Leases

12 Months Ended

Dec. 31, 2024

Leases

Leases

5. Leases

We lease 31,505 square feet of office space in Minneapolis, Minnesota, which houses our principal executive offices and our manufacturing facility. We lease this space under an operating lease agreement that commenced December 1, 2008, and was scheduled to expire August 31, 2024. On April 21, 2023, we extended the operating lease for our office space in Minneapolis, Minnesota for an additional 49 consecutive months through August 31, 2028. On November 7, 2023, we expanded our existing office space with the addition of 7,615 square feet of property adjacent to our principal executive offices and our manufacturing facility. The term on this expanded property is for 57 consecutive months that will run concurrently with the term on the existing lease. We intend to add new facilities as we grow, and we believe that suitable additional or substitute space will be available as needed to accommodate any such expansion of our operations. Our operating lease agreement includes an option to renew for one additional period of three years. The exercise of the lease renewal option is at our sole discretion and was not included in the lease term for the calculation of the ROU asset and lease liability, as it is not reasonably certain of exercise.

In addition to base rent, we also pay our proportionate share of operating expenses, as defined in the lease. These payments are made monthly and are adjusted annually to reflect actual charges incurred for operating expenses, such as common area maintenance, taxes, and insurance.

The following table presents the lease balances within the consolidated balance sheets:

	December 31,		December 31,
(in thousands)	2024		2023
Right-of-use assets:
Operating lease right-of-use asset	$	1,069	$	1,349
Operating lease liabilities:
Accrued expenses		282		231
Operating lease liability, non-current portion		877		1,160
Total operating lease liabilities	$	1,159	$	1,391

Maturities of our lease liability for our operating lease are as follows as of December 31, 2024:

	December 31,
(in thousands)	2024
2025	$	350
2026		362
2027		374
2028		223
Total undiscounted lease payments		1,309
Less: imputed interest		(150)
Present value of lease liability	$	1,159

As of December 31, 2024, the remaining lease term was 3.7 years, and the weighted average discount rate was 6.7%. The operating cash outflows from our operating lease were $0.5 million and $0.4 million for the years ended December 31, 2024 and 2023, respectively.