operating leases to facilitate the expansion of its manufacturing, research and development, and selling, general and administrative activities. For purposes of calculating operating lease liabilities, lease terms may be deemed to include options to extend or terminate the lease when those events are reasonably certain to occur. The interest rate implicit in lease contracts is typically not readily determinable and as such the Company uses the appropriate incremental borrowing rate based on information available at the lease commencement date in determining the present value of the lease payments. Current lease agreements do not contain any residual value guarantees or material restrictive covenants. As of June 30, 2022, the Company did not have any finance leases and one additional operating lease that had not yet commenced.

The following table presents the Company’s operating lease cost and supplemental cash flow information related to the Company’s operating leases (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Operating lease cost	$	1,073	$	757	$	2,171	$	1,372
Non-cash activity:
Right-of-use assets obtained in exchange for lease obligations	$	—	$	5,351	$	—	$	10,071

The following table presents the Company’s operating right-of-use assets and liabilities (in thousands):


	June 30, 2022		December 31, 2021
Right-of-use assets	$	28,544	$	30,614
Short-term lease liabilities		3,302		3,351
Long-term lease liabilities		25,242		27,263

The following table presents weighted average assumptions used to compute the Company’s right-of-use assets and lease liabilities:


	June 30, 2022
Weighted average remaining lease term (in years)		8.1
Weighted average discount rate		2.8	%

As of June 30, 2022, current operating leases had remaining terms between two months and nine years with options to extend the lease terms.

Undiscounted future minimum lease payments as of June 30, 2022, by year and in the aggregate, having non-cancelable lease terms in excess of one year were as follows (in thousands):


	Maturities of Operating Lease Liabilities
2022 (1)	$	2,005
2023		3,985
2024		3,933
2025		3,974
2026		3,986
Thereafter		13,944
Total lease payments		31,827
Less: Imputed interest		(3,283	)
Present value of lease payments	$	28,544

(1)

Scheduled maturities of lease liabilities represent the period from July 1, 2022 to December 31, 2022.