LEASES

Jan. 31, 2022

Leases [Abstract]

LEASES

LEASES

We lease our office space under lease arrangements with expiration dates on or before April 25, 2024. We recognize lease expense on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the Consolidated Balance Sheets. We combine lease and non-lease components for new and reassessed leases. We apply discount rates to operating leases using a portfolio approach.

Below is a summary of our ROU assets and lease liabilities (in thousands):

	Balance Sheets Classification	December 31 2022		December 31, 2021
Assets
Right-of-use assets	Other assets	$	360	$	912
Liabilities
Operating lease liabilities - current	Other current liabilities	486		1,098
Operating lease liabilities - long-term	Other long-term liabilities	56		550
Total lease liabilities		$	542	$	1,648

The table below provides supplemental information related to operating leases during the years ended December 31, 2022, and 2021 (in thousands except for lease term):

	Years Ended December 31,
	2022			2021
Cash paid within operating cash flow	$	1,264		$	1,491
Weighted average lease terms (in years)	0.70			1.40
Weighted average discount rates	3.93		%	N/A

On June 6, 2022, we entered into a sublease agreement with Innovobot Fund LLP (“Innovobot”) for our facility located in Montreal Canada (the "Montreal Facility"). This sublease commenced on June 8, 2022 and ends on February 27, 2024 which approximates the lease termination date of the original Montreal Facility lease. In accordance with provisions of ASC 842, we treated the sublease as a separate lease as we were not relieved of the primary obligation under the original lease. We continue to account for the original Montreal Facility, as a lessee, in the same manner as prior to the commencement date of the sublease. We accounted for the sublease as a lessor of the lease. We classified the sublease as an operating lease as it did not meet the criteria of a Sale-Type or Direct Financing lease. At the commencement date of the sublease, we recognized initial direct costs of $23,000. These deferred costs will be amortized over the term of the sublease payments.

On January 31, 2022, we entered into an agreement to lease a 1,390 square feet of office space in Aventura, Florida (“Aventura Lease”). We use this facility as our principal executive offices and for general administrative functions. This lease commenced in the first quarter of 2022 and expires in the first quarter of 2024. We accounted for this lease as an operating lease in accordance with the provisions of ASC 842 Leases (“ASC 842”). In the first quarter of 2022, we recorded a lease liability of $0.1 million, which represents the present value of the lease payments using an estimated incremental borrowing rate of 3.93%. We also recognized a right-to-use asset ("ROU") of $0.1 million which represents our right to use an underlying asset for the lease term.

On March 12, 2020, we entered into a sublease agreement with Neato Robotics, Inc. (“Neato”) for our facility located in San Jose, California (the "San Jose Facility"). This sublease commenced in June 2020 and ends on April 30, 2023 which is the lease termination date of the original San Jose Facility lease. In accordance with provisions of ASC 842, we treated the sublease as a separate lease as we were not relieved of the primary obligation under the original lease. We continue to account for the original San Jose Facility, as a lessee, in the same manner as prior to the commencement date of the sublease. We accounted for the sublease as a lessor of the lease. We classified the sublease as an operating lease as it did not meet the criteria of a Sale-Type or Direct Financing lease. At the commencement date of the sublease, we recognized initial direct costs of $0.3 million. These deferred costs will be amortized over the term of the sublease payments. As of December 31, 2022, the unamortized balance of the deferred costs are not material.

We recognize operating lease expense and lease payments from the sublease, on a straight-line basis, in our Consolidated Statements of Income and Comprehensive Income over the lease terms. During the year ended December 31, 2022, and 2021, our net operating lease expenses are as follows (in thousands):

	Years Ended December 31,
	2022		2021
Operating lease costs	$	906	$	834
Variable lease payments	426		399
Sublease income	(1,143)		(1,030)
Total lease cost (income)	$	189	$	203

Minimum future lease payments obligations as of December 31, 2022, are as follows (in thousands):

For the Years Ending December 31,
2023	$	594
2024	39
Total lease payments	633
Less: Interest	(91)
Total lease liability	$	542

Future cash receipts from our sublease agreements as of December 31, 2022, are as follows (in thousands):

For the Years Ending December 31,
2023	$	550
2024	33
Total	$	583