Leases

12 Months Ended

Dec. 31, 2023

8. Leases

In connection with the sale of a portion of our corporate campus as further discussed in Note 9 to the consolidated financial statements, we leased the property pursuant to a master lease for a term extending through September 30, 2030, with two five-year extensions. The extension options are not recognized as part of the right-of-use asset and lease liability. We record the right to use the underlying asset for the operating lease term as an asset and our obligation to make lease payments as a liability, based on the present value of the lease payments over the lease term. At December 31, 2023, the weighted average remaining lease term was 6.75 years and the weighted average discount rate was 3.75%.

Because the rate implicit in the lease is not readily determinable, we use our incremental borrowing rate to determine the present value of lease payments. Information related to our right-of-use asset and related lease liability were as follows:


	As of December 31,
(in thousands)	2023		2022
Operating right-of-use asset, net	$	6,288	$	7,093

Operating lease liability, current portion	$	780	$	745
Operating lease liability, net of current portion		5,708		6,489
	$	6,488	$	7,234


	For the Year Ended December 31,
(in thousands)	2023		2022
Cash paid for operating lease liabilities	$	1,001	$	1,001

Operating lease expense is recognized on a straight-line basis over the lease term. Our operating lease expense was $1.1 million and for both 2023 and 2022. Future amortization of our lease liability as of December 31, 2023 is expected to be as follows:


(in thousands)
2024	$	1,008
2025		1,035
2026		1,064
2027		1,093
2028		1,123
Thereafter		2,037
Future lease payments, gross		7,360
Less: Imputed interest		(872	)
Operating lease liability	$	6,488