Leases

12 Months Ended

Dec. 31, 2021

Note 18. Leases

Operating Leases

As of December 31, 2021, the Company leases office space in Davis, CA, Chatsworth, CA, and Chesterfield, MO, as well as additional buildings, land and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these short-term leases on a straight-line basis. The Company subleases a portion of the Davis office lease to a third party. During the year ended December 31, 2021, the Company entered into two leases for office space in Chesterfield, MO, and for office space and

production in Chatsworth, CA, both with a lease term of 35 months following the commencement date and no renewal option. The leases commenced in April and May of 2021, respectively. There are no other leases that have not yet commenced as of December 31, 2021.

Some leases (the Davis office, warehouse, greenhouses and a copy machine) include one or more options to renew, with renewal terms that can extend the lease term from one to six years. The exercise of lease renewal options is at the Company’s sole discretion. During the year ended December 31, 2020, the Company entered into a lease amendment that provided for additional office space in Davis, CA, and extended the term through April 2025, with one option to renew for an additional five-year term. The Company initially expected to exercise its options to renew, and in accordance with ASC 842, Leases, accounted for the amendment and expected renewal as a lease modification and remeasured the operating lease liability. During the year ended December 31, 2021, the Company re-assessed its long-term strategy regarding office spaces, and determined that the expectation to exercise its option to renew for an additional five-year term after April 2025 is no longer reasonable. In accordance with ASC 842, the Company accounted for the change that resulted in a decrease of $2.8 million for the operating lease liability and of $2.6 million for the right of use asset.

The Company’s lease agreements do not contain any material variable lease payments, material residual value guarantees or material restrictive covenants. Leases consisted of the following (in thousands):


Leases	Classification	December 31, 2021		December 31, 2020
Assets
Operating lease assets	Right of use asset	$	3,081	$	5,826
Total leased assets		$	3,081	$	5,826
Liabilities
Current - Operating	Operating lease liability - current	$	1,074	$	717
Noncurrent - Operating	Operating lease liability - noncurrent		2,220		5,389
Total leased liabilities		$	3,294	$	6,106


Lease Cost	Classification	For the Year Ended December 31, 2021			For the Year Ended December 31, 2020
Operating lease cost	SG&A and R&D Expenses	$	1,352		$	1,042
Short term lease cost (1)	SG&A and R&D Expenses		133			305
Sublease income (2)	SG&A and R&D Expenses		(63	)		(45	)
Net lease cost		$	1,422		$	1,302

(1)

Short term lease cost consists of field trial lease agreements with a lease term of 12 months or less.

(2)

Sublease income is recorded as a reduction to lease expense.


Lease Term and Discount Rate	December 31, 2021			December 31, 2020
Weighted-average remaining lease term (years)		2.7			5.0
Weighted-average discount rate		6	%		6	%

The maturities of the operating lease liabilities as of December 31, 2021 are as follows (in thousands):


Years Ending December 31,	Amounts
2022	$	1,217
2023		1,237
2024		973
2025		168
2026 and thereafter		—
Total operating lease payments	$	3,595
Less: imputed interest	$	301
Total current and noncurrent operating lease liabilities	$	3,294