The Company leases certain manufacturing and office space and equipment. We determine if an arrangement is a lease at inception. A contract is or contains a lease if the contract conveys the right to control the use of identified property, plant or equipment (an identified asset) for a period of time in exchange for consideration. Amounts associated with operating leases, which are not short-term, are included in right-of-use lease assets. Current lease liabilities are included in other accrued expenses and long-term lease liabilities are included in other liabilities in our Consolidated and Combined Balance Sheets. Right-of-use lease assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Right-of-use lease assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company uses its incremental borrowing rate at the lease commencement date in determining the present value of lease payments. Short-term leases, leases with an initial term of 12 months or less, are not recorded in the Consolidated and Combined Balance Sheets; we recognize lease expense for these short-term leases on a straight-line basis over the lease term.

The Company leases certain property and equipment under operating leases with terms that range from one to five years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. During the year ended December 31, 2021, we renewed our lease on our facility in Hong Kong, resulting in the addition of $80,000 in right-of-use lease assets in exchange for operating lease liabilities.

Total operating lease costs amounted to $349,000 and $476,000 for the years ended December 31, 2022 and 2021, respectively.

At December 31, 2022 and 2021, our total lease obligation was $147,000 and $218,000, respectively, of which the current portion of $71,000 and $73,000, respectively, was included in other accrued expenses on the Consolidated and Combined Balance Sheets. The weighted average discount rate for the years ended December 31, 2022 and 2021 was 6.3% and 4.2%, respectively. At December 31, 2022 and 2021, the weighted average remaining lease term was 2 years and 3 years, respectively.

Future minimum lease payment obligations under operating leases are as follows (in thousands):

	2022
2023	$	73
2024		73
2025		12
Total lease payments		158
Less: interest		(11	)
Present value of lease payments	$	147