XML 51 R16.htm IDEA: XBRL DOCUMENT v3.23.1
Operating Leases
12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Operating Leases

Note 10. Operating Leases

On October 24, 2022, the Company entered into a lease termination agreement (the “Lease Termination Agreement”) with the landlord, pursuant to which it terminated the lease agreement for its office and manufacturing space in Carlsbad, California, effective October 28, 2022. In accordance with the terms of the Lease Termination Agreement, the Company agreed to (i) release its right to the security deposit of approximately $36,000 previously paid to the landlord and (ii) pay a $0.3 million lease termination fee to the landlord. As a result of the Lease Termination Agreement, the Company wrote-off its right-of-use asset, right-of-use liability and security deposit, resulting in a non-cash gain of approximately $0.1 million. The lease termination fee of $0.3 million was paid on October 31, 2022.

On October 31, 2022, the Company entered into a month-to-month lease agreement with Avanti Workspace (the “Lease Agreement”) for its corporate headquarters in Carlsbad, California, effective November 1, 2022. The rent expense under the Lease Agreement is approximately $1,000 per month.

During the year ended December 31, 2021, the Company had two operating leases for office and manufacturing space which required it to pay base rent and certain utilities. Monthly rent expense was recognized on a straight-line basis over the terms of the leases. The office operating lease expired in December 2021 and the office and manufacturing operating lease would have expired in 2027, had it not been terminated.

At December 31, 2021, the remaining lease term for the manufacturing operating lease was six years. The manufacturing operating lease was included in the balance sheet at the present value of the lease payments at a 7% discount rate, the rate of interest that the Company estimated it would have paid to borrow on a collateralized basis over a similar term and amount equal to the lease payments in a similar economic environment, as the lease did not provide an implicit rate.

For the years ended December 31, 2022 and 2021, operating lease expense and cash paid were $0.4 million and $0.5 million, respectively. The Company recognized non-cash right-of-use assets and lease liabilities of $3.2 million upon adoption of ASU 2016-02 on January 1, 2019. Operating lease right-of-use asset amortization was $0.2 million and $0.4 million, respectively, for the years ended December 31, 2022 and 2021. Variable costs were de minimis for the years ended December 31, 2022 and 2021.