Leases

6 Months Ended

Jun. 30, 2022

Leases

Leases

8.            Leases

Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Rent expense is recognized on a straight-line basis over the lease term.

Operating lease liabilities are included in accrued and other current liabilities and other liabilities (noncurrent) in the consolidated balance sheets as of June 30, 2022 and December 31, 2021.

In November 2019, CASI Wuxi entered into a fifty-year lease agreement for the right to use state-owned land in China for the construction of a manufacturing facility. The land parcel is 74,028.40 square meters. The Company classifies this lease as an operating lease. The Company prepaid all of the lease payments for the land use right in 2019 in the amount of RMB 45 million (equivalent to $6.5 million).

Rent expense for the six months ended June 30, 2022 and 2021 was $0.7 million and $0.8 million, respectively. There were no variable lease costs or sublease income for leased assets for the six months ended June 30, 2022 and 2021.

Right of use assets and liabilities as of June 30, 2022 and December 31, 2021 on the condensed consolidated balance sheets were as follows:

	June 30,		December 31,
(In thousands)	2022		2021
Right of use assets	$	8,462	$	9,107
Accrued and other current liabilities	$	1,038	$	1,061
Other liabilities		858		1,105
Total lease liabilities	$	1,896	$	2,166

Supplemental cash flow information related to leases was as follows:

	Six Months Ended June 30,
(In thousands)	2022		2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows	$	639	$	775
Right of use assets obtained in exchange for lease obligations:	$	421	$	1,615

All of the Company’s existing leases as of June 30, 2022 and December 31, 2021 were classified as operating leases. As of June 30, 2022 and December 31, 2021, the Company had nine and eight, respectively, material operating leases for land and facilities with remaining terms expiring from 2022 through 2069 and a weighted average remaining lease term of 37.15 years and 36.47 years, respectively. The Company has fair value renewal options for many of the Company’s existing leases, none of which are considered reasonably certain of being exercised or included in the minimum lease term. Weighted average discount rates used in the calculation of the lease liability as of June 30, 2022 and December 31, 2021 is 3.53% and 3.56%, respectively. The discount rates reflect the estimated incremental borrowing rate, which includes an assessment of the credit rating to determine the rate that the Company would

have to pay to borrow, on a collateralized basis for a similar term, an amount equal to the lease payments in a similar economic environment.

A maturity analysis representing the future undiscounted cash flow of the Company’s operating leases liabilities as of June 30, 2022 is as follows:

(In thousands)
2022 (remaining six months)	$	528
2023		939
2024		484
Thereafter		13
Total		1,964
Discount factor		(68)
Lease liability		1,896
Amounts due within 12 months		1,038
Non-current lease liability	$	858