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Note 5 - Leases

9 Months Ended

Sep. 30, 2023

5. LEASES

Lessee

The Company has operating leases primarily for administrative, sales and marketing offices, manufacturing operations and research and development facilities, employee housing units and certain equipment. These leases have remaining lease terms from less than one year to seven years. Some of these leases include options to renew the lease term for up to five years or on a month-to-month basis. The Company does not have finance lease arrangements.

The following table summarizes the balances of operating lease right-of-use (“ROU”) assets and liabilities (in thousands):

		*September 30,*		*December 31,*
	*Financial Statement Line Item*	*2023*		*2022*
Operating lease ROU assets	Other long-term assets	$	8,571	$	4,288

Operating lease liabilities	Other accrued liabilities	$	2,225	$	2,133
	Other long-term liabilities	$	5,758	$	1,664

The following tables summarize certain information related to the leases (in thousands, except percentages and years):

	*Three Months Ended September 30,*				*Nine Months Ended September 30,*
	*2023*		*2022*		*2023*		*2022*
Lease costs:
Operating lease costs	$	852	$	656	$	2,327	$	2,061
Other		480		454		1,572		1,259
Total lease costs	$	1,332	$	1,110	$	3,899	$	3,320

	*Three Months Ended September 30,*				*Nine Months Ended September 30,*
	*2023*		*2022*		*2023*		*2022*
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	629	$	649	$	2,267	$	2,115
ROU assets obtained in exchange for new operating lease liabilities	$	2,086	$	13	$	6,921	$	1,071

	*September 30,*			*December 31,*
	*2023*			*2022*
Weighted-average remaining lease term (in years)		4.8			2.1
Weighted-average discount rate		4.2	%		2.1	%

As of September 30, 2023, the maturities of the lease liabilities were as follows (in thousands):

2023 (remaining three months)	$	598
2024		2,397
2025		1,762
2026		1,193
2027		1,201
Thereafter		1,603
Total remaining lease payments		8,754
Less: imputed interest		(771	)
Total lease liabilities	$	7,983

As of September 30, 2023, the Company had no operating leases that had not yet commenced.

Lessor

The Company owns certain office buildings and leases a portion of these properties to third parties under arrangements that are classified as operating leases. These leases have remaining lease terms ranging from less than one year to three years. Some of these leases include options to renew the lease term for up to five years.

For the three months ended September 30, 2023 and 2022, income related to lease payments was $0.4 million and $0.6 million, respectively. For the nine months ended September 30, 2023 and 2022, income related to lease payments was $1.2 million and $1.7 million, respectively. As of September 30, 2023, future income related to lease payments was as follows (in thousands):

2023 (remaining three months)	$	316
2024		750
2025		226
2026		40
Total	$	1,332