The Company had raised funds by issuing notes to various related parties including directors, officers, and shareholders. The related party notes were paid off in full in November 2021. The balance of related party notes was zero as of December 31, 2021, and June 30, 2022, respectively. The Company incurred interest expense for the three and six months ended June 30, 2021 of $0.4 million and $0.7 million, respectively on the related party notes.

J.T. Burnette, the spouse of Kim Rivers, the Chief Executive Officer and Chair of the Board of Directors of the Company, was a minority owner of a company (the “Supplier”) that provides construction and related services to the Company. As of January 1, 2022, the Supplier is no longer a related party of the Company. The Supplier is responsible for the construction of the Company’s cultivation and processing facilities, and provides labor, materials, and equipment on a cost-plus basis. For the six months ended June 30, 2021, property and equipment purchases totaled $76.4 million. As of December 31, 2021, $11.4 million of related party property and equipment purchases was included in accounts payable in the condensed consolidated balance sheets. The use of the Supplier was reviewed and approved by the independent members of the Company’s board of directors, and all invoices of the Supplier are reviewed by the office of the Company’s Chief Legal Officer.

The Company leases a cultivation facility and corporate office facility from an entity that is directly or indirectly owned by Kim Rivers, the Company's Chief Executive Officer and Chair of the board of directors, George Hackney, a former member of the Company's board of directors, and Richard May, a member of the Company's board of directors. The Company also leases various properties from companies that are managed by Benjamin Atkins, a former director and shareholder of the Company, and the Supplier. As of January 1, 2022, Benjamin Atkins is no longer a related party of the Company due to the time that has passed since Mr. Atkins held a director position.

As of June 30, 2022, and December 31, 2021, under ASC 842, the Company had the following related party leases in the condensed consolidated balance sheets:


	As of June 30, 2022		As of December 31, 2021
	Operating		Operating		Finance
	(in thousands)
Right-of-use assets, net	$	874	$	2,082	$	2,009
Lease liabilities:
Lease liabilities - current portion	$	106	$	418	$	215
Lease liabilities		809		1,862		2,127
Total related parties lease liabilities	$	915	$	2,280	$	2,342

Expenses recognized for related party leases was less than $0.1 million and $0.1 million for the three and six months ended June 30, 2022, and less than $0.1 and $0.1 for the three and six months ended June 30, 2021, respectively.