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Leases
12 Months Ended
Dec. 31, 2024
Leases [Abstract]  
Leases Leases                
The Company accounts for its leases under ASC 842 Leases (“ASC 842”). The Company has elected to apply the short-term measurement and recognition exemption in which the right-of-use (“ROU”) assets and lease liabilities are not recognized for short-term leases.

The following table summarizes the Company’s ROU assets and lease liabilities (in thousands):
December 31,
Location on the
Consolidated Balance Sheets
20242023
ROU AssetsOther assets$16,384 $22,085 
Lease liabilities, current portionOther current liabilities5,600 5,744 
Lease liabilities, long-term portionOther long-term liabilities15,128 19,475 
Total lease liabilities$20,728 $25,219 

The components of lease cost related to the Company’s operating leases were as follows (in thousands):

Year Ended December 31,
202420232022
Operating lease expense$8,262 $8,188 $7,701 
Variable lease expense 1,838 1,501 1,089 
Short-term lease expense48 86 327 
Total lease expense$10,148 $9,775 $9,117 

Future minimum operating lease payments as of December 31, 2024, are as follows (in thousands):
Operating Leases
2025$5,156 
20263,035 
20272,968 
20282,983 
20293,047 
Thereafter11,268 
Total lease payments28,457 
Less: Imputed lease interest(7,729)
Total lease liabilities$20,728 

Other information pertaining to operating leases consists of the following:
Year Ended December 31,
202420232022
Weighted average remaining lease-term6.0 years5.7 years4.2 years
Weighted average discount rate8.3 %7.9 %5.4 %

Supplemental cash flow and other information related to operating leases are as follows (in thousands):
Year Ended December 31,
202420232022
Operating cash flows from operating leases$7,042 $7,911 $5,380 
Non cash investing activities:
Lease liabilities arising from obtaining right-of-use assets$849 $10,562 $12,558 

In May 2024, the Company entered into a triple net lease (“NNN term lease”) with GDC Sunshine LLC (“Lessor”) for 13 1/2 years (162 full calendar months) for a new manufacturing and office facility in Bernaillo County, New Mexico. The NNN term lease agreement allows for an extension of one consecutive period of 10 years. The new facility that is mixed use and built for general purposes will be approximately 216,000 square feet when constructed.

The NNN term lease commences upon the earliest of several events, including the Lessor’s completion of the construction of the building, which is currently expected to occur in the fourth quarter of 2025 and will be accounted for as a finance lease.
Under the construction agreement with the Lessor, the Company contributed approximately $11.3 million to the construction costs of the facility during October 2024. Future minimum lease payments under the NNN term lease, assuming the Company executes the renewal option, are estimated to be $105.0 million at December 31, 2024, payable over the expected lease term beginning with the commencement date.

In connection with this NNN term lease and the Company’s planned acquisition of machinery and equipment related to the new facility, the Lessor and the Company entered into a series of transactions with Bernalillo County (the “County”) related to a tax abatement plan. These transactions had no net impact to the
consolidated financial statements of the Company. The tax abatement plan provides for the effective elimination of 75% of the real property taxes and 100% of the personal property taxes payable to the County by the Company and the Lessor during the term of the NNN term lease, and the abatement of 100% of the sales and use taxes that would be incurred by the Company and the Lessor related to the purchase and use of machinery and equipment.