All of the Company’s leases are classified as operating leases. The majority of the Company’s leases are for office and manufacturing space, along with several automobiles and certain equipment. Leases with initial terms of less than twelve months are not recorded on the balance sheet. Expense for these leases is recognized on a straight-line basis over the lease term. The Company’s leases have remaining terms of less than one year to just over 11 years. The majority of the Company’s leases do not have options to renew, although several have renewal terms to extend the lease for one five-year term, and one lease contains two five-year renewal options. None of the renewal options are included in determining the term of the lease, used for calculating the associated lease liabilities. None of the Company’s leases include variable payments, residual value guarantees or restrictive covenants. A number of the Company’s leases for office and manufacturing space include provisions for common area maintenance (“CAM”). The Company accounts for CAM separately from lease payments, and therefore costs for CAM are not included in the determination of lease liabilities. The Company is a party to one arrangement as the lessor, for its facility located in Sunnyvale, California, with a third party. The initial term of the lease agreement expired on May 31, 2024 and was extended for an additional eighty-four months, commencing June 1, 2024 and ending May 31, 2031.

As of December 31, 2024 and 2023, the balance of right of use (“ROU”) assets was approximately $6,367,000 and $7,390,000, respectively. As of December 31, 2024, the balances of short-term and long-term lease liabilities were approximately $1,716,000 and $5,620,000, respectively. As of December 31, 2023, the balances of short-term and long-term lease liabilities were approximately $1,864,000 and $6,364,000, respectively. For the year ended December 31, 2024, the Company recorded operating lease cost, including short-term lease cost, of approximately $2,108,000 ($2,138,000 in 2023). The ROU assets are included in “Property, plant and equipment, net” in the accompanying Consolidated Balance Sheets.

The maturities of the Company’s lease liabilities are as follows (in thousands):


2025	$	2,009
2026		1,389
2027		1,031
2028		846
2029		644
Thereafter		2,697
Total lease payments	$	8,616
Less: Imputed interest		1,280
Present value of lease liabilities	$	7,336

As of December 31, 2024 and 2023, the weighted-average remaining lease term was 6.7 years and 6.8 years, respectively, and the weighted-average discount rate was 4.45% and 4.22%, respectively, for the Company’s operating leases. The Company developed the discount rates used based on a Secured Overnight Financing Rate (“SOFR”) over a term approximating the term of the related lease, plus an additional interest factor, which was generally 1.25%.

For the years ended December 31, 2024 and December 31, 2023, the Company paid approximately $2,194,000 and $2,096,000, respectively, for amounts included in the measurement of lease liabilities through operating cash flows. The

Company obtained approximately $902,000 and $1,180,000 in ROU assets in exchange for $896,000 and $1,165,000 of new operating lease liabilities for the years ended December 31, 2024 and December 31, 2023, respectively.

The maturities of the lease payments to be received by the Company under the lease agreement for its leased facility in California are as follows (in thousands):



2025	$	1,111
2026		1,145
2027		1,179
2028		1,214
2029		1,251
Thereafter		1,832
Total lease payments to be received	$	7,732

The Company recorded net lease income under this lease of approximately $992,000, $792,000, and $792,000 for the years ended December 31, 2023, 2022, and 2021, respectively.