Leases

6 Months Ended

Jun. 30, 2021

On January 1, 2019, the Company adopted a new accounting standard, Topic 842, that amends the guidance for the accounting and reporting of leases. Leases with terms of 12 months or less are expensed on a straight-line basis over the term and are not recorded in the Company's Condensed Consolidated Balance Sheets.

The Company has entered into operating leases with terms greater than 12 months during the six months ended June 30, 2021. In accordance with the guidance of Topic 842, the leases which are classified as operating leases are included in the Company's Condensed Consolidated Balance Sheets. The Company's operating leases do not include options to renew, do not contain residual value guarantees, do not have variable lease components, or impose significant restrictions or covenants.

Right of use assets, "ROU assets", represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments over the respective lease term, with the ROU asset adjusted for deferred rent liability. The ROU asset is recognized as lease expense on a straight line basis over the lease term. As the implicit rate on the leases is not determinable, the Company uses judgement to estimate the incremental borrowing rate which is used as the discount rate to determine the present value of lease payments. The weighted average discount rate used was 8.8% and the weighted average remaining lease term is 4.53 years.

The ROU asset and corresponding operating lease liability recognized at lease inception during the three months ended June 30, 2021 was $1.09 million.

The following table summarizes information related to the Company's operating leases and are included in the Company's Balance Sheet as of June 30, 2021.


Balance Sheet descriptions	June 30, 2021
Assets:	(in thousands)
Right of use assets - operating leases	$	1,119
Liabilities:
Operating leases - current	339
Operating leases - long term	781
Total lease liabilities:	$	1,120

The following table summarizes the components of operating lease cost for the three and six months ended June 30, 2021:


Lease costs, (in thousands)	Three months ended June 30, 2021		Six months ended June 30, 2021
Operating expenses lease costs	$	152	$	300

As of June 30, 2021, future minimum operating leases payments related to the Company’s operating lease liabilities were as follows:


(in thousands)	June 30, 2021
2021 (six months remaining)	$	234
2022	257
2023	236
2024	247
2025	276
2026	115
Total lease payments	1,365
Less imputed interest	(245)
Present value of operating lease liabilities	$	1,120