LEASES

3 Months Ended

Mar. 31, 2024

To conduct certain of our operations, the Company is a party to leases for office space, warehouses and Company-operated store locations. In December 2022, the Company entered into a lease agreement, which expires in 2033, for its new headquarters to accommodate its growing workforce. The new lease agreement provides for the Company to receive a tenant allowance amounting to approximately $3.8 million through the construction period, out of which $2.2 million has been disbursed through March 31, 2024. Also, the Company will commence making monthly lease payments on November 1, 2024. Such tenant allowance has been recorded within prepaid expenses and other current assets in the condensed consolidated balance sheets.

The presentation of right-of-use assets and lease liabilities in the condensed consolidated balance sheets is as follows (in thousands):


Leases	Classification	March 31, 2024		December 31, 2023
Assets
Right-of-use assets	Other assets(1)	$	20,606	$	22,100
Total leased assets		$	20,606	$	22,100

Liabilities
Current
Operating	Accrued and other liabilities	$	5,378	$	4,955
Noncurrent
Operating	Lease liabilities	21,190		22,670
Total Lease liabilities		$	26,568	$	27,625

(1) Operating right-of-use assets are recorded net of accumulated amortization of $11.4 million and $10.0 million as of March 31, 2024 and December 31, 2023, respectively.

Lease expense for the three months ended March 31, 2024 and 2023, was as follows (in thousands):


		Three Months Ended March 31,
Lease Cost	Classification		2024		2023
Operating lease cost	Other selling, general and administrative expenses		$	1,802	$	2,064

As of March 31, 2024 and December 31, 2023, the Company’s weighted-average remaining lease terms on its operating leases is 6.6 and 6.7 years, and the Company’s weighted-average discount rate is 6.10% and 6.06%, respectively, which is the Company’s incremental borrowing rate. The Company used its incremental borrowing rate for all leases, as none of the Company’s lease agreements provide a readily determinable implicit rate.

Lease Payments

Future minimum lease payments for assets under non-cancelable operating lease agreements with original terms of more than one year are as follows (in thousands):


2024	$	4,340
2025	6,337
2026	4,905
2027	3,472
2028	2,670
Thereafter	12,029
Total lease payments	33,753
Less: Imputed interest	(7,185)
Present value of lease liabilities	$	26,568