Leases

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Leases

Leases

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, 2024 and December 31, 2023, the Company had ROU assets of $1.9 million and $2.4 million, respectively, and corresponding operating lease liabilities of $2.9 million and $3.3 million, respectively. For the three and nine months ended September 30, 2024 and 2023, the components of operating lease expenses are as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2024		2023		2024		2023
Operating leases
Operating lease expense	$	218	$	231	$	668	$	692
Variable lease expense (1)	104		79		309		191
Operating lease expense	322		310		977		883
Short-term lease rent expense	4		4		12		12
Total expense	$	326	$	314	$	989	$	895

(1) Variable lease costs, including property taxes and insurance and common area maintenance fees, are classified in cost of services in the Company's Unaudited Condensed Consolidated Statements of Operations.

	At September 30, 2024
Weighted-average remaining lease term (years), operating leases	3.0
Weighted-average discount rate, operating leases	6.6	%

Future minimum lease payments under operating leases as of September 30, 2024 are as follows:

Year	(In thousands)
2024 (Remainder)	$	218
2025	1,135
2026	901
2027	491
2028	358
2029	30
Total	3,133
Less present value discount	(252)
Present value of total operating lease liabilities	2,881
Less current portion	(1,008)
Long-term obligations under operating leases	$	1,873