Quarterly report pursuant to Section 13 or 15(d)

Note 9 - Leases

Note 9 - Leases

9 Months Ended

Sep. 30, 2024

Lessee, Operating and Finance Leases [Text Block]

9. Leases

As of September 30, 2024, the Company maintained two finance leases for equipment and two operating leases for real estate. The operating leases have current terms of 36 and 37 months and include one or more options to extend the duration of the agreements. These operating leases are included in "Other assets" on the Company's condensed consolidated balance sheets and represent the Company's right to use the underlying assets for the term of the leases. The Company's obligation to make lease payments are included in "Lease liability, current portion" and "Lease liability, non-current portion" on the Company's condensed consolidated balance sheets.

On March 14, 2024, the Company extended its operating lease for its headquarters located at 5370 Kietzke Lane, Reno, NV. The lease extension was determined to be a lease modification that qualified as a change of accounting on the existing lease and not a separate contract. As such, the Right-of-Use (“ROU”) assets and operating lease liabilities were remeasured using an incremental borrowing rate at the date of modification of 9.61%, which resulted in an increase of the ROU asset of $170,000 and an increase in the operating lease liabilities of $166,000.

On June 9, 2024, the Company extended its operating lease for its Innovation Center located at 160 Denmark Dr, McCarran, NV. The lease extension was determined to be a lease modification that qualified as a change of accounting on the existing lease and not a separate contract. As such, the Right-of-Use (“ROU”) assets and operating lease liabilities were remeasured using an incremental borrowing rate at the date of modification of 9.52%, which resulted in an increase of the ROU asset of $347,000 and an increase in the operating lease liabilities of $324,000.

The Company currently maintains two finance leases for equipment. In November 2021, the Company entered into a finance lease for a modular laboratory which expires in October 2024. On April 1, 2024 the Company entered into a finance lease for laboratory equipment which expires in 2029.

Information related to the Company's right-of-use assets and related lease liabilities were as follows (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
Cash paid for operating lease liabilities	$	68	$	66	$	204	$	199
Operating lease cost	$	72	$	65	$	210	$	196

Cash paid for finance lease liabilities	$	25	$	15	$	64	$	46
Interest expense	$	2	$	2	$	6	$	5

	September 30, 2024			September 30, 2023
Weighted-average remaining lease term (years) - operating leases		2.4			1.1
Weighted-average discount rate - operating leases		10.48	%		6.17	%

Weighted-average remaining lease term (years) - finance leases		2.3			1.1
Weighted-average discount rate - finance leases		4.59	%		8.17	%

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	600		$	—

Future maturities of lease liabilities as of September 30, 2024 are as follows (in thousands):

Due in 12-month period ended September 30,
	Operating Leases			Finance Leases
2024	$	71		$	16
2025		291			47
2026		182			47
2027		149			48
Thereafter		—			60
Less imputed interest		(84	)		(21	)
Total lease liabilities	$	609		$	197

Current lease liabilities	$	242		$	44
Non-current lease liabilities		367			153
Total lease liabilities	$	609		$	197