LEASES

9 Months Ended

Sep. 30, 2025

Leases [Abstract]

LEASES

NOTE 5. LEASES

We have operating leases for certain manufacturing sites, office space, and equipment. Most leases include the option to renew, with renewal terms that can extend the lease term from one to five years or more. Right-of-use lease assets and lease liabilities are recognized at the commencement date based on the present value of the remaining lease payments over the lease term which includes renewal periods we are reasonably certain to exercise. Our leases do not contain any material residual value guarantees or material restrictive covenants. We have financing leases for certain property and equipment used in the normal course of business.

The components of lease expense were as follows:

	Three Months Ended September 30,
Lease Cost	2025		2024
Operating lease cost	$	609	$	569
Finance lease interest cost		15		6
Finance lease amortization expense		62		265
Total lease cost	$	686	$	840

	Nine Months Ended September 30,
Lease Cost	2025		2024
Operating lease cost	$	1,738	$	1,746
Finance lease interest cost		30		18
Finance lease amortization expense		147		394
Total lease cost	$	1,915	$	2,158

Supplemental condensed consolidated balance sheet information related to leases was as follows:

	Balance Sheet Location	September 30, 2025		December 31, 2024
Assets
Finance lease assets	Property and equipment, net	$	891	$	411
Operating lease assets	Operating lease assets, net		7,306		8,139
Total leased assets		$	8,197	$	8,550
Liabilities
Current
Current operating lease liabilities	Current portion of operating lease obligations	$	1,319	$	1,175
Current finance lease liabilities	Current portion of finance lease obligations		239		143
Noncurrent
Long-term operating lease liabilities	Long-term operating lease obligations, net of current portion		6,795		7,773
Long-term finance lease liabilities	Long-term finance lease obligations, net of current portion		713		311
Total lease liabilities		$	9,066	$	9,402

Supplemental condensed consolidated statements of cash flows information for the nine months ended September 30, 2025 and 2024 related to leases was as follows:

	September 30,		September 30,
	2025		2024
Operating Leases
Cash paid for amounts included in the measurement of lease liabilities	$	1,342	$	468
Conversion of notes payable to finance leases	$	637	$	-
Property acquired under operating lease	$	-	$	1,923

Future annual payments of lease liabilities as of September 30, 2025 were as follows:

	Operating Leases			Finance Leases			Total
Remainder of 2025	$	464		$	72		$	536
2026		1,866			320			2,186
2027		1,579			211			1,790
2028		1,569			211			1,780
2029		986			196			1,182
Thereafter		4,669			76			4,745
Total lease payments	$	11,133		$	1,086		$	12,219
Less: imputed interest		(3,019	)		(134	)		(3,153	)
Present value of lease liabilities	$	8,114		$	952		$	9,066

The lease term and discount rate as of September 30, 2025 and 2024 were as follows:

	September 30, 2025			September 30, 2024
Weighted-average remaining lease term (years)
Operating leases		7.3			7.9
Finance leases		4.2			3.4
Weighted-average discount rate
Operating leases		8.1	%		7.8	%
Finance leases		6.7	%		5.7	%