XML 27 R17.htm IDEA: XBRL DOCUMENT

Leases

9 Months Ended

Sep. 30, 2024

11. Leases.

The Company is party to leasing contracts in which the Company is the lessee. These lease contracts are classified as either operating or finance leases. The Company’s lease contracts include land, buildings, and equipment. Remaining lease terms range from 1 to 15 years with various term extension options available. The Company includes optional extension periods and early termination options in its lease term if it is reasonably likely that the Company will exercise an option to extend or terminate early.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term, at the later of the commencement date or business combination date. Because most of the Company’s leases do not provide an implicit rate of return, the discount rate is based on the collateralized borrowing rate of the Company, on a portfolio basis.

The weighted average remaining lease term and weighted average discount rate is as follows at:

	September 30, 2024
Weighted average remaining lease term (years)
Finance leases		4.31
Operating leases		14.11
Weighted average discount rate applied
Finance leases		5.40	%
Operating leases		8.22	%

The components of lease expense from continuing operations are as follows within our condensed consolidated statements of operations and comprehensive income (loss):

	Three Months Ended September 30, 2024		Nine Months Ended September 2024
Operating lease expense:
Operating lease cost	$	1,061,000	$	2,565,000
Short-term variable lease cost (1)		67,000		277,000
Finance lease expense:
Finance lease cost - depreciation		8,000		11,000
Total lease expense	$	1,136,000	$	2,853,000

(1)

In the Form 10-Q for the second quarter, management incorrectly disclosed the short-term variable lease expense for the six months ended June 30, 2024. Management corrected the disclosure above. There was no impact on the condensed consolidated statement of operations in either period.

	Three Months Ended		Nine Months Ended
	September 30, 2023		September 2023
Operating lease expense:
Related party lease	$	1,000	$	2,000
Other		5,000		13,000
Total lease expense	$	6,000	$	15,000

Lease expense from discontinued operations	$	6,000	$	15,000

Supplemental cash flow information related to leases where the Company is the lessee is as follows:

	Three Months Ended		Nine Months Ended
	September 30, 2024		September 2024
Operating cash flows from operating leases	$	927,000	$	2,155,000
Financing cash flows from finance leases		8,000		11,000
Leased assets obtained in exchanged for operating lease liabilities		-		34,289,000
Leased assets obtained in exchange for finance lease liabilities		62,000		84,000

As of September 30, 2024, the maturities of the operating and finance lease liabilities are as follows:

Year ending December 31,	Operating Leases			Finance Leases
remainder of 2024	$	926,000		$	7,000
2025		3,770,000			25,000
2026		3,842,000			14,000
2027		3,919,000			14,000
2028		3,809,000			14,000
2029		3,827,000			9,000
Thereafter		38,081,000			-
Total Lease Payments		58,174,000			83,000

Less discount to PV		(24,403,000	)		(9,000	)
Liability balance	$	33,771,000		$	74,000