Leases

9 Months Ended

Sep. 30, 2023

The Company accounts for its leases in accordance with ASU No. 2016-02 (Topic 842) which requires that a lessee recognize the assets and liabilities that arise from operating leases. The ASU requires lessees to recognize a liability for lease obligations, which represents the discounted obligation to make future lease payments, and a corresponding right-of-use (ROU) asset on the balance sheet. The Company leases office space facilities and a research and development laboratory under non-cancelable operating leases with varying expirations extending through fiscal year 2029. The lease agreements provide for renewal options and rent escalation over the lease term as well as require the Company to pay maintenance, insurance and property taxes. Lease expense is recognized on a straight-line basis over the term of the lease.

Operating Leases

As of September 30, 2023, the Company had right-of-use assets and corresponding operating lease liabilities of approximately $3.0 million and $3.8 million, respectively. For the three and nine months ended September 30, 2023 and 2022, the components of operating lease expense are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2023		2022		2023		2022
Operating leases
Operating lease expense	$	231	$	235	$	692	$	727
Variable lease expense	79		47		191		132
Operating lease expense	310		282		883		859
Short-term lease rent expense	4		33		12		160
Total expense	$	314	$	315	$	895	$	1,019


	At September 30, 2023
Weighted-average remaining lease term (years), operating leases	4.0
Weighted-average discount rate, operating leases	5.7	%

Future minimum lease payments under operating leases as of September 30, 2023 are as follows:


Year	(In thousands)
2023 (Remainder)	$	231
2024	1,101
2025	1,135
2026	901
2027	491
2028	358
Thereafter	30
Total	4,247
Less present value discount	(482)
Present value of total operating lease liabilities	3,765
Less current portion	(854)
Long-term obligations under operating leases	$	2,911

Subsequent to September 30, 2023, the Company entered into a lease amendment for its Los Angeles, California office space. Pursuant to this amendment, the Company received a total value of approximately $355,000 in rent abatement for approximately eight months starting in November 2023.